Honolulu Sporting Goods Co., Ltd.

National Labor Relations Board - Board Decisions

Jan 5, 1979

239 N.L.R.B. 1277 (N.L.R.B. 1979)

HONOLULU SPORTING GOODS CO., LTD.
Honolulu Sporting Goods Co., Ltd., a Subsidiary of
Zale Corporation and Hawaii Teamsters and Allied
Workers, Local 996, International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and
Helpers of America. Case 37-CA-1273
January 15, 1979
DECISION AND ORDER
BY MEMBERS PENELLO. MURPHY. AND TRUESDALE
On December 15, 1977, Administrative Law Judge
Maurice M. Miller issued the attached Decision in
this proceeding. Thereafter, the General Counsel
filed exceptions and a supporting brief, and Respon-
dent filed limited cross-exceptions and an answering
brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge only to
the extent consistent herewith.
Shortly after the Charging Party (the Union) re-
quested recognition and filed a petition for an elec-
tion in a unit of Respondent's warehouse employees,
Respondent granted those employees a massive pay
raise which encompassed both small step increases
based on merit and longevity and a radical upward
revision of the entire applicable wage structure. The
Administrative Law Judge found the entire pay raise
lawful, and not violative of Section 8(a)(l) of the Act,
on the grounds that: (1) prior to gaining knowledge
of the Union's organizational campaign, Respondent
conducted performance reviews for some of its em-
ployees and informed them that wage increases
based thereon had been recommended; and (2) the
complete revision of the basic wage structure was
consistent with a provision in the policy and practice
manual of Respondent's parent corporation which
states that company pay ranges reflect the prevailing
pay scale in the local geographic area and are based
on wage surveys taken in the region involved. We
find merit in the General Counsel's exceptions to
these findings of the Administrative Law Judge be-
cause, although it is clear that the employees would
have been granted their small step increases without
regard to the existence of their union activity, we are
convinced from the record evidence that, but for the
Union's organizational campaign, Respondent would
never have instituted the major revision in its basic
wage structure during that particular period of time.
I. Respondent,' a subsidiary of Zale Corporation,
is engaged in the retail and wholesale distribution of
sporting goods equipment in the State of Hawaii
wherein it operates four retail stores and the Hono-
lulu warehouse facility which is the subject of this
proceeding. Zale, headquartered, in Dallas, Texas,
operates over 1,600 retail outlets nationwide, admin-
istering them through a number of merchandising
groups and operating divisions-Honsport being un-
der the administrative control of Zale's Sporting
Goods Division.2 During the time period relevant to
the unfair labor practices alleged herein, Miles Bai-
dack served as Respondent's general manager with
supervisory authority over all Honsport employees.
He, in turn, was immediately responsible to William
Gart, the Division's vice president for operations.
The record 3 shows that, during the latter half of
1975, General Manager Baidack formulated pay
scales for Respondent's warehouse employees.4 Sub-
sequently, these proposed pay scales were approved
by the Division's president, with a designated effec-
tive date of October 1, 1975. Although Zale's policy
and procedure manual states that company pay
ranges reflect prevailing wages paid in the local area
and are based on wage surveys conducted therein,
the record herein shows that no survey of wages paid
by other Honolulu employers was conducted by Re-
spondent, by the Division's personnel department, or
by Zale's wage and salary section.5 And, in fact, the
pay scales adopted set forth wages which were well
below the local prevailing rate.
On March 8, 1976,6 Zale officials, Blumenthal and
Gart (the Division's president and vice president, re-
spectively), paid a week's visit to Hawaii for the pur-
pose of conducting an in-depth review of Honsport's
operations and conferring thereon with Baidack.
While there, Gart specifically inquired as to the wag-
es earned by each warehouse employee. Later that
week, he instructed Baidack to immediately place
Honsport's retail sales employees on a commission-
Also referred to hereinafter as Honsport.
2 Referred to hereinafter as the Division.
'In setting forth the facts hereinafter, we rely on record testimony which
either stands uncontradicted or was specifically credited by the Administra-
tive Law Judge.
One pay scale, designated for warehousemen, provided for a $2.40-
per-hour starting rate. $2.55 after a 3-month probationary period, and,
thereafter, eight set increments of 10 or 15 cents each (up to a maximum of
$3,70). The other pay scale, for warehouse clerks and a truckdriver, started
at $2.60 (after 3 months prior Honsport employment), with ten 15-cent
increments (up to a maximum of $4.10).
5 Zale's manual states, in pertinent part, as follows: "To insure that em-
ployees are paid fairly, most jobs are included in a systematic pay program
developed by the Wage and Salary Section of the Corporate Personnel De-
partment and adrmnistered by Division Personnel Departments. The pay
program bases the pay range for each job on the rates paid for similar jobs
in the community.
6 All dates hereinafter are in 1976. unless otherwise indicated.
1277
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
based pay plan but never suggested, or even dis-
cussed, any change in the wage structure for ware-
house personnel. He did, however, direct Baidack to
initiate promptly performance reviews for the ware-
house employees and to forward such reviews to him
in Dallas, together with recommendations for pay
raises based thereon. 7
On March 25, after his return to Zale's Dallas
headquarters, Gart sent Baidack an I I-page memo-
randum setting forth detailed directions for a wide
variety of changes in Honsport operations, but,
again, nothing concerning warehouse wage rates was
mentioned-although reference was made to the im-
plementation of sales commission payments for retail
personnel.
On April 10, Honsport's warehouse manager con-
ducted performance reviews for five of the nine
warehouse employees, after which he told them that
they would receive wage increases-the amounts of
which were not specified. These reviews were then
submitted to Baidack who, based thereon, made pay
raise recommendations (ranging from 10 to 30 cents
per hour) 8 on the appropriate company forms which
he then forwarded to Gart in Dallas. However, con-
trary to his instructions, Baidack failed to attach the
related performance reviews to the forms which con-
tained his recommendations. Approximately April
15, Gart returned Baidack's forms with a note stating
that the raise recommendations were inadequate and
asking Baidack, upon receipt thereof, to notify him
so that they could discuss the matter further. There-
after, about May 10, Baidack inquired of Jerry Mar-
tin-the Division's controller who was visiting Hons-
port operations at the time-as to why his pay raise
recommendations had been rejected and Martin re-
plied that, "They'll get back to you on it." Then, on
May 12, Gart sent Baidack another memorandum in
which he criticized with specificity, and made infor-
mation requests relative to, Baidack's recommended
pay raises and pay structure for department heads
and assistant managers in Honsport's retail stores.
But, once more, no reference whatever was made to
the warehouse pay structure or to Baidack's earlier
recommendations for warehouse employee pay rais-
es.
On May 10 or 1, Harlan Reed, the Union's busi-
ness agent, initiated a telephone conversation with
As found by the Administrative Law Judbe. Gart had previously insti-
tuted a policy mandating twice-yearly performance reviews to be completed
in September and March, with pay raises based thereon to be effective on
October I and April I of each year.
The record indicates the amount of the pay raise recommendations with
respect to only four of those employees. which were as follows: employee
Yamamoto-10 cents (from $2.60 to $2.70); employee Hasegawa- 30 cents
from $2.40 to $2.70); employee Takahara--10 cents (from $4 to $4.10). and
employee Leomo--15 cents (from $2.55 to $2.70).
Baidack during which he claimed to represent a ma-
jority of Honsport's warehouse employees, requested
recognition, and stated that a representation petition
had been filed with the Board's Subregional Office.
Baidack answered that, when received, he would re-
fer the representation petition to Zale's management
representatives for response.
About May 13, when Baidack received formal no-
tification from the Board that the representation pe-
tition had been filed, he informed Gart and other
Zale officials as to what had transpired with respect
to Reed's telephone call and the petition. Their re-
sponse was to tell Baidack that Norman Landa,
Zale's assistant general counsel for labor relations,
would come to Honolulu to look into the matter and
that, in the interim, Baidack should refrain from tak-
ing any action which might "create problems."
Landa arrived in Honolulu on May 24. Before
leaving Dallas, however, he secured from Zale's wage
and salary administrator comparative data on the
warehouse wage rate structures utilized by Sears,
Roebuck & Company and J. C. Penney Company at
their Honolulu facilities, as well as data on Zale's
own wage structure for its Dallas warehouse person-
nel. The record testimony of Respondent's witnesses
sheds no light on the reason or motivation for this
inception of Zale's interest in Honsport's warehouse
wage structure. None of the consultations and ex-
changes or memorandums between Gart and Bai-
dack during the previous 3 months even touched on
this subject, although comments and instructions
pertaining to the wage structure for retail store em-
ployees and managers had been made on a number
of occasions.
Upon his arrival in Honolulu on May 24, Landa
had a discussion with Baidack on the situation gener-
ated by the Union's petition. Landa expressed con-
cern that the wage increases promised some employ-
ees in conjunction with their April performance
reviews had not been implemented, stated that the
warehouse employees appeared underpaid, and told
Baidack to contact the personnel directors of other
local businesses for the purpose of conducting an
area wage survey. Baidack testified without contra-
diction, that this was the first occasion on which he
had been instructed to perform an area wage survey.
Later that same morning, Landa addressed a meet-
ing of the warehouse employees. He told them, inter
alia, of the Union's petition, of the possibility that an
election would be held, and that the law protected
them in their right to vote for or against representa-
tion. In response to an employee question as to how
Honsport determined its compensation schedule for
warehouse employees, Landa replied that company
policy was to pay "competitive rates" within the local
area.
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HONOLULU SPORTING GOODS CO., LTD.
During May 24 and 25, Landa and Baidack took
swift action. They contacted other Honolulu em-
ployers, gathered data, drew up an area wage survey,
and fully drafted completely new wage structures
covering the two categories of Honsport warehouse
employees. Their proposed new pay scales set forth
wages which, varying somewhat with each longevity
step, ranged from 33 to 40 percent above the wages
provided for in the then-current schedules.'
The next day, May 26, Landa telephoned Gart in
Dallas. He told him the results of the wage survey,
stated his view that Honsport warehouse wages were
low, read out the details of the proposed new wage
schedules, and requested an immediate decision by
Gart on authorizing implementation of the new rates.
Gart then gave his approval.
Subsequently, Landa and Baidack determined spe-
cific new hourly wage rates for individual employees
by applying the appropriate step of the new sched-
ules in accord with each employee's length of service
with Honsport. On this basis, most employees were
awarded new rates which encompassed a rise of one
or two longevity steps on the pay schedule plus an
additional increase derived from the 33 to 40 percent
upward revision in the schedules themselves. Em-
ployees Yamamoto, Hasegawa, Leomo, Culkin, and
James were granted rates which ranged from 44 to 48
percent above those which they had previously re-
ceived; and employees Ragasa and Takahara were
raised by approximately 36 percent,"o all such raises
being made retroactive to May 1." By way of con-
trast, the record indicates that the rate schedules and
merit increases adopted by Honsport in October
1975 yielded the warehouse employees total pay rais-
es which ranged from 4 to 8 percent.
9The new pay scale for warehousemen provided for a S3.30-per-hour
starting rate, $3.47 after probation, and, thereafter. eight increments set at
6month intervals and ranging from 17 to 24 cents each (up to a maximim of
$5.11). The raise for warehouse clerks and the truckdrinver started at $3.57
(after 3-months' prior employment). with 10 set 6-month increments ranging
from 18 to 27 cents each (up to a maximum of $5.75). For comparison with
the rates then current, see in. 4. supra.
o1 The two remaining employees, Alvin Moratin, Jr., and Richard Mora-
tin, are the sons of Honsport's warehouse manager. Although Moratin, Jr.'s
new wage rate was set at or near the appropnate longevity step of the
applicable schedule, his total raise amounted to only 10 percent. This lesser
increase was probably a result of the fact that his earlier rate of $3.40 per
hour appears to have been arbitrarily set as it failed to match any desig-
nated rate step on the old schedules. With respect to Richard Moratin. he
only commenced Honsport employment on May 4 and, as the new sched-
ules were made effective retroactive to May I, the record data on his wage
rates only reflects the new schedule. Thus, the difference between the rate
he was to be paid when initially hired and the rate which later became
retroactively effective is unknown.
' As employee James was on maternity leave during all of May and June.
her pay raise did not become effective until her return to work in July. Her
temporary replacement. Karen Schubach. was given no increase hiatever
and Respondent presented no evidence relating to her level of compensa-
tion.
On May 28-just 4 days after Landa's arrival in
Honolulu-the employees were called to a meeting
where Baidack told them that they would receive pay
raises which were the product of both their April per-
formance reviews and a revised wage structure based
on a survey of comparable jobs in Hawaii. He said
nothing to connect these raises with the Union's or-
ganizational campaign. Rather, he asserted that-at
the time the Ap-il performance reviews were con-
ducted-Zale officials in Dallas were reviewing and
reworking the wage rate structure for all warehouse
facilities, and that the revised wages were being ap-
plied retroactive to May I because the new rate
structure had not been completed on time.
We conclude that Baidack's above-noted asser-
tions to the warehouse employees concerning the ori-
gin of Honsport's revised wage structure were pat-
ently false. Respondent did not produce a shred of
evidence indicating that Zale was, in fact, reviewing
or reworking the warehouse wage structure in April.
To the contrary, the record evidence establishes that
no action was taken in that regard until after Zale
officials, including both Landa and Gart, learned of
the Union's demand for recognition and the filing of
its representation petition. It is also clear from the
record testimony that, when determined on May 25,
the step increase component of the pay raise was
based solely on length of service and was not a merit
increase based on performance reviews.2
With respect to the granting of employee step in-
creases, Zale's policy and procedure manual stipu-
lates that employees should be given performance re-
views at least once every 12 months and that, if their
performance so warrants, a pay raise recommenda-
tion should then be forwarded to higher manage-
ment. Further, as detailed at footnote 7, supra, the
Administrative Law Judge found that Gart had insti-
tuted a policy mandating that such reviews and pay
raise determinations be made twice yearly. And, as
the previous pay raise was made effective on either
October I or November 1, 1 97 5 ,3 both employees
and management could reasonably be expected to
anticipate that the next set of pay raise recommenda-
tions would become effective on or about May 1.
Moreover, as Gart directed Baidack in March to
make such recommendations and Baidack did so in
April, it is established that Respondent took steps to
implement its performance review/pay increase poli-
cy prior to the May 6 advent of the Union's organi-
1 It is noted that only five of Honsport's nine warehouse employees re-
ceived performance reviews in Apnl or thereafter.
Ii While the prior pay schedules had October 1. 1975. as their designated
effective date, thr employee pay records introduced into evidence indicate
that the employees ma' not. In fact. have received any pay raises until
November 1,. 1975. The record does not establish the extent to which such
raises resulted from individual employee step increases, new pay schedules,
or a combination of both
1279
DECISIONS OF NATIONAL. LABOR RELATIONS BOARD
zational campaign. Therefore, to the extent that the
pay raise at issue herein encompassed step increases
based on merit and/or employment longevity, we
conclude that such grant did not interfere with the
Section 7 rights of the employees and was not, by
itself, violative of Section 8(a)(1).
With regard to Respondent's 33- to 40-percent up-
ward revision in its basic wage schedules, however,
we conclude to the contrary. The Administrative
Law Judge, in holding that Respondent's wage
schedule revisions were lawful, found that Landa, in
initiating the wage survey and formulating the new
schedules, was merely pursuing to completion the
course of conduct which Baidack should have pur-
sued before the Union's campaign began and, there-
fore, Respondent's wage schedules cannot be found
to have been altered by virtue of the Union's pres-
ence. We disagree, as such finding is based on a me-
chanistic reading of Zale's written policy statements
which ignores the considerable evidence, discussed
infra, pertaining to the manner in which those poli-
cies were actually implemented in the past. We also
note that, although Baidack formulated the October
1975 wage schedules without conducting the appro-
priate area wage survey, such schedules were never-
theless approved by the Division's president. And
when Gart, upon inquiry in March, was informed as
to the wages paid each warehouse employee, he indi-
cated no concern as to whether they reflected the
locally prevailing rates. By way of contrast, during
the same period of time he did initiate action and
assert critical suggestions relative to the pay struc-
tures for retail store managers, department heads,
and sales personnel.
While Zale's policy and procedure manual does
provide, as the Administrative Law Judge found, that
employee pay ranges should reflect local prevailing
rates and be based on area wage surveys, it sets forth
no criteria as to how often (or under what circum-
stances) such rates should be reviewed or such sur-
veys should be taken. Moreover, Respondent's wit-
nesses, Landa and Richard Horton,' testified that
Zale had no policy respecting the frequency of area
wage surveys; and that, in practice, such surveys are
taken in response to indications of excessive employ-
ee turnover, employee inquiries on the subject, or
specific suggestions from management officials.
Here, there was no indication of excessive employee
turnover, and inquiries by employees and manage-
ment officials were only made in response to the
Union's organization campaign. Thus, while the pro-
cess used for determining the rates set forth in
M4 At the time of the hearing herein, Horton was Baidack's successor as
Honsport general manager. Previous to that, he served for over 6 years in
various Zale management positions.
Honsport's revised pay schedules, i.e., the taking of
an area wage survey, was in conformance with com-
pany policy, there was no company policy which
mandated the revision of schedules or the taking of
surveys at the time such actions were taken herein.
Further, the record establishes that-wholly apart
from the statements in the policy manual--no man-
agement official took any action directed at securing
wage-schedule revisions or the taking of area wage
surveys relative to warehouse employees until after
the Union requested recognition and filed its peti-
tion. And then, such action was initiated by Landa,
an attorney whose responsibilities were in the area of
labor relations, rather than by officials whose respon-
sibilities normally included wage, salary, or person-
nel administration.
The validity of wage increases or other benefits
during the pendency of representation petitions turns
upon whether they are granted "for the purpose of
inducing employees to vote against the union." 1I
And a lawful purpose is not established by the fact
that the employer who took such action did not ex-
pressly relate the granted wage increases to the orga-
nizational campaign. For, as the Supreme Court ob-
served in N. L. R. B. v. Exchange Parts Company, supra
at 410, "the absence of conditions or threats pertain-
ing to the particular benefits conferred" is not "of
controlling significance." Under settled Board poli-
cy, a grant or promise of benefits during the critical
preelection period will be considered unlawful unless
the employer comes forward with an explanation,
other than the pending election, for the timing of
such action.' No such explanation can be found in
the present record.
As previously indicated, we agree with the Admin-
istrative Law Judge that the decision to grant step
increases was made before the advent of the Union's
campaign and was not in response to the Union's
efforts. However, in view of all the facts and circum-
stances set forth above-particularly the timing and
extensive nature of the upward revisions in Respon-
dent's basic warehouse rate structures-we find that
the May 28 pay raise (effective retroactive to May I)
was granted in response to the Union's campaign
and was, therefore, violative of Section 8(a)(1) of the
Act.'7
2. The General Counsel asserts that, as of the date
of its recognitional demand, the Union represented a
majority of Respondent's employees; and because
Respondent thereafter undertook a course of unlaw-
15 Tonkawa Refining Co., 175 NLRB 619 (1969). citing N.LR.B. v. Ex-
change Parts Co., 375 U.S. 405. and Russell-Newman Mjg. Co., Inc. v.
N. L. R. B. 370 F.2d 980 (5th Cir. 1966).
i6 The Singer Company. 199 NLRB 1195 (1972).
Montgomery Ward Co., Incorporated. 220 NLRB 373 (1975). enfd. 554
F2d 996 (10th Cir. 1977).
1280
HONOLULU SPORTING GOODS CO., LTD.
ful conduct to defeat the Union's representative sta-
tus, its failure to recognize and bargain with the
Union violated Section 8(aX5) and (I) of the Act-
requiring a bargaining order remedy within the prin-
ciples set forth in N.L.R.B. v. Gissel Packing Co., Inc.,
395 U.S. 575 (1969).
We agree with the Administrative Law Judge, for
the reasons stated by him, that, as of May 10, the
Union had secured signed authorization cards from
five of the employees in the appropriate bargaining
unit,'" and that, immediately thereafter,'9 it claimed
majority status and made its demand for recognition.
But to properly evaluate the above-noted assertions
of the General Counsel, additional issues must be
considered and resolved. For Respondent contends
that: (1) the five employees who signed union au-
thorization cards did not constitute a majority of the
appropriate unit's employees; (2) the authorizations
were tainted because the Union offered to waive ini-
tiation fees in exchange for employee signatures on
the cards; and (3) even if the Union represented an
employee majority and Honsport's grant of wage in-
creases was violative of Section 8(a)( ), under the cir-
cumstances of this case a bargaining order is not just-
ified.
At all times relevant herein, there have been a total
of nine job positions in the bargaining unit. For a
number of years, one of those positions has been
filled by employee Carol James, the inventory con-
trol clerk. However, sometime in April James was
granted maternity leave under the provisions of
Zale's maternity leave policy as set forth in its policy
and procedure manual. She subsequently returned to
work on July 1. During her absence, Karen Schu-
bach was hired to replace her temporarily and held
that position on both the date of the Union's recogni-
tional demand and the date on which Respondent
announced the wage increases found herein to have
been unlawful. Schubach resigned her employment
Is The parties are in agreement that the appropriate unit herein is:
All full-time and regular part-time warehousemen and Iruckdrisers em-
ployed by Respondent at its facility located at 2868 Kaihikapu Street.
Honolulu. Hawaii; excluding office clerical employees. guards and sup-
ervisors as defined in the Act.
This is the unit found appropnate by the Regional Director In her Decision
and Direction of Election in Case 37 RC-2245 (issue July I1 1976) In fur-
ther accord with that decision, the parties also agree that the isarehouse
freight claims clerk and inventory control clerk are plant clencal employees
and. accordingly, also included in the unit.
Subsequent to the issuance of the complaint herein, the Regional Director
dismissed the representation petition in Case 37-RC-2245. subject to rein-
statement, if appropriate, upon the Union's application after disposition of
the instant unfair labor practice proceeding.
19 The Administrative Law Judge credited testimony which dated the
Union's demand for recognition as occurnng during either the mid-af-
ternoon of May 10 or the morning of May I I. We do not find it necessars
to determine which of those two dates is correct However. for purpoes of
reference, we shall hereinafter use the date of May II. which is the date
alleged in the complaint.
by mid-June. Neither James nor Schubach signed au-
thorization cards and their inclusion or exclusion
from the unit is, thereby, relevant only in determin-
ing the number of employees in the bargaining unit.
The parties agree that James is properly includable
in the unit as she had, at all relevant times, a reason-
able expectancy of reemployment. However, Re-
spondent would include Schubach as well, while the
General Counsel and Charging Party would exclude
her as a temporary employee.
Baidack, Honsport's general manager at the time
these events occurred, testified that Schubach was
hired by Office Manager Penny Austin, his immedi-
ate subordinate, who reported to him that Schubach
was hired as a temporary employee who would re-
main employed until James' return from leave; and
that a tentative return date of July I had been set for
James. Respondent's witness, Landa, conceded that
his understanding was that Schubach was hired to
replace James until she came back to work but de-
nied knowing whether Schubach was or was not to
be terminated at that time. However, he further ad-
mitted that the pay raises announced on May 28
(and made effective retroactive to May 1) for all reg-
ular employees were never granted to Schubach; and
none of Respondent's management witnesses assert-
ed any intent or plan for employing more than nine
employees in the Honolulu warehouse facility.
On the subject of maternity leave policy, Zale's
manual states, in part, as follows:
When an employee requests a maternity leave,
the employee's job should not be permanently
filled during such leave unless the job is of such
a nature that it must be filled and can only be
filled if filled by a permanent replacement. The
job may be filled on a temporary basis, but any
individual hired on such a temporary basis must
be informed that the job is a temporary one due
to a maternity leave.
Respondent contends, in effect, that this provision is
of no significance because the issue of whether a re-
placement is a temporary or permanent employee is
determined under the facts of each particular case
and it has not been established whether or not James'
position was one which could only be filled on a per-
manent basis. However, Respondent, although pre-
sumably in possession of its own employment rec-
ords 20 and other personnel data, makes no assertion
that James' job had to be filled by a permanent re-
placement or that Schubach was hired on anything
but a temporary basis.
:' We note that i:e record herein contains copies of Respondent's basic
employ ment records setting forth pay rates, job titles. dates of hire, labor
grades, and other related information for every employee in the bargain-
ing unit. except Schubach
1281
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Considering, cumulatively, Baidack's testimony as
to the circumstances of Schubach's hire, the provi-
sions of Zale's maternity leave policy, Landa's ad-
missions-particularly the withholding from Schu-
bach of the wage increases given all regular
employees-and the failure of Respondent to show
that anyone in management ever even considered re-
taining Schubach after James' return, we conclude
that Schubach was hired as a temporary employee
and that she held such status as of the date the Union
demanded recognition and thereafter.2 See Fearn In-
ternational, Inc., Eggo Foods Division, 209 NLRB 232
(1974). Accordingly, we find that the bargaining unit
consisted of nine employees as of that date, and the
Union's majority status, or lack thereof, must be
measured against this number.
In N.L.R.B. v. Savair Manufacturing Co., 414 U.S.
270 (1975), the Supreme Court held that, where
signed authorization cards are the basis for an elec-
tion, a union may not promise initiation fee waivers
to those who sign cards before the election and with-
hold such waivers from others. Respondent asserts
that the authorization cards herein are tainted be-
cause, in soliciting employee signatures thereon,
Union Business Agent Reed contravened Savair
principles. In our view, however, the record fails to
support that assertion.
At the hearing, only two witnesses testified with
respect to Reed's solicitation. Taken in isolation, the
testimony of employee Hasegawa, paraphrasing
Reed's remarks, attributes to him statements on the
subject which appear ambiguous. However, we find
more convincing Reed's clarifying and uncontra-
dicted testimony that he told the card signers that:
"all employees, before the contract is signed, will pay
no initiation fee" and "nobody is going to pay any
initiation fee until a contract is signed, and all new
employees that is [sic] hired after the contract is
signed between the union and the company will be
paying initiation fees." 22 Accordingly, we find that
the record establishes that prospective card signers
were not told that initiation fees would only be
waived for those who signed.
2 We find no merit in Respondent's contention that the Regional
Director's Decision and Direction of Election in Case 37 RC 2245 found
that Schubach. as an individual, should be included in the bargaining unit.
It is clear from the context of that decision that the Regional Director only
found that the position held by Schubach at the time of the representation
hearing, that of inventory control clerk, was a plant clerical position and.
therefore, properly includable in the warehouse bargaining unit. No Issue as
to her temporary or permanent status was either raised or discussed.
22 The Administrative Law Judge made no findings or credibility determi-
nations relative to this issue. However. with respect to other issues on which
there were testimonial conflicts. Reed's testimony was found to he the more
reliable and, accordingly, was specifically credited. Conversely. in one in-
stance where Hasegawa's testimony differed from that of another witness.
the Administrative Law Judge found Hasegawa's testimony to reflect confu-
sion and, accordingly, specifically credited the account given by the other
witness.
In view of the above, we find that Respondent em-
ployed nine employees in the appropriate bargaining
unit on May 11, the date of the Union's demand for
recognition-five of whom had signed authorization
cards. Their cards were identified and authenticated
by the employees themselves, by the union represen-
tative who solicited their signatures, or by fellow em-
ployees who were present when the cards were
signed. Further, it is clear from the testimony that the
employees were told that the cards would be used to
request the Union's recognition and, if that failed,
for an election. At no time were the employees told
that the cards would be used solely for an election.
Considering these circumstances, we conclude that,
as of May II, a majority of employees in the appro-
priate unit had validly selected the Union as their
bargaining representative.
As previously stated, the General Counsel con-
tends that under the principles set forth in Gissel
Packing Company, supra, a bargaining order remedy
should be granted in this case. We agree, as the un-
fair labor practice committed by Respondent was so
pervasive and extensive that the possibility of erasing
its effects on the employees and insuring a fair elec-
tion by the use of traditional remedies is slight. And,
therefore, employee sentiment, as expressed by au-
thorization cards, is best protected by a bargaining
order.
Under the Gissel doctrine, a bargaining order be-
comes appropriate where a union's majority is estab-
lished by cards, and the nature and extent of the
employer's unfair labor practices appear to make a
free choice by the employees problematical. Here,
there was but a single unfair labor practice, but it
encompassed a massive wage increase whose scope
and timing were clearly designed to undermine the
Union's majority status. The following statement
from Tower Enterprises, Inc., d/b/a Tower Records,
182 NLRB 382, 387 (1970), enfd. 79 LRRM 2736, 67
LC 1¶12,453 (9th Cir. 1972), is directly applicable to
the facts herein:
It is a fair assumption that in most instances
where employees designate a union as their rep-
resentative, a major consideration centers on the
hope that such representative may be successful
in negotiating wage increases. Certainly this ap-
pears to have been an important consideration in
the instant case. A unilateral award of a wage
increase by an employer following a union's de-
mand for recognition results in giving the em-
ployees a significant element of what they were
seeking through union representation. It is diffi-
cult to conceive of conduct more likely to con-
vince employees that with an important part of
what they were seeking in hand union represen-
tation might no longer be needed. An employer
1282
HONOLULU SPORTING GOODS CO., LTD.
may have the right to persuade the employees
that representation is not in their best interests,
but it does not have the right to threaten them or
confer benefits on them which are designed to
influence the employees against choosing a rep-
resentative. When, as here, an employer does so,
free choice in a subsequent election becomes a
matter of speculation. so long as the effects of
the interference remain unremedied.
In its defense, Respondent asserts that, rather than
being motivated by a desire to undermine the Union,
its grant of wage increases was intended merely to
fulfill the promises it had made its employees prior to
the commencement of the Union's campaign: and
that it was fearful, because of its earlier promises,
that the withholding of wage increases might also be
judged unlawful. We find no merit in these asser-
tions, for the unspecified increases promised four or
five employees in April were clearly intended to be
step increases-most probably within the 4- to 8-per-
cent range of the previous increases granted 6
months earlier. Instead, Respondent combined the
expected step increases with a massive upward revi-
sion in the basic wage structure which yielded most
employees total wage raises ranging from 36 to 48
percent. Further, while Respondent's parent corpora-
tion, Zale, had a policy which, on paper, mandated
the payment of prevailing area wages, the record evi-
dence establishes that such policy was not system-
atically implemented and no precedent was shown
for any upward revision of the entire wage scale ap-
proaching the magnitude of the one effectuated
herein.
We are similarly unimpressed with Respondent's
attempt to give ameliorating weight to the fact that it
refrained from telling its employees that the wage
increases were related to the Union's campaign. On
May 24, Landa, Zale's labor counsel, came from
Dallas to Honolulu, where he spoke to employees
concerning the Union's representation petition. Four
days later, the entire wage structure was raised be-
tween 33 and 40 percent. The fact that other compa-
ny officials, not Landa, informed employees of the
good news would not, in our view, prevent them
from getting the message that the increase was Re-
spondent's response to the Union's efforts. Further,
we note that, when Landa initially spoke on union-
related matters at an employee meeting on his first
day in Honolulu, one of the principal questions
asked of him was what basis was used in determining
the wage scale. Landa's answer referred to "competi-
tive" rates, which he then proceeded to implement in
the next few days.
In Skaggs Drug Centers, Inc., 197 NLRB 1240
(1972), enfd. 84 LRRM 2384, 72 LC ¶13,951 (9th Cir.
1973), we granted a bargaining order where the only
unfair labor practice found was a general pay in-
crease which, while substantial, was of considerably
more modest degree than the one implemented
herein. There, we fully explicated our reasons for
finding our traditional remedies to be insufficient for
the purpose of adequately iemedying this type of un-
lawful employer activity. The identical considera-
tions are applicable herein.
Accordingly, we find that by refusing the bargain-
ing request of the Union which represented a majori-
ty of its employees in an appropriate unit and, there-
after, granting wage increases under the
circumstances described above, Respondent violated
Section 8(a)(5) and ( I) of the Act, and that a bargain-
ing order is necessary and appropriate to protect the
majority sentiment expressed through authorization
cards and to otherwise remedy the violation commit-
ted. We further find that under the principles set
forth in Trading Port, Inc., 219 NLRB 298 (1975),
and The Kroger Co., 228 NLRB 149 (1977), Respon-
dent had a duty to bargain with the Union as of May
28, 1976, the date on which Respondent committed
its unfair labor practice which undermined the
Union's majority status and made the holding of a
fair election improbable.2 3
CONC L.SIONS OF LAW
1. Respondent is an employer engaged in com-
merce within the meaning of Section 2(6) and (7) of
the Act.
2. The Union is a labor organization within the
meaning of Section 2(5) of the Act.
3. By interfering with, restraining, and coercing its
employees in the exercise of rights guaranteed by
Section 7 of the Act, as found above, Respondent has
engaged in unfair labor practices within the meaning
of Section 8(a)(l) of the Act.
4. By refusing. upon request, to bargain in good
faith with the Union as the representative of its em-
ployees in the unit found above to be appropriate,
Respondent has engaged in unfair labor practices
within the meaning of Section 8(a)(5) and (1) of the
Act.
5. The aforesaid unfair labor practices are unfair
labor practices affecting commerce within the mean-
ing of Section 2(6) and (7) of the Act.
: Member rruesdale would date the bargaining order from May II.
1976, the date on which the lInion, with a card majority. requested recogni-
tion and bargaining, which request Respondent declined (Chandler Motors,
Inc. 236 NL.RB 1565 (19781
1283
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
THE REMEDY
Having found that Respondent engaged in certain
unfair labor practices, we shall order it to cease and
desist therefrom and to take certain affirmative ac-
tion designed to effectuate the purposes and policies
of the Act.
Having found that Respondent unlawfully refused
to bargain with the Union as the exclusive represen-
tative of its employees in an appropriate unit, we
shall order it, upon request, to bargain collectively
with the Union and, in the event an understanding is
reached, embody such understanding in a signed
agreement.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board hereby orders that the Respondent,
Honolulu Sporting Goods Co., Ltd., a Subsidiary of
Zale Corporation, Honolulu, Hawaii, its officers,
agents, successors, and assigns, shall:
i. Cease and desist from:
(a) Granting wage increases to its employees for
the purpose of influencing their selection of a labor
organization as their bargaining representative; pro-
vided, however, that nothing herein shall be con-
strued as requiring Respondent to vary or abandon
any benefits heretofore established.
(b) Refusing to bargain with the Union as the ex-
clusive representative of a majority of its employees
in the below-described bargaining unit, found appro-
priate under Section 9(b) of the Act:
All full-time and regular part-time warehouse-
men and truckdrivers employed by Respondent
at its facility located at 2868 Kaihikapu Street,
Honolulu, Hawaii; excluding office clerical em-
ployees, guards and supervisors as defined in the
Act.
(c) In any like or related manner interfering with,
restraining, or coercing its employees in the exercise
of the rights guaranteed them by Section 7 of the
Act.
2. Take the following affirmative action necessary
to effectuate the policies of the Act:
(a) Upon request, recognize and bargain with the
Union as the exclusive bargaining representative of
the employees in the above-described appropriate
unit and, if an understanding is reached, embody
such agreement in a written signed contract.
(b) Post at its warehouse facility in Honolulu, Ha-
waii, copies of the attached notice marked "Appen-
dix." 24 Copies of said notice, on forms provided by
the Regional Director for Region 20, after being duly
signed by a representative of Respondent, shall be
posted immediately upon receipt thereof, and shall
be maintained by it for 60 consecutive days thereaf-
ter, in conspicuous places, including all places where
notices to employees are customarily posted. Rea-
sonable steps shall be taken by Respondent to insure
that said notices are not altered, defaced, or covered
by any other material.
(c) Notify the Regional Director for Region 20, in
writing, within 20 days from the date of this Order,
what steps Respondent has taken to comply here-
with.
24 In the event that thth Order is enforced by a judgment of a United
States Court of Appeals. trie words in the notice reading "Posted by Order
of the National L abor Relations Board" shall read "Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board."
APPENDIX
NOTICE To EMPLOYEES
PosrFED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT grant our employees wage in-
creases for the purpose of influencing their
choice of a labor organization as their bargain-
ing representative.
WE WILL NOT refuse to bargain with Hawaii
Teamsters and Allied Workers, Local 996, Inter-
national Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America, as the
exclusive representative of our employees in the
appropriate unit noted below, with respect to
rates of pay, wages, hours, or any other terms or
conditions of employment.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employees
in the exercise of any rights guaranteed to them
by the National Labor Relations Act, as
amended.
WE WILL, upon request, bargain collectively
with the said Local 996, as the exclusive repre-
sentative of our employees in the appropriate
unit noted below, with respect to rates of pay,
wages, hours, and all other terms and conditions
of employment and, if an understanding is
reached, embody such understanding in a signed
agreement. The appropriate unit is:
All full-time and regular part-time warehouse-
men and truckdrivers employed by us at our
warehouse facility located at 2868 Kaihikapu
1284
HONOLULU SPORTING GOODS CO., LTD.
Street, Honolulu, Hawaii; excluding office
clerical employees, guards and supervisors as
defined in the Act.
All our employees are free to become, remain, or
refrain from becoming or remaining members of the
above-named or any other labor organization.
HONOLULU SPORTING GOODS Co.. LTD. A
SUBSIDIARY OF ZALE CORPORATION
DECISION
STATEMENT OF THE CASE
MAURICE M. MILLER. Administrative Law Judge: Upon a
charge filed July 22, 1976, and duly served, the General
Counsel of the National Labor Relations Board caused a
complaint and notice of hearing dated November 29, 1976,
to be issued and served upon Honolulu Sporting Goods
Co., Ltd., designated as Respondent or Honsport within
this decision. Therein, Respondent was charged with the
commission of unfair labor practices within the meaning of
Section 8(aX I) and (5) of the National Labor Relations
Act. (61 Stat. 136; 73 Stat. 519.) Respondent's answer. duly
filed, conceded certain factual allegations within General
Counsel's complaint, but denied the commission of any
unfair labor practice.
Pursuant to notice, a hearing with respect to this matter
was held on February 22 and 23, 1977 in Honolulu, Ha-
waii, before me. The General Counsel and Respondent
were represented by counsel. When the hearing began,
General Counsel's representative moved to amend certain
jurisdictional allegations within her complaint; Respon-
dent's counsel, thereupon, conceded the correctness of par-
ticular allegations which the permitted amendment had
modified. Each party was, thereafter, afforded a full oppor-
tunity to be heard, to examine and cross-examine witness-
es, and to introduce evidence with respect to pertinent mat-
ters. Since the hearing's close, briefs have been received
from General Counsel's representative and Respondent's
counsel; these briefs have been duly considered.
Upon the entire testimonial record, documentary evi-
dence received, and my observation of the witnesses, I
make the following:
FINDINGS OF FACT
I JURISDICTION
Respondent raises no question, herein, with respect to
General Counsel's present jurisdictional claims. Upon the
complaint's relevant factual declarations-more particu-
larly, those set forth in detail within the lately amended
second paragraph thereof-which Respondent's counsel
currently concedes to be correct, and upon which I rely, I
have concluded that Respondent herein was, throughout
the period with which this case is concerned, and remains,
an employer within the meaning of Section 2(2) of the Act,
engaged in commerce and business activities which affect
commerce within the meaning of Section 2(6) and (7) of
the statute. Further, with due regard for presently applica-
ble jurisdictional standards, I find assertion of the Board's
jurisdiction in this case warranted and necessary to effectu-
ate statutory objectives.
I1 COMPLAINANT UNION
Hawaii Teamsters and Allied Workers, Local 996, Inter-
national Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America, designated as the
Union within this decision, is a labor organization within
the meaning of Section 2(5) of the Act, as amended, which
admits certain of Respondent's employees to membership.
111 THE UN AIR LABOR PRACTICE CHARGED
A. Issues
This case presents two closely related substantive ques-
tions, both of which have been thoroughly litigated. For
present purposes, these questions may be summarized, gen-
erally, as follows:
I. Whether Respondent's management representa-
tives granted Honolulu warehouse workers and their
firm's truckdriver substantial wage increases consis-
tently with a revised wage progression schedule based
upon job tenure-despite the firm's receipt of prior
notification that complainant Union had petitioned
this Board for certification as such workers' collective-
bargaining representative-for the purpose of fore-
stalling the designation of the Union, by such workers,
as their representative.
2. If so, whether Respondent should be directed to
recognize and bargain collectively with the Union
herein-retroactively from the date when the chal-
lenged wage increases were granted-based upon that
organization's prior procurement of designation cards
signed by a majority of Respondent's workers within a
warehouse and truckdriver unit concededly appropri-
ate for collective-bargaining purposes.
With respect to General Counsel's first contention, Re-
spondent concedes that various challenged wage increases
were granted but seeks a determination that such wage in-
creases had been previously promised and would have
been granted consistently with Respondent's commitment
and previously followed practice, without regard for the
pendency of the Union's representation petition. Further,
Respondent contends that General Counsel's presentation
provides no persuasive support for the Union's majority
representation claim: that the Union had never formally
requested recognition: that, consequently, Respondent's
management representatives have never specifically re-
fused to recognize the Union herein; and that Respon-
dent's management, therefore, should be neither directed
nor required io bargain collectively with with the labor or-
ganization designated.
1285
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
B. Facts
1. Background
a. Respondent's business
Honolulu Sporting Goods Company, Ltd., a Hawaii cor-
poration, is engaged in the retail and wholesale distribution
of sporting goods, equipment, and related items. Since
1972, approximately, the firm has been a Zale Corporation
subsidiary.
Zale Corporation maintains substantially diversified re-
tail merchandising establishments throughout the United
States, Puerto Rico, Guam, and England. The firm's retail
operations are conducted through merchandising groups,
each of them headed by a group vice president. Within
each merchandising group, Zale maintains operating divi-
sions, each with its own president and staff; these manage-
ment representatives are charged with responsibility for di-
visional operations, subject to defined company policies
and procedures. Throughout the period with which this
case is concerned, Zale Corporation maintained some 17
divisions. Among these, the firm's sporting goods division
maintained and operated more than 30 sporting goods
stores, which provided a full line of sporting goods and
other leisure-time products. Honolulu Sporting Goods
Company, Ltd., functioning within its parent corporation's
sporting goods division, currently maintains four retail
stores within the State of Hawaii; two are located on Oahu,
one on Maui, and one in Hilo. The firm, likewise, main-
tains a wholesale "team sales" office, located within its Ho-
nolulu warehouse facility.
For present purposes, we are concerned, solely, with cer-
tain developments, during the late spring months of 1976,
specifically, which concerned Respondent's Honolulu
warehouse personnel.
b. Managerial personnel
Throughout the period with which this case is con-
cerned, Zale Corporation's group vice president, Marvin
Rubin, held managerial responsibility, inter alia, for both
the firm's sporting goods and jewelry divisions. Between
1974 and March 1976, Vernor Zinik, president of Zale
Corporation's sporting goods division, functioned as
Rubin's direct subordinate. William Gart, the Division's
vice president in charge of operations, reported to Zinik, in
Zale Corporation's managerial chain of command.
Within the corporation's sporting goods division,
throughout the period with which this case is concerned,
Miles Baidack, Honsport's regional supervisor, functioned
as Respondent's general manager. Between his November
1974 designation and March 1, 1976, Baidack reported di-
rectly to Zinik, Zale Corporation's divisional president.
Lawrence Yamaguchi functioned as Baidack's assistant; he
was considered primarily responsible for Honsport's retail
store operations. Alvin Moratin, Sr., was, throughout the
period with which this case is concerned, Honsport's ware-
house manager.
c. Respondent's performance review and pay raise policy
With respect to wages and salaries, Zale Corporation's
policy and procedure manual provides, generally, for the
payment of competitive wages based on area wage surveys.
The manual mandates a systematic pay program, with pay
ranges for each job based on the rates paid for similar
positions within the local community. In this connection,
the manual declares that:
Surveys are conducted in various geographic areas to
determine the proper pay range for the [relevant labor]
grades. The pay ranges will vary throughout the coun-
try depending on the prevailing pay scale in the local
area.
Zale Corporation's manual, further, requires performance
reviews for employe-es, which their supervisors must con-
duct periodically. The precise calendar "intervals" between
performance reviews may vary within the divisions; corpo-
rate policy, however, dictates such formal reviews at least
once a year. Should a given worker's performance be
deemed sufficient to qualify him or her for a pay increase,
supervisors are directed to make recommendations to man-
agement consistent with their determinations.
Pursuant to Zale Corporation's policy mandate,
Honsport's management representatives, Baidack and
Yamaguchi, had-shortly before the period with which this
case is concerned--formulated pay scales for their firm's
warehouse personnel. The pay sclaes, with a designated
October 1, 1975, effective date, had been separately drafted
for warehousemen, on the one hand, and for Respondent's
warehouse clerks and truckdriver, on the other. For ware-
housemen, Respondent's management had set a $2.40 per
hour starting rate, which matched the State of Hawaii stat-
utory minimum rate; nine hourly rate increments, rising to
$3.70 per hour after 51 months of full-time service, had
been established. The first step, which provided for a 15-
cent raise following completion of the warehouseman's 3-
month probationary period, was to be "automatically"
granted; further raises at 6-month intervals were to be
based upon merit, with set increments for personnel who
might be considered worthy, pursuant to Respondent's 6-
month performance reviews. These reviews were to be
conducted on April Ist and October Ist, yearly. Employees
with 6 months of service following their last previous raise
could, thereby qualify for a further raise, within the rate
range previously noted. With respect to Respondent's
head shipping clerk, head receiving clerk, and truckdnver,
Baidack and Yamaguchi had set a $2.60 hourly rate paya-
ble after three months, with 10 raises within the range pos-
sible at 6-month intervals thereafter; the maximum $4.10
hourly rate was to be payable after 63 months of full-time
service. All raises, within this rate range, were to be merit
raises.
While a witness, Baidack conceded that, when his firm's
October 1, 1975, warehouse pay scale was formulated, he
had "combined" a rate structure which had been devel-
oped, several months previously, for Zale Corporation's
Dallas, Texas, warehouse personnel, with a rate structure
which Warehouse Manager Alvin Moratin, Sr., had pro-
vided. So far as the record shows, however, Respondent's
1286
HONOLULU SPORTING GOODS CO., LTD.
October 1975 pay scale formulations had not been derived
from surveys calculated to determine prevailing pay scales
for warehouse personnel, specifically within Honolulu,
Hawaii's labor market.
d. Zale Corporation's managerial reorganization
On March I, 1976, Jerrold Blumenthal replaced Vernor
Zinik as Zale Corporation's sporting goods division presi-
dent. Concurrently, certain changes were effectuated with
respect to divisional line supervision, inter alia, Respon-
dent's general manager, who had previously reported to
Divisional President Zinik directly, was notified that he
would be immediately responsible to William Gart, the
division's vice president.
e. Zale Corporation's management representatives visit
Respondent
Between March 8 and 14, 1976, President Blumenthal
and Vice President Gart visited Hawaii, where they re-
viewed Honsport's situation. They visited Respondent's
stores and conferred extensively with General Manager
Baidack and Respondent's subordinate managerial person-
nel. The subjects canvassed compassed regional opera-
tions, personnel, compensation levels, performance re-
views, and merchandise problems.
During their first conversation-so Gart credibly testi-
fied-Respondent's general manager reported that he had
not yet conducted his scheduled semiyearly performance
reviews. His divisional supervisor directed him to review
Respondent's personnel promptly; further, Baidack was di-
rected to forward his reviews, plus Zale Corporation's
"Form 515's" containing his recommendations with re-
spect to raises, so that Respondent's parent corporation
could take proper steps in that regard. Vice President Gart,
so his credible testimony shows, had-some time previous-
ly, following his 1973 designation presumably-decreed a
divisional policy whereby workers would be reviewed twice
yearly in March and September, so that recommended pay
changes could be effectuated during April and October pay
periods. When he learned that General Manager Baidack
had scheduled April and October performance reviews,
Gart directed him to "get on to the division schedule"
forthwith, and to transmit his performance reviews and
Form 515's thereafter. Respondent's general manager was
directed, inter alia, to put Honsport's retain store sales per-
sonnel on commission. So far as the record shows, how-
ever, Respondent's October 1975 rate ranges for Honolulu
warehouse personnel were never specifically discussed.
Before their Hawaii visit concluded, Blumenthal and
Gart notified Respondent's general manager that his future
performance would be scrutinized closely, and that he
should "shape up" forthwith, failing which he might find
his future with the Company jeopardized.
On March 25, following his return to Dallas. Vice Presi-
dent Gart prepared a comprehensive I l-page memoran-
dum, directed to both Baidack and Yamaguchi: therein, he
detailed various merchandising and managerial "problem
areas" which, within his view, required consideration and
correction. With respect to Respondent's Honolulu ware-
house, Baidack was directed to make certain physical
changes and to modify certain merchandise storage, han-
dling, and security procedures. No comments were prof-
fered, however, with regard to warehouse personnel com-
pensation levels.
f. Respondent's performance review and pay raise
recommendations
On April 10, Respondent's warehouse manager conduct-
ed some performance reviews which covered four of Re-
spondent's five warehousemen, together with Honsport's
single truckdriver. These reviews, however, did not cover
Respondent's complete warehouse complement. Those re-
viewed were warehousemen Hasegawa, Leomo, Ragasa,
and Yamamoto, plus truckdriver Takahara. The firm's
fifth warehouseman Timothy Culkin, had been hired for
regular part-time work less than a month previously; he
had not yet completed his probationary period. Honsport's
two warehouse clericals, likewise, were not reviewed. Carol
James, the firm's inventory control clerk, was, presumably,
then on maternity leave. However, no rationale for Mora-
tin, Sr.'s failure to review Alvin Moratin, Jr., then
Honsport's freight claims clerk, has been proffered for the
present record. Moratin, Sr.'s reviews were promptly sub-
mitted to Respondent's general manager. Thereupon, I
find, Baidack prepared form 515's which presumably re-
flected his pay raise recommendations for Respondent's
warehouse personnel. Meanwhile, however, Honsport's
warehouse manager, following his April 10 performance
reviews, had promised his warehouse subordinates wage
increases; Moratin, Sr., had cited no specific raise figures.
Within a short time after April 10, Respondent's general
manager transmitted form 515's for Honsport's warehouse
personnel to Vice President Gart; however, these "Employ-
ee Status Record Forms" were transmitted without their
supportive performance reviews.
g. Zale Corporation's reaction
While a witness, Vice President Gart testified, without
effective contradiction, that Baidack's form 515's submit-
ted for Respondent's warehouse personnel were returned
to Honolulu by mail on or about Thursday, April 15, with
his personal handwritten note declaring that Respondent's
general manager had recommended "inadequate" ware-
house raises, within his view.
The sporting goods division vice president, concededly,
kept no copy of his covering note. His failure, in this re-
spect, reflected a deviation from his regular parctice. When
Baidack's Honsport files were reviewed, subsequently,
Gart's handwritten note could not be found. Arguably, Re-
spondent's failure to produce such documentation, suppor-
tive of Gart's testimony, might warrant some present doubt
regarding that testimony's probative weight. The record,
however, reflects no forthright or credible denial proffered
by Baidack that his submitted form 515's, for warehouse
personnel particularly, had indeed been returned. He con-
ceded, while a witness, that he had subsequently asked
Controller Mar:in why his recommendations had been re-
jected. Upon this record, Vice President Gart's testimony,
1287
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
generally, impressed me favorably; his proffered recollec-
tions in this regard have therefore been credited. Within a
memorandum dated April 30, Baidack finally replied to
Vice President Gart's previously forwarded March 25 com-
munication. With respect to his superior's directives and
suggestions related to Honsport's warehouse specifically,
Respondent's general manager reported that "all changes
designated in the warehouse" were currently in process.
Regarding two matters which Zale Corporation's vice pres-
ident had discussed, specific replies were proffered; Bai-
dack' memorandum, however, made no reference to com-
pensation recommendations for warehouse personnel.
On May 10, approximately, Jerry Martin, Zale
Corporation's sporting goods division vice president and
controller, left Dallas, Texas, for Hawaii. The record,
herein, provides no comprehensive recapitulation with re-
gard to his visit's purpose; Respondent's testimonial and
documentary presentation, however, warrants a determina-
tion which I make that, among other things, Martin hand-
carried "some 515's" which Baidack had previously sub-
mitted.
Within a subsequent May 12 memorandum, directed to
Baidack, Gart complained that, despite the April 30 memo-
randum which Respondent's general manager had sent
him, he still lacked information with regard to certain ques-
tions raised during his [Gart's] March visit and subsequent
March 25 communication. Inter alia, the sporting goods
division's vice president noted that "some 515's" had been
returned, through Vice President and Controller Martin,
because he [Gart] did not understand them. The record,
however, warrants a determination which I make, that
Gart's questions were specifically related to Baidack's pro-
posed compensation adjustments for assistant managers
and department heads. The vice president's May 12 memo-
randum made no reference to Honsport's proposed ware-
house compensation changes.
2. Complainant Union's representation petition
a. Complainant Union's contact with Respondent's workers
Shortly before these several company developments,
sometime on Thursday, May 6, 1976, Business Agent Har-
land Reed of the Union had spoken with several Honsport
warehouse workers. While conversing with union members
at a nearby completely unrelated facility, whom the Union
represented, Reed had been notified that Respondent's
warehouse personnel lacked a collective-bargaining repre-
sentative. He had, thereupon, visited Respondent's ware-
house, where he had conferred briefly with several workers.
Reed had distributed union designation cards and had sug-
gested a further meeting at 4 o'clock that same day, in a
nearby drive-in restaurant.
Four Honsport warehousemen met with the Union's
business representative, pursuant to his suggestion, follow-
ing the conclusion of their May 6 working day. Reed dis-
cussed the Union, detailed some Union benefits, and de-
scribed his organization's designation card. He declared
that, should a sufficient number of cards be signed. he
would request the Union's recognition, but that a represen-
tation election would "probably" be necessary. Inter alia,
Reed directed Respondent's warehousemen to disregard
his designation card's reverse side; thereon, language
whereby a different, though related, labor organization
would, purportedly, have likewise been "authorized" to
represent card signers had, mistakenly, been printed. Fur-
ther, so the record shows, Reed discussed the Union's initi-
ation fees. Warehouseman Hasegawa testified that the
Union's business representative had declared, with respect
thereto, that "if we [Respondent's warehouse workers]
turned the company union," initiation fee payments would
be waived, and that "after the company turned union"
anybody else would be required to pay. Reed, when quer-
ied further by General Counsel's representative, testified as
follows:
Initiation fee? I told them that nobody pays initiation
fees if we go through the-if they don't recognize us,
we go through an election and we win, we start to
negotiate for them, and nobody is going to pay any
initiation fee until a contract is signed, and all new
employees that is hired after the contract is signed be-
tween the union and the company will be paying initi-
ation fees. I also told them, "Because you are the ones
who wanted this union in there, in here, that's why the
union don't charge you initiation fee."
During this meeting, three warehousemen-Hasegawa,
Yamamoto, and Ragasa-completed, signed, and dated
union designation cards. Warehouseman Leomo had al-
ready partially completed and signed his card but added
the date, plus his job classification, during their drive-in
restaurant discussion. The Union's business representative
then collected four completed cards.
b. Complainant Union's petition filed
Shortly after noon on Monday, May 10, Reed filed a
representation petition (Case 37-RC-2245) with this
Board's Subregional Office; therein, the Union sought cer-
tification within a bargaining unit defined to encompass
"regular full time and part time truckdrivers and ware-
housemen" within Respondent's Honolulu warehouse, save
for "office" clericals and certain conventionally excluded
classifications. The Union described its petition as consti-
tuting its request for recognition, within the bargaining unit
previously defined.
Respondent's warehouse personnel, following the com-
pletion of their May 10 shift, met with the Union's business
representative for a further discussion at Jumbo's Drive-In
restaurant. The record warrants a determination, which I
make, that the firm's fifth "regular part time" warehouse-
man, Timothy Culkin, was present. Following a brief dis-
cussion, during which the Union's business representative
substantially recapitulated his May 6 remarks regarding a
designation card's significance, Culkin, I find, signed a
card.
Respondent's counsel, when he cross-examined Reed
and Hasegawa, particularly, sought to impugn their testi-
mony that CaJlkin had, indeed, signed and delivered his
designation card on May 10, correctly dated. Since the
Union's business representative never submitted Culkin's
card to this Board's Subregional Office representative be-
1288
HONOLULU SPORTING GOODS CO., LTD.
fore their next subsequent contact 4 months later, the card
in question could conceivably have been completed,
signed, and backdated shortly before its September 10 sub-
mission. When requested to report what Culkin looked
like, Reed provided a generalized, somewhat questionable
description, with respect to which Hasegawa's witness-
chair recollection varied. Considered in totality, however,
the record does warrant a determination, which I make,
that Culkin signed a May 10th designation card. Reed's
explanatory testimony-that Culkin's card had been re-
tained within his "organizing" file at the Union's head-
quarters because the representation petition which it would
have supported had already been filed, because that peti-
tion, when filed, had been supported with four designation
cards which he [Reed] then considered sufficient to demon-
strate the organization's majority representative status, and
because he believed, therefore, that no further "showing of
interest" would be required--rings true. General Counsel
and the Union cannot be faulted for their failure to pro-
side Culkin's corroborative testimony. Rather, I note Re-
spondent counsel's failure to produce testimony from Cul-
kin, presumably a readily available witness, calculated to
contradict Reed's proffered recollection and documentary
submission.
Following his receipt of Culkin's signed card, the
Union's business representative, so I find, cautioned
Honsport's warehousemen that they should "watch out"
for company questions and maneuvers calculated to sub-
vert their presumptive desire for union representation.
Upon this note the meeting concluded.
Sometime subsequently, I find, the Union's business rep-
resentative telephoned Baidack; Respondent's general
manager was notified that the Union's representation peti-
tion had been filed, Reed'a testimony with regard to their
further conversation, which I credit in this connection,
warrants a determination, which I make, that the Union's
spokesman claimed to represent a majority of Honsport's
warehouse workers; Respondent's recognition of the
Union was requested. Reed's proffered recollection, partic-
ularly with regard to this telephone conversation with Re-
spondent's general manager, was, within my view, suffi-
ciently positive. He testified that he communicated with
Baidack shortly following a fruitless personal visit to Re-
spondent's premises, either during the mid-afternoon of
May 10, or sometime during the morning of Tuesday, May
11. While a witness, Baidack could not, himself, recall the
date on which the Union's business representative tele-
phoned precisely; nor could he recall whether the Union's
recognition had been requested. Upon this record, Reed's
testimony, within my view, merits credence. In material
part, Respondent's general manager notified Reed that,
when Respondent received its copy of the Union's repre-
sentation petition, that document would be referred to Zale
Corporation's management representatives, for whatever
response they might consider necessary.
c. Respondent's notification given to Zale Corporation's
management
Respondent's general manager, testifying consistently
with his best recollection, recalled that Honsport received
its formal notice with respect to the Union's petition 2 days
after Business Agent Reed's telephone call-thus, on
Thursday, May 13, presumably. Thereupon, with a telex
message, he promptly notified his Zale Corporation superi-
ors. Previously, within this decision, reference has been
made to Zale Corporation's sporting goods division con-
troller, Jerry Martin, who, so the record shows, had
reached Hawaii several days previously. The present rec-
ord is silent with respect to any communication between
Martin and Respondent's general manager regarding
Reed's telephone call or the Union's petition. On Friday,
May 14. Vice President Gart placed a conference call to
Respondent's general manager, with President Blumenthal
of Zale Corporation's sporting goods division and Norman
Landa, Zale Corporation's assistant general counsel for la-
bor relations, participating.
Inter alia, Baidack was queried with regard to when he
had first herad about the Union's petition; further, he was
asked why he had not telephoned Vice President Gart
promptly. Respondent's general manager replied, so Gart's
credible testimony shows, that he had not considered the
matter "important" before he received the Board Subre-
gional Office's official document. Baidack was notified
that Assistant General Counsel Landa would visit Hono-
lulu shortly. He was directed to refrain from questioning
Honsport's wolkers and to take no action whatsoever
which might "create problems" while "sitting tight" pend-
ing Landa's arrival.
3. Respondent's reaction to Complainant Union's petition
a. Norman Landa visits Hawaii
On Sunday, May 23, Landa, pursuant to Vice President
Gart's prior suggestion plus President Blumenthal's confir-
matory directive, reached Honolulu; he brought with him,
from Zale Corporation's Dallas headquarters, so I find,
some wage rate data supplied by the corporation's home
office wage and salary administrator, which purportedly
reflected wage rate ranges currently being utilized for
warehouse workers by Sears, Roebuck & Company and
J. C. Penney Company, Inc., within their Honolulu facil-
ities. The record, herein, warrants a determination, which I
make, that various management representatives within
Zale Corporation's several divisions have historically solic-
ited such wage rate data from their particular area's com-
petitive firms. Pay schedules for divisional personnel,
based upon such solicited data, have periodically been
drafted and revised conforming with a company policy
which calls for the payment of so-called "competitive
rates" within a particular facility's relevant labor market.
The wage data which Assistant General Counsel Landa
had procured, a priori, from his Dallas, Texas, source, how-
ever-with particular reference to Sears' and Penney's Ho-
nolulu warehouse rate rantes-had reflected merely their
entry-level and maximum pay rates. The record warrants a
determination, which I make, that Landa expected to pro-
cure further, more detailed data.
During a May 24 Monday morning conversation with
Baidack, Landa discussed the situation which the Union's
representation petition had generated. He declared his con-
1289
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
cern because Honsport's warehouse personnel had been
promised wages, during the course of their prior April per-
formance reviews, which had not yet been granted. Having
reviewed Respondent's various pay scales currently in
force for sales people as well as warehouse workers, Landa
declared his view, inter alia, that Honsport's warehouse
personnel were underpaid; he suggested a current wage
survey. Zale's assistant general counsel named certain per-
sons connected with several local business operations with
whom he proposed to communicate; Baidack was request-
ed to provide further names, specifically, personnel direc-
tors connected with other local businesses which main-
tained warehouse facilities.
With particular reference to the Union's representation
petition, Baidack testified that Landa had declared, during
their conversation, his belief that Respondent would not
"lose this case" which the Union had brought. Further,
Baidack recalled a comment by Zale's assistant general
counsel that "in all likelihood we would commit unfair la-
bor practices" while winning the case.
When General Counsel's representative first sought to
question Baidack with regard to Landa's May 24 remarks,
Respondent's counsel noted a protest in his client's behalf,
contending that Assistant General Counsel Landa's state-
ments constituted confidential communications between
Zale Corporation's lawyer and Respondent's general man-
ager, with respect to which Respondent could now proper-
ly claim privilege. General Counsel contended that no priv-
ilege could be claimed, since Landa's remarks had been
closely related to Respondent's developing plan for the
commission of unfair labor practices. Respondent's claim
of privilege was denied. Federal Rules of Evidence, Rule
501. Upon reconsideration, my ruling is reaffirmed. Re-
gardless of my determination's correctness, however, I note
further that Respondent's counsel subsequently proffered
Landa's testimony, both with respect to this May 24 con-
versation and with regard to relevant developments there-
after. Thereby, clearly, Respondent's claim of privilege,
whether or not meritorious, was consciously waived. Then,
so Baidack testified, Landa provided him with a booklet
which described contrasting statements and conduct con-
sidered permissible and/or proscribed for management
representatives concerned with union representation cam-
paigns. Respondent's general manager was told to comply
with the booklet's directives. When queried further with
regard to Landa's precautionary remarks, Baidack recalled
statements:
that we could not talk directly te the people pro or con
on the union; we could only state the case of the com-
pany and list the benefits that the employees derived
working for the Zale Corporation. More points along
those lines . . . He gave me the Zale Corporation
booklet on how to deal with labor unions which have
all the do's and don'ts in it ...
Landa, when subsequently summoned as Respondent's
witness, conceded a conversational "unfair labor practice"
reference but denied making any comment that Respon-
dent, confronted with the Union's petition, would trans-
gress permissible limits. When requested to detail his May
24 conversation with Baidack, Landa testified as follows:
We were talking about giving the increases, and I told
him that again, that we were between a rock and a
hard place; that if we gave the increases we could face
possible unfair labor practice charges, and that if we
didn't give them we could face unfair labor practice
charges ....
Q. And [do] you recall what, if anything, Mr. Bai-
dack said in response?
A. Shrugged his shoulders.
Q. Did you tell Mr. Baidack, "We're going to com-
mit unfair labor practices?"
A. I did not.
Q. During your conversation with Mr. Baidack, did
you give him any reference materials with respect to
do's and don'ts"
A. Yes, I did.
Q. And did you give him any advice with respect to
what he should not do in dealing with the employees?
A. I did . . . That happened on the 24th, Monday,
in Mr. Baidack's office. I told him and Mr. Moratin
[Senior] that they could not promise the employees
benefits or grant increases to dissuade them from
going union; they could not threaten them with plant
closing or make any other threats. They could not talk
to the employees or ask questions concerning their
union sympathies, and that they could not discrimi-
nate against them because of their union activities if
they knew of them . . . I told them that if an employ-
ee wanted to talk to them voluntarily and freely, they
could listen, but they could not draw the employee
out. I told them that if the employees asked them any
questions with regard to their personal feelings, that
they could go ahead and comment as long as there
was no promise or threat contained.
With matters in this posture, I am satisfied that Baidack's
specific testimony regarding Landa's conceded "unfair la-
bor practice" comment reflects a misconstruction of that
comment's purport and thrust. Possibly, Respondent's gen-
eral manager may have misconstrued Landa's comment
when it was made; possibly, however, his testimonial re-
capitulation really reflects a currently rationalized recollec-
tion derived from less-than-perfect memory, which subse-
quent developments may have colored. Whatever the
situation, I am satisfied that Landa' proffered recollection,
particularly with regard to their May 24 morning conversa-
tion, merits credence.
Between 9 and 10 o'clock, after his conversation with
Respondent's general manager, Landa spoke to Honsport's
warehouse workers. Following Baidack's introduction,
Landa reported the Union's petition; noted the possibility
that a representation vote would be conducted; declared
that a Board hearing would be held to determine who
would vote and who would not vote; notified his listeners
that they were free to vote for or against union representa-
tion; and delcared that the law protected them in their
right to do so. Warehousemen Yamamoto and Hasegawa,
together with Respondent's general manager, were ques-
tioned with regard to this meeting. Their composite recol-
lections with respect to what transpired, however, were lim-
!290
HONOLULU SPORTING GOODS CO. LTD.
ited. Ms factual determinations herein derive from Landa's
comprehensive testimony. Before the meeting concluded, I
find, truckdriver Takahara questioned Landa with respect
to how Respondent determined its compensation schedule
for warehouse work. Zale's assistant general counsel re-
plied, so I find, that the Company's policy was to pay
"competitive rates" within the area where compensable
work was being performed. Originally, while a witness, Ha-
segawa recalled Takahara questioning Landa with regard
to how he could compare Honsport's warehouse pay scale
with "mainland" warehouse rates. He [Hasegawa] could
not recall, however, how the subject had been raised: his
recollection with regard to Landa's reply was not solicited.
Upon this record, Landa's recollection, with respect to the
matter, has been credited. Takahara, so Zale's assistant
general counsel recalled, proffered no further comment.
Upon this note, presumably, the meeting concluded.
Directly thereafter, Landa placed a long distance tele-
phone call to Vice President Gart. The lawyer's credible,
corroborated testimony with regard to the substance of his
verbal report, reads as follows:
I told Mr. Gart that I had arrived in Honolulu, that we
met with the employees in a meeting that morning:
that we had meetings, further meetings [set for] that
afternoon with members of [Respondent's Honolulu]
law firm; that based on what we had previously ob-
tained from Penney's and Sears, that I thought that
the wage rates we were paying in Honolulu were low,
and that I would get back to him.
The sporting goods division's vice president requested Lan-
da merely to keep him informed with respect to further
developments.
b. Respondent's new wage sunrvey
Throughout the balance of Monday, May 24, and the
following day, Assistant General Counsel Landa, with
Baidack's help, sought to determine prevailing rates of pay
and rate ranges, within the Honolulu labor market, for
warehouse personnel. Inter alia, they communicated with a
Hawaii Employer's Council representative; they were pro-
vided with data which compassed certain "low, median,
and high" rates currently being paid truckdrivers and
warehousemen by five designated retail establishments.
Further, both men conferred face to face with local person-
nel managers or directors for Sears, Woolworth's, and
J. C. Penney stores. With their survey completed, Baidack
and Landa proceeded to formulate new rate ranges for
Honsport's warehousemen, warehouse clerical workers,
and truckdriver.
c. Landa's report to Zale Corporation's management
Thereafter, on Wednesday, May 26, Landa telephoned
the sporting goods division's vice president. When queried
with regard to Landa's report, General Manager Baidack
testified that Gart was told:
[it] looked like we would have to grant a substantial
increase to these [warehouse] personnel, and there wsas
no way to get around it; that we were, in fact, under-
paying according to equivalent jobs in the area: and
that if swe would stand any chance against the union,
this would be the only way we could do that.
Further, Baidack testified that Landa supplied Gart with
proposed "low" and "high" hourly rate figures for both of
Respondent's required warehouse rate ranges, merely. He
[Baidack] declared that Gart had not signified his concur-
rence directly, but that he had ultimately communicated
his "approval" during a subsequent May 27 or May 28
telephone conversation.
During cross-examination, however, Baidack could not
recall precisely how many times Landa had telephoned his
divisional superior. He speculated that "two to four" calls
had been placed. He could not recall specific conversations
or specific phrases, conceding that he could merely recapi-
tulate the "general conteit" of Landa's telephoned reports.
When summoned later in Respondent's behalf, Zale's as-
sistant general counsel testified at length, with Vice Presi-
dent Gart's substantial corroboration, regarding these tele-
phone calls. His proffered recollections read as follows:
I told Mr. Gart that we had obtained the results of the
Hawaii Employer Council survey: that along with the
Penney's and Sears rates we had obtained, that I felt
we were low. I made a recommendation that the wage
rate be adjusted, and then I read off what I suggested
or what I recommended to Mr. Gart .... Mr. Gart
asked me if it would be competitive. I told him we
would probably not be the highest paid warehouse in
Honolulu, but we would be in the ballpark. He then
asked me. "Are we going to have any problems with
it?" I told him that we were really between a rock and
a hard place. The employees had been previously re-
viewed, that they were expecting raises, and that if we
did not give them raises, that there was a good possi-
bility that unlair labor practice charges would be filed
for not giving the raises. On the other hand, I told him
that if we gave the raises, we could also face the possi-
bility of unfair labor practice charges, but that in my
opinion the risk of the latter was lesser than the risk of
the former because it was within the company's policy
of making the surveys, that the employees, themselves,
had been told that they were free to vote either way
that the) wanted, and that no election was imminent.
I also told him that because we had given the employ-
ees The employees had been reviewed and had been
promised wages, that that was also a factor; that it was
my legal opinion that if we did we would not be com-
mitting an unfair labor practice . . . Mr. Gart asked
me. "Can we wait." I said, "No. I would like a deci-
sion immediately." He replied, "Go ahead and make
the change."
Confronted with patent discrepancies between Baidack's
and Landa's proffered recollections. I find the assistant
general counsel's testimonial recapitulation more worthy of
credence, for several reasons: First: I note Baidack's final
concession, despite his purportedly positive direct testi-
mony, that he could not recall Landa's specific language
but merely its general tenor. When queried during General
Counsel's redirect examination, with respect to whether
Landa had said ant thing regarding a union, Baidack could
1291
I)E('ISIONS OF NATIONAl, IABOR RELATIONS BOARD
merely recall the lawyer's comment that "there was a good
possibility the election would happen" with results which
could not be gauged. Second: Vice President Gart's notes
taken during the conversation in question reveal, despite
Baidack's contrary recollection, that Ianda had then pre-
sented him with two completely detailed rate ranges for
Honsport's warehouse personnel, rather than with their
minimum and maximum rates, merely. Third: I note that
some 7 months before this case was heard, during July
1976, specifically, Baidack had resigned his position as
Honsport's regional supervisor. The record, considered in
totality, warrants determinations, which I make, that Vice
President Gart had, long before his regional supervisor's
resignation, strongly criticized the latter's performance rec-
ord; that Baidack's subsequent dealings with Zale
Corporation's management representatives and some
Honsport personnel following his resignation had, tempo-
rarily, at least, been marred by tension: and that Respon-
dent's former general manager had, for a time, considered
himself seriously aggrieved thereby. Baidack's witness-
chair demeanor-- which I have retrospectively evaluated
with these developments in mind persuasively suggests
that his testimonial recapitulations, wherever they differ
from Landa's, may reflect his rationalized recollections,
merely, based upon some memories which personal "after-
thoughts" could have colored. Landa's version of his MaN
26 conversation with Vice President Gart merits credence,
in my view.
d. Respondent's contacts fwith concerned workers
Respondent's revised pay scales for warehouse person-
nel, with respect to which Vice President Gart had noted
Zale's concurrence, provided substantial raises for
Honsport's concerned workers. These changes should be
noted.
With respect to warehousemen, Respondent's previously
defined starting rate [$2.40 per hour] was raised by $.90,
becoming $3.30 per hour. For nine successive steps, set at
6-month intervals thereafter, Respondent replaced succes-
sive $.15 hourly rate raises with a progressively graduated
series of rate increments ranging from $.17 to $.24 per
hour. The firm's new rate range maximum, payable after
51 months of full-time service, became $5.11; this repre-
sented a $1.41 increase, beyond the firm's previously de-
fined $3.70 rate range maximum.
With respect to Honsport's warehouse clerks and truck-
driver, comparative entry-level rates, derived from the
firm's previously defined and revised rate ranges, have not
been provided for the present record. For II successive
steps, set at 6-month intervals thereafter, however, Respon-
dent replaced successive $.15 hourly rate raises with a pro-
gressively graduated series of rate increments ranging from
$.18 to $.27 per hour. The rate payable after three months
of service became $3.57; this represented a $.97 raise over
the defined $2.60 hourly rate previously declared payable
after Respondent's probationary period. Honsport's new
rate range maximum, payable after 63 months of full-time
service, became $5.75; this represented a $1.65 raise be-
yond the firm's previously defined $4.10 maximum hourly
rate.
For Respondent's warehousemen, the various rate range
modifications noted reflected prospectively payable gross
hourly rate increases, varying from 33 percent to 38 per-
cent of the firm's prex iously defined rate range steps. With
respect to Honsport's warehouse clerks and truckdrivers,
new step rates, which would range from 34 percent to 40
percent higher than comparable steps within the firm's pre-
viously defined rate range, were promulgated.
Having procured Gart's permission to raise warehouse
compensation levels consistently with these newly formu-
lated pay scales, Landa suggested that Respondent's gener-
al manager should meet with Honsport's warehouse per-
sonnel to describe their newly formulated rate range
structure. Pursuant to Landa's suggestion, Baidack drafted
some notes, which would cover his prospective remarks.
Then, on Friday, May 28, Respondent't general manager
summoned his firm s warehouse personnel. They were re-
minded that their performance records had been reviewed
during April 1976. and that they had "all" been recom-
mended for merit raises. Baidack's listeners were told, fur-
ther. that, when their April 10 performance reviews were
conducted, the wage schedules for Honsport's warehouse
were being reviewed at Zale Corporation's Dallas head-
quarters; Respondent's general manager commented that,
while a revised wage rate structure had not been completed
in timely fashion, their new rates would be made effective
retroactively, with a May I date. Additionally, Respon-
dent's warehouse workers were told that their new rate
structure, based upon a survey of comparable jobs, would
be competitive with wage rates payable for similar posi-
tions. within the State of Hawaii specifically.
No references to the Union's pending representation pe-
tition or some possible representation vote were made,
however, during the meeting now under consideration.
Summoned as General Counsel's witnesses, both Bai-
dack and warehouseman Hasegawa testified that while Re-
spondent's general manager had addressed the group both
Landa and Warehouse Manager Moratin had been pres-
ent. While testifying subsequently in Respondent's behalf,
however, Zale Corporation's assistant general manager de-
clared categorically that he had deliberately refrained from
attending this particular conference. When queried, then,
with regard to his reason, Landa testified as follows:
I had previously spoken to the employees on Monday.
We were talking about giving raises. I had spoken to
them about the possibility of the union election, that
they were free to vote either way they wanted to, and
I didn't want to be there when they were discussing
the raises because I did not want them to think the
union had anything to do with it . . . I had told them
on Monday about the union petition, that there was
going to be a hearing to determine who would vote
and who would not vote. At that time I told them that
they were free to vote for [the] union or against the
union, but the law protected them in their rights to do
so, and I did not want to be present at the time the
raises were announced because of my previous meet-
ing with the employees.
Baidack's testinonial reference to Landa's presence, dur-
ing this May 28 meeting, struck me as purely perfunctory;
1292
HONOLULU SPORTING GOODS CO.. lTD.
his recapitulation, with respect to what was said, reflects no
comments chargeable to Zale's assistant general counsel.
And Hasegawa's testimony, particularly with regard to
Takahara's question and Landa's purported reply, reflects
some possible confusion on his part between what tran-
spired during Respondent's May 24 meeting and May 28
developments. Landa's testimonial denial that he was pres-
ent on May 28, within my view, merits credence.
Directly following their May 28 meeting, warehouse
manager Moratin told Honsport's warehouse workers
separately-what their new wage rates would be based
upon Respondent's wage survey, the firm's newly formu-
lated rate ranges, and their respective periods of service.
Warehouseman Yamamoto, Respondent's sole worker
questioned in this connection, could not recall an', refer-
ence to the Union, by Moratin. Sr.. while he [Yamamoto]
was being notified regarding his raise.
e. Respondent processes Takahara's loan applic alio
With respect to certain related developments during the
May 24 - 28 penod with which we are now concerned.
Baidack testified, without contradiction, that Landa. dur-
ing one conversation, had asked whether he IBaidack] felt
there was any reason "other than monetary" that might
have persuaded Honsport's warehouse workers to seek
union representation. Respondent's general manager had
replied that he did not know but "believed" there were no
other reasons. When Zale's assistant general counsel asked.
then, whether he knew who might have "gone to the
union" seeking unionization. Baidack had speculatisvcl
noted the possibliity that truckdriver Takahara might have
done so. According to Baidack, Landa had commented
then that they "really couldn't go out and find out directlx"
whether Takahara had been responsible. Assistant Mlan;g-
er Yamaguchi, so Baidack testified, had thereupon been
requested to determine "indirectly" what Takahara's role.
if any, had been. The following day. Baidack notified
Zale's assistant general counsel, so his undenied testinions
shows, that Takahara had applied for a loan one week pre-
viously from Zale Corporation's Dallas-based emploxees'
credit union. According to Baidack's recollection:
Mr. Landa said that if we pushed the loan through. it
would probably go a long way to swaxing Tommx
Takahara if he had been, in fact. the one insvolved in
seeking the union. At which time a phone call sas
made to Dallas by Mr. Landa. I do not recall specifi-
cally who he spoke to . . ... He told (the pairt called]
that we had a union problem or potential union probh-
lem here in Hawaii; that it appeared that loom x Tla-
kahara could be influential in the case: that it sAould
behoove us to put through this loan as quickl? as ps-
sible.
The record warrants a determination, which I make. that
Takahara's loan application, which might otherwise habce
been processed routinely within a 2 or 3-week period. u as
thereupon given expedited consideration. IThe truckdriner's
loan check from the credit union reached Baidack's desk
on Monday. May 31.
While a witness, Vice President Gart testified credlibih
and without contradiction that before this, he personally
had sometimes taken action calculated to speed up credit
union processes in connection with personal loan applica-
tions. The sporting goods division's vice president cited
several instances when he had "walked a check through"
personally. after being notified that some "problem" ex-
isted and that the loan applicant needed his requested
funds forthwith. Gart disclaimed any knowledge with re-
gard to I akahara's loan particularly but declared that
Landa's conduct had not lacked precedents.
Nothing within the present record. however, would war-
rant a determination that truckdriver Iakahara was ever
told his loan application had been processed with particu-
lar expedition.
4. Reprtsent;tion case proceedings
On June 1. 1976. pursuant to notices previously given.
this Board's Subregional Office conducted a hearing on the
Union's representation petition. Ihe parties stipulated that
Respondent's full-time and regular part-time warehouse-
men and truckdrivers within Its Honolulu warehouse facil-
ity. save for "office clerical" employees. guards, and statu-
tory supervisors, constituted a unit appropriate for
collective-bargaining purposes. I he Union contended,
however. that warehouseman Richard Moratin, newly
hired, and freight claims clerk Alvin Moratin. Jr., should
be excluded because thex are the sons of Alvin Moratin.
Sr.. Respondent's warehouse manager. Respondent sought
their inclusion, contrariwise.
Respondent's representatives contended further that
freight claims clerk Moratin. Jr.. together with inventor,
control clerk Karen Schubach. should be included within
their firm's w arehouse unit as plant clericals. The Union
took no position with regard to these contentions. When
the complaint case sith which we are now concerned was
heard. teslimonial and documentary evidence revealed that
Karen Schubach had ceased working for Respondent with-
in a fc w eeks after this Board's hearing on the Union's
representation petition. She had been hired. so the records
show, to replace temporarils flonsport's regular inventors
control clerk. ( arol Ja mes. then on maternitx leave. Subse-
quentlN. uittlii a Jui I [)ecisioi and l)irection of Election
issued hb the Board's Rei ional Director with jurisdiction.
%'arehouse M.ilanLger Mloratin. Sr.'s sons were found "in-
cludable" within the l ni nm's petitioned-for bargaining
unit, both plant cr-lical workers. pre, iouslv noted. wsere
lihke ise found propel I inch ided witk in Itonsport's ware-
house complement
5. ('omplainant ;L mon's reaction
.1i Retp'Vudtw' iil')r or re ceive ilt leir rars'.h
I hroughoutr thc perilod with which we have been con-
ci'rnied. Responldent i.illlrillt.ed hiweekly pay periods.
which. so the iecii shhow s, terminated on alternate Fri-
dlas: on the iolIlowinr Ihiur sdas or Fridavs, Respondent's
wa;rehouse workers receis ed their pa'checks.
[)urint! the )croiid with which we are presently con-
cerled,. Respondent's blxeteklx pax periods terminated on
1293
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
May 28 and June 11, 1976, respectively. The record war-
rants a determination, which I make, that, presumably on
June 3, Respondent's warehouse workers were paid for the
2-week period which had ended May 28, on the basis of
their "old" pre-April 10 rates of pay. However, with respect
to their next pay period, namely, the 2-week period with a
June 11 closing date, the firm's warehouse workers were
paid consistently with Respondent's newly formulated rate
ranges; their checks, further, included retroactive pay for
two prior pay periods running back to May I., separately
computed at their newly set rates. Honsport's five senior
warehousemen received hourly rate raises, dependent upon
their periods of service, which ranged from $.92 to $1.22
per hour. Warehouseman Richard Moratin, with a May 4.
1976, date of hire, was granted Respondent's newly formu-
lated service entry rate. Takahara, Respondent's truckdriv-
er, received a $1.48 raise. Alvin Moratin, Junior, received a
$.35 wage increase. The record does not reveal Inventory
Control Clerk Schubach's modified pay; when Carol James
subsequently resumed work in Respondent's warehouse,
on July 5, 1976, she received a $1.31 raise over her previous
pay rate. Herein, General Counsel's documentary submis-
sion, derived from Respondent's records, reveals that the
firm's wage rate adjustments in some cases may have devi-
ated slightly from those which its newly formulated rate
ranges would presumably have required. Warehousemen
Yamamoto and Ragasa, so the record shows, were granted
raises within Honsport's relevant rate range for their job
classification, properly geared to their periods of service:
Richard Moratin was correctly granted compensation
which matched the firm's new entry-level rate. Timothy
Culkin, however, was granted a rate properly payable after
3 months of service, though he had not, by May I. finished
his probationary period. Warehousemen Hasegawa and
Leomo were given raises correctly geared to their periods
of service but derived from Respondent's revised ware-
house clerical rate range: the record suggests, however.
that, subsequent to May I, they may have been performing
clerical duties. Alvin Moratin, Jr., with 2 years and 8
months of prior service, in toto, had worked slightly more
than 3 months before May I as Respondent's freight
claims clerk; nevertheless, he was assigned a wage rate
within the clerical rate range, purportedly payable after 9
months of service. Together with these presumptively bene-
ficial wage level changes, however, Respondent's manage-
ment made two less generous miscalculations. Takahara.
despite II years of service, was raised to a compensation
level within his rate range, payable after 57 months of ser-
vice; he was not granted his rate range maximum, which he
should have been granted, until 6 months later. Carol
James, with a nominal 21-month gross service record when
she resumed work in July 1976, was granted a raise com-
mensurate with her service record within the warehouse-
men's rate range; consistent with Respondent's new clerical
rate range, she could have been given 10 cents more per
hour.
The Union's business representative testified credibly
and without contradiction that, following the June I repre-
sentation case hearing, he continued to call Jumbo's Drive-
In restaurant meetings for Respondent's warehouse work-
ers. However, when these workers finally received their ret-
roactive raises, so Business Agent Reed's credible testi-
mony shows, they no longer responded when notified of
the Union's scheduled meetings. According to Reed, only
one worker, whose name he could not recall, reported.
b. Complainant Union's charge
On June 21, 1976. the Union's business representative
signed a formal Board charge, wherein Respondent was
charged with the commission of 8(a)(1) and (5) statutory
violations, dating back to June I 1, specifically. The Board's
record, however, shows that this charge was filed On July
22. No rationale for the Union's presumptive failure to file
its charge promptly has been proffered for the present rec-
ord. Conceivably, the charge's date notation, showing that
Business Agent Reed had signed it on June 21, may reflect
a simple draftsman'" or typist's mistake. The charge could
have been signed on July 21; then it could have been filed
the following day. While a witness, however, Reed prof-
fered no such contention. On January 10, 1977, this
Board's Regional Director notified the Union's counsel
that, since a complaint and notice of hearing had been
issued based upon the Union's July 22, 1976, charge, the
representation petition previously filed would be dismissed,
subject to reinstatement, should such action be deemed ap-
propriate, upon the Union's application following some
disposition of the present complaint proceeding.
C. Discussion and Conclusions
Consistent with well-settled decisional doctrine, this
Board has noted frequently that wage increases granted
during union organizational campaigns may not be consid-
ered, per se, statutorily proscribed. The Board's conclusions
as to whether such wage increases or benefits conferred
have transgressed permissible limits must derive, rather,
from subsidiary determinations, based upon each case's
particular circumstances, with respect to whether the con-
cerned emploNer's grant was calculated to interfere with
the self-organizational rights of workers or to thwart a la-
bor organization's campaign for representative status.
N. I .B. v. Exchunge Parts Co., 375 U.S. 405 (1964); Cen-
tralia Fireside Health. Inc. dh, a The Fireside House of Cen-
tralia, 233 NLRB 139. 140 11977), and cases therein cited.
Mr. Justice Harlan, in the Supreme Court's Exchange Parts
decision, noted that:
Ihe precise issue [which this case presentsl is whether
[Section 8(a)( I)] prohibits the conferral of [economic]
benefits. without more, where the employer's purpose
is to affect the outcome of the (representation] election
.... We think the Court of Appeals was mistaken in
concluding that the conferral of employee benefits
while a representation election is pending. for the pur-
[pose of inducing tenplovees to vote against the union,
does not "interfere with" the protected right to orga-
nize . . . We have no doubt that [Section 8(a)(l)1 pro-
hibits no' only intrusive threats and promises but also
conduct immediately favorable to employees which is
uinderrak(A l n h the e. press purpose of impinging upon
their / eedomn of chicne for or against uionionization and is
1294
HONOLULU SPORTING GOODS CO.. LTD.
reasonably calculated to have that effect. [Emphasis
supplied.]
This Board, with judicial concurrence, has long recognized
that the statute, thus construed, places many concerned
employers in difficult positions when business circum-
stances would dictate some revision of their wage struc-
tures following their receipt of notice with respect to repre-
sentation proceedings filed. McCormick Longmeadow Stone
Co., Inc., 158 NLRB 1237, 1241-43 (1966). Compare Sta-
Hi Division, Sun Chemical Corporation v . N.L.R.B., 560
F.2d 470 (Ist Cir. 1977) The Singer Company, Friden Divi-
sion, 199 NLRB 1195, 1196 (1972). In McCormick Long-
meadow Stone, supra at 1242, Trial Examiner Reel defined
the statute's mandate---with Board concurrence Posi-
tively: his formulation read as follows:
An employer's legal duty in deciding whether to
grant benefits while a representation case is pending is
to determine that question precisely as he would if a
union were not in the picture. If the employer would
have granted the benefits because of economic cir-
cumstances unrelated to union organization, the grant
of those benefits will not violate the Act. On the other
hand, if the employer's course is altered by virtue of
the union's presence, then the employer has violated
the Act, and this is true whether he confers benefits
because of the union or withholds them because of the
union. [Emphasis supplied.]
However, determinations thus required. with respect to
whether some particular benefit had been conferred "be-
cause of economic circumstances unrelated to union orga-
nization" or derived from a concerned employer's decision
which had been "altered by virtue of the union's presence"
primarily, cannot be lightly reached. When financial re-
wards-pay raises or fringe benefits--have been granted
workers, within a situational context which reflects statuto-
rily proscribed statements or conduct, conclusions regard-
ing the concerned employer's statutorily proscribed "pur-
pose" may be readily drawn. Likewise, when managerial
declarations or conduct-which might not, themselves, call
for statutory proscription-nevertheless reflect a con-
cerned employer's campaign to forestall unionization, the
presence of some forbidden motive, for benefits conferred
during a representation case's pendency. may reasonabl\
be deduced. In Exrchange Parts Co., 376 U.S. 405. 410
(1964), the Supreme Court declared, with respect to such
determinations, that:
It is true, as the court below pointed out, that in most
cases of this kind the increase in benefits could he
regarded as "one part of an overall program of inter-
ference and restraint by the employer." ... and that
in this case the questioned conduct stood in isolation.
Other unlawful conduct may often be an indication of
the motive behind a grant of benefits while an election
is pending, and to that extent it is relevant to the legal-
ity of the grant: but when as here the nmotiet i.s otherwrise
established, an employer is not free to violate Section
8(a)(l) by conferring benefits simply because it re-
frains from other, more obvious violations. IEmphasis
supplied.]
And this Board has frequently found benefit grants proper-
ly subject to statutorv' proscription, consistent with this Su-
preme Court language. because their "nature" and "tim-
ing" persuasively demonstrated their character as
responses to some l bor organization's representation cam-
paign. See. e.g.. Montgomery Ward & Co., Incorporated 220
NLRB 373 (1975), enfd. 554 F.2d 996 (10th Cir. 1977); cf.
Laars Engineers, Inc., 142 NLRB 1341, 1344-45 (1963),
enfd. on this point 332 F.2d 664 (9th Cir. 1964). in this
connection.
In recent sears, however. several decisions have reflected
this Board's recognition, with judicial concurrence, that its
decisional principle-whereby concerned employers, con-
strained to determine whether benefits should be granted
during a representation case's pendency. must determine
that question precisely as the+! would if a union were not in
the picture will sometimes generate managerial dilem-
mas. See, e.g.. Sla-Hi Division. Sun (Chemical Corporation v.
N L.R.B., 560 1.2d 470 (Ist Cir. 1977), enfg. 226 NLRB
646 (1976): The Singer (Companv, Friden Division, 199
NLRB 1195. 1196 (1972). In Sun ('henical. supra at 474.
the court of appeals commented that:
We are not unsympathetic with an employer who.
having decided to increase his employees' wages, finds
himself tr'ing to navigate a "perilous" course between
the Sc lla of a violation of the Act for granting a wage
increase to his employees when a representation elec-
tion is pending and the Charybdis of a violation of the
Act for withholding such an increase when an election
is pending.
This Board's decisions, however, have suggested several
"escape" routes whereby such putative dilemmas may be
avoided, For example. the Board notes, within its Singer
Compani decision, that--while grants or promises of bene-
fits during a critical preelection period will be considered.
prima face,. statutonly proscribed--concerned employers
may escape statutory sanctions. by coming forward with
some explanation. other than a representation vote's pen-
denc'. for the timing of their particular benefit's grant or
proclamation. See, for example. C('ntralia Fireside Health,
Inc.. 233 N LRB 139. 140 (1977)1: MAic, MeasuremcLnt~, 233
NL.RB 76. 77 (1977); Aircraft HIdro,,-orrmrng. In.. 221
NLRB 581. 585 586 (1975). In short: Whenever General
Counsel's presentation. regarding some particular benefit's
nature, significance and timing, can be considered suffi-
cient to provide a primna facic demonstration of statutorily
proscribed interference, the "burden of proceeding" will
necessarily be shifted: respondent firms, then, must first
establish that their challenged benefit grant was consistent
iwith a prev iouslx formulated program or prior practice.
and. secondl. , justif? the temporal coincildence between
some labor organization's hid for representative status and
their benefit's conlferral. (ompare C)olonial Haven .Nurxing
Ho,nc. Inhi.. 218 N'LRIB 1(X)7. 1008. 1017. fn. 5, (1975). enfd.
in material part 542 F.2d 691 (7lh ('ir. 1976). in this con-
nection.
[o put the matter differentl . respondent firms charged
with benefit grants presumptixels conferred for some "ex-
press purpose" statutorils proscnbed. must demonstrate
that such grants. regardless of their nature and timing
1295
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
which could be suspect, really reflect no pnor "course al-
teration" motivated by a labor organization's presence.
In most cases, such defensive demonstrations have en-
compassed testimonial and documentary proffers calling
for determinations: first, that challenged benefit conferrals
had been based upon the designated respondent's regular
practice or based upon plans specially formulated before
any labor organization's campaign had commenced or be-
came known: second, that some notice regarding a pro-
spective grant, based upon such a respondent's previously
formulated plan or regular practice, had been communicat-
ed to concerned employees, preferably before any labor
organization's known advent; third, that procedures subse-
quently followed and benefits finally conferred had been
consistent with the particular respondent firm's regular
practice or previously formulated program.
I. Respondent's pay raises
The present record clearly warrants a determination,
which I make, that, during the period with which we are
concerned, Respondent's compensation policy did indeed
derive from established practices and procedures which
predated the Union's representation bid. Zale
Corporation's policy and procedure manual, throughout
the period with which we are concerned, had called for
periodic performance reviews, pursuant to which qualified
workers might be granted raises within prescribed rate
ranges. Those rate ranges, formulated to be generally
"competitive" with prevailing wage rates currently being
paid for comparable positions within the local community.
have historically been derived from area wage surveys.
Zale Corporation's manual, so far as the record shows, pre-
scribes no fixed time interval within which wage surveys
previously conducted should be reviewd, reconsidered, or
brought up to date. Presumably, renewed surveys have
been conducted whenever, in management's judgement,
conditions within a particular labor market have persua-
sively suggested their desirability. At Honsport. General
Manager Baidack had, consistent with Zale Corporation's
manual directive, formulated October 1975 rate ranges for
Honolulu warehouse persorinel. T hose ranges had ostensi-
bly been based upon previously collected survey data. I he
fact that Baidack's purported survey data may not have
reflected correctly the local pay scales prevailing for ware-
house personnel in Honolulu's labor market specifically
cannot, in my view, detract from their presumptively "ob-
jective" character; their validity, however, will be consid-
ered further in this decision. Respondent's written "Ware-
house Personnel Pay Scales" policy had, finally. provided
for semiyearly April I and October I performance reviews,
which would be prerequisites for raise recommendations.
While the present record provides no persuasive clue rela-
tive to Honsport's prior October 1975 compliance with its
formally promulgated compensation policies, there can be
no doubt that such policies do provide a quintessential
background for subsequent developments. with which we
are presently concerned.
Directly following Warehouse Manager Moratin's April
10 performance reviews Respondent's warehouse workers
had been notified that raises, based upon their meritorious
performance records, would be granted. Concededly, no
specific raise figures had been mentioned. When Baidack
shortly thereafter sent Vice President Gart his pay raise
recommendations, however, wage increments computed in
conformity with Honsport's October 1975 rate ranges had
been specified. These developments had clearly preceded
Business Agent Reed's initial May 6 conferences with Re-
spondent's warehouse workers. Vice President Gart could
conceivably have "acquiesced" promptly, with respect to
Baidack's April 10 raise recommendations; had he done so,
no problem worthy of present Board cognizance would
subsequently have been generated. When Zale's sporting
goods division vice president returned Baidack's recom-
mendations, however, while declaring them "inadequate"
in his view, his determination necessarily set the stage for
subsequent developments, which have generated the pres-
ent controversy. With matters in this posture, there can be
no doubt that, so far as Honsport was concerned, two gen-
erally recognized preconditions for wage increases free of
statutory 'taint had been satisfied. Raises for Honolulu
warehouse personnel had been recommended, conforming
with a previously determined company policy, and Re-
spondent's concerned workers had been told that wage in-
creases based on merit would be forthcoming, long before
Honsport's management learned that the Union claimed
representative status.
Considered in totality, however, the present record clear-
I' warrants a determination, which I make, that Respon-
dent's warehouse raises, when finally granted, derived from
substantially revised rate ranges formulated, concededly,
during a representation petition's pendency. Since most of
the firm's raises granted under such circumstances ran con-
siderably higher than the step increases which Respon-
dent's general manager had previously recommended,
General Counsel's representative seeks a determination,
substantially, that such raises, when granted, had not been
"consistent" with Honsport's previously promulgated per-
formance review and compensation program. Respon-
dent's counsel contends, nevertheless, that his client's vari-
ous raises had been granted in conformity with
"established company policy" whereby workers were sup-
posed to be paid at rates competitive with those being re-
ceived by other workers performing similar work in their
local communities. This contention, in my view, raises a
different question, which I purpose to discuss further in
this Decision. And, mindful of this situation, General
C(ounsel's representative would now have this Board sim-
ply infer that Respondent's course of conduct had been
specifically' designed to persuade concerned employees that
wage increases had been granted, and would be granted,
thereafter, without any necessity for union representation.
Upon this record, however, General Counsel's conten-
tion, in my view, carries no persuasive thrust. While Re-
spondent's rate range revisions, coupled with raises pur-
portedly granted consistently therewith, may have followed
hard upon management's acquisition of knowledge with
respect to the Union's campaign, the factual record, in my
view, will not preponderantly sustain a determination that
the firm's challenged course of conduct had been cons-
ciously "undertaken" with a statutorily proscribed "ex-
press" purpose. My conclusion, substantially, that Respon-
1296
HONOL[ ULU SPORTING GOODS CO.. I.TD.
dent's defensive presentation, with regard to management's
motive for challenged conduct, has persuasively overcome
General Counsel's prima facie case derives from several
considerations.
First: I note that Respondent's May 28 wage increases,
with May I retroactive dates, though concededly "substan-
tially greater than many increases (which warehouse em-
ployees) had received" previously. derived from revised
rate ranges, based upon Assistant Cieneral Counsel
Landa's concluded wage survey: that survey had been con-
ducted. consistent with Zale ('orporation's previously es-
tablished policy, specifically to facilitate the formulation of
rate ranges which could be considered "competitive" with
those governing the compensation of warehouse workers.
generally, within the Honolulu labor market Essentially,.
therefore, Respondent's raises, when promulgated, reflect-
ed corporate management's "lawful attempt to correct an
inequity" which General Manager Baidack's prior neglect
had generated. When formulating his October 1975 rate
ranges, Baidack had, so he testified, relied upon Zale
Corporation's previously determined rate range for Dallas.
Texas, grade 12 warehousemen, plus further data, never
specified, which Warehouse Manager Moratin had pur-
portedly supplied. The present record, however, warrants
no determination whatsoever regarding the identity of
Moratin's presumably local sources: nor will it warrant de-
terminations with respect to his data's then current rele-
vance or reliability. With respect to Baidack's purported
reliance upon Zale Corporation's Dallas, Texas, warehouse
scale, I note record documentation which reveals the
corporation's September 1. 1975, rate range, for "Gtrade
12" Dallas warehousemen; that previously determined
range was substantially higher than Baidack's October I.
1975 formulation. In Dallas, Zale's newly hired warehouse-
men were, then, being paid $3.14 hourly; Baidack had,
nevertheless, set a $2.40 statutory minimum rate. His pro-
mulgated October 1975, warehouse rate range provided for
compensation after 27 months of service which matched
Dallas' minimum rate. Dallas warehousemen could qualify
for Zale Corporation's maximum $3.69 hourly rate follow-
ing 30 months of service; in Honolulu, Honsport ware-
housemen could not qualify for their compensation
schedule's maximum $3.70 hourly rate until after 51 monthrs
of service. Thus, should this Board consider a determina-
tion warranted, arguendo, that Respondent's general man-
ager might reasonably have considered current Dallas,
Texas, pay scales relevant when drafting his October 1975
rate ranges, there would be clear warrant for a further de-
termination that Baidack must have relied upon patently
obsolete data. Further, I note officially that the Federal
Government considers Honolulu, Hawaii. a high cost-of-
living area, wherein compensation levels, generally'. run
higher than "mainland" rates paid for comparable work
From all this, I conclude that Baidack's October 1975
warehouse pay scales, when formulated, were clearl' less
than competitive in the Honolulu labor market: certainly'
6 months later their gross failure to provide competitive
compensation consistent with corporate policy could have
been readily perceived. However, Respondent's general
manager, so far as the record shows, never considered a
renewed warehouse wage survey. centered on local firms.
which might conceivably dictate rate range revisions, nec-
essar,. Vice President (Gart had, during his March 1976
visit. noted Baidack's previously tolerated deviation from
the March-September performance review schedule which,
pursuant to his direction. Zale's sporting goods division
generally followed. He had specifically directed Respon-
dent's general manager to "get on to the division schedule"
forthwith: Baidack. however, had not complied. When
flonsport's belated April 10 form 515 raise recommenda-
tions were finally ubmnitted. (art had. so I have found,
labelcd them "inadequate" promptly: he had returned
them for revision The vice president's reaction had predat-
ed the Utnion's designation card solicitation; clearly his re-
quest for more realistic raise recommendations had not
been motivated therebv.
Nevertheless, bet veen April IS and May 10. Respon-
dent's general manager had taken no steps whatsoever. so
far as the record shows. calculated to suggest compliance
with his divisional supervisor's directive. Thus. when con-
fronted shortly thereafter with with word of the Union's
representation bid, Zale Corporation's management repre-
sentatives were presented with choices to be made between
three conceivable courses: (I) Vice President Gart could
conceivably have reversed his April 15 decision: Baidack's
previousl, recommended raises, despite their derivation
from two carelessly formulated rate ranges and their clear
failure to match competitive Honolulu wage levels. could,
nevertheless, have been granted: (2) Respondent could
have decided to postpone or suspend all further action with
respect to warehouse raises despite Moratin. Sr.'s prior no-
tice to subordinates that wage increases would be granted.
coupling that decision with some public declaration which
reflected its desire to avoid the appearance of statutorily
proscribed interference with a possible representation vote.
(Company StIa-Hi Division. Sun Chemical Corporation v.
I...R.B., 560 F.2d 470 (Ist Cir. 1977)., enfg. 226 NLRB
646. 648 (1976); The Singer Companv Friden Division, 199
NLRB 1195, 1196 (1972). and (3) the firm could conduct a
current up-to-date wage survey. which Baidack had plainly
neglected to conduct: warehouse rate ranges based thereon
could then be devised, and raises calculated conformably
therewith could be granted. Zale Corporation's manage-
ment representatives cannot be faulted, in my view, for
choosing the latter course.
The firm's assistant general counsel, with Vice President
Gart's concurrence, merely pursued to completion the
course of conduct which General Manager Baidack should
have pursued, consistent with company policy, before the
iUnion's campaign for representation rights began.
Thus, no determination could reasonably be considered
warranted. in mi view, that Respondent's May 28 wage
increase erants reflected a course "altered by virtue fo the
union's presence" wholly or partially. McCormick Long-
meadow Stone ( o. Inc . vupra. Nor could a determination
he considered warranted. in my view, that Respondent's
course of conduct, though "immediately favorable" with
respect to warehouse personnel, had been "undertaken
with the e'pr'is purpove of impinging upon their freedom
of choice" relative to unionization. Exchange Parts Co., su-
pra. Assistant General (ounsel Lianda may well have be-
lieved that warehouse raises granted consistent with his re-
1297
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
vised rate range recommendations might conceivably gen-
erate unfair labor practice charges: concededly, Vice Presi-
dent Gart was told that a corporate decision to grant sub-
stantial raises during a representation proceeding's
pendency would require a difficult. potentially risk)
choice. The lawyer's professional counsel, however, could
hardly be considered a conscious concession. that such
raises, because of their sizable "nature" and "timing" sole-
ly, would necessarily reflect some statutorily proscribed
motivation or that Board charges based thereon would
necessarily be considered meritorious.
Second, I note further that Respondent has not been
charged herein with "other unlawful conduct" which could
"indicate" statutorily proscribed motives behind the firm's
substantial retroactive raises; nor have Respondent's possi-
bly questionable motives been "otherwise" demonstrated
within General Counsel's presentation. Compare .L. R.B.
v. Exchange Parts Co., 375 U.S. 405, 406 407. The Supreme
Court, therein, noted that respondent employer had
"granted" and "announced" certain fringe benefits within
a situational context which encompassed managerial decla-
rations clearly reflective of the firm's disparagement re-
garding unionization. Rather, the record, herein, warrants
a determination, which I have made, that Zale's assistant
general counsel, during his May 24 remarks before
Honsport's warehouse personnel, offered no comments
whatsoever revelatory of Respondent's reaction to the
Union's petition. Later, having won Vice President Gart's
concurrence with regard to substantial raises ior the firm's
warehouse personnel, Landa deliberately refrained from
attendance dunng the workers' May 28 meeting. when
General Manager Baidack reported that retroactive raises
would be granted, described Respondent's basis for their
determination generally, and referred his listeners to Ware-
house Manager Moratin for further details. Landa with-
held his presence, so his presumably self-serving, but nev-
ertheless credible, testimony shows, because he had
previously discussed the Union's representation petition
with Respondent's workers; and because, mindful of this,
he wished to preclude any possibility that Respondent's
warehouse personnel, with him present, might "associate"
their raises with the Union's pending bid for representative
status. Consistent with Landa's purpose. Respondent's
general manager, concededly, mentioned neither the
Union's campaign nor any prospective representation vote
when describing his firm's retroactive raise program.
In short, Respondent's management representatives
were, so the record shows, consciously trying to deal with
their firm's "economic exigency" lawfully. Having de-
termined to grant substantial raises calculated to correct a
clearly "inequitable" business situation traceable to Gener-
al Manager's Baidack's prior misfeasance, Honsport's
management, so I have found, deliberately refrained from
comments, however mild or factual, which might have di-
rected the employees' attention to the union aspect of the
matter" with reasonably foreseeable consequences. Com-
pare McCormick Longmeadow Stone Co., Inc.. supra at 1238
and 1242-43. Therein, this Board found that a respondent
firm had improperly conditioned wage increase grants
"which could have been lawfully instituted without refer-
ence to the union" when it notified concerned workers di-
rectly that prospective ra ses would be withheld unless
their possible collective-bargaining representative, con-
cerned with a pending representation case, would waive its
right to file later representation vote objections or Board
charges based there )n. No comparable statements or con-
duct reasonably calculated to suggest or imply that Re-
spondent's workers might be well advised to forswear
union representation can properly be charged to Zale
Corporation's counsel or Honsport's managerial spokes-
men.
This Board has, of course, held heretofore--twice at
least, so far as I can determine-that fringe benefits con-
ferred or reaffirmed specifically to correct a presumptive
"inequity" negligently generated or to match benefits pre-
viously conferred on workers elsewhere merit statutory
proscription. Howexer, these cases, in my view, may prop-
erls be considered c istinguishable.
In Montgomeitrv Ward and (o.. Incorporated, 187 NLRB
956 (1970), the designated respondent's labor relations
manager had during the critical period preceding a sched-
uled representation vote reaffirmed a specific fringe bene-
fit, previously promulgated and generally provided
throughout his firm's multistate operations, which local
management in a particular retail facility had mistakenly
failed to provide. The record, considered in totality, re-
*ealed, however. that the firm's labor relations manager
had reaffirmed his company's negligently "overlooked"
benefit policy. within a situational context which encom-
passed several 8(a)(l) violations. Further, the Board found
that Montgomery Ward's labor relations manager had,
during a subsequent speech directed to concerned workers.
specifically mentioned the fringe benefit reaffirmed, while
prophesyting that his listeners would derive "absolutely
nothing" from union representation.
Herein, no concurrent unfair labor practices beyond
Honsport's retroactive raises have been charged. Further,
neither Zale Corporation's counsel nor Respondent's local
management has been charged with statements or conduct
calculated to suggest any significant relationship between
their firm's newly granted raises and the Union's campaign
or prospective representation case developments.
In fEremont Manufacturing C'ompany, Inc., 224 NLRB
597. 602 603 (1976), enfd. 558 F.2d 889 (8th Cir. 1977), the
designated respondent's management had, shortly follow-
ing the commencement of a labor organization's represen-
tation campaign. distributed a workers' handbook wherein
various newly defined fringe benefits, never previously pro-
vided at the particular facility concerned, were listed. The
company's management contended that these new benefits
had been provided because it had decided to provide work-
ers at the facility concerned with the same benefits which
their fellow workers at another corporate facility had previ-
ously been given. However, this Board rejected the com-
pany's defense. It noted, first, that no supportive documen-
tation with respect thereto had been proffered for the
record; second, that no legitimate business concerns, which
might reasonably have dictated the implementation of nov-
el fringe-benefit programs during a representation cam-
paign, had been demonstrated; third, that such fringe ben-
efits had been provided within a situational context which
revealed further unfair labor practices: fourth, that no tes-
!298
HONOLULU SPORTING GOODS CO., LTD.
timony had been proffered calculated to show that new
fringe benefits had been long planned or that their promul-
gation was unrelated to management's knowledge that a
designation card drive was in progress. Mindful of these
considerations, this Board found the company's fringe ben-
efit grants "designed to thwart" self-organization.
Herein, however, Respondent's defensive presentation
could hardly be considered comparably deficient. Docu-
mentation generally supportive of Respondent's position
has been proffered; no concurrent unfair labor practices,
which could reasonably have provided some "indication of
the motive" behind Respondent's raises, have been proven;
testimony revelatory of Respondent's presumptively "legit-
imate" business concerns, which might reasonably be con-
sidered a sufficient justification for raises granted during a
critical preelection period, has been proffered.
More particularly, with respect to pay raises granted
during a representation case's pendency which reflect a
concerned firm's clear "departure" from prior wage in-
crease practices, policies, or programs, this Board has, like-
wise, twice at least, found Section 8(aX I) violations. Again,
however, these cases, in my view, may properly be distin-
guished from the case with which we are presently con-
cerned.
In Styletek, Division of Pandel-Bradford, Inc., 214 NLRB
736 (1974), enfd. 520 F.2d 275 (Ist Cir. 1975), the designat-
ed respondent's management had, some time previously,
promised workers "cost-of-living" raises comparable with
raises which had previously been granted. Shortly before a
scheduled representation election, however, Respondent
had restructured job classifications and wage rates. Vary-
ing wage increases consistent with the firm's restructured
rate schedule had then been granted. The Board found
these wage increases violative of law. It noted, first, that
"job inequities and company growth" had been proffered
as Respondent's proper "business justifications" for wage
structure revisions; second, that Respondent had, never-
theless, sought no remedy for these "problems" until a la-
bor organization's representation campaign had been un-
derway for some 3 months; third, that Respondent's
workers had not been notified of Respondent's plan to res-
tructure job classifications and wage rates until another
month had passed; fourth, that Respondent's plan had
been formally announced and implemented 2 months later,
2 weeks before a scheduled representation vote. Upon this
record, the Board found that "inferences" warranted that
Styletek's conduct had been motivated, partially at least,
by an antiunion purpose.
Herein, however, determinations have been found war-
ranted that Zale's sporting goods division vice president,
newly vested with direct "line" responsibility for
Honsport's operations, had developed concern with regard
to Respondent's warehouse wage structure, pursuant to
which presumptively "inadequate" periodic raises had
been recommended, sometime before the Union's designa-
tion card campaign began. Confronted, thereafter, with a
business situation which General Manager Baidack's prior
reglect had generated and with respect to which requested
remedial action had been inexplicably delayed, the divi-
sional vice president had reacted promptly. True, the
Union's petition had by then been filed. With a prospective
representation vote foreseeable, Respondent was, however,
required to refrain from conduct deliberately "undertaken"
with a manipulative purpose, merely: the statute does not
mandate paralysis. See N.L.R.B. v. Stvlerek, Division of
Pandel-Bradford, In,., 520 F.2d 275, 280 (Ist Cir. 1975).
Therein, the court of appeals commented that:
Merely by coming on the scene and starting to orga-
nize, a union cannot prevent management from taking
reasonable steps to run its business properly.
Respondent's management representatives, herein, pro-
ceeded to conduct required wage surveys and formulate
revised rate ranges forthwith; consciously, however, they
sought to preclude any possible inference that wage in-
creases based upon revised rate ranges had been timed de-
liberately for the purpose of maximizing their manipulative
"impingement" upo i Honsport's warehouse workers' free-
dom of choice. In this connection, Assistant General
Counsel Landa testified as follows:
Q. Now, why, during your conversation with Mr.
Gart on the 26th, did you tell Mr. Gart that you want-
ed a decision right away rather than wait?
A. I was concerned that if a decision was made to
increase the wage rates, to change the rate structure,
and it was done any later that we would be running
into an election, and it would occur just before the
election and interfere with the employees' rights ....
Q. (By Mr. Jossem) Well, put it this way: Based on
your knowledge and experience with Board proceed-
ings, what would have happened if you had told Mr.
Gart, "Take your time, Bill. Let us know when you
have decided what you're going to do about the rais-
es?"
A. The decision [on the unit and the direction of
election] could have been handed down by the Board
by the time Mr. Gart had made up his mind ....
A. It would have been grounds for an objection to
the election. It would affect-would have affected the
finality of the election one way or the other.
Q. Was that the reason why you told Mr. Gart you
wanted the decision right away?
A. Yes.
In Stvietek. this Board found-with judicial concurrence-
that the respondent firm had not satisfied its heavy "bur-
den to explain" why it had announced restructured wage
rates and job classifications, together with wage adjust-
ments based thereon, 2 weeks before a scheduled represen-
tation vote. With respect to this Board determination, the
court of appeals noted (Id. at 280) that:
Wage increases and associated benefits may be well
warranted for business reasons; still the Board is un-
der no duty to permit them to be husbanded until
right before an election and sprung on the employees
in a manner calculated to influence the employees'
choice.
However, in nmy view, Respondent's management spokes-
men herein have provided a factual justification for their
challenged "timing." with respect to pay raises, sufficiently
credible to preclude any conceivable "inference" consistent
1299
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
with General Counsel's contention that they were pursuing
questionable tactics for a statutorily proscribed motive. No
determination could reasonably be considered warranted,
upon this record, that Respondent's responsible spokesmen
had, like Styletek's management, deliberately timed sub-
stantial wage increase grants with a knowing view toward
their persuasive impact on workers who would shortly be
required to choose for or against collective-bargaining rep-
resentation.
In Montgomery Ward & Co., Inc., 220 NLRB 373 (1975),
Respondent's regional personnel manager had, sometime
before the commencement of a labor organization's cam-
paign, directed the firm's district managers to conduct area
wage surveys; to revise their current rate ranges, based
upon such surveys, so that Respondent could remain com-
petitive with respect to wages; and to grant specific raises
within such revised rate ranges, where warranted, consis-
tent with a defined chronological schedule. Revised wage
ranges for a particular retail facility had been recom-
mended; however, precise limits with respect to these rate
range revisions had not been specified. Respondent's re-
gional management had noted its concurrence, however.
with these less-than-precise recommendations. Shortly
thereafter, a labor organization had requested recognition.
When Respondent's local management representatives
subsequently granted wage increases, they proceeded, so
this Board found, without regard for certain determinative
standards which Respondent's regional personnel manager
had directed them to follow, and without regard for his
directive's chronological specifications. Several raises,
when finally granted, were presumptively greater than Re-
spondent's program had purportedly mandated, while rais-
es granted some other workers fell below supposedly com-
petitive rates for comparable work. While conceding that
Montgomery Ward's general decision to grant wage increas-
es had been reached before any labor organization's cam-
paign began and did not reflect a corporate response there-
to, the Board found that, since various raises finally
granted did reflect local management's deviations from
previously defined standards, disregard for previously de-
fined chronological limitations, and departures from previ-
ously professed criteria, their "nature" and "timing" re-
flected a response to the labor organization's campaign.
With respect to Honsport, however, comparably signifi-
cant deviations from newly revised rate ranges sufficiently
egregious to warrant a determination that such rate range
revisions were not, really, considered meaningful cannot
reasonably be found. Warehousemen Yamamoto, Ragasa.
and Richard Moratin were granted raises within their
firm's relevant rate range, correctly computed. Culkin,
though granted a rate proper payable after 3 months of
service, despite a total service record which covered a lesser
time span between his date of hire and his raise's May I
retroactive date, had, nevertheless, substantially completed
his probationary period by the time Respondent's pay-
checks which reflected the raises were distributed. Ware-
housemen Hasegawa and Leomo received raises correctly
geared to their periods of service but derived from Respon-
dent's revised warehouse clerical rate range; however, since
the record does suggest that, subsequent to May I, they
may have been "dual function" workers, performing some
clerical duties, no determination that they were being ex-
cessively compensated could reasonably be considered
warranted herein. Alvin Moratin, Jr., was granted a new
wage rate within Respondent's warehouse clerical rate
range greater than his job service record within a clerical
classification would presumably have warranted; his com-
plete plant service record within warehouse job classifica-
tions, however, would clearly have supported a rate better
than $3.75 per hour. Truckdriver Takahara, who should
have been raised forthwith to his rate range's maximum,
instead received a raise to that rate range's penultimate
step. In my view, however, none of the deviations was suf-
ficiently irregular or sufficiently serious to warrant a deter-
mination that Respondent's management had consciously
granted raises based upon substantively irrelevant, or pure-
ly personal, considerations. In short, Respondent's partial
nonconformity witl- newly defined wage increase criteria,
which Vice President Gart had approved, carries no per-
suasive implication, in my view, that statutorily proscribed
"interference" with the Union's campaign was intended,
rather than valid raises. Stated conversely, nothing within
the relevant "totality of circumstances" which surrounded
Respondent's final June 1976 retroactive raise payments
would, preponderantly, warrant a determination that such
raises had not been validly granted.
2. Respondent's treatment of Takahara's loan request
Having reached the conclusion herein set forth, I have
considered, further, whether the record with respect to As-
sistant General Counsel Landa's voluntary suggestion, that
Takahara's pending request for a credit union loan should
be given expedited consideration demonstrated Respon-
dent's statutorily proscribed motivation for various pay
raises challenged herein sufficient to warrant conclusions
consistent with General Counsel's contention. I have con-
cluded that it does not. General Counsel's presentation
with respect to Takahara's loan request, in my view, lacks
sufficient "makeweight" significance to carry the day for
General Counsel's position. I note, first, that Landa's unde-
nied telephone suggestion with regard to Takahara's loan
request has not been challenged in General Counsel's com-
plaint as separately violative of law. Further, no showing
has been made that Respondent's truckdriver was ever no-
tified with regard to Landa's voluntarily proffered recom-
mendation. Finally, nothing in the present record suggests
that Takahara himself ever drew relevant "inferences"
from his credit union loan check's relatively quick delivery.
With matters in this posture, Landa's conduct, in my view,
could hardly be considered "reasonably calculated" to
"impinge upon" Takahara's freedom of choice with respect
to collective-bargaining representation.
3. Conclusions
Essentially, this Board stands presented, upon this rec-
ord, with a situation wherein Respondent's presumptive
"purpose" or "motive" for challenged conduct must be de-
duced solely from testimonial and documentary evidence
which merely reflects substantially larger wage increases
than Honsport's warehouse workers could realistically
1300
HONOl.tI IU SPORTING GOODS CO.,. LTD.
have foreseen granted during a Board representation
proceeding's pendency. No "other unlawful conduct" suffi-
cient to provide a reliable indication with regard to Re-
spondent's motive has been charged or proven; nor has
any statutorily proscribed motive been otherwise demon-
strated. Respondent's defensive presentation, proffered to
support its contention that substantial raises were granted.
despite a representation proceeding's pendency, specifical-
ly to correct a discovered deviation from corporate wagie
and salary policy, for which Honsport's local management
had been responsible, has not been, in my view, persuasive-
ly overborne.
Years ago, Mr. Justice Frankfurter, speaking for the Su-
preme Court in N.L.R.B. v. Donnellr Garment ( 'omrlani.
330 U.S. 219. 229 (1947), commented therein., with refer-
ence to a somewhat different problem in deductive reason-
ing, that:
According to an early English judge. "The devil
himself knoweth not the mind of man," and a modern
reviewing court is not much better equipped to laN
bare unexposed mental processes.
Triers of fact for regulatory agencies certainly cannot
claim immunity from the disability described. When, as
here. Respondent's never-manifested motivation for bene-
fits conferred during a representation case's pendency
must be deduced ,o!e/l; from superficially equivocal con-
duct. a trier of fact's presumed competence to draw "infer-
ences" cannot. alone. generate the record preponderance
required to support a conclusion favoring one determina-
tion with respect to motive rather than another. The testi-
monial and documentary preponderance required, rather.
must he a demonstrable factual preponderance sufficient
to support whatever dedulcti',e inferences may be sought.
No such sufficient factual record, in my view. has been
proMded herein. General Counsel's burden of proof, there-
fore, cannot be considered satisfied; the present complaint.
I find. must be dismissed.
-laving reached this conclusion. I have not considered
Respondent's furth r contentions: that the Union has
failed persuasively t) demonstrate majority representative
status within a bargaining unit properly defined: that the
LUnion's designation card showing should, in any event, be
considered tainted, consistent with the Supreme Court's
Satair decision: and that no Gissel bargaining order, predi-
cated solely upon the course of conduct challenged herein,
would be warranted.
[Recommended Order for dismissal omitted from publi-
cation.)
1301