Kranco, Inc.

National Labor Relations Board - Board Decisions

Feb 18, 1977

228 N.L.R.B. 319 (N.L.R.B. 1977)

KRANCO, INC.
Kranco, Inc. and Carpenters District Council of
Houston & Vicinity, affiliated with United Broth-
erhood of Carpenters & Joiners of America. Case
23-CA-5975
February 18, 1977
DECISION AND ORDER
BY CHAIRMAN MURPHY AND MEMBERS
FANNING AND PENELLO
On October 8, 1976, Administrative Law Judge
Michael O. Miller issued the attached Decision in this
proceeding. Thereafter, both the General Counsel
and Respondent filed exceptions and supporting
briefs and Respondent filed a brief in opposition.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge and to
adopt his recommended Order, as modified herein.'
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge as
modified below and hereby orders that the Respon-
dent, Kranco, Inc., Houston, Texas, its officers,
agents, successors, and assigns, shall take the action
set forth in the said recommended Order, as so
modified:
1. Insert the following as paragraph 1(c) and
reletter the following paragraphs accordingly:
"(c) Threatening employees by indicating that
employees have been terminated because of their
support for the Union."
2. Substitute the attached notice for that of the
Administrative Law Judge.
i The Administrative Law Judge found that, at the time of Respondent's
March 4 discharge of its night-shift employees , employee Gilmer confronted
Supervisor Michulka with the statement that they both knew that employees
were being terminated because of the Union Michulka nodded his head in
the manner normally signifying agreement Unlike the Administrative Law
Judge, we find that this acknowledgement that employees were discharged
because of their support for the Union violated Sec 8(a)(1), of the Act
Certainly, if a threat to discharge violates Sec 8(a)(l), a fortiori, an
acknowledgement (or statement) that union activities precipitated the
discharge would constitute a violation of that section of the Act. Indeed, to
employees who were not discharged , it was tantamount to a threat of similar
treatment for them if they chose to engage, or continued to engage, in union
activities
APPENDIX
319
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing at which all sides had a chance to give
evidence, the National Labor Relations Board has
found that we violated the National Labor Relations
Act and has ordered us to post this notice:
The Act gives all employees these rights:
To engage in self-organization
To form, join, or help a union
To bargain collectively through a repre-
sentative of their own choosing
To act together for collective bargaining
or other mutual aid or protection
To refrain from any or all these things.
WE WILL NOT do anything that restrains or
coerces employees with respect to these rights.
WE WILL NOT discharge or otherwise discrimi-
nate against employees because they engage in
union activities.
WE WILL NOT interrogate our employees con-
cerning their union membership, activity, or
support.
WE WILL NOT threaten employees with loss of
employment or other reprisals if they engage in
union activity or select a union as their collective-
bargaining representative.
WE WILL NOT indicate to our employees that
employees have been terminated because of their
support for the Union.
WE WILL NOT in any other manner interfere
with, restrain, or coerce our employees in the
exercise of their rights as set forth above.
WE WILL reinstate the following named employ-
ees to their former jobs or, if such jobs are no
longer available, to substantially equivalent jobs,
without prejudice to their seniority and other
rights and privileges, and WE WILL make them
whole for any loss of earnings with backpay plus
6-percent interest.
J. L. Armstrong Clifford Melvin
Danny Starnes W. L. Gilmer
Steven Norton Steve Hundl
Dan Mason William C. Bowen
Scott Forbes James Hindman
Kenneth Carriere
KRANCO, INC.
228 NLRB No. 45
320 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
DECISION
STATEMENT OF THE CASE
MICHAEL O. MILLER, Administrative Law Judge: This
matter was heard in Houston , Texas, on May 12, 13, and
14, 1976. The complaint issued on March 31, 1976,
pursuant to a charge filed on March 4, 1976 , was amended
at hearing and alleged violations of Section 8(a)(1) and (3)
of the National Labor Relations Act, as amended. Respon-
dent's timely filed answer was also amended at hearing. All
parties have filed briefs.'
Upon the entire record herein, including my observation
of the witnesses as they testified, I hereby make the
following:
FINDINGS OF FACT AND CONCLUSIONS
I. THE EMPLOYER 'S BUSINESS AND THE UNION'S
LABOR ORGANIZATION STATUS
Kranco, Inc., herein called Respondent, is a Texas
corporation engaged in Houston , Texas, in the manufacture
and sale of overhead cranes . Jurisdiction is not in issue. The
complaint alleges , the answer admits , and I find and
conclude that Respondent is an employer engaged in
commerce within the meaning of Section 2(6) and (7) of the
Act.
The complaint alleges , Respondent admits, and I find
and conclude that Carpenters District Council of Houston
& Vicinity, affiliated with United Brotherhood of Carpen-
ters & Joiners of America, herein called the Union, is a
labor organization within the purview of Section 2(5) of the
Act.
II. THE ALLEGED UNFAIR LABOR PRACTICES
A. Union Activity
Overt union activity among Respondent 's employees
began on February 19, 1976 (all dates hereinafter are 1976
unless otherwise specified), with a distribution of literature
and authorization cards in front of the plant . The activity
immediately came to the attention of Raymond Vajdak,
plant superintendent, and John Pearson , personnel manag-
er. Pearson telephonically reported it to Thomas J. Lee,
Respondent's executive vice president, who was out of town
at the time .2 A distribution on February 24 announced
meetings to be held on February 26 with the day - and night-
shift employees . The night shift met with union representa-
tives at a restaurant following the end of their shift.
Authorization cards were distributed and approximately 16
of the 30 night-shift employees signed and returned cards at
that time . Several more were returned by W. C. Bowen, the
Union's inplant organizer . An additional meeting was held
with the night-shift employees on March 1. A representa-
1 Respondent filed a reply brief, to which General Counsel objected and
moved to stoke , correctly asserting that the Board 's Rules and Regulations
do not provide for reply briefs to the Administrative Law Judge . Joseph E
Cote, d/b/a J E Cote, 101 NLRB 1486, fn. 4 (1952). Thereafter , General
Counsel filed a motion requesting that I take notice of a recent Board
decision and urging that it be deemed diapositive of the issue herein General
Counsel ' s motion is, itself, in the nature of a reply brief and I deem its filing a
tion petition, bearing the date of March 4, was filed by the
Union (Case 23-RC-4359).
B. The Employer's ResponseAlleged 8(a)(1)
Violations
Kranco's official response was a letter from its president
to the employees , distributed on -March 2. The letter urged
employees not to select union representation and based its
arguments on the costs of union dues , fines , and assess-
ments , the risk and financial burdens of strikes , the Union's
lack of interest in them or investment in the plant, the
Union's alleged misuse of money, and the disadvantages of
a seniority system , grievance procedure, and checkoff.
Specifically, the letter stated , inter alia:
These strangers are not out getting customers to buy
our cranes so you will have work . They are not putting
up their money to make this a safe comfortable place to
work . They are not doing anything for you except
causing you to risk everything so they can collect tribute
from you.
s s s s r
The threats to your welfare come from the Union -
not from the company.
s s s s s
You would not like a union contract hanging over
you.
You would not like "job classifications" which pegs
you and freezes your pay.
You would not like "seniority" which limits your
progress.
Various employees testified in regard to conversations
with Night Supervisor Tommy Michulka (supervisory
status admitted) both before and after the March 2 letter
issued . Michulka did not testify. General Counsel contend-
ed that these conversations violated Section 8(a)(1). Thus,
W. L. Gilmer testified that, on the evening of February 27,
Michulka came up to him and asked what he thought about
the Union. Gilmer gave a noncomittal answer. Steven
Norton testified that, while he was reading Respondent's
March 2 letter, Michulka asked him, "Are you for the
Union?" and what he thought of it. They had a brief
discussion of their opposing points of view. Michulka also
asked Scott Forbes whether he had a union card and if he
knew who was passing them out. In yet another conversa-
tion, after Forbes had asked Michulka whether Michulka
knew that W. C. Bowen was the union spokesman on the
night shift, Michulka asked him who the spokesman was for
the day shift. I credit the foregoing testimony and find that
the foregoing conversations constitute inherently coercive
interrogations in violation of Section 8(a)(1) of the Act.
waiver of General Counsel 's objections to my receipt of Respondent's reply
brief Additionally , I note that both postbnef submissions facilitated and did
not delay my resolution of the issues, herein . Accordingly, I deny General
Counsel's motion to strike and have considered both documents. See
Cavender Oldsmobile Company, 181 NLRB 148, fn. 2 (1970)
2 The supervisory status of Lee, Vajdak , and Pearson is admitted.
KRANCO, INC. 321
Crown Zellerbach Corporation, 225 NLRB 911 (1976); P B.
and S Chemical Company, 224 NLRB 1 (1976). That
Michulka may have enjoyed a rapport with his employees,
may have been well thought of by them, and even may have
been considered a friend by some, does not negate the
coercive nature of questions seeking to elicit the union
sympathies of a particular employee and others. As the
Board noted in Quemetco, Inc., 223 NLRB 470 (1976):
An employee is entitled to keep from his employer his
views concerning unions, so that the employee may
exercise a full and free choice on the point, uninflu-
enced by the employer's knowledge or suspicion about
those views and the possible reaction toward the
employee that his views may stimulate in the employer.
That the interrogation may be suave, courteous, and
low-keyed instead of boisterous, rude, and profane does
not alter the case. It is the effort to ascertain the
individual employee's sympathies by the employer, who
wields econonuc power over that individual, which
necessarily interferes with or inhibits the expression by
the individual of the free choice guaranteed him by the
Act.
Employees Bowen, Gilmer, Melvin, and Mason relate
hearing statements by Michulka to the effect that they
should not get "messed up" with the Union because it was
.,no good," that they did not want the Union, and that it
would only cause trouble, the latter two statements phrased
crudely and profanely. Such statements , I find, do not
contravene the Act's provisions; they are mere statements
of permissible opinion.
On March 2, Bowen approached Michulka and asked
him, "What position would it put me in with the company
toward being fired or dismissed if I was to say that I was an
organizer and promoter for the Union on the night shift?"
Michulka asked him what he was talking about and Bowen
stated that he was the promoter of the Union on the night
shift. Michulka first told Bowen that he could not answer
him but, when pressed, said that it would not affect his
employment. Later that evening, according to Bowen,
Michulka asked Bowen if he was the Union's organizer on
the night shift and Bowen hesitantly answered that he was.
In light of Bowen's earlier volunteered admission of his
role, I cannot find Michulka's subsequent question to
constitute coercive interrogation.
About March 1, Mason heard a conversation between
Robert Chapman, day electrical foreman (supervisory
status admitted), and Walter Schultz, in which Chapman
asked Schultz, "Just between me and you . . . how do you
feel about this Union? It won't go any further."3 I credit
Mason's uncontradicted testimony and conclude, for the
reasons set forth supra, that Chapman's questioning of
Schultz constituted coercive interrogation in violation of
Section 8(a)(1).
During the week of February 25 to March 1, employee
James Armstrong participated in a conversation with two
other employees who were talking about pay raises they
had received. David Rattray, who was contended by
General Counsel to be the night electrical foreman and a
statutory supervisor, joined the conversation. He told the
employees that, when a union had previously tried to come
in, the Employer had made promises to the employees and
was giving these raises now so that the employees would not
vote for the Union. Rattray did not testify.
Respondent denied that Rattray was a supervisor and
contended that he was only the lead electrician on the night
shift. The record reflects that Rattray was on the night shift
for about 3-1/2 months. He was hourly paid at the rate for a
lead electrician on that shift. Admitted supervisors were
salaried. Rattray worked with two other employees in the
electrical department, a trainee and a helper; he was also
observed, from time to time , telling the trainee and the
helper what to do, checking their work, reassigning them
from job to job, working with them, and sitting in the office
reading or taking coffee while the others worked. In all,
there were about 30 people on the night shift during
February. Michulka was the only admitted supervisor
working on that shift. According to Plant Superintendent
Valdak, Rattray received his instructions for the night's
work on a work schedule from the electrical foreman on the
day shift and would follow that schedule in performing or
assigning work. Rattray did not appraise the work of the
others in the electrical department on the night shift or
make recommendations regarding wage increases. That
was done by the day foreman by examination of the work
performed and the worksheets completed. On one occasion,
Rattray was involved in the discharge of an employee:
Michulka had reported to Vajdak that he had complaints
from Rattray that a given employee would not respond to
work instructions and would wander away from his work
area. Vajdak gave instructions to the day foreman that, if
the conduct was repeated, that employee was to be
terminated. When Rattray again reported an infraction by
this employee, he was terminated. The termination was
effected by Rattray.
Based upon the foregoing, I conclude that David Rattray
did not possess or exercise the statutory authority indicative
of supervisory status. He was but a conduit of manage-
ment's instructions to himself and other employees within
the small department in which he worked. In so concluding,
I note that there was a supervisor on duty at all times and
that if Rattray were to be found a supervisor the electrical
department would have been the only department so
directly supervised on the night shift. Accordingly, I shall
recommend dismissal of the alleged 8(a)(1) violation
attributed to Rattray.
Clifford Melvin began working for Respondent about
October 10, 1975, as a fitter helper, at $3.30 per hour plus 20
cents night-shift differential. After 3 months of employment
he questioned Michulka about a raise he believed due him.
Michulka subsequently told him that, under a new compa-
ny policy , raises were not due for 6 months. About
February 1, a fitter quit and Melvin was promoted into his
place. He spoke to Michulka about his raise and was told
that he would be put in for a raise, to about $3.80 per hour.
He learned that he was receiving a 70-cent raise on the
Monday following the first union meeting . He received the
3 Mason was Schultz' helper and worked in close proximity to him
Chapman did not testify
322 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
raise in the pay he received on March 3, the night he and
others were terminated. It was one of the largest raises
given by Respondent. It placed Melvin into the second step
of the trainee classification. General Counsel contended
that Melvin's raise was given to dissuade support for the
Union and thus violated Section 8(axl). Melvin had
received a bona fide promotion, prior to the union activity,
and his raise was consistent with that promotion. The
evidence is insufficient to warrant a finding that the raise
was intended to interfere with the exercise of free choice by
either Melvin or any other employee.
On March 4, the day following the termination of 10
night-shift employees (discussed infra), Lee called meetings
for the day and night shifts. In his speech to each group he
spoke about both the terminations and the union campaign,
and he admitted that the latter was what occasioned the
meetings. He described how orders had slacked off or been
canceled. He described the Company's recent acquisition of
Euclid Crane Company in Cleveland, Ohio. James Hind-
man, who attended the day-shift meeting, and C. L.
Cullever, who attended the night-shift meeting, both
attributed to Lee a statement to the effect that Respondent
could transfer work from Euclid to Kranco if Kranco's
work became slack but that he would not do so if the Union
came in. Lee denied making this statement and claimed
that he told the employees that they did not want the Union
to come in and that some of their customers might object to
buying a crane from a shop that was unionized, because of
the potential for work stoppages. Cullever recalled Lee
making the latter statement; Hindman did not. Pearson
confirmed Lee's version of the speeches. Based on the
foregoing testimony and my observation of the comparative
demeanors of the witnesses, I credit the testimony of the
employee witnesses, Hindman and Cullever.4 Accordingly,
I find that, in his speeches of March 4, Lee threatened
employees with diminished work opportunities in the event
they selected the Union to represent them, in violation of
Section 8(a)(1). I note also, in reaching this conclusion that,
even crediting Lee's version, Lee's statement that customers
might not want to do business with them if unionized
constituted an impermissible threat of loss of employment
opportunities. This was an employer prediction of adverse
consequences stemming from unionization unsupported by
the requisite objective factual basis. N.LR.B. v. Gissel
Packing Co., Inc., 395 U.S. 575, 618-620 (1969); Hertzka
and Knowles, 206 NLRB 191, 194-195 (1973).
C. The Alleged Discrimination
In the early morning hours of Thursday, March 4, at the
conclusion of the night shift which had begun on March 3,
Respondent discharged 10 employees from its structural
department: J. L. Armstrong, Danny Starnes, Steven
Norton, Dan Mason, Scott Forbes, Kenneth Carriere,
Clifford Melvin, W. L. Gilmer, Steve Hundl, and William
C. Bowen. They were informed, by a letter read to them at
that time, that "reversals in the business situation, as it has
affected several of our customers, has resulted in cancella-
tions of orders and postponements in other cases, thus
causing a shortage in our workload. This in turn has caused
us to discontinue our night fabrication work." All of these
employees had attended union meetings and/or signed
union authorization cards. On March 12, James Hindman,
a day-shift welder, was also terminated, supposedly for the
same reasons. Hindman had signed a union authorization
card on February 25 and had attended a union meeting on
March 9. At that meeting he was appointed as a witness to
accompany the newly appointed inplant committee to see
Superintendent Vajdak when they went to inform him that
they would be soliciting membership in the plant. The
committee, and Hindman, so informed Vajdak on March
10. Those terminations were the first in Kranco's history for
such alleged reasons. Indeed, new employees were regularly
told that they did not have to worry about layoffs.
Respondent asserts that the discharges were unrelated to
the union activity and were solely motivated by adverse
business conditions. The record reflects the following:
Kranco had a record year in 1975. Gross revenues
exceeded $9 million and after tax earnings were approxi-
mately $750,000. On December 12, 1975, Respondent's
employees were sent a letter of season's greetings, inform-
ing them of the record established and stating that they
were going into 1976 "with the largest backlog [of orders ] in
the history of our company." As of October 1975, Respon-
dent had prepared a budget for 1976 anticipating another
record year, increasing after tax earnings by approximately
$80,000. However, according to Respondent's witnesses,
business began to slack off in December 1975. An order for
one crane was canceled and two orders that had been
scheduled for 1976 delivery were postponed until 1977.
These cranes had a total value of approximately $1,200,000
and allegedly represented 25,000 to 30,000 shop hours.5 The
pace of new incoming orders also slackened, according to
this testimony and, even with increased sales effort,
including an alleged reduction in profit margin, sales did
not keep pace with cranes being shipped. Respondent
introduced summaries reflecting its backlog of orders (in
dollars) and the estimated number of shop hours required
to complete those orders, as of March 1, 1975, February 7,
1976, and February 28, 1976. Those summaries show as
follows:
4 Cullever was still employed by Respondent at the time he gave this 5 No documentary evidence identifying or describing these orders was
testimony That he would so testify, and incur the potential enmity of his
employer, is an additional factor I have considered in deeming him credible
Georgia Rug Mill, 131 NLRB 1304, 1305, fn 2 (1961)
adduced during the hearing.
KRANCO, INC.
3/1/75
dollars/ est. hours
2/7/76
dollars/ est. hours
2/28/76
dollars /est, hours
Mar - 616 ,623/13388 840,903/25,710 905,976/20,725
Apr - 897 ,160/28,834 465,945/13,375 629,048/21,631
May - 524,343/13,093 192,360/ 4,440 203,560/ 4,605
June - 760,420/23,465 490,275/10,690 490,383/10,721
July - 365,940/ 8,746 607,529/12,955 627,427/12,946
Aug - 804,241/19,175 34,700/ 793 69,930/ 1,063
Sept - 638,082118,378 48 ,250/ 725 48,250/ 725
Oct - 284,204/ 7,734 276, 815/ 6 ,110 267,930/ 6,005
Nov - 455,102/13,000 1,434,392/ 18,615 1,434,392/18,615
Dec - 572,295/17,330 55, 018/ 855 52,722 855
These summaries do not, of course, reflect orders which
might be received (or lost) after their respective dates.
Respondent also introduced summaries showing that in
1973 the plant had worked an average of 1,052 man hours
per day. The average was 1,045 hours per day in 1974 and
1,031 in 1975. The plant worked an average of 1,026 hours
per day in January 1976, 914 in February, and 723 and 619
respectively in March and April, after the terminations. In
1975, during the months of February, March, April, and
May, the average daily hours worked had been 932, 906,
956, and 915, respectively. Vajdak testified that they were
able to meet or exceed production requirements with the
reduced manpower.
Overtime was a regular feature of employment with
Respondent and there were 10-hour days and Saturday
work throughout 1975 and until the end of January 1976.
The plant continued to work 9 hours per day, on both
shifts, until the end of March, when the plant finally went
on an 8-hour day. Lee and Vajdak testified that they did not
reduce overtime earlier, in lieu of the terminations, because
they feared an adverse impact on morale.
According to Lee and Vajdak, a decision to reduce the
work force was made in the last week in February, about a
week before the discharges actually took place.6 Vajdak
testified that his instructions from Lee were to reduce the
force by 30 to 35 percent. The details of how and who were
supposedly left to Vajdak and Pearson.? Lee made the
decision to effectuate the reduction on the morning of
March 3. The record reflects no evidence of any specific
precipitating event on or about that date. Vajdak chose to
eliminate 10 employees from the structural department on
the night shift, on the basis that approximately 50 percent
of production work is performed in the structural depart-
ment and that is the department where production on new
cranes begins. The terminations followed seniority among
those in that department on that shift. No employees were
transferred to the day shift or offered the opportunity to go
into other departments.s In all, there was a reduction of the
work force by about 40 employees by the end of April;
about one-half during March and the remainder in April.
Approximately half of the reduction occurred through
natural attrition. The night shift was shut down at the end
of April and employees on that shift who were not
terminated were transferred to days.
6 Pearson allegedly took part in this decision However, his testimony as
to when the decision was made was vague, shifting, and conjectural
7 Neither Lee nor Pearson testified as to any communication , at that time,
to effect a reduction by a specific percentage of the work force
6 Respondent 's production is a continuous process, the night shift does
323
General Counsel contends that the evidence establishes
that the discharges were motivated by the employees' union
activities, rather than the business conditions, and were
thus violative of Section 8(a)(3). Upon the evidence in its
entirety I am constrained to agree with General Counsel.
All of the elements for finding the discharges to have
been substantially motivated by the union activities are
present herein . See Publishers ' Offset, Inc., 225 NLRB 1045
(1976). Respondent had knowledge that its employees were
engaging in union activity and,, from the conversations
occurring on the night shift between Michulka and the
employees , had reason to conclude that the activity was
strong, if not centered , among the night-shift employees in
the structural department . All of the discharged employees
were , in fact, card signers . Respondent also demonstrated
union animus by its March 2 letter,9 the interrogations by
Michulka and Chapman , and Lee 's March 4 speeches
which contained threats of job loss in the event of
successful union organization . Such "antiunion bias and
demonstrated unlawful hostility are proper and significant
factors for Board evaluation in determining motive."
N.LR.B. v. Dan River Mills, Incorporated, Alabama Division
274 F .2d 381 (C.A. 5, 1960); Publishers ' Offset, Inc., supra.
The timing of the discharges in the instant case and their
precipitous nature further evidence the unlawful motive.
Even crediting Respondent's witnesses in regard to the
decision to reduce the work force, that decision was made
almost immediately upon the inception of the union
activity and Respondent 's acquisition of knowledge there-
of. The discharges took place in that same timespan and on
the day between Respondent's antiunion letter and Lee's
antiunion speeches . They also occurred in midweek, with
no advance warning to the employees, and in the absence of
any event which might have occasioned such precipitous
action.
Finally , for a number of reasons , I find Respondent's
economic defense unpersuasive . Central to its contention
was the alleged loss of one order and the postponement of
two others . Details of these transactions, including the size,
scope, and timing , and documentary evidence thereof
(which must necessarily have existed in contracts of such
magnitude) were not offered . Other evidence of its business
condition consisted, in part , of self-serving and vague
testimony and documents , some prepared after the fact.
More significant , however , are the inconsistencies in
not work on separate projects . Rather , it continues from where the day shift
leaves off.
9 The complaint did not allege the letter to be independently violative of
Sec 8(axl) However , I deem its statement, that the Union was causing
employees to "risk everything ," a thinly veiled threat evidencing animus
324 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Respondent's actions. In December, it boasted of a record
year with another to follow. Even allowing for some
reduction in business, the evidence did not establish that
sales would be significantly below those of 1973, 1974, and
1975, when the plant operated, without reductions-in-force,
at an average of over 1,000 man-hours per day. Moreover,
Respondent's exhibits establish that as of both February 7
and 28, 1976, the backlog of orders for March was higher
than it had been for the same month 1 year earlier. Further,
these same exhibits reveal that between February 7 and 28
the backlog of orders for April delivery increased by more
than a third over $160,000, and increased the necessary
shop hours by approximately 8,000. I further note in this
regard that, as Respondent admitted, the early months of
each year was its usual slow period.
Additionally, Respondent had met slow periods before
without layoffs and, indeed, this and the regularity of
overtime were selling points in the hiring of new employees.
Respondent continued its overtime, 2 hours per day per
employee plus Saturday work through January, and 1 hour
per day even after the discharges in question, even though it
claimed to be looking for solutions to the slackening off of
business as early as December 1975. With approximately
130 employees, 2 hours of daily overtime equals 390 paid
man-hours per day; eliminating even the I hour of daily
overtime worked after February saves 195 paid man-hours
per day without any terminations. I fmd unpersuasive
Respondent's argument that reduction in overtime threat-
ened to create a morale problem. It seems clear that
discharges, after a history that did not even include layoffs,
would be at least equally threatening to morale. Further,
faced with an alleged economic situation warranting a
reduction in profit margins, it is unlikely that Respondent
would have rejected the savings potential of premium pay. I
note, too, that, while there was no evidence of any
permanent change in the pattern of Respondent's business,
Respondent did not lay off the employees in question, they
discharged them.
Casting further doubt on Respondent's claimed motiva-
tion and indicating the precipitous and inconsistent nature
of the discharges are various personnel actions by Respon-
dent. Notwithstanding the alleged decline in business,
James Hindman was hired on February 16 as a welder.
Several of the employees terminated on March 4 were
welders with greater seniority than Hindman. As previously
noted, Clifford Melvin received a substantial wage increase
effective in the week before his discharge. He actually saw
this increase, for the first time, in the pay he received after
discharge. Additionally, Respondent continued to advertise
for employees all during the period of its alleged crisis. A
trailer, advertising job openings, remained outside the
Kranco premises until the end of March. Respondent's
explanation, that it was paid for on a monthly basis and was
retained through March because it was paid for, is
implausible and, even if believed, does not explain why it
would have been rented for the months of January,
February, and March in the face of the alleged loss of
business. Moreover, Respondent ran newspaper advertise-
ments for crane service personnel and crane service trainees
(bargaining unit positions) after the March 4 discharges,
gave no consideration to any of the discharged employees
for such positions, and, when one of the discharged
employees applied for such a job, informed him that the
minimum qualifications for the job had just been increased.
Considering all of the above, I conclude that "Respondent's
unconvincing reasons for the [discharges] actually support
the General Counsel'sprima facie case of unlawful discrimi-
nation." Paramount Metal & Finishing Co., Inc., 225 NLRB
464 (1976).
Finally, while I do not give it great weight, I note that
when Gilmer confronted Michulka with the statement that
they both knew that the employees were being terminated
because of the Union, Michulka did not deny it. Instead, he
nodded his head in the manner normally recognized as
signifying agreement.lo
Accordingly, I fmd that, by discharging the 10 previously
named employees from the night shift on March 4, and by
discharging James Hindman on March 12, Respondent has
discriminated against those employees because of their
union activity and has thereby violated Section 8(a)(3) of
the Act.
CONCLUSIONS OF LAW
1. By threatening employees with loss of employment
opportunities or other reprisals and by interrogating
employees concerning their union activity, membership,
and support, Respondent has interfered with, restrained,
and coerced its employees in the exercise of rights guaran-
teed them under Section 7 of the Act, thereby violating
Section 8(a)(1) of the Act.
2. By discharging the employees named below in order
to discourage union activity, membership, and support,
Respondent has discriminated in regard to the hire and
tenure of their employment, in violation of Section 8(a)(3)
and (1) of the Act:
J. L. Armstrong Clifford Melvin
Danny Starnes W. L. Gilmer
Steven Norton Steve Hundl
Dan Mason William C. Bowen
Scott Forbes James Hindman
Kenneth Carriere
3. The unfair labor practices enumerated above are
unfair labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act.
4. Respondent has not engaged in any unfair labor
practices not specifically found herein.
THE REMEDY
It having been found that Respondent has engaged in
unfair labor practices in violation of Section 8(a)(1) and (3)
of the Act, it will be recommended that Respondent cease
and desist therefrom and take certain affirmative action
designed to effectuate the policies of the Act.
It having been found that Respondent discriminatorily
discharged the employees named in Conclusion of Law 2
10 1 do not deem Michulka's implied admission sufficient to constitute an
independent violation of Sec 8(a)(1) as alleged in the complaint.
KRANCO, INC.
above, Respondent shall offer them immediate and full
reinstatement to their former or substantially equivalent
positions, without prejudice to their seniority or other rights
and privileges, and shall make them whole for any loss they
may have suffered by reason of the discrimmation against
them. Any backpay found to be due shall be computed in
accordance with the formula in F. W. Woolworth Company,
90 NLRB 289 (1960), and Isis Plumbing & Heating Co., 138
NLRB 716 (1962).
"A violation of Section 8(a)(3) goes to the very heart of
the Act." It therefore warrants that Respondent be further
required to cease and desist from infringing in any other
manner upon the rights guaranteed employees by Section 7
of the Act. Pan American Exterminating Co., Inc., 206
NLRB 298, fn. 1 (1973); Entwistle -Mfg. Co., 23 NLRB
1058, enfd. as modified 120 F.2d 532 (C.A. 4, 1941).
Upon the basis of the entire record, the findings of fact,
and the conclusions of law, and pursuant to Section 10(c) of
the Act, I hereby issue the following recommended:
ORDER i i
The Respondent, Kranco, Inc., Houston, Texas, its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Threatening employees with loss of employment
opportunities or other reprisals in order to discourage umon
activity, membership, and support.
(b) Interrogating employees concerning their union
activity, membership, and support.
(c) Discouraging membership in or activities on behalf of
any labor organization, by discharging or otherwise dis-
criminating against employees in any manner with regard
to their rates of pay, wages, hours of employment, hire,
tenure of employment, or any term or condition of their
employment.
(d) In any other manner interfering with, restraining, or
coercing its employees in the exercise of their rights to self-
organization, to form, join, or assist any labor organization,
to bargain collectively through representatives of their own
choosing, and to engage in concerted activities for the
11 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board , the findings,
conclusions, and recommended Order herein shall, as provided in Sec 102 48
of the Rules and Regulations , be adopted by the Board and become its
findings , conclusions , and Order , and all objections thereto shall be deemed
waived for all purposes
325
purposes of collective bargaining or other mutual aid or
protection, or to refrain from any and all such activities.
2. Take the following affirmative action which is
deemed necessary to effectuate the policies of the Act:
(a) Offer the following-named employees immediate and
full reinstatement to their former jobs or, if those jobs no
longer exist, to substantially equivalent positions, without
prejudice to their seniority or other rights and privileges,
and make them whole for any loss of earnings they may
have suffered by reason of the discrimination against them
in the manner set forth in the section of this Decision
entitled "The Remedy":
J. L. Armstrong Clifford Melvin
Danny Starnes W. L. Gilmer
Steven Norton Steve Hundl
Dan Mason William C. Bowen
Scott Forbes James Hindman
Kenneth Carriere
(b) Preserve and, upon request, make available to the
Board or its agents, for examination and copying, all
payroll records, social security payment records, timecards,
personnel records and reports, and all other documents
necessary and relevant to analyze and compute the amount
of backpay due under this recommended Order.
(c) Post at its Houston, Texas, facility copies of the
attached notice marked "Appendix." 12 Copies of said
notice, on forms provided by the Regional Director for
Region 23, after being duly signed by the Respondent's
authorized representative, shall be posted by it immediately
upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places, includ-
ing all places where notices to employees are customarily
posted. Reasonable steps shall be taken by Respondent to
insure that said notices are not altered, defaced, or covered
by any other material.
(d) Notify said Regional Director, in writing, within 20
days from the date of this Order, what steps Respondent
has taken to comply herewith.
IT IS FURTHER RECOMMENDED that the complaint be
dismissed in all other respects.
12 In the event the Board 's Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by Order of
the National Labor 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 "