Kohen-Ligon-Folz, Inc.Download PDFNational Labor Relations Board - Board DecisionsJan 14, 194346 N.L.R.B. 1082 (N.L.R.B. 1943) Copy Citation In.the Matter of KoHSEN-LIOoN-FOLz, INC. ,.and,INTERNATION.AL, LADIE'S' GARMENT WORKERS UNION, LOCAL 348 , Case No. C-0,377.-Decided January 14, 1943 Jurisdiction: garment manufacturing industry Unfair Labor Practices- Collective Bargain ng: charges of refusal to bargain collectively, dismissed, where evidence showed that employer made concessions in counterproposals and made genuine effort to find a basis for agreement; union's contention that employer's proposed contract and its conduct during negotiations constituted a repudiation of the duty to bargain during life of any contract which might be entered into, not supported by evidence Practice and Procedure : complaint dismissed Mr. Elmer Davis and Mr. Robert F. Proctor, for the Board. Mr. Emil Corenbleth, of Dallas, Tex., for the respondent. Mr. Jack Johannes, of Dallas, Tex., and Mr. Elias Lieberman, of New York City, for the Union. Mr. Gilbert V. Rosenberg, of counsel'to the Board. DECISION AND ORDER STATEMENT OF THE CASE Upon a second amended charge 1 duly filed on August 10, 1942, by, International Ladies' Garment Workers Union, Local 348, affiliated with the American Federation of Labor, herein called the Union, the National Labor Relations Board, herein called the Board, by the Re- gional Director for the Sixteenth Region (Fort Worth, Texas), issued .its complaint dated August 12, 1942, against Kohen-Ligon, Folz, Ir. ., Dallas, Texas, herein called the respondent, alleging that the respond- ent-had engaged in and was engaging in unfair labor practices affect- ing commerce, within the meaning of Section 8 (1) and (5) and Sec- tion 2 (6)-and (7) of the National Labor Relations Act, 49 Stat. 449, herein called the Act. Copies of the complaint and of notice of hear- ing thereon were duly-served upon-the-respondent and,the Union. ,,the oiiginal charge was filed on February 18, 1942, and P. first amended charge on April 29, 1942 46 N. L. R. B., No. 125. 1082 KOHEN-LIGON -FOLZ, INC. 1083 With respect to the unfair labor practices , the- complaint alleged, in substance , that on or about December 1, 1941, in an election con- ducted under the supervision of the Regional Director for the' Six- teenth Region , a majority , of the respondent 's employees' in an appropriate unit designated and selected the Union as their repre- sentative for the purposes of collective bargaining , and that ,the Union, at all times material hereto, has been the exclusive bargaining repre- sentative of all the employees in the appropriate unit; that on or about December 4, 1941, and at all times thereafter , the respondent refused and, has continued to refuse to bargain collectively with the Union; .and that, by such refusal to bargain collectively, the respondent has interfered with, restrained , and coerced its employees in the exercise of the rights guaranteed in Section 7 of the Act. On September 8, 1942, the respondent filed its answer admitting certain allegations of the complaint , but denying the alleged unfair labor practices. Pursuant to notice, a hearing was held at Dallas, Texas, on Septem- ber 8, 9, and 10, 1942, before W. P. Webb, the Trial Examiner duly ,designated by the Acting Chief Trial Examiner . The Board, the respondent, and the Union were represented at and participated in the hearing. Full opportunity to be heard , to examine and, 'c'ross- examine witnesses , and to introduce evidence bearing . upon the issues was afforded all parties . At the conclusion of the Board's case, coun- sel for the Board'moved to conform the pleadings to the proof in regard to formal matters ; and at the close of the hearing , the respond- ent made a similar motion . Both motions were granted by the Trial Examiner without objection . At the close of the hearing , the respond- ent also moved to dismiss the complaint . The Trial Examiner re- served decision on this motion and later denied it in his Intermediate Report. During the course of the hearing the Trial Examiner made rulings on other motions and on the admissibility of evidence. The Board has reviewed all the rulings of the Trial Examiner and finds that no prejudicial errors were committed. The rulings , except those inconsistent with`our findings and-order-below, are hereby affirmed. On October 16, 1942, the Trial Examiner filed his Intermediate Re- port, copies of which were duly served upon the parties . ' He found that the respondent had engaged in and was engaging in unfair labor practices affecting commerce , within the meaning of Section 8 (1) and (5) and Section 2'(6) and (7) of the Act: He recommended that the respondent cease and desist from its unfair labor practices and that upon- request it bargain collectively with the Union ., On Novem- ber 2, 1942 , the respondent filed exceptions to the Intermediate Report. Pursuant to notice and at the request of the respondent, a hearing was held before the Board in Washington , D. C., on December 1, 1942, for, the purpose, of oral argument. The respondent and the Union were represented by counsel and participated in the 'argument. 1084 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Board has considered the exceptions filed by the respondent and hereby sustains them insofar as they are directed to the Trial Ex- aminer's findings and conclusions that the respondent has engaged in unfair labor practices, within the meaning of the Act. Upon the entire record in the case, the Board makes the following: FINDINGS OF FACT I. THE BUSINESS OF THE RESPONDENT Kohen-Ligon-Folz, Inc., a Texas corporation, is engaged at a plant in Dallas, Texas, in the manufacture, sale, and distribution of ladies' dresses and related merchandise. During 1941 the respondent pur- chased raw materials, consisting principally of cloth, valued at ap-, proximately $70,000, almost all of which was obtained from outside the State of Texas. During the same period, the respondent sold finished products valued in excess of $160,000, of which approximately 50 percent was shipped to destinations outside the State of Texas. The respondent admits that it is engaged in commerce, within the meaning of the Act. If. THE ORGANIZATION INVOLVED . International Ladies' Garment Workers Union, Local 348, is a labor organization affiliated with the American Federation of Labor, admitting, to membership employees of the respondent. III. TILE ALLEGED UNFAIR LABOR PRACTICES The alleged-refusal to 'bargafin A. The negotiations On December 1; 1941, in a consent election conducted by the Board's Regional Director among all production employees of the respondent, a majority of the employees designated the Unioli as their representa- tive for the purposes of collective bargaining.2 On December 4 the Union requested the respondent to enter into, bargaining negotiations. Thereafter, during the first half of December, W. Don Ellinger, the Union's manager, and L. P. Lorch, the respondent's majority'stock- holder and treasurer, met on three occasions and discussed in detail some of theT proposals --which the-Union desired to include in its con- The production unit, which the respondent concedes to be appropriate for the purposes of'collective bargaining , includes operators , finishers , pressers , basters, special operators, pin-ups , inspectors , button makers, drapers, cutters , and sample makers, but excludes de- signers , supervisory employees , office employees , and shipping and packing employees. 'Of the 42 votes cast in the election, 28 were for, and 14 against , the Union. K0HEN-LIG0N-FOLZ, .INC. - - , - 1085 tract with _the respondent::-No agreement wa's- reached with respect- to any of the matters discussed. However; in : accordance with a mutual understanding, Ellinger,'on December 17, sent the respondent a draft'of`the Union's complete proposed contract. In substance, its more important provisions related to a closed shop, equal distribution of work, the respondent's right to discharge employees for just cause, a 35-hour week of 5 days, a minimum wage scale for various groups of operators, a definition of the wholesale price range of dresses upon which piece rate wages were to be based, arbitration of proposed changes in the wage scale, a prohibition of strikes, stoppages of work, and lock-outs, and arbitration of disputes. 'On December 19 and 22, the parties again met and discussed the Union's proposed contract. Lorch requested clarification of several clauses and protested that the proposed minimum wage schedule was too high, but agreed to submit counterproposals after he had further considered the Union's 'draft contract 'in the light of the discussion. At a meeting with Ellinger on January 5, 1942, Lorch- submitted a proposed contract which varied considerably from the one which had been prepared by the Union. The respondent in its proposed contract rejected the closed shop, but included a prohibition of 'strikes- and lock-outs; and accepted without modification the Union's proposal that no employee be called for less than a half-day's work. As to the other clauses in the Union's draft contract, the respondent proposed numer- ous modifications which are considered below. At this meeting the Union registered its objections to the respondent's proposed contract, and a lengthy discussion followed in which the parties were unable to agree on any of the issues in controversy. Thereafter, during January and the early part of February 1942, the Union and the respondent held some five or six lengthy bargaining con- ferences during which each agreed to modify its proposed contract in certain respects, but the parties were unable to compose their differ- ences. On January 29, the Union sought to eliminate a stalemate in the -negotiations.-by proposing that the parties immediately enter into a temporary contract for a period of 3 months, with the understanding' that negotiations would continue as to the wage scale and other matters upon which no agreement had, been reached. Under this arrange- ment the`Union offered to waive its proposal for a closed shop, but insisted upon retaining its right to strike in connection with the con- templated subsequent negotiations. The respondent would not agree to a temporary contract of this kind, and negotiations were continued on the issues in controversy. On February 11, the parties had two bargaining conferences, during which the discussions centered on the. ,Union's objections to the respondent's revised proposal 'and on further revisions suggested by, the Union. The respondent agreed to make 1086' DECISIONS OF NATIONAL LABOR. RELATIONS BOARD certain changes in the, phraseology of several. clauses, which, Ellinger testified, brought the parties "mighty close to an agreement" on some of the issues between them. Nevertheless, negotiations were suspended after February 11 for a period of about 3 months.' On May 6, 1942, Lorch wrote Ellinger that one of the Board's Field Examiners had suggested further negotiations between the respondent and the Union with respect to two of the most controversial sections of the proposed contract, andtthat Lorch would`le glad` to meet with [Ellinger] at any time which will meet your convenience :... [to] dis- cuss with you any revision which you may have in mind concerning any phase of the contract we have had under consideration.". Accordingly, on May 13 the parties again met, and the respondent submitted_a form of contract containing revised versions of two or three of the most important provisions on which they had previously been unable to agree. The respondent's revisions were not acceptable to the Union which, by letter to the respondent dated May 21, requested further considerationand revision°of-certain sections and urged that the parties obtain the services of a conciliator to assist in the negotiations. On June 5 Lorch replied with a-lengthy letter in which he rejected the suggestion of conciliation and sought to meet the Union's objections to the respondent's proposal and to convince the Union of the reason- ableness of the respondent's position. This letter also contained an invitation to continue the negotiations; however, the Union made no further attempt to continue bargaining, and the negotiations termi- nated., The -issues'in controversy, ,t the time thelegotiatioris-'broke off, and the position of the parties with respect thereto, may be summa- rized as follows : The Union's original proposed contract, as stated above, included closed-shop and no-strike' clauses, and provisions establishing a 35- hour work week, a $5.75 unit price as the dividing line between higher and lower'priced dresses, and.a rule that employees not be called for less than a half-day's work: During the negotiations,Ahe Union pro- posed several modifications of the closed-shop clause; but, at•the time negotiations ceased, it was insisting upon a. maintenance-of-member- ship and preferential-hiring clause. The respondent consistently refused to agree to any clause requiring -its employees to become or remain union members, although it was entirely willing to include a no-strike clause. It insisted upon a40-hour week and a $6.75 unit price as the'dividing line between higher and lower priced.dresses, but ac- cepted the Union's proposal that no employee be called for less than a half-day's work., The respondent proposed that nothing in'the con- -tract should take:away•its right to contract work out or to liquidate - the business, if that became desirable or'necessary from an economic 3 The Union filed the original char-,e in this p•oceedmg on F-b iiary 18. 1942 KOHEN-LIGON-FOLZ, INC. - 1087 standpoint, although it was willing to agree that before so, doing,it would advise, the Union. The Union would not agree to this proposal unless the respondent also agreed to arbitrate any disagreement be- - tween the parties as to the necessity for any such action contemplated by the,respondent. The respondent refused to accept this arbitration requirement, and an impasse on this question was reached. Sections II and XI of the respondent's proposed contract related, respectively, to the managerial rights of the respondent and to the arbitration of disputes.`' Section 11 reserved to the respondent the right to assign work, to require compliance with reasonable working rules, to discharge employees for specified causes, to take non-discrim- inatory reasonable disciplinary action for efficient operation of the plant,-and to lay off employees in accordance with production needs. It further provided that, "in the exercise of his discretion, the. Em- ployer shall seek to secure the efficient, orderly, and economical oper-, ation of the plant and shall not for personal, or other, reasons not connected 'with,," the 'efficiency of operation,' discriminate- against any, employee," and that "if at any time a disagreement arises as to whether or not the employer, in good faith, is living up to the terms of this contract, then and in that event, final determination of the disagreement shall be made as provided in Section XI [the arbitra- tion clause]." The Union was willing to accept the general import, of the respondent's proposed Section II, but objected to the arbitra- tion clause referred to therein. The respondent's arbitration clause, Section-M of•its proposed contract, provided that neither'the Union nor the respondent should "have the right to demand that [the other] go any further than is provided in the contract," and that "on mat- ters covered by the contract, if there is difference of opinion between the parties] as to what the contract provides and if the contract is being complied with," the question should be referred_to an impartial umpire whose "authority shall be solely to determine what the con- tract provides and to determine if the contract is being complied with and then,to order either, [party]' to' take" action necessary' to conform to the contract." Ellinger testified that this arbitration clause was acceptable,4 except for the restriction upon the right of either party to make demands upon the other, which, according to Ellinger, ". .. cuts off, by its phrasing, any further bargaining, any review of new issues; anything that was unpredicted or uncovered'that comes up is automatically barred from discussion by that provision," thereby negating the idea of collective bargaining,"as a continuing process under the agreement." On the other hand,- the arbitration clause finally "proposed by the Union not':6nly omitted the''above'.language 'The pal ties were unable to agi ec on the person who would select the umpire The respondent wanted the Texas Secretary of Labor to select the umpire, while the Union wanted the United States Department of Labor. 1088 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to which it objected, but also expanded, the scope of the arbitration procedure by providing that "all "questions which arise involving the welfare of the employees," and upon which the parties could not agree through collective bargaining, might be submitted by either party to an impartial umpire who "shall have authority to determine all questions submitted by the Union and the Employer following an attempt to reach a satisfactory conclusion through collective bar- gaining." In its letter to the, Union dated June 5, the respondent rejected the Union's proposed arbitration provision, and stated : Mr. Ellinger, I submit to you that if you are going to include this in the contract, than all of the work which you and 'I are doing and have been doing in trying to arrive at an agreement, would,be wasted. What you propose- here is not,arrive at an agreement covering the rights of the employees and the right of the employer, but what ' you propose to do is to arrive at an agreement between the, Union and the employer that we will try to agree on everything in the" future and, if we cannot agree, we will submit it to arbitration. What you propose to include does not, in any sense, limit the union to the provisions of this con- tract. What would the union decide next week, if we should Sign the contract, was a • question ,that involved the yvelfare of,-,,the em- ployees? When would they decide the welfare was not adequately protected? What standard would they use in arriving at a decision ? It seems to me that right now when we are engaged in the process of collective bargaining, is the time to,solve these ques- tions and not merely agree that we will solve them at some time in the future. What right is there, affecting the welfare of em= ployees, that we have not included in the contract? If there be such a right, you, and I should reach agreement on it and put it in the, contract. Let us not defer all the trouble to the future. Let us settle it now; let us now through a process of collective bar- gaining, put in this contract what belongs in,it, then let us.provide, as I suggested in my Section XI, that the contract should control. The parties reached no agreement on Section XI and Section I. The' Union's original Section IV, providing for minimum hourly and piece rates for the various operations in the plant, meant substan- tial increases over the existing wage rates. The respondent's counter- proposal of January 5, 1942, provided for a small overall wage in- crease substantially less than that requested by the Union. Thereafter, the Union modified its wage demands, and the respondent also made' some concession with..respect to increases for the' 'utters: in-its letter of June 5, sdnt to the Union just prior to the cessation of negotiations, the respondent further indicated that it would be willing to make con- KOHEN-LIGON-POLZ, INC. 1089 cessions in a "few cases,?' but that "it would be a waste of time for [the Union] to attempt to sell [the respondent] on [the former's] proposed wage, scale because [the respondent] cannot agree to the one which you have submitted." In the same letter the respondent further stated that "if we did reach agreement on the wage scale, then we probably could iron out 'such differences as might still exist between [the Union's] thinking and [the respondent's] on Section VII." Section VII, dealing with the fixing of piece rates, provided that a union piece-rate ecmmittee meet from time to time with the respondent to establish piece rates on clew style garments. The Union's contract provided that the respondent submit proposed piece-rate schedules to the union committee, which would submit recommendations as to the fairness of the rates, and that in the event' of disagreement between the parties the matter should be submitted to arbitration. It further provided that "a piece rate shall be deemed fair and equitable when earnings of the operators working on such rates reach the contract provision." The respondent refused to arbitrate piece rates, and pro- posed' instead that "piece rates shall,be fixed by the employer" with the understanding that, before new piece rates were put into effect, they would be submitted to the union committee for the purpose of making "reconmiendations" to the respondent. It further proposed that the union committee and the respondent meet once a month "for the purpose of rechecking piece rates to determine whether or not the rates are too low," and that, although the decision of the respondent with respect to rechecking of rates "shall be final," no rate should be maintained so low that more than 50 percent of the employees involved ivoilld'earn less than the minimum scale provided in Section IV. The, respondent's proposal was not acceptable to the Union. The, Union's original proposal provided that, during February of any contract year, either party could institute arbitration proceedings to determine whether general economic conditions warranted an "ad- j ustnient" in the minimum wage schedule set forth in Section IV. The respondent offered a substitute provision for an automatic in- crease or decrease in.the wage scale whenever the cost-of-living index increased or decreased by as much as 10 percent. The Union accepted this change in 'principle, but insisted that the adjustment be made whenever the cost of living fluctuated by as much as 21/2 percent. ; The respondent would not agree to this change. Section IX related to the establishment of a union shop committee' and a grievance procedure. The Union's proposal provided that "any matter that cannot be settled by the shop committee and the employer shall be finally" settled by arbitration as provided in its proposed version of Section XI, discussed above. The respondent would not acceptrthe unlimited arbitration feature' of this section, but provided 504086-43-vol 45--CO 1090 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in its, counterproposal that, whenever the Union and the respondent were unable to settle a grievance , and "if the Union claims that the Employer, in making [the decision NN i'th respect to thet grievance in question], has not acted within his authority, then and in that event the matter shall be referred to an impartial umpire as provided in Section XI and the authority of the impartial umpire shall be confined solely to determining whether or not the employer in his decision has complied in good faith with the provisions of the contract." B. Conclusions Our findings , above, as to the negotiations between the respondent and the Union from December 4, 1941, to'February 11, 1942, and there- after in May and June 1942, show that the respondent recognized,the Union as the collective bargauiing representative of the employees in the unit in which the Union had been designated and that the re- spondent met and dealt with the Union as such representative. Fol- lowing the preliminary conferences between the parties , the Union prepared and submitted to the respondent a proposed contract em- bodying the provisions desired by it. After consideration and dis- - cussion of the Union's proposal, the respondent in turn prepared, and submitted to the Union a proposed contract containing the provisions desired by it. Thereafter, over a period of more than 2 months, the parties bargained with respect to the differences between them and between their proposed contracts. The respondent agreed- with ' out modification to the Union's proposal that no employee be called, for less than a half-day's , work and accepted in principle a number of other proposals made by the Union. The respondent also suggested revisions in certain disputed sections of its proposed contract in an effort to reach common ground with the Union . Nevertheless , despite the concessions made on both sides, 'the parties were unable to agree on the closed shop, the length of the work week, the dividing line between higher and lower priced dresses, the mechanics of adjusting the wage scale to the cost of living, and the 'arbitration provision. Inability to reach agreement with the bargaining representative is not of itself , however, a refusal on the part of the employer to bargain collectively. We are convinced and" we find that the record contains no substantial showing that the respondent failed or refused to bargain collectively in good faith with the Union.' It is contended by the Union , however, that the respondent did not fully discharge its obligation under Section 8 (5) of the Act because its position was and its proposed contract provided, in effect, that there, was to be no collective bargaining between the parties during the life of any contract entered into by them. This contention is based partic- I., ,-._KOHEN-LIG,ON-FOLZ, INC.-- 1',,'-'--- 1091 ularly:'ou-tlie provision in- the- respondent's proposed-Section XI;-011 arbitration, that neither the Union nor the respondent. "should have the right to demand that [the other] go any further than is provided in the contract." We do not believe that this provision in the re- spondent's proposed contract, or that anything said or done by the respondent during the negotiations, can reasonably be construed as an attempt by it,to limit or restrict the proper scope of,collective bargain- ing,during the'life of any contract 'made by the parties. Certainly there is nothing in the respondent's proposed contract which supports the contrary view. The respondent proposed to bind itself to dis- charge employees only for specific causes, to make and enforce reason- able working rules, and to take orily nondiscriminatory reasonable disciplinary action for efficient operation of the plant. With respect to these nutters, as well as oilier questions arising out of the contract or its interpretation, the respondent's proposed contract provided that "if at any time a disagreement arises as to whether or not the em- ployer, in-gooal faith, is living'up to the terms of the contract," either party could have the point in issue referred to an impartial umpire empovA eyed to make a. binding decision. The respondent also proposed to bargain with the union piece-rate committee in fixing new piece rates during the life of the contract; and, although the respondent refused to agree to arbitrate any disagreement with respect to piece rates, the contract itself contained a definite minimum standard for such rates and machinery for adjusting the rates to meet the standard. The respondent's proposed contract further provided for automatic adjustments in wage rates to conform with fluctuations in the cost=ufI living index. These are not, in our opinion, provisions designed to circumvent the continuing duty to bargain collectively. We agree with the Union, as we have held before, that collective bargaining does not end with the execution of a contract and that the employer's duty to meet and bargain with the duly designated representative of the employees-continues during the life of any contract made by them.5 But'we are not convinced that the respondent's-proposed contract or its conduct during the negotiations with the Union constituted a re- pudiation of that duty or gives reason to believe that the respondent would not fully discharge that duty during the effective period of a contract between it and the Union. 'We find that the respondent has not refused to bargain collectively with the Union, within the mewling of Section 8 (5) of the Act. N L R B v Sands Mannfactun ng,Co, 306 U S 332, N L R B v Newink Mornonq Ledge) Go , 120 F. (2d) 266 (C C A 3) c:;i t den 314 U S 693, Mattel" of R 17), (1 Roller On, etc and Local`1t0,"t7nited Rubber Workers of'Ametica, eto. 33 N L R B 557, 587-, enf'd Rapid Mo'ler'Co v N L R B 12b F (2d) 452 (C C A 7), cert` den 63 S Ct '5, Matter of \orth. Amerncan Avtat on, Inc and United Automobile, .4 is.'aft and Ayr oulturat Implement 11'oikers of Ameitea. Local 887, C 1 0., 44 N L R 13.604 f 1092--, DECISIONS OF NATIONAL- LABOR''RELAT--IONS BOARD -Upon the''ba"si's of theaforegoinb-findings of fact and upon-the entire= record-inlthe"case,-the Board makes the following:, CONCLUSIONS OF LAW 1. The operations of the respondent, Kohen-Ligon-Folz, Inc., con- stitute a continuous flow of trade, traffic, and commerce among the several States, within the meaning of Section 2 (6) of the At. 2. International Ladies' Garment Workers. Union, Local 348, affil- iated with the American Federation of Labor, is a labor organization, within the meaning of-Section 2 (5) of the Act. 3. The respondent 'has not engaged in unfair labor pradtices as alleged in the complaint, within the meaning of Section 8 (1) and (5) ..of the Act. .ORDER Upon the basis of the foregoing findings of fact and conclusions of, law,, and pursuant to, Section 10 (c) of the National Labor Relations Act, the National Labor Relations Board hereby orders that the com- plaint against the respondent, Kohen-Ligon-Folz, Inc., Dallas, Texas, be,' and it hereby is, dismissed. Copy with citationCopy as parenthetical citation