Irwin & Lyons

National Labor Relations Board - Board Decisions

Apr 9, 1942

40 N.L.R.B. 346 (N.L.R.B. 1942)

I
In the Matter of MILL B, INC., DIVISION OF IRWIN & LYONS, PARTNERS,
DOING BUSINESS UNDER THE ASSUMED NAME OF IRWIN & LYONS and
INTERNATIONAL WOODWORKERS OF AMERICA, LOCAL 116, C. I. O.
Case No. R-3208.Decided April 9, 194
Jurisdiction : lumber products.manufacturing industry.
Practice and Procedure : petition -dismissed where rival union requested recog-
nition after renewal date but prior to expiration date, and contract as
renewed is held to constitute a bar to a determination of representation.
Mr. H. W. Irwin, of North Bend, Oreg., for the Company.
Cllr. Ben Anderson, of Portland, Oreg., and Mr. Richard Law, of
Marshfield, Oreg., for the I. W. A.
Mr. William E. Walsh and Mr. J. W. Mclnturuff, of Marshfield,
Oreg., for Local 2573.
Mr. Marvin C. Vahl, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
On September 16, 1941, International Woodworkers of America,
Local 116, C. I. 0., herein called the I. W. A., filed with the Regional
Director-for the Nineteenth Region (Seattle, Washington) a petition
alleging that a question affecting commerce had arisen concerning
the representation of employees of Mil] B, Inc., division of Irwin
& Lyons, partners, doing business under the assumed name of Irwin
& Lyons, North ' Bend, Oregon, herein called the Company,' and
requesting an investigation and certification of representatives pur-
suant to Section 9 (c) of the National Labor Relations Act, 49 Stat.
449, herein called the Act. On October 6, 1941, the National Labor
Relations Board, herein called the Board, acting pursuant to Section
9 (c) of the Act and Article III, Section 3, of National Labor Rela-
tions Board Rules and Regulations-Series 2, as amended, ordered
'By motion granted at the hearing , the name of the Company was amended to read as
appears herein.
40 N. L. R B., No. 57.
346 -
M1LL B, INC. - 347
an investigation -and authorized the Regional Director to conduct it
and to provide for an appropriate hearing upon due'notice.
On October '11, 1941; the Regional Director issued a notice of
hearing, copies of which were duly served upon the Company, the
I. W. A., and Lumber and Sawmill Workers Union, Local 2573,
A. F. of L., herein called Local 2573, a labor organization claiming
to represent employees directly affected by the investigation. Pur-
suant to notice, a hearing -was held on October 22 and 23, 1941,
at Marshfield, Oregon; before Harry George, the Trial Examiner
duly designated by the Chief Trial Examiner. The Company, the
I. W. A., and Local 2573 were represented by counsel and partici-
pated in the hearing. Full opportunity to be heard, to examine and
cross-examine witnesses, and to introduce evidence bearing on the
issues was afforded all parties. During the course of the hearing
.the-Trial Examiner made various rulings on motions and on objec-
tions to the admission of evidence. The Board has reviewed the
rulings of the Trial Examiner and finds that no prejudicial errors
were committed: The rulings are hereby affirmed. On October 29
and November 7, 1941, the I. W. A. and Local 2573, respectively,
filed a brief which the Board' has considered.
Upon the entire record in the case, the Board makes the following:
FINDINGS OF FACT
I. THE BUSINESS OF THE COMPANY
Mill B, Inc., is an Oregon corporation, presently operated as a
division of Irwin & Lyons, a copartnership, doing business under -
the assumed name of Irwin & Lyons. Its plant and principal office
is located in North Bend, Oregon, where it is engaged in purchasing
logs and manufacturing them,into finished lumber products. The
logs are obtained from lumber camps within the State of Oregon.
The Company produces approximately 100,000,000 board feet an-
nually and its gross receipts from sales amount to approximately
$1,800,000. Of this amount, 90 percent represents receipts from sales
to customers situated outside the State of Oregon. The Company
admits that it is engaged 'in commerce within the meaning of the
Act.
H. THE ORGANIZATIONS INVOLVED
International Woodworkers of America, Local 116, is a labor or-
ganization affiliated with the Congress of Industrial Organizations,
admitting to membership employees of the Company. -
Lumber and Sawmill Workers Union, Local 2573, is a labor organ-
ization affiliated with the American Federation of Labor, admitting
to membership employees of the Company.,
348 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
III. THE QUESTION CONCERNING REPRESENTATION
On September 10, 1939, following the certification of Local 2573
by the Board,2 the Company and Local 2573 entered into a collec-
tive bargaining agreement.3 Besides providing for a "union" shop,4
the agreement contained the' following provision :
This agreement is for one year. When either party to this agree-
ment desires to modify, add to or terminate the agreement, he
shall give written notice to the other party at least sixty days in
advance of such termination. . . . If neither party sixty days
prior to expiration requests in writing changes or termination,
this agreement to continue from year to year.
Neither of the contracting parties gave notice of termination in
1940 or 1941.
On August 22, 1941, the I. W. A. advised the Company by letter
that it represented a majority of the Company's employees and ex-
pressed a desire to enter into a collective bargaining agreement with
the Company. On August 25, 1941, the Company refused 16-enter
into negotiations with the I. W. A. because of the existence of its
agreement with Local 2573. The petition herein, as above noted,
was filed by the I. W. A. on September 16, 1941.
The Company and Local 2573 contend that their agreement runs
from year to year from the date of its execution unless terminated
by either party on sixty days' written notice prior to the expiration
date (e. g., September 10) of any yearly period. They urge that
the I. W. A.'s petition should be dismissed, as it was filed after the
agreement had automatically renewed itself on July 11, 1941.15 The
I. W. A. contends that under the above-quoted provision, the agree-
ment between the Company and- Local 2573 may be terminated by
2 See Matter of Mill It, Inc and Limber and Sawmill IVoless' Vnron, Local No. 2573, 13
N. L R B. 613 The I IV A and Local 2573 participated in the election which the Boaid
directed ( see Mattes of Mill B, Inc . and Lumber and Satonirll TVo•kess Union Local No
2573, 12 N L R B 1317) The results indicated that 172 ballots were cast, of which 110
were for Local 2573 and 62 for the I W A
3 The record shows that at the time of the hearing, Dull B, Inc, with whom Local 2573
.entered the agreement, was undergoing reorganization pursuant to Section 77B of the
Bankruptcy Act, and was,being operated by Inwun & Lyons When Irwin & Lyons coin-
menced operations, it advised Local 2573 that it assumed and accepted the terms of the
agreement
Article XV' of the agi cement reads in pai t
In the event that any employee fails to niainLun continuous membership in rood
standing or make application to join the Union [ Local 2573] as herein prodded,
on after making application is rejected by the Union, shall be discharged [sicl,by
the Employ-ei within a reasonable time upon written notice fioni the Union
It is undisputed that notice of intention to terminate the agreement was 'not given
by either the Company or Local 2573.
MILL B, INC. 349
either party at any time on sixty days' notice in writing, and that,
therefore, the contract is no bar to this proceeding.'
We do not believe that the parties intended, or that the agreement
provides, that it can be terminated at any time on sixty days' notice.
The provision quoted above states that the agreement will be renewed
from year to year unless terminated at least sixty days in advance
of its "expiration" which, under the terms of the agreement, occurs
on September 10 of each year.
Since the employees had neither given notice of any intention to
discontinue the contract nor to designate other representatives prior
to August 22, 1941, the date the I. W. A. gave notice of its claim
of representation, it is apparent that under the terms of the contract
the condition precedent for discontinuance had not been fulfilled. In
other words, the automatic renewal clause in the contract had taken
effect, even though the new year had not actually begun. The
Board, therefore, is squarely presented with the question of whether
or not a contract which by its terms was validly renewed on July 11,
1941, should be deemed a bar to a direction of election on the
assumption that the majority of employees in the unit covered by
the contract have subsequently designated other bargaining repre-
sentatives.
We are thus confronted with the problem of weighing and resolv-
ing the conflicting interests in maintaining the stability of relation-
ships previously established by collective bargaining contracts as
opposed to the right of the majority of employees. to change their
collective bargaining representative at any particular time.
The statute contains few guides to the solution of this problem.
Although it has been contended that Section 9 (c) confers upon
employees an unlimited right to have the organization selected by
the majority exercise exclusive bargaining powers, the Board has
generally held that the statutory recognition of collective agree-
ments under the proviso to Section 8 (3) of the Act must be deemed
a limitation upon the continual exercise of this right.
The Board has frequently refused to proceed to a new determina-
tion of representatives where the petitioning union presented its
claim to majority representation after the new term of a contract,
automatically renewed for another year, has commenced to run.7
° The I . W. A. also contends that inasmuch as the provisions of the agreement governing
the selection of an employer 's committee and a plant committee for the settlement of
grievances was never followed and modifications of the agreement were made without
giving the required sixty days ' written notice , the contract is, in effect , non-existent. It is
sufficient to note that parties to an agreement have the right to agree to, or acquiesce in, a
modification or alteration of some or all of its terms without , thereby, abandoning the
agreement.
7 See Matter of Detroit £ Cleveland Nazvigation Company and National Organization of
Masters, Mates and Pilots of America, A. F. of L., and Great Lakes Officers Association
(C. 1. 0.), 29 N. L. R. B. 176.
350 DECISIONS 'OF NATIONAL LABOR RELATIONS BOARD
Thus the Board considered that the practice and procedure of col-,
lective bargaining, which the Act was designed to encourage, would
best be effectuated if the contract was permitted to stand as a bar for
the remainder of its new term. In the recent Owens-Illinois case,
the Board refused to proceed to a new determination of representa-
tives after a contract, executed for a period of two years, had al-
ready run beyond the term of one year.8 Under the circumstances,
of that case the Board concluded that an agreement for a term of
two years was not an-unreasonable result of the collective bargaining
process. A fortiori, it would seem that' a contract for a term of one
year which, by virtue of an automatic renewal clause becomes a con-
tract for two years, should be given the same effect. Indeed in those
cases in which the Board found that the operation of a renewal clause
did not constitute a bar to an investigation and determination of
representatives, the Board specifically took cognizance of the fact
that the petitioning union asserted, its claim prior to the last day of
the period during which the renewal clause was subject to defeasance
by option of either party to the contract.'
It is a wide-spread practice for employers and unions to execute
collective agreements which run from year to year, subject to defea-
sance upon sixty or thirty days' notice by either party. These contracts,
contemplate that the party seeking a modification or amendment must
give notice prior to the beginning of the automatic renewal date,
thereby leaving a period of one or two months for negotiating the
terms of the new agreement. Such thirty- or sixty-day periods are
not unduly long for collective bargaining conferences and tend to
promote stability of employer-employee relationships by avoiding a
hiatus between contracts. It has never been doubted that such agree-
ments are in harmony with the policy of the Act.
'Competing unions have apparently recognized that such auto-
matic renewal clauses are recognized as binding according to trade
union custom and therefore generally make their counter-claims prior
to the notice period of the contract. The precise situation present in
the instant case has arisen only once before during the six-year history
of the Board. It is clear, therefore, that giving effect to such condi-
tions in a collective agreement would not, as the dissenting opinion
8 Matter of Owens-Illinois Pacific Coast Co. and International Longshoremen's Union,
Local 6, C. 1. 0 , 36 N. L. R. B. 990
See Matter of Showers Brothers Company, Inc . and National Furniture Workers Local
No. 1, etc, 13 N. L. R B 829; Matter of Heldman -Sehild-Lesser, Inc. and Cincinnati Joint
Board of the Amalgamated Clothing Workers of America (C. 1. 0 ), 11 N. L. R B 1289;
Colonic Fibre Company, Inc. and Cohoes Knit Goods Workers Union No. 21514, A F. of L.,
9 N. L. R. B. 658. Cf Matter of The American Oak Leather Company, 1401 Dalton St,
Cincinnati, Ohio and The International Fur & Leather Workers Union, Local 214, affiliated
with the Congress of Industrial Organizations, 31 N L. R. B 1155, cited in the
dissenting opinion. Our decision in that case is herein overruled to the extent that it is
inconsistent with our opinion in the instant case.
MILL B, INC. 351
implies,-.impose- an undue hardship upon a union not a party to the
contract.
Here the I. W. A. did not give notice of its claim to majority repre-
sentation until August 1941, six weeks after the contract had been
automatically renewed. , Moreover, a majority of the designations
submitted by the I. W. A. to the Regional Director bear dates later
than July 11, 1941, the renewal date, while the remainder of the cards
are undated. 10 ;Consequently, the contract was automatically renewed
at a time when Local 2573 was, beyond challenge, the duly designated
representative of the Company's employees. To hold that such a
contract should bar an election at the present time' does not,- as the
dissenting opinion suggests, apply to representation disputes a legal
concept borrowed from- the field of commercial law. Rather it- is
to insure the industrial stability achieved through a valid collective
bargaining agreement, and to apply the same criteria of judgment to
comparable situations in order that both employers and labor organ-
izations may know with some degree of certainty the considerations
under which the administrative machinery of the Act properly may
be invoked.
Nor do we believe that our ruling "places a premium on inaction
while penalizing unions which seek necessary changes in an agree-
ment." There is no more warrant for assuming that a labor organiza-
tion has become inert because it does not seek changes in an agreement
than for concluding that the existing contract is satisfactory. The
safeguard against the perpetuation of a bargaining representative
through inertia, which the dissent visualizes, lies in the power of the
employee to give notice of a claim to a new bargaining agent within
the time limited by the contract. It must always be remembered that
labor organizations are merely the agent of the employees in an appro-
priate unit. We do not go so far as to hold that only the union
which is a party to the contract can- give notice of an intent to
terminate it prior 'to the operation of the renewal clause. The em-
ployees can achieve the same result themselves by signifying an intent
to designate new representatives, either by direct word to the em-
ployer 11 or by filing a petition with the Board.12 See the dissenting
10 The Field Examiner's statement showed . that the I. W. A. possessed 183 signed mem-
bership application cards, 171 of which represented persons appearing on the Company's
September 15, 1941, pay roll ; 122 cards were dated in August and September -1941,- and
62 were undated. All signatures appeared to be genuine At the date of the hearing, there
were approximately 285 persons in the unit which the I W. A. claimed to be appropriate.
ii See Matter of General Motors Corporation, Chevrolet Motor Division, Norwood Plant
and United Automobile Workers of America, affiliated with the C I 0, 33 N L R. B. 41;
Matter of Standard Cap & Seal Company and Lodge ' 304, International Association of
Machinists, 10 N L R. B 466 '
12 See Matter of Colonic Fibre Company , Inc. and Coh;oes Knit Goods Workers Union No.
21514, A. F. of L, 9 N. L. R B. 658, supra.
352 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
opinion in Triboro Coach Corporation, et al. v. State Labor Relations
Board, et al., 286 N. Y. 314, 36 N. E. (2d) 315 (1941).
Accordingly, we are of the opinion that the contract constitutes a
bar to an investigation and certification of representatives at this- time,
and, consequently, the petition' of the I. W. A. shall be dismissed.
This dismissal, however, shall not prejudice the right of the petitioning
union to file a new petition at a reasonable time before July 11, 1942.
Upon the basis of the above findings of fact and upon the entire
record in the case, the Board makes the following :
CONCLUSION OF LAW
No question concerning representation of Mill B, Inc., division of
Irwin & Lyons, partners, doing business under the assumed name of
Irwin & Lyons, North Bend, Oregon, exists within the, meaning of
Section 9 (c) of the National Labor Relations Act.
ORDER
Upon the basis of the foregoing findings of fact and conclusion of
law, the National Labor Relations Board hereby dismisses the petition
for investigation and certification of representatives filed by Inter-
national Woodworkers of America, Local 116, C. I. 0., without preju-
dice to its right to renew the petition at a reasonable time before July
11, 1942.
MR. WILLIAM M. LEISERSON , dissenting :
It has long been the established policy and practice of the Board
to find that a representation dispute exists and that an election may
be ordered when a petition supported by sufficient authorizations is
filed prior to the expiration of an existing contract 13 In the case
of the American Oak Leather Co. '14 decided less than a year ago, the
Board clearly stated the policy, that a contract automatically renewed
for another year was not a bar to an election when the petition was
filed before the renewed contract went into effect.15 The decision in
the present case is a direct reversal of this ruling. I think the rea-
sons given for the reversal are not sufficient to change an established
policy which works well in practice, to which both employers and
13 Matter of Heldman -Schild-Lasser, Inc. and Cincinnati Joint Boaid of the Amalgamated,
Clothing Workers of America ( C. 1. O.), 11 N . L. R B. 1239.
14 Matter of The American Oak Leather Company, 1401 Dalton St., Cincinnati, Ohio and
The International Far h Leather Workers Union, Local 214, affiliated auth the Congress of
Industrial Organizations, 31 N. L. R. B. 1155
15 In that case the contract provided that it would be automatically renewed for another
term 'unless either party gave notice of a desire to terminate the contract at least thirty
days before the date of expiration . Neither party gave notice and the contract was thereby
renewed , in accordance with its provisions, for another term. The petition was filed there-
after.
MILD B, INC„ 353
labor organizations have adjusted themselves and which they clearly
understand.
It seems to me a mistake to apply to the problem of representation
disputes among employees the technical legal criteria governing re-
newal of contracts borrowed from the field of commercial law. Most
union agreements provide for automatic renewal unless notice of
desired changes is given 30 or 60 days prior to expiration date. If
such notice is given, employees are then free to change their represent-
ative even though their petition is filed after the 30- or 60-day period
has commenced to run.16 I do not see any reason for' having a
different rule if no notice is given either because of neglect or design.
The .rule announced in the present decision places a premium on
inaction while penalizing unions which seek necessary changes in an
agreement. It will tend to perpetuate as bargaining representative a
labor organization which has become inactive. In addition, this rule
will require every contesting organization to be familiar with the
detailed provisions as to notice and renewals of agreements to which
they are not a party. The requirements of the new rule seem to me
unreasonable and tend to create difficult new problems which have
been avoided by the rule hitherto prevailing.
16 Matter of Monolith Portland Cement Company and Local 550, International `Union
Mine, Mill & Smelter Workers, C. I. 0 , 36 N. L. R. B. 1329. Moreover , the Board has
ruled that when notice is given to open an agreement for the purpose of negotiating
changes and thereafter the notice is withdrawn and the old agreement renewed, that such
a renewal is not a bar to an election. Matter of Certain-Teed Products Corporation and
International Longshoremen 's & Warehousemen's Union, Local 1-6, 28 N L R B 915.
See also, Matter of International Harvester Company Tractor Works and Chicago Die
Sinkers Local No 100 of the International Die Sinkers Conference, 36 N. L R B. 520.
B
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