Interco Inc.

National Labor Relations Board - Board Decisions

Sep 8, 1986

281 N.L.R.B. 336 (N.L.R.B. 1986)

336 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
International Hat Company, a Wholly-Owned Sub-
sidiary of Interco Incorporated and Tex Barnes.
Case 14-CA-16407
8 September 1986
SUPPLEMENTAL DECISION AND
ORDER
BY CHAIRMAN DOTSON AND MEMBERS
JOHANSEN AND BABSON
On 28 March 1984 the Board issued a Decision
and Order' in this proceeding. The Board found,
inter alia , that the Respondent, a manufacturer of
hats and caps that instituted a new method of cut-
ting material at its Piedmont, Missouri plant, on 29
November 1982 violated Section 8(a)(3) and (1) of
the Act by setting the rate of pay of Tex Barnes, a
leading union adherent, at a level that substantially
decreased his earnings as a cutter.
The Respondent thereafter petitioned the United
States Court of Appeals for the Eighth Circuit to
review the Board's Decision and Order. On 4 Sep-
tember 1985 the court issued its decision,2 which
found substantial evidence "to support the Board's
initial determination that Barnes' union activities
were a motivating factor in the [Respondent's]
action" setting his new rate of pay for bulk cutting
at a level that substantially reduced his earnings
below his previous income. However, the court re-
manded the case to the Board to determine wheth-
er, under NLRB v. Transportation Management
Corp., 462 U.S. 393 (1983), that action would have
occurred in the absence of Barnes ' union activities.
On 6 January 1986 the Board accepted the
remand and the General Counsel and the Respond-
ent filed statements of position on 22 January and 7
February 1986, respectively.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has reconsidered its Decision and
Order in light of the entire record, the court's deci-
sion, and the statements of position and has, for
reasons given below, decided to affirm its conclu-
sion that the Respondent violated Section 8(a)(3)
and (1) of the Act by dealing with Barnes' pay rate
in a manner that would not have occurred if the
Respondent had not desired to punish Barnes for
his union activities.
The record shows that about 8 October 1982 the
Respondent's general manager, Richard May, in-
formed Barnes that the Respondent planned to
1 269 NLRB 539 (1984)
2 771 F 2d 1170 (8th Cir 1985)
change from cutting by the piece to bulk cutting3
and that Barnes would be paid at the "temporary"
rate of 1.9 cents per cut subject to review. Shortly
thereafter, Barnes complained to May that this rate
was too low to produce an income equal to his
previous earnings. May agreed that 1.9 cents per
cut was too low and would result in decreased
income for Barnes. In this connection, May told
Barnes that Jim McGlynn, the Respondent's cost
accountant manager, was responsible for establish-
ing this rate, and that May might have to deny his
admission concerning its inadequacy.
McGlynn testified that this 1.9-cent rate "was set
up [by him] with the idea that [Barnes] could do
just as well or better" with it. McGlynn also testi-
fied that rate was temporary and subject to review
because "we didn't know whether the rate would
achieve [the Respondent's purpose of having
Barnes] come out even . . . [or] go a little higher"
than his previous income.
As already indicated the 1.9-cent rate went into
effect on 29 November 1982 when the Respondent
commenced the bulk cutting system at its Piedmont
plant. This so-called "temporary" rate, which re-
sulted in a reduction in Barnes' earnings, was not
subsequently reviewed and was still unchanged at
the time of the hearing in June 1983. McGlynn ex-
plained that the rate had been in effect "for such a
short time" before Barnes filed an unfair labor
practice charge in January 1983 and that the Re-
spondent decided against undertaking a review
until the matter was "settled."
It is clear from General Manager May's admis-
sion that the Respondent knew some weeks in ad-
vance of implementing the 1.9-cent rate that this
rate would fall short of its avowed objective to
match or increase Barnes' previous income. The
Respondent's claim that in setting the rate at 1.9
cents it was acting in the belief that it would meet
its avowed objective is therefore not sustainable.
Further, if the rate was truly temporary, as the Re-
spondent contends, it would have reviewed Barnes'
earnings as promised to ascertain whether it was in
fact meeting its professed desire to be "fair" to
Barnes . The objective of the bulk method was, ac-
cording to the Respondent, to reduce material
waste, not labor costs. Yet the Respondent failed to
make any adjustments in the "temporary" rate de-
spite the decline in Barnes' earnings under that
rate. The initiation of the instant unfair labor prac-
tice proceeding by Barnes in January 1983 is no
justification for the Respondent's abandonment of
S According to the Respondent, the purpose of implementing the bulk
cutting method was to reduce material waste
281 NLRB No. 53
INTERNATIONAL HAT CO. 337
its plan to review and adjust the bulk cutting rate
to raise Barnes ' income to its previous level.
As peviously stated, the Court agreed with the
Board that the General Counsel made a prima facie
showing that Barnes' union activities were "a moti-
vating factor" in setting Barnes ' rate per cut at a
level that substantially decreased his earnings. In
view of the Respondent's awareness that it was set-
ting Barnes' rate at too low a level to achieve its
professed objective of maintaining his earnings and
its failure to take corrective action either before or
after its change in method , we also conclude that
the Respondent has not established that Barnes' de-
creased earnings would have occurred in the ab-
sence of his union activities . Thus, the Respondent
has failed to establish that implementation of the
bulk cutting method itself, rather than the rate se-
lected and maintained by the Respondent , precipi-
tated Barnes ' decreased earnings.
Accordingly, we adhere to the Order previously
entered in this case.
ORDER
The National Labor Relations Board affirms the
Order entered on, 28 March 1984 in its Decision
and Order, 269 NLRB 539.