Howard Industries, Inc.

National Labor Relations Board - Board Decisions

Dec 21, 2016

365 NLRB No. 4 (N.L.R.B. 2016)

365 NLRB No. 4
NOTICE: This opinion is subject to formal revision before publication in the
bound volumes of NLRB decisions. Readers are requested to notify the Ex-
ecutive Secretary, National Labor Relations Board, Washington, D.C.
20570, of any typographical or other formal errors so that corrections can
be included in the bound volumes.
Howard Industries, Inc. and International Brother-
hood of Electrical Workers, Local 1317. Case
15–CA–164449
December 21, 2016
DECISION AND ORDER
BY CHAIRMAN PEARCE AND MEMBERS MISCIMARRA
AND MCFERRAN
On September 2, 2016, Administrative Law Judge
Geoffrey Carter issued the attached decision. The Union
filed exceptions and a supporting brief and the Respond-
ent filed an answering brief. The General Counsel filed
an “Answer in Support of Union’s Exceptions.”
The National Labor Relations Board has considered
the decision and the stipulated record in light of the ex-
ceptions and briefs and has decided to affirm the judge’s
rulings, findings, and conclusions and to adopt the rec-
ommended Order.
ORDER
The recommended Order of the administrative law
judge is adopted and the complaint is dismissed.
Dated, Washington, D.C. December 21, 2016
______________________________________
Mark Gaston Pearce, Chairman
______________________________________
Philip A. Miscimarra, Member
______________________________________
Lauren McFerran, Member
(SEAL) NATIONAL LABOR RELATIONS BOARD
The Board’s decision can be found at
www.nlrb.gov/case/15-CA-164449 or by using the QR code
below. Alternatively, you can obtain a copy of the decision
from the Executive Secretary, National Labor Relations
Board, 1015 Half Street, S.E., Washington, D.C. 20570, or
by calling (202) 273–1940.
Matthew Dougherty, Esq., for the General Counsel.
Roger Doolittle, Esq., for the Charging Party.
Elmer E. White, III, Esq., for the Respondent.
DECISION
GEOFFREY CARTER, Administrative Law Judge. The General
Counsel asserted in this case that Howard Industries, Inc. (Re-
spondent) ran afoul of Section 8(a)(5) and (1) of the National
Labor Relations Act (the Act) by unilaterally changing its poli-
cy regarding gifts to employees (including hams during the
Christmas season) without first notifying the International
Brotherhood of Electrical Workers, Local 1317 (the Union) and
giving the Union an opportunity to bargain about the policy
change. As explained below, I find that Respondent did not
violate the Act because Respondent implemented the policy
change after following the procedure set forth in the collective-
bargaining agreement regarding proposing, negotiating and
implementing new or modified policies. Accordingly, I rec-
ommend that the complaint be dismissed.
STATEMENT OF THE CASE
This case was submitted to me via joint motion, dated July 5,
2016, to have the case decided based on an agreed stipulation
of facts and exhibits. I granted the parties’ joint motion, and I
also granted the General Counsel’s unopposed July 6, 2016
motion to supplement the record with formal papers (including,
but not limited to, the complaint, answer, and various unfair
labor practice charges).
The Union filed the charge in this case on November 18,
2015, and amended that charge through filings on January 5,
February 25, March 1 and 29, and July 1, 2016. In a complaint
that the General Counsel issued on March 30, 2016, the Gen-
eral Counsel alleged that Respondent violated Section 8(a)(5)
and (1) of the Act by, on or about November 19, 2015, unilater-
ally changing its policy regarding which employees would
receive hams from Respondent during the Christmas season,
without first notifying the Union and giving the Union an op-
portunity to bargain about the policy change.1 Respondent filed
a timely answer denying the alleged violations in the complaint.
On the entire record, and after considering the briefs filed by
the General Counsel and Respondent, I make the following

1 The General Counsel also alleged that Respondent violated Sec.
8(a)(5) and (1) of the Act by unreasonably delaying in responding to an
information request that the Union submitted on December 3, 2015.
The General Counsel withdrew that complaint allegation on or about
July 1, 2016.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD2
FINDINGS OF FACT2
I. JURISDICTION
Respondent, a corporation with an office and place of busi-
ness in Laurel, Mississippi, engages in the manufacture and
nonretail sale of electrical transformers. On an annual basis,
Respondent sells and ships from its Laurel, Mississippi facility
goods that are valued in excess of $50,000 and go directly to
locations outside the State of Mississippi. Respondent admits,
and I find, that Respondent is an employer engaged in com-
merce within the meaning of Section 2(2), (6), and (7) of the
Act. Respondent also admits, and I find, that the Union is a
labor organization within the meaning of Section 2(5) of the
Act.
II. ALLEGED UNFAIR LABOR PRACTICES
A. Collective-Bargaining History
Since about 1970, Respondent has recognized the Union as
the exclusive collective-bargaining representative of the follow-
ing appropriate bargaining unit:
All full time and regular part-time production and mainte-
nance employees (excluding all other employees, guards, and
supervisors as defined by the Act).
That recognition has been embodied in a number of successive
collective-bargaining agreements, the most recent of which is
effective from October 5, 2015, to October 4, 2018. (GC Exhs.
1(k) (par. 7), 1(m) (par. 7).)
B. Collective-Bargaining Agreement Language Concerning
Creating or Changing Workplace Policies and/or Job
Performance Standards
Section 1 of article XXI of the collective-bargaining agree-
ment sets forth a procedure that applies when Respondent
wishes to change an existing policy, create a new policy, or
modify job performance standards. Section 1 of article XXI
states, in pertinent part, as follows:
The parties acknowledge that during the negotiations which
resulted in this Agreement, each had the unlimited right to
make demands and proposals with respect to any subject or
matter not removed by law from the area of collective bar-
gaining. Except as provided below, they therefore each vol-
untarily and unqualifiedly waive the right for the life of this
Agreement to bargain collectively with respect to any matter
referred to or covered in this Agreement or with respect to any
subject or matter not specifically referred to or covered by this
Agreement.
However, if the Company wishes to change an existing poli-
cy, create a new policy, or modify job performance standards
that affect the bargaining unit, advance written notice will be
provided to the Union via email. If the Union wishes to nego-
tiate over the changes, it will notify the Company in writing

2 Although I have included several citations in this decision to high-
light particular portions of the evidentiary record, I emphasize that my
findings and conclusions are not based solely on those specific cita-
tions, but rather are based on my review and consideration of the entire
record for this case.
within ten (10) calendar days of receipt of the notification. If
the Union does not serve written notification of a desire to ne-
gotiate over the policy or policy change, the Company may
implement the change and the Union waives any arbitration or
other legal remedies concerning the creation or modification
of the policy.
If timely notification of a desire to bargain is provided by the
Union, negotiations shall commence within (10) calendar
days and be completed no later than seven (7) calendar days
after the first negotiating session unless both parties agree to
extend the deadline for negotiations. If the parties fail to
reach agreement by the end of the time period set above, the
Company may implement the new policy or policy change. If
the Company exercises its right to implement the new policy
or policy change, the Union will have the right to grieve the
reasonableness of the policy under the grievance procedure.
(Jt. Exh. D (emphasis in original; paragraph spacing added); see
also Jt. Stipulation of Facts (par. 9).)
C. The December 13, 2006 Christmas Gifts Policy
From December 2006, to November 2015, Respondent main-
tained and followed a “Christmas Gifts” policy that was issued
on December 13, 2006, and stated as follows:
Policy: Issuance of Christmas gifts by the company to
employees and retired employees of [Re-
spondent]
Purpose: To [ensure] uniform treatment to all full-time
employees of [Respondent]
Procedure: A committee handles Christmas gifts of hams
or [whatever] their choice might be at Christ-
mas time. They may also contribute cash gifts
to employees who have experienced cata-
strophic occurrences, as the committee deems
necessary.
Retired employees with 10 or more years of
service who voluntarily retire from [Respond-
ent] may be eligible for a Christmas gift of a
ham if the [C]ompany deems so on a year to
year basis. This is a gift from the Company
and does not imply any obligation by the
Company to be continued.
(Jt. Exh. A; see also Jt. Stipulation of Facts (par. 1) (noting that
the December 13, 2006, Christmas Gifts policy updated an
earlier policy from July 1, 2003, which is included in the record
as Jt. Exh. F).)
Up to November 2015, all of Respondent’s employees, in-
cluding employees who were out on medical leave or workers’
compensation, were eligible to receive certificates from Re-
spondent for turkeys at Thanksgiving and hams at Christmas.3
The president of the Union was also eligible to receive certifi-

3 Some of the money that Respondent used to purchase the certifi-
cates came from payments that Respondent received from vendors who
placed vending machines at Respondent’s facility that employees used
to buy snacks and sodas. (Jt. Stipulation of Facts (pars. 2–3).)
HOWARD INDUSTRIES, INC. 3
cates from Respondent for a Thanksgiving turkey and a
Christmas ham, even though the president of the Union was not
eligible for the benefits that Respondent provided to employees.
The Thanksgiving turkeys and Christmas hams were the only
gifts that Respondent provided to employees on an annual ba-
sis. (Jt. Stipulation of Facts (pars. 3–5).)
D. Respondent’s November 6, 2015 email to the Union
On November 6, 2015, Respondent’s human resources man-
ager Loren Koski sent an email to Union president Clarence
Larkin. The November 6 email stated as follows:
Subject: 2015-11-2 Company Gifts to Employees
[Message]: This redrafted policy is being provided to you
pursuant to Article XXI Section 1 of the CBA.
(Jt. Exh. B1; see also Jt. Stipulation of Facts (par. 6).)
Koski’s November 6 email included an attached copy of the
“Company Gifts to Employees” policy that was dated Novem-
ber 2, 2015, and erroneously stated that it superseded a policy
dated December 17, 2014 (the parties stipulate that Respondent
did not have a policy that was issued on December 17, 2014).
(Jt. Stipulation of Facts (par. 6.); see also Jt. Exh. C.) Re-
spondent’s proposed Company Gifts to Employees policy stat-
ed as follows:
Policy: Issuance of gifts by the Company to active
employees and certain retired employees of
[Respondent]
Procedure: A Company committee may determine to
give gifts to active employees at certain
times of the year.
Each year the committee will determine the
tenure required to receive a gift from the
Company if a gift is given.
The Company will distribute the gift of its
choice to all active employees that have
performed work within the month of the
gift distribution that also meet the tenure
requirement.
Employees away from work on Military
Assignments are eligible for the gift even if
they have been away from the company for
the month of the gift distribution, but it is
their responsibility to have their family
contact the [C]ompany during the gift giv-
ing period.
Retired employees with 10 or more years of
service who voluntarily retire from [Re-
spondent] may be eligible for a gift if the
[C]ompany chooses to provide gifts.
The committee may also contribute cash
gifts to active employees who have experi-
enced catastrophic occurrences on a case by
case basis, as the committee deems neces-
sary.
This is a gift from the Company and does
not imply any obligation by the Company
to be continued.
(Jt. Exh. C.)
On November 6, the Union received Respondent’s Novem-
ber 6 email and the attached, proposed Company Gifts to Em-
ployees policy. The Union did not respond to the November 6
email or request to bargain over the proposed Company Gifts to
Employees policy within ten calendar days of receiving the
email and policy. The Union also did not seek clarification of
what Respondent considered to be “gifts to employees” until
after November 16, 2015. (Jt. Stipulation of Facts (pars. 6–7).)
E. November 17, 2015—Respondent Implements its Company
Gifts to Employees Policy
On November 17, 2015, Respondent implemented the Com-
pany Gifts to Employees policy. The policy was identical to
the proposed policy that Respondent emailed to the Union on
November 6, except that the heading to the policy: stated that
the policy was issued on November 17, 2015; and clarified that
the policy superseded the policy dated December 13, 2006 (i.e.,
the Christmas Gifts policy).4 (Jt. Stipulation of Facts (par. 8);
Jt. Exhs. E, H.)
On November 19, 2015, the Union learned from employees
who were out on workers’ compensation that Respondent had
implemented its Company Gifts to Employees policy and that,
as a result, certain employees were no longer eligible for certif-
icates for Thanksgiving turkeys and Christmas hams. That
same day, Larkin emailed Koski to request that Respondent
bargain over the policy change. (Jt. Stipulation of Facts (pars.
10, 12); Jt. Exh. B2; see also Jt. Exh. H (describing some of the
eligibility rules for Thanksgiving turkeys and Christmas hams
under the new policy).)
On or about December 1, 2015, Koski asserted that Re-
spondent implemented the Company Gifts to Employees policy
after the Union did not request bargaining within ten days of
receiving the proposed policy on November 6. (Jt. Stipulation
of Facts (par. 15); Jt. Exh. B6.)
Applicable Legal Standards
“Under the unilateral change doctrine, an employer’s duty to
bargain under the Act includes the obligation to refrain from
changing its employees’ terms and conditions of employment
without first bargaining to impasse with the employees’ collec-
tive-bargaining representative concerning the contemplated
changes.” Lawrence Livermore National Security, LLC, 357
NLRB 203, 205 (2011). The Act prohibits employers from
taking unilateral action regarding mandatory subjects of bar-
gaining such as rates of pay, wages, hours of employment and
other conditions of employment. Garden Grove Hospital &
Medical Center, 357 NLRB 653, 653 fn. 4, 657 (2011). Nota-
bly, an employer’s regular and longstanding practices that are

4 Respondent sent a copy of the November 17, 2015 Company Gifts
to Employees policy to the Union on November 30, 2015. (Jt. Stipula-
tion of Facts (par. 14); Jt. Exh. B5.)
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD4
neither random nor intermittent become terms and conditions of
employment even if those practices are not required by a col-
lective-bargaining agreement. Id; see also Palm Beach Metro
Transportation, LLC, 357 NLRB 180, 183 (2011) (noting that
the party asserting the existence of a past practice bears the
burden of proof on the issue, and that the evidence must show
that the practice occurred with such regularity and frequency
that employees could reasonably expect the practice to continue
or reoccur on a regular and consistent basis), enfd. 459 Fed.
Appx. 874 (11th Cir. 2012).
Although an employer and the representative of its employ-
ees have a mandatory duty to bargain with each other in good
faith about wages, hours, and other terms and conditions of
employment, the Board has explained that employers do not
have to bargain about gifts that they give to their employees.
North American Pipe Corp., 347 NLRB 836, 837 (2006), peti-
tion for review denied 546 F.3d 239 (2d Cir. 2008). Items
“given to all employees regardless of their work performance,
earnings, seniority, production, or other employment-related
factors” are properly characterized as gifts. Benchmark Indus-
tries, 270 NLRB 22, 22 (1984). Conversely, items that are “so
tied to the remuneration which employees receive for their
work that [the items] are in fact a part of the remuneration” are
properly characterized as wages and are subject to the mandato-
ry duty to bargain. A sufficient relationship to remuneration
may exist if the payment (i.e., the alleged gift) is tied to various
employment-related factors such as work performance, wages,
regularity of the payment, hours worked, seniority and produc-
tion. North American Pipe Corp., 347 NLRB at 837.
Under the clear and unmistakable waiver standard, bargain-
ing partners may “unequivocally and specifically express their
mutual intention to permit unilateral employer action with re-
spect to a particular employment term, notwithstanding the
statutory duty to bargain that would otherwise apply.” Provena
St. Joseph Medical Center, 350 NLRB 808, 810 (2007).
Discussion and Analysis
Did Respondent Violate Section 8(a)(5) and (1) of the Act when
it Implemented its Company Gifts to Employees policy on
November 17, 2015?
1. Complaint allegation
The General Counsel’s sole remaining allegation in the com-
plaint is that Respondent violated Section 8(a)(5) and (1) of the
Act by, on or about November 19, 2015, unilaterally changing
its policy regarding which employees would receive hams from
Respondent during the Christmas season, without first notifying
the Union and giving the Union an opportunity to bargain about
the policy change.
2. Analysis
In a case where the General Counsel alleges that an employ-
er has made unlawful unilateral changes to the terms and condi-
tions of employment, Board precedent would normally require
an analysis of issues such as whether the employer made a uni-
lateral change regarding a mandatory subject of bargaining, and
if so, whether the union clearly and unmistakably waived its
right to bargain.
This case is different, primarily because in Section 1 of arti-
cle XXI of the collective-bargaining agreement, the parties
created and agreed to a specific procedure that applies when
Respondent wishes to change an existing policy, create a new
policy, or modify job performance standards. Specifically,
when Respondent wishes to take such action, Respondent must
give the Union advance written notice (by email) of the chang-
es. Upon receipt of such notice, the Union has ten calendar
days to notify Respondent in writing that it (the Union) wishes
to negotiate over the proposed changes. If the Union does not
provide such notice of its wish to negotiate, then Respondent
may implement the changes and the Union waives any arbitra-
tion or other legal remedies concerning the creation or modifi-
cation of the policy. (Findings of Fact (FOF), Section II(B).)
Notably, the General Counsel does not contend that this portion
of the collective-bargaining agreement, or the waiver contained
therein (when applicable), is invalid. Cf. Baptist Hospital of
East Tennessee, 351 NLRB 71, 72 (2003) (finding that the
employer was entitled to unilaterally implement a change in
scheduling holiday shift work because the plain language of the
contract privileged the change that the employer made, and
because the union clearly and unmistakably waived bargaining
over the issue).
The issue in this case, then, is whether Respondent’s deci-
sion to implement its Company Gifts to Employees policy on
November 17, 2015, is protected by the collective-bargaining
agreement.5 I agree with Respondent that it is. There is no
dispute that on November 6, the Union received an email from
Respondent in which Respondent explicitly stated that it was
providing the “redrafted” Company Gifts to Employees policy
to the Union pursuant to section 1 of article XXI of the collec-
tive-bargaining agreement. That communication alone put the
Union on notice that Respondent was proposing a new or re-
vised policy, and that the Union had ten calendar days to notify
Respondent in writing that it wished to negotiate about the
policy. Moreover, the Union also received (as an attachment to

5 In their posttrial briefs, the General Counsel and, to a lesser extent,
Respondent raised the threshold question of whether Respondent need-
ed to bargain at all over gifts that it provided to employees. (See GC
Posttrial Br. at 2–4; R. Posttrial Br. at 8.) As an initial thought on that
point, I note that it was Respondent who attempted to initiate bargain-
ing over its Company Gifts to Employees policy by invoking sec. 1 of
art. XXI of the collective-bargaining agreement. Thus, to the extent
that Respondent now asserts that it did not need to bargain at all about
the policy (based on the theory that the policy related to gifts), Re-
spondent asserts a position that is contrary to how it handled the matter
in the first instance. In addition, the Company Gifts to Employees
policy explicitly states that, apart from a few exceptions, Respondent
“will distribute the gift of its choice to all active employees that have
performed work within the month of the gift distribution that also meet
[a] tenure requirement.” (FOF, Sec. II(D).) Those employment-related
prerequisites to receiving gifts such as Christmas hams arguably estab-
lish that the Christmas hams are a part of the remuneration that em-
ployees receive for their work, and thus are subject to the mandatory
duty to bargain. Compare Benchmark Industries, 270 NLRB at 22
(finding that Christmas hams and dinners that the employer gave to
employees were properly characterized as gifts because the employer
gave them regardless of employees’ work performance, earnings, sen-
iority, production or other employment-related factors). Ultimately, I
need not rule definitively on this issue because I find that Respondent
prevails in this case on other grounds.
HOWARD INDUSTRIES, INC. 5
the November 6 email) a copy of Respondent’s proposed Com-
pany Gifts to Employees policy, and thus had notice of the
nature and content of Respondent’s proposal.
To be sure, the proposed Company Gifts to Employees poli-
cy that Respondent sent to the Union on November 6 incorrect-
ly stated that it superseded a policy dated December 17, 2014 (a
date that does not correspond to any existing policies). I disa-
gree, however, with the General Counsel’s argument that the
incorrect date of the old policy invalidates Respondent’s No-
vember 6 notice to the Union. Even with the incorrect date of
the old policy, the Union was still on notice that Respondent
was seeking to change its gift policy under the procedures set
forth in the collective-bargaining agreement. To the extent that
the incorrect date of the old policy prompted questions, that
should have provided the Union with even more reason to noti-
fy Respondent that it wished to negotiate. The Union, however,
did not do so within the 10-day notification period specified in
the collective-bargaining agreement. Thus, once the 10 day
notification period passed, the terms of the collective-
bargaining agreement permitted Respondent to implement the
Company Gifts to Employees policy, and also established that
the Union waived arbitration and any other legal remedies con-
cerning the creation or modification of the policy.6

6 The General Counsel also argued that Respondent did not provide
adequate notice of its proposed policy change because Respondent’s
Company Gifts to Employees policy did not explicitly state that it was
related to distributing hams to employees at Christmas. (GC Posttrial
Br. at 5.) I find that the lack of explicit language about Christmas hams
does not undermine the validity of Respondent’s November 6 email to
the Union to propose the Company Gifts to Employees policy. To the
contrary, sec. 1 of art. XXI of the collective-bargaining agreement
allows Respondent to propose modifications to existing policies and
also to propose entirely new policies. (FOF, sec. II(B).) Thus, even if
In sum, I find that Respondent lawfully implemented its
Company Gifts to Employees policy on November 17, 2015,
after complying with the notice and bargaining requirements
that the parties agreed to in section 1 of article XXI of the col-
lective-bargaining agreement. Accordingly, I do not find that
Respondent violated Section 8(a)(5) and (1) of the Act as al-
leged in the complaint, and I recommend that the complaint be
dismissed.
CONCLUSIONS OF LAW
The General Counsel failed to prove that Respondent violat-
ed Section 8(a)(5) and (1) of the Act by, on November 17,
2015, unilaterally changing its policy regarding which employ-
ees would receive hams from Respondent during the Christmas
season, without first notifying the Union and giving the Union
an opportunity to bargain about the policy change.
On these findings of fact and conclusions of law and on the
entire record, I issue the following recommended7
ORDER
The complaint is dismissed.
Dated, Washington, D.C. September 2, 2016

Respondent’s proposed Company Gifts to Employees policy contained
new, broader or different language from the December 2006 policy
concerning Christmas gifts/hams, Respondent’s proposal was still
covered and protected by the procedure that the parties agreed to for
creating or changing company policies.
7 If no exceptions are filed as provided by Sec. 102.46 of the Board’s
Rules and Regulations, the findings, conclusions, and recommended
Order shall, as provided in Sec. 102.48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses.