Ladish Co.

National Labor Relations Board - Board Decisions

Jul 22, 1975

219 N.L.R.B. 354 (N.L.R.B. 1975)

354 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Ladish Co. and District No. 10, and Its Local Lodge
1862, International Association of Machinists and
Aerospace Workers, AFL-CIO. Case 30-CA-2800
July 22, 1975
DECISION AND ORDER
BY MEMBERS JENKINS, KENNEDY, AND PENELLO
Upon a charge filed on July 25, 1974,' by District
No. 10, and its Local Lodge 1862, International As-
sociation of Machinists and Aerospace Workers,
AFL-CIO, herein called the Union , which was
amended on July 31, the General Counsel of the Na-
tional Labor Relations Board , by the Regional Di-
rector for Region 30, issued a complaint on Septem-
ber 27, alleging that Ladish Co., herein called the
Respondent , has unilaterally raised vending machine
prices and refused to bargain with the Union with
respect thereto . Copies of the charge, complaint, and
notice of hearing were duly served on the parties to
this proceeding . On October 5, Respondent filed its
answer admitting various allegations of the com-
plaint but denying that its conduct violated Section
8(a)(5) and (1) of the Act.
On November 8, Respondent , the Union , and the
General Counsel entered into a stipulation to trans-
fer the above-entitled proceeding to the Board, by
which the parties waived a hearing before an Admin-
istrative Law Judge and the issuance of an Adminis-
trative Law Judge 's Decision and recommended Or-
der and agreed to submit the case to the Board for
findings of fact , conclusions of law , and an order,
based upon a record consisting of the stipulation of
facts and the exhibits attached thereto.
On November 15, the Board , by its Associate Ex-
ecutive Secretary , approved the stipulation of the
parties and ordered the case transferred to the Board,
granting permission for the filing of briefs . Thereaf-
ter, the Respondent and the General Counsel filed
briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended , the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
Upon the basis of the stipulation , the briefs, and
the entire record in this proceeding, the Board makes
the following:
FINDINGS OF FACT
1. JURISDICTION
The Respondent is a Wisconsin corporation with
its principal offices and facilities located in Cudahy,
Wisconsin, where it is engaged in the manufacture of
forgings and fittings. During the past calendar year, a
representative period, Respondent shipped and sold
goods valued in excess of $50,000 directly from sup-
pliers located outside the State of Wisconsin.
The parties stipulated, and we find, that Respon-
dent is an employer within the meaning of Section
2(2) of the Act, and is, and at all material times here-
in has been, engaged in commerce and in operations
affecting commerce within the meaning of Section
2(6) and (7) of the Act. Accordingly, we find that it
will effectuate the policies of the Act to assert juris-
diction herein.
II. THE LABOR ORGANIZATION INVOLVED
The parties stipulated, and we find, that the Union
is a labor organization within the meaning of Section
2(5) of the Act.
III. THE UNFAIR LABOR PRACTICES
A. The Issue
The issue presented is whether the Respondent's
vending machine prices are a mandatory subject of
bargaining, so that Respondent's admitted unilateral
raising of food prices in its vending machines and
refusal to bargain with respect to the formulation
and implementation of vending machine prices vio-
lated Section 8(a)(5) and (1) of the Act.
B. Background; Contractual Relations
Respondent has been in existence since 1905.
Since about 1946 to the present time, Respondent
has recognized and bargained with the Union as the
collective-bargaining representative of about 1,800 of
its 4,800 employees at its main plant in Cudahy, Wis-
consin , in an appropriate unit, and has entered into a
series of collective-bargaining agreements . The most
recent agreement is a 3-year contract which became
effective on February 17, 1973. Respondent has con-
tractual relations with six other unions representing
eight other bargaining units.
C. Eating Facilities
All dates hereinafter are in 1974 unless otherwise stated . The Respondent has since 1972 provided for its
219 NLRB No. 60
LADISH CO.
employees 29 "vendette" areas located throughout its
plant and office facilities at Cudahy , Wisconsin. A
"vendette" is a room in which several types of vend-
ing machines are located and which contains tables
and chairs . There are other vending machines at vari-
ous places throughout the plant . The total number of
vending machines is 197 . The machines dispense hot
foods , sandwiches , beverages , pastry, candy , and cig-
arettes . The Respondent provides no other eating fa-
cilities for bargaining unit employees except for the
aforementioned "vendette" areas.
The vending machines are owned and operated by
two companies pursuant to lease agreements with the
Respondent . Canteen Company of America owns
and maintains about 60 to 65 percent of the ma-
chines . The remainder of the machines are owned
and operated by Automatique . Under the lease
agreements , Respondent provides the space in which
these machines are located and maintains the ven-
dette areas . Its craftsmen provide access to electricity
and water needed to operate the machines . Respon-
dent receives a commission on the items sold in the
vending machines to cover the use of floor space,
overhead , and operational costs.
The prices for items sold in the vending machines
are determined by the outside contractors . However,
Respondent has ultimate control over the prices by
its ability under its lease agreements to completely
replace a vendor.
The majority of Respondent 's employees and all of
the employees in the Union 's bargaining unit receive
a 15-minute paid lunch period . About 70 percent of
the employees in the Union 's bargaining unit pur-
chase their lunches from the vending machines, and
90 percent of the employees in the unit utilize the
vending machines for their beverages.
Under the following rule in the employees' hand-
book put out by the Respondent , employees who re-
ceive a 15-minute paid lunch period are not permit-
ted to leave the plant for lunch:
WHEN DO WE EAT AND WHERE
Food service is available at the "servinettes"
(automatic vending machines) located through-
out the plant and office areas. A variety of hot
and cold food is available at reasonable cost.
You may , of course , bring your own lunch.
Lunch periods vary by departments and unions,
so consult your supervisor as to the time and
length of your lunch period . Employees who re-
ceive a 15 -minute paid lunch period are not permit-
ted to leave the plant . [Emphasis supplied.]
355
D. The Union's Requests to Negotiate Increases in
Vending Machine Prices
On October 14, 1970, after being informed by the
Respondent that vending machine price increases
might be required , the Union filed a grievance ob-
jecting to any increased prices . In its grievance, the
Union requested that Respondent show just cause
and proof that price increases were necessary or, in
the alternative , that Respondent negotiate with an-
other company. This grievance was held in abeyance
since prices remained the same.
On June 2, 1972, the Union was again told by the
Respondent that vending machine prices were going
to increase . The Union informed the Respondent
that it was reactivating the 1970 grievance and that it
was protesting the announced unilateral price in-
creases . Nevertheless , prices were increased. In its
June 29 , 1972, answer to the grievance, Respondent
stated that it was not responsible for the increased
prices and that the matter was not considered a bar-
gainable item.
In April and May, vending machine prices on all
items except beverages were increased without nego-
tiation with the Union. Thereafter, on May 28, the
Union reinstituted its 1972 grievance and asked Re-
spondent to negotiate over the price increases. On
June 20, Respondent replied that it did not believe
the increase in vending machine prices was a manda-
tory subject of collective bargaining , and therefore
refused to negotiate concerning the subject.
E. Contentions of the Parties
The General Counsel contends that the vending
machine prices are a condition of employment so
that a change in the prices is a mandatory subject of
bargaining and Respondent's conceded failure to
bargain with the Union before making such increases
violates Section 8 (a)(5) and ( 1) of the Act. Respon-
dent asserts that vending machine prices are not con-
ditions of employment where the prices are set by
independent suppliers and alternative sources of
food and beverages are available.
F. Conclusion
Section 8(d) in defining the duty to bargain, pro-
vides, inter alia, that
to bargain collectively is the performance of the
mutual obligation of the employer and the rep-
resentative of the employees to meet at reason-
able times and confer in good faith with respect
to wages , hours , and other terms and conditions
of employment . . . .
356 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Coupled with this duty is the correlative obligation of
an employer not to unilaterally change employment
conditions without first giving the employees' collec-
tive-bargaining representative prior notice and ade-
quate opportunity to negotiate, in the absence of cir-
cumstances excusing or justifying such action .2
Respondent concededly refused to bargain with
the Union concerning the vending machine prices
charged its employees for food. The Respondent de-
fends this refusal on the ground that vending ma-
chine prices do not fall within the scope of "terms
and conditions of employment" and hence are not a
mandatory subject upon which it is required to nego-
tiate.
Any determination of what is or is not a subject
for mandatory bargaining must start with the prima-
ry purpose of the Act: "to promote the peaceful set-
tlement of industrial disputes by subjecting labor-
management controversies to the mediatory influ-
ence of negotiations." 3 While "the Act does not
encourage a party to engage in fruitless marathon
discussions . . . ," 4 it at least requires him to submit
a dispute to the salutary process of negotiations. In
the instant case, Respondent's unilateral exclusion of
the controversy from the bargaining process has
demonstrated the basis for the statutory scheme
which Congress created; already there have been
three rebuffed requests for negotiations. The only
question, therefore, is whether the dispute shall be
resolved within the framework of collective bargain-
ing established by national policy or left outside the
framework, to fester without negotiation and perhaps
break out in economic warfare.'
Cognizant of the industrial strife brought on by
refusals to confer and negotiate, Congress used the
phrase "terms and conditions of employment" in a
broad sense . Thus, the original Wagner Act did not
contain a section like the present Section 8(d) pur-
porting to define collective bargaining. It did, howev-
er, state in Section 9(a) that a majority union shall be
the exclusive representative "for the purposes of col-
lective bargaining in respect to rates of pay, wages,
hours of employment, or other conditions of employ-
ment." 6 When the Taft-Hartley Act was being deli-
berated, the House of Representatives added Section
2 N.L.R.B. v C & C Plywood Corporation, 385 U.S. 421, 425 (1967);
N.L.R.B. v Benne Katz, d/b/a Williamsburg Steel Products Co., 369 U.S.
736, 743 (1962)
3 Fibreboard Paper Products Corp. v. N.L.R.B, 379 U.S. 203 , 211 (1964),
see also Secs. I and 101 of the Act (61 Stat. 136, 29 U.S C. if 141, 151).
4 N.L.R B v. American National Insurance Company, 343 U.S. 395, 404
(1952).
5 See P . Ross, "The Government as a Source of Union Power : The Role
of Public Policy in Collective Bargaining," pp. 155- 159, 262-265 (Brown
University Press, 1965)
6 1I Leg . Hist . 1669 (1948).
8(d) and sought to specifically enumerate various
subjects to which collective bargaining would be lim-
ited.7 This version of Section 8(d) was opposed on the
ground, inter alia, that what is a proper subject for
collective bargaining "should not be strait jacketed
by legislative enactment." I This reasoning apparent-
ly was persuasive in the Senate since it successfully
resisted the House version and won acceptance of
the present 8(d) language?
The Board and courts have found a wide variety of
subjects to fall within the scope of compulsory bar-
gaining. Among the "myriad matters arising from the
employer-employee relationship" 10 are such "condi-
tions of employment" as inplant feeding," involved
herein, union security,12 employee seniority," plant
locations,14 subcontracting," employee housing,"
price discount practices," employee loan repayment
procedures," methods of paying employees,19 and
plant or environmental matters relating to health,
sanitation, and safety.20 However, the Board has nev-
er taken the position that Section 8(d) requires bar-
gaining about everything that might possibly bear on
the employment relationship?' In this vein, the
Board has recognized that an employer who effec-
tively controls the prices charged his employees at
7 1 Leg . Hist . 163-167, 313-314 ( 1948).
6 1 Leg. Hist. 362 (1948).
911 Leg. Hist . 1541, 1668, 1669 (1948)
10 Inland Steel Company v. N.GR.B, 170 F.2d 247 (C.A. 7), cert. denied
336 U.S. 960 ( 1948).
11 Inland Steel Co., supra at 251.
12 N L R.B v. Andrew Jergens Co., 175 F.2d 130, 133 (C.A. 9, 1949).
I3 N.L.R.B. v Century Cement Mfg Co., Inc, 208 F.2d 84, 35 (C.A. 2,
1953).
14 Industrial Fabricating Inc., et al , 119 NLRB 162, 168, 189-190 (1957),
enfd . sub nom. N.L R B v. Frank Mackneish, et al, 272 F.2d 184 (C.A. 6,
1959).
13 Fibreboard, supra.
6 N.L.R.B. v Lehigh Portland Cement Company, 205 F.2d 821, 823 (C.A.
4, 1953 ); American Smelting and Refining Company, 167 NLRB 204 (1967).
17 N L.R.B. v. Central Illinois Public Service Company, 324 F.2d 916 (C.A.
7, 1963).
is Porto Rico Container Corporation, 89 NLRB 1570 ( 1950).
19 Weyerhaeuser Timber Company, 87 NLRB 672, 686 (1949).
20 N L R B. v Washington Aluminum Company, 370 U.S. 9 (1962)(plant
heat); Preston Products Company, Inc, 158 NLRB 322, 344-345 (1966), re-
manded on other grounds 373 F.2d 671 (C.A.D.C., 1967) (sanitary condi-
tions and towel supply in toilets ); NL.R.B. v. Gulf Power Company, 384
F.2d 822 (C.A. 5, 1967)(safety rules)
21 See, for example , N.L.R B. v. Wooster Division of Borg-Warner Corp.,
356 U S. 342, 349-350 (1958xmsistence on clauses requiring prestrike em-
ployee vote on company's last offer and substitution of union 's uncertified
local as bargaining representative ); Detroit Resilient Floor Decorators Local
Union No. 2265, of the United Brotherhood of Carpenters and Joiners of A mer-
ica, AFL-CIO (Mill Floor Covering, Inc.), 136 NLRB 769, 761 (1962), affd.
317 F.2d 269, 270 (C.A. 6, 1963)(contributions to an industry promotion
fund); District 50, United Mine Workers, Local 13942 [Allied Chemical Cor-
poration] v. N L.R.B., 358 F 2d 234 (C.A. 4, 1966) (decision to subcontract
which had no adverse impact on bargaining unit employees ); Metropolitan
District Council of Philadelphia and Vicinity of the United Brotherhood of
Carpenters and Joiners of America, AFL-CIO (McCloskey & Company), 137
NLRB 1583, 1585 (1962) (provision establishing an industrial advancement
program to carry out industrywide activities, e.g., accident prevention and
research ), Douds v. International Longshoremen 's Association, 147 F.Supp.
103, 111-112 (D.C.N.Y.), affd. 241 F.2d 278, 282-283 (C.A. 2, 1957) ( insis-
tence on bargaining for employees outside the certified unit).
LADISH CO.
in-plant eating facilities cannot practicably be re-
quired to consult with a union before he changes the
price of any item of food . Rather, our view , which we
think is a reasonable one, is that the statute imposes
on such an employer the narrower obligation to hon-
or a specific union request for bargaining about
changes made or to be made.
Nevertheless , the Board , with court approval, has
consistently rejected the argument that bargaining is
not required on various employment benefits on the
ground that they were offered for employee conve-
nience and by their nature accrue only to employees
who elect to use them ,22 or that alternative benefits
from an outside source are available which many and
even a majority of the employees prefer.23
Mr. Justice Stewart , concurring in Fibreboard Pa-
per Products Corp. v. N. L. R. B., supra, stated that "[i]n
common parlance , the conditions of a person's em-
ployment are most obviously the various physical di-
mensions of his working environment ." 24 Consistent
therewith , the Board has long held that an increase in
the price of food charged employees by an employer
in his plant eating facilities involves a "condition of
employment," and hence is a mandatory subject of
bargaining.25
These holdings reflect our experience that employ-
ees who choose to bargain collectively have far more
than increased wages as their goal. Rather , advanta-
geous plant conditions , whether or not of an eco-
nomic nature , are also a source of substantial exxec-
tations and , therefore , potential industrial strife.
Food vending machines and other in-plant eating
facilities also meet significant management needs.
22 See , for example , Richfield Oil Corporation v. N.L.R.B., 231 F.2d 717
(C.A.D.C.), cert . denied 351 U.S. 909 (1956) (stock purchase plans);
N. L.. R.B. v. Black-Clawson Company, 210 F.2d 523, 524 (C.A. 6, 1954) (prof-
it-sharing retirement plans); The Kroger Company v. N.L.R.B., 401 F.2d 682,
687-688 (C.A. 6), cert. denied 395 U.S. 904 (1968) (profit-sharing plans)
23 N.L.R.B. v. General Motors Corporation, 179 F.2d 221, 222 (C.A. 2,
1950) (company health and accident insurance ); Inland Steel Co. v.
N.L.R.B., supra, 250-251 (pension plan).
24 379 U.S. 203, 222 (1964).
25 Weyerhaeuser Timber Co., 87 NLRB 672, 674 ( 1949); Westinghouse
Electric Corporation, 156 NLRB 1080 (1966), enfd . 369 F.2d 891 (C.A. 4,
1966), reversed 387 F.2d 542 (1967); McCall Corporation, 172 NLRB 540
(1968), enforcement denied 432 F.2d 187 (C.A. 4, 1970); Package Machinery
Company, 191 NLRB 268 (1971), enforcement denied 457 F.2d 936 (C.A. 1,
1972).
26 For example , in Preston Products Company, Inc., 158 NLRB 322 (1966),
remanded on other grounds 373 F.2d 671 (C.A.D.C., 1967), a leading indus-
trial relations survey was quoted as follows:
Probably one of the .most striking differences between employee inter-
views and supervisory interviews was that employees were far more
concerned with plant conditions than were supervisors . . . [even those
supervisors ] who shared the same general physical environment....
F. S. Roethlisberger , "Management and the Worker" (Harvard Uni-
versity Press, 1964).
More recent studies reach the same conclusion . See Theodore V. Purcell,
S.J., "The Worker Speaks His Mind on Company and Union" ( Harvard
University Press, 1953) pp. 274-275; Joel Seidman, "The Worker Views His
Union" (University of Chicago Press, 1958), pp 260, 265.
357
Data from various surveys show that food services
are provided to further various management inter-
ests , for example, to boost employee morale by being
presented as an employment benefit, to increase effi-
ciency and productivity by keeping employees near
their working areas and thereby avoiding excessive
lunch and work breaks, and to aid in the recruiting of
personnel. Increasingly, these management needs are
being met by dispensing food through vending ma-
chines?'
In the instant case, the record amply demonstrates
how the Respondent's vending machines are an im-
portant element of the employment conditions in the
plant. About 70 percent of the employees in the
Union's bargaining unit obtain their food from vend-
ing machines during their 15-minute lunch period,
and 90 percent of these employees use the vending
machines for beverages.28 While some employees
bring a lunch with them, there are no other sources
of food, except the vending machines, as
Respondent's rules do not permit those employees
who receive a 15-minute paid lunch period, which
includes all of the employees represented by the
Union, to leave the plant for lunch. Where, as here,
alternative eating facilities are unavailable, the prices
charged for food take on an even greater importance.
If the employees are unsatisfied with those prices,
they cannot simply choose another eating facility.
They are compelled to pay whatever prices are
charged or bring meals from home, whether or not
the latter alternative is burdensome, inconvenient, or
otherwise undesirable to them.29
As Respondent points out in its brief to the Board:
It is readily apparent that rising prices have been
a major item of national concern for a number
of years. Frustration in dealing with the prob-
27 In a recent survey, 54 percent of the responding companies provided
food services for employees in a lunchroom with vending machines. Em-
ployee cafeterias are provided in 43 percent of all companies. Vending ma-
chines (but not in a lunchroom) are provided by 25 percent of the compa-
nies, and lunchrooms with snack bar service are provided in 15 percent.
Because the services vary from one company location to another and re-
spondents were asked to check any of the services provided, the percentages
add to more than 100. The extended use of vending machines is shown by a
survey made by the Field Research Division of the Paper Cup & Container
Institute, New York. Of 1,264 plant officials who replied to the survey,
better than 8 of 10 are using vending machines , with over I of 5 depending
entirely upon automatic vending. 4 Labor Policy and Practice , 245. 201-
203. See also data and conclusions cited in fn. 30 of the Administrative Law
Jud¢e's Decision in McCall Corporation, supra
The fact that beverage prices are not involved herein is irrelevant, as it
is not unreasonable for employees to assume that if the employer increases
the prices of all food items as was done here , increases for beverages will
follow.
29 We have applied here the principles enunciated in our previous cases
cited in In . 25, as well as in other Board precedents, many judicially ap-
proved . However, despite the similarities between those cases and this case,
there are substantial differences, the more notable being the unavailability
of alternative eating facilities because of the Respondent 's rule against leav-
ing the premises if employees have a 15-minute lunchbreak, and the high
percentage of use by employees of the vending machines.
358 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
lems associated with inflation is shared by both
employer and employee.
In our view, the current economic situation makes
even more apparent that the prices charged for food
in the vending machines are a significant condition
of employment. To argue as does Respondent that
employees concerned with rising prices should solve
their problems by negotiating for higher wages really
begs the question before us. For there can be no
comparison between increased wages and lower
vending machine prices since the former are subject
to multiple and increasing taxes and deductions
while the latter are a direct tax-free benefit. More-
over, Respondent presents no good reason why the
Union should not be permitted to bargain about
both "conditions of employment," vending machine
prices and wages.
In any event, as Judge Craven pointed out in the
initial decision in Westinghouse Electric Corporation,
supra:
In determining whether a matter is a mandatory
subject of bargaining, whether much or little is
involved financially is not the controlling test
.... The underlying philosophy of the Labor
Act is that discussion of issues between labor
and management serves as a valuable prophy-
lactic by removing grievances, real or fancied,
and tends to improve and stabilize labor rela-
tions. Experience teaches that major work inter-
ruptions may spring from seemingly trivial caus-
es .30
Respondent contends that vending prices cannot
be a mandatory subject of bargaining because it is
the caterers who set prices and not Respondent and
therefore bargaining with the Respondent would be
futile. However, as detailed above, by virtue of its
lease agreements with the vending companies, Re-
spondent retains ultimate control over which vendors
will maintain and stock the machines on its premises
and has the ability to completely replace a vendor.
Moreover, in Respondent's handbook to employees
quoted above, Respondent maintained that prices in
the vending machines would be "reasonable." If dis-
cussions between Respondent and the Union per-
suade the former that the vendors' pricing policies
are out of line and detrimental to employee interests,
its right to terminate a vendor gives the Respondent
persuasive economic leverage to bring about a
change in those policies. This, of course, would affect
prices to be charged by a third person. So may a
demand for a wage increase when ability to grant it
30 Westinghouse, supra, 369 F.2d at 895. Accord: Fibreboard, supra, 261;
Cap Santa Vue, Inc. v. N.L R. B., 424 F 2d 883 (C.A D.C., 1970).
turns on the employer's willingness to try to obtain
lower prices from his or alternative suppliers; or, per-
haps more in point, so may a demand for more con-
fortable heat in the plant when providing it turns on
the employer's willingness to try to obtain more eco-
nomical heat from his or alternative heating compa-
nies.
The request to negotiate unit working conditions
may not be rejected as futile merely because the bar-
gaining demand may require the employer to exer-
cise his power to change business relationships with
other employers. Hence, the Union and Respondent
may engage in meaningful bargaining concerning re-
duction of prices of meals in the plant vending ma-
chines, even if it is assumed that any agreement
reached would require the Respondent to exercise its
clear ability to modify or terminate the arrangement
with the current caterers. Our order requires no more
than that the Union be given the chance to persuade
the Respondent that a given increase is unwarranted.
The contractual relationship between the vendors
and the Respondent is such that giving the Union
this opportunity may well result in a satisfactory res-
olution of the problem. In our view, the "chances are
good enough to warrant subjecting [this issue] to the
process of collective negotiations." 31
Finally, we see no problem in the fact that the
Union represents only about 37 percent of
Respondent's employees and is only one of seven
unions representing Respondent's employees, when
all of Respondent's employees are served by the
vending machines located on the Respondent's
premises. For the definition of a mandatory subject
of bargaining does not turn upon whether the subject
under negotiation has an impact beyond the confines
of the bargaining unit.32 While it is not unusual for
an employer whose employees are represented by
several unions to negotiate separately with each
union, the Respondent is of course not precluded
from joint discussion with some or all of the unions.
In any event, "it is inconsistent with public policy to
hold that public duties [e.g., the duty to bargain in
good faith] may be set to naught because of alleged
private inconvenience." 33
For all of the reasons stated, we find and conclude
that the vending machine food prices constitute
"conditions of employment" and bargainable mat-
ters. We further find that Respondent's refusal to
comply with the Union's specific request to bargain
about the vending machine food price increases, af-
ter placing into effect such increases, constitutes a
31 Fibreboard, supra.
33 N.L R B v. Charles M Smythe d/b/a E W Saybolt & Co, 212 F.2d
664, 667 (C A. 5, 1954).
33 N.L R.B v. F McKenzie Davison, et al d/b/a Arlington Asphalt Compa-
ny, 318 F 2d 550, 558 (C A. 4, 1963).
LADISH CO. 359
violation of Section 8(a)(5) and (1) of the Act.
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in com-
merce within the meaning of Section 2(6) and (7) of
the Act.
2. The Union is a labor organization within the
meaning of Section 2(5) of the Act.
3. At all times material herein, the Union has been
and is the exclusive representative of all employees in
the following appropriate unit 34 within the meaning
of Section 9(a) of the Act:
All Cudahy, Wisconsin, employees of the
Company, as such group may exist from time to
time after giving effect to all of the provisions of
this contract and actions taken hereunder, in-
cluding Pattern Makers, Janitors, Sweepers, and
Charwomen, Production Machine Shop, Tool
Room, Welding, Maintenance and Repair De-
partment Employees, Grinders, Straightening
Press, Processing Department, Inspection De-
partment, Shipping and Receiving, crane opera-
tors, truck drivers, Stock and Parts Room, oilers,
Garage employees, first aid attendants, fire in-
spectors, machine operators in the Draw Bench
Department who perform machine operations
after the end sawing operation immediately after
ells are formed, and all other production and
maintenance employees, in all other classifica-
tions herein not mentioned but excluding the
following: All executives, office and clerical em-
ployees, all guards, all supervisors with authority
to hire, promote, discipline, discharge or other-
wise effect changes in the status of employees or
effectively recommend such action, all employ-
ees of the Metallurgical Laboratory Depart-
ment, all employees engaged in the Die Room
who work on dies or parts of dies used in the
manufacture and completion of forgings and
who are covered by the collective bargaining
contract between the Company and the Milwau-
kee Die Sinkers' Lodge No. 140 of the Interna-
tional Die Sinkers' Conference, all employees of
the Company of the Steel Stores, Forge Shop,
Draw Bench, Heat Treat and Metallurgical De-
partments coming under the jurisdiction of the
International Brotherhood of Boilermakers, Iron
Ship Builders, Blacksmiths, Forgers & Helpers,
Subordinate Lodge #1509, AFL-CIO, all em-
ployees in the Electrical Department under the
jurisdiction of the Associated Unions of Ameri-
74 As described in the collective agreement between the Union and Re-
spondent and as stipulated at the hearing.
ca, Local No. 85, and all employees in the Power
Plant coming under the jurisdiction of the Inter-
national Brotherhood of Firemen and Oilers,
Local No. 125, A.F. of L., and all employees
under the jurisdiction of the International
Brotherhood of Firemen and Oilers, Local No.
125, A.F. of L., and all employees under the ju-
risdiction of the American Federation of Tech-
nical Engineers and Local 92, AFL-CIO. Cu-
dahy, Wisconsin as used in this section is
defined to include Milwaukee County and pro-
tions of Ozaukee County, Wisconsin.
4. By refusing, on and since June 20, 1974, to bar-
gain collectively with the Union as the exclusive rep-
resentative of its employees in the aforesaid bargain-
ing unit , concerning plant vending machine food
price changes, Respondent has engaged in and is en-
gaging in unfair labor practices within the meaning
of Section 8(a)(5) and (1) of the Act.
5. The aforesaid unfair labor practices affect com-
merce within the meaning of Section 2(6) and (7) of
the Act.
THE REMEDY
Having found that Respondent has unlawfully re-
fused to meet and bargain with the Union concern-
ing food price increases, we shall order that it cease
and desist therefrom and take certain affirmative ac-
tion to effectuate the policies of the Act. As we held
in Westinghouse Electric Corporation, supra, "It is suf-
ficient compliance with the statutory mandate . . . if
management honors a specific union request for bar-
gaining about changes made or to be made." 156
NLRB at 1081. Accordingly, our order will not re-
quire Respondent "to bargain about every proposed
price change in food prices before putting such
change in effect." Ibid. We will require Respondent
to bargain on such price changes only after they are
effectuated unilaterally and upon a request of the
Union.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board hereby orders that the Respondent,
Ladish Co., Cudahy, Wisconsin, its officers , agents,
successors, and assigns, shall:
1. Cease and desist from:
(a) Refusing, upon request, to bargain collectively
with District No. 10, and its Local Lodge 1862, Inter-
national Association of Machinists and Aerospace
Workers, AFL-CIO, as the exclusive bargaining rep-
resentative of all the employees in the unit set forth
360 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
in paragraph 3 of the Conclusions of Law herein with
respect to changes in food prices in the vending ma-
chines.
(b) In any like or related manner interfering with
the efforts of the above-named labor organization to
bargain collectively on behalf of the employees in the
above-described unit.
2. Take the following affirmative action which will
effectuate the policies of the Act:
(a) Upon request, bargain collectively with the
above-named labor organization, as the exclusive
representative of all its employees in the aforesaid
appropriate unit with respect to any changes, now in
effect or hereafter made or proposed, in food prices
charged employees in the vending machines.
(b) Post at its plant in Cudahy, Wisconsin, copies
of the attached notice marked "Appendix." 31 Copies
of said notice, on forms provided by the Regional
Director for Region 30, after being duly signed by an
authorized representative of Respondent, shall be
posted by it immediately upon receipt thereof, and
be maintained by it for 60 consecutive days thereaf-
ter, in conspicuous places, including all places where
notices to employees are customarily posted. Rea-
sonable steps shall be taken by Respondent to insure
that said notices are not altered, defaced, or covered
by any other material.
(c) Notify the Regional Director for Region 30, in
writing, within 20 days from the date of this Order,
what steps the Respondent has taken to comply here-
with.
MEMBER JENKINS, concurring:
It is axiomatic that not every matter bearing upon
the employment relationship is so material or signifi-
cant as to constitute a mandatory subject over which
an employer is obligated to bargain with the union.
However, many employee benefits which in typical
circumstances have only a peripheral effect on the
terms and conditions of employment may in another
context have a direct impact on the employment rela-
tionship and thereby become mandatory subjects of
bargaining. Food services provided by an employer
for the benefit of its employees fall into just such a
category. The service may be offered merely as a
convenience to employees which they as individuals
may utilize or not utilize as they see fit, or it may be
that due to work schedules or job requirements there
is no other food service available. In the latter situa-
tion, the employee may evidence his protest over the
cost or the service at the employer's facility only by
35 In the event that this 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."
bringing his own lunch or not eating at all and nei-
ther of those options qualifies, in my judgment, as a
reasonable alternative to food services provided by
the employer.36
As I stated in my dissent in Westinghouse,37 price
increases in the cost of food items at an employer's
facilities are best left to the voluntary action of the
market place. But that contemplates that a market
place exists in the sense that employees have the op-
portunity to use other commercial vendors. This is
not to say that alternative food services exist only
when there are a sufficient number of restaurant fa-
cilities in locations proximate enough to the plant to
permit their utilization by employees during their
meal period. It is enough if one can say that commer-
cial food services similar to those offered by the em-
ployer are available or can be made available to the
employees.
In my judgment, the situation presented here is
more akin to the one in Weyerhaeuser 38 than the one
in Westinghouse.39 Here the employees are true cap-
tives to the food services being offered at the
Respondent's plant because they receive only a 15-
minute lunch period and they are not permitted to
leave the plant for lunch. There are no other food
services available to the employees and their depen-
dence on the facilities provided by the Respondent is
demonstrated by the fact that, among the employees
in the bargaining unit represented by the Union, 70
percent obtain their food from these facilities and 90
percent purchase beverages from this source.
In these circumstances, I find in agreement with
Member Penello that food prices at the Respondent's
facilities are conditions of employment over which
the Respondent is obligated to bargain, upon re-
quest. In reaching this conclusion, I recognize full
well that the independent caterers who supply the
food and drink items set the prices, not the Respon-
dent. But, Respondent clearly has a financial stake in
the caterers' operations, since it receives a commis-
sion on all items sold. More importantly, ultimate
control over pricing policies resides in the Respon-
dent by virtue of its ability under the lease agree-
ments to replace any vendor whose prices the Re-
spondent considers to be unreasonable. Thus, since
real and effective control is in the hands of the Re-
spondent, it is of little or no significance whether the
control is exercised directly or indirectly 40 Accord-
ingly, on the basis of the undisputed evidence that
36 The brown bag may be an American institution , but it is not an ade-
quate substitute for commercial food services . For an interesting discussion
as to why , see Arbitrator Gerald Cohen's Decision in United Telephone Sys-
tem, 64 LA 525 (March 19, 1975).
37 Westinghouse Electric Corporation, 156 NLRB 1080 (1966).
3e Weyerhaeuser Timber Company, 87 NLRB 672 (1949).
39 Supra
40 Cf. McCall Corporation v. N.L.R B, 432 F.2d. 187 (C.A. 4, 1970).
LADISH CO.
the Respondent refused to honor the Union's request
for bargaining about vending machine food prices
which had been placed into effect, I find that such
conduct constitutes a violation of Section 8(a)(5) and
(1) of the Act.
MEMBER KENNEDY, dissenting:
In my opinion, the Employer is not obligated to
bargain with the Union over the prices charged by an
independent caterer for food dispensed by the cater-
er in vending machines located at the Employer's
plant.
As noted in the majority opinion, there are approx-
imately 197 vending machines located in
Respondent's plant. These machines are utilized by
4,800 employees represented for collective-bargain-
ing purposes by seven labor organizations in nine dif-
ferent units. The machines are owned and operated
by two independent catering companies pursuant to
lease arrangements with Respondent. The leases pro-
vide that prices for items sold in the vending ma-
chines shall be established by the caterer.
During April and May 1974, prices on all vending
machine items were increased by the caterers. By let-
ter dated May 28, 1974, the Charging Party 41 (here-
after IAM) filed a grievance with Respondent in
which it objected strenuously "to your increasing
these prices without negotiations ...." On June 20,
1974, Respondent replied that the vending machine
prices did not constitute a mandatory subject of bar-
gaining given, inter alia, "our lack of control over the
prices charged...." 42 My colleagues find that
Respondent's refusal to bargain with regard to a sub-
ject over which it retained no control violated Sec-
tion 8(a)(5) of the Act. I cannot agree.
This case is the fourth time that a majority of this
Board has found an employer in violation of Section
8(a)(5) for refusing to bargain over changes in vend-
ing machine prices.43 In each of the three prior cases,
the Board's Order was denied enforcement by the
courts.44
Of the four cases, the instant case provides the
weakest record for finding an 8(a)(5) violation be-
41 The Charging Party is one of seven separate labor organizations recog-
nized by Respondent in nine bargaining units at its Cudahy, Wisconsin,
facility. The Charging Party represents approximately 1,800 of the 4,800
em4ployees.
The 1974 grievance is actually a reinstatement of an identical grievance
filed after a 1972 price increase . According to the stipulation herein,
Respondent's answer to the grievance then , as now, was that it "was not
responsible for the increased prices...." The Charging Party elected not
toSursue the 1972 grievance any further.
See fn . 44, infra
44 Westinghouse Electric Corporation, 156 NLRB 1080 (1966 ), enfd. 369
F.2d 891 (C.A. 4, 1966), reversed 387 F.2d 542 (C.A. 4, 1967); McCall
Corporation, 172 540 (1968), enforcement denied 432 F.2d 187 (C.A 4,
1970); Package Machinery Company, 191 NLRB 268 (1971), enforcement
denied 457 F.2d 936 (C.A. I, 1972).
361
cause here-unlike the earlier cases-the Employer
has virtually no control over the caterers' estab-
lishment of prices. In Westinghouse, for example, the
employer retained indirect control over vending ma-
chine prices through a clause in the contracts with
the caterers which provided that the "quality and
prices of the meals served . . . shall at all times be
reasonable." In Package Machinery, the employer
was able to influence vending machine prices by ad-
justing the amount of the subsidy paid to the caterers
as an incentive to service its employees. And in Mc-
Call, the employer itself actually determined the
prices to be charged. In contrast, the authority to
establish vending machine prices here resides exclu-
sively with the caterers.
My colleagues nevertheless find that Respondent
has an obligation to bargain with the IAM over the
establishment of vending machine prices. Their theo-
ry, I gather, is that Respondent does possess the abil-
ity to dictate prices by virtue of its authority to can-
cel the leases and procure catering services
elsewhere. The Fourth Circuit in Westinghouse did
not find this argument persuasive 45 and neither do I.
In my judgment, authority to take the extreme step
of contract cancellation cannot reasonably be equat-
ed with authority to effectively establish prices on
individual items . Just as the prospect of divorce is
seldom an effective mechanism for controlling daily
marital discord, so too the prospect of lease termina-
tion is unlikely to provide Respondent with the le-
verage necessary to dictate a 15-cent reduction in the
price of peanut butter sandwiches or prevent a nickel
increase in the cost of a root beer.
The plain and simple fact is that under
Respondent's lease arrangements it is the caterers-
not Respondent-who effectively establish prices.
This being the case, my colleagues' Order that Re-
spondent bargain "with respect to any changes, now
in effect or hereafter made or proposed, in food
prices charged employees in the vending machines"
is, in effect, an order to perform a futile act. For if
Respondent cannot set prices, any agreement
reached by the negotiators would be unenforceable.
In the words of the Fourth Circuit, my colleagues are
ordering Respondent to engage in "fictional bargain-
ing." 46
There is also a second-and in my judgment
equally persuasive-reason for dismissing the 8(a)(5)
complaint. As noted above'41 the IAM is only one of
seven labor organizations currently recognized by
Respondent at its Cudahy facility. Moreover, the
IAM represents only 1,800 of the 4,800 employees.
45 387 F.2d at 549-550.
46 Westinghouse Electric Corp., supra, 387 F .2d at 550; cl: N.L.R.B v.
Highland Park Mfg. Co., 110 F.2d 632, 637 (C.A 4, 1940).
See In. 41, supra
362 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Accordingly, since the vending machines are avail-
able to everyone in the plant, any price agreement
reached by Respondent and IAM will directly affect
employees represented by other labor organizations.
And what if the agreement reached is not acceptable
to those other employees? The Board cannot logical-
ly direct Respondent to bargain with the IAM over
vending machine prices without providing the same
privilege to the six other labor organizations. It is
entirely possible, therefore, that each time the cater-
ers increase their prices Respondent will be com-
pelled to engage in seven separate sets of negotia-
tions.48 If a uniform price schedule acceptable to all
of the labor organizations cannot be attained, would
the cost of a "ham and cheese on rye" then depend
upon which labor organization represents the pur-
chases of the sandwich?
This is not the meaningful collective bargaining
envisioned by our Act. The order of my colleagues
carries with it the potential for meaningless and re-
petitive negotiations which would be both disruptive
of stable employee relations and economically waste-
ful. In refusing to enforce a similar Board order in
Westinghouse, the Fourth Circuit stated, "[c]onceiv-
ably, enforcement of the order could lead to dis-
agreement, dissatisfaction, strife and turmoil." 49 I
think this observation is equally valid here.
In my judgment, the order of my colleagues re-
quires Respondent to bargain with respect to a sub-
ject over which it has no control and in a manner
which is inimical to the purposes and policies of our
Act. Accordingly, I dissent and would dismiss the
complaint in its entirety.
48 There is nothing in the record to indicate that the labor organizations
recognized by Respondent have ever engaged in joint bargaining
49 387 F.2d at 550.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
Pursuant to a Decision of the National Labor Rela-
tions Board, and in order to effectuate the policies of
the National Labor Relations Act, as amended, we
hereby notify our employees that:
WE WILL NOT refuse, upon request, to bargain
collectively with District No. 10, and its Local
Lodge 1862, International Association of Ma-
chinists and Aerospace Workers, AFL-CIO, as
the exclusive representative of all employees in
the bargaining unit described below with respect
to any change in food prices charged in the food
vending machines. The bargaining unit is:
All Cudahy, Wisconsin, employees of the
Company, as such group may exist from time
to time after giving effect to all of the provi-
sions of this contract and actions taken here-
under, including Pattern Makers, Janitors,
Sweepers, and Charwomen, Production Ma-
chine Shop, Tool Room, Welding, Mainte-
nance and Repair Department Employees,
Grinders, Straightening Press, Processing De-
partment, Inspection Department, Shipping
and Receiving, crane operators, truck drivers,
Stock and Parts Room, oilers, Garage em-
ployees, first aid attendants, fire inspectors,
machine operators in the Draw Bench De-
partment who perform machine operations af-
ter the end sawing operation immediately af-
ter ells are formed, and all other production
and maintenance employees, in all other clas-
sifications herein not mentioned but exclud-
ing the following: All executives, office and
clerical employees, all guards, all supervisors
with authority to hire, promote, discipline,
discharge or otherwise effect changes in the
status of employees or effectively recommend
such action, all employees of the Metallurgi-
cal Laboratory Department, all employees en-
gaged in the Die Room who work on dies or
parts of dies used in the manufacture and
completion of forgings and who are covered
by the collective bargaining contract between
the Company and the Milwaukee Die Sinkers'
Lodge No. 140 of the International Die Sink-
ers' Conference, all employees of the Compa-
ny of the Steel Stores, Forge Shop, Draw
Bench, Heat Treat and Metallurgical Depart-
ments coming under the jurisdiction of the In-
ternational Brotherhood of Boilermakers,
Iron Ship Builders, Blacksmiths, Forgers &
Helpers, Subordinate Lodge #1509, AFL-
CIO, all employees in the Electrical Depart-
ment under the jurisdiction of the Associated
Unions of America, Local No. 85, and all em-
ployees in the Power Plant coming under the
jurisdiction of the International Brotherhood
of Firemen and Oilers, Local No. 125, A.F. of
L., and all employees under the jurisdiction of
the International Brotherhood of Firemen
and Oilers, Local No. 125, A.F. of L., and all
employees under the jurisdiction of the Amer-
ican Federation of Technical Engineers and
Local 92, AFL-CIO. Cudahy, Wisconsin as
used in this section is defined to include Mil-
waukee County and portions of Ozaukee
County, Wisconsin.
LADISH CO. 363
WE WILL NOT in any like or related manner representative of all of our employees in the
interfere with the efforts of the above-named aforesaid appropriate unit with respect to any
Union to bargain collectively on behalf of the changes, now in effect or hereafter made or pro-
employees in the above -described unit. posed, in food prices charged employees in the
WE WILL , upon request , bargain collectively vending machines.
with the above -named Union, as the exclusive
LADISH CO.