Lauren Mfg. Co.

National Labor Relations Board - Board Decisions

Jun 21, 1984

270 N.L.R.B. 1307 (N.L.R.B. 1984)

LAUREN MFG. CO.
Lauren Manufacturing Company and United
Rubber, Cork, Linoleum and Plastic Workers of
America, AFL-CIO-CLC, Local No. 1091.
Case 8-CA-16622
21 June 1984
DECISION AND ORDER
BY MEMBERS ZIMMERMAN, HUNTER, AND
DENNIS
Upon unfair labor practice charges filed 24
March 1983 by the Union, United Rubber, Cork,
Linoleum and Plastic Workers of America, AFL-
CIO-CLC, Local No. 1091, the General Counsel
of the National Labor Relations Board issued on 6
May 1983 a complaint against the Respondent,
Lauren Manufacturing Company, alleging that it
has violated Section 8(a)(5) and (1) of the National
Labor Relations Act. The Respondent filed an
answer denying the commission of any unfair labor
practices and asserting certain affirmative defenses.
On 26 October and 3 November 1983 the parties
jointly moved to transfer the instant proceeding to
the Board without benefit of a hearing before an
administrative law judge and submitted a proposed
record consisting of the formal papers and the par-
ties' stipulation of facts with attached exhibits. On
23 February 1984 the Board issued an order grant-
ing the motion, approving the stipulation, and
transferring the proceeding to the Board. The Gen-
eral Counsel and the Respondent filed briefs.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
Upon the entire record in the case, the Board
makes the following
FINDINGS OF FACT
I. JURISDICTION
The Respondent is an Ohio corporation engaged
in the manufacture of extended rubber products at
its facility located in New Philadelphia, Ohio. The
Respondent, in the course and conduct of its busi-
ness operations, annually sells and ships goods and
material valued in excess of $50,000 directly -to
points and places outside the State of Ohio. Ac-
cordingly, we find that the Respondent is an em-
ployer engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
The United Rubber, Cork, Linoleum and Plastic
Workers of America, AFL-CIO-CLC, Local No.
1091 is a labor organization within the meaning of
Section 2(5) of the Act.
270 NLRB No. 190
III. THE UNFAIR LABOR PRACTICES
A. Issue
The issue presented is whether the Respondent
violated Section 8(a)(5) and (1) of the Act by uni-
laterally changing the terms of its employee medi-
cal insurance plan without bargaining with the
Union.
B. Facts
On 7 July 1981, pursuant to a representation
election, the Union was certified as the exclusive
collective-bargaining representative of the Re-
spondent's employees in the following unit:
All production and maintenance employees, in-
cluding regular part-time employees, line oper-
ators and quality control inspectors employed
by the Employer at its facility located at 2228
Reiser Avenue, S.E., New Philadelphia, Ohio,
but excluding the scheduler, all office clerical
employees, and professional employees, guards
and supervisors as defined in the Act.
Contending that the certified unit was inappro-
priate, the Respondent refused the Union's request
to bargain collectively and to provide relevant bar-
gaining information. In an 11 September 1981 letter
to the Union, the Respondent explained its objec-
tion to the unit and stated, "[w]e therefore decline
to recognize your union as a bargaining agent, or
to enter into labor negotiations with you." At the
same time, the Respondent sent a letter to its em-
ployees notifying them that it was refusing to rec-
ognize the Union until the certification question
was ultimately resolved and stating that it planned
"to maintain our position on the issue through legal
processes and will, if necessary, submit the issue to
the federal court of appeals for a final determina-
tion."
In a Decision and Order issued 13 April 1982,
the Board found that the Respondent had violated
Section 8(a)(5) and (1) of the Act by refusing to
bargain and furnish information to the Union.
Lauren Mfg. Co., 261 NLRB 140 (1982). When the
Respondent refused to comply with the Board's
Order, the Board filed an application for enforce-
ment in the United States Court of Appeals for the
Sixth Circuit. On 22 July 1983 the Sixth Circuit
issued a decision affirming the Board's unit deter-
mination and enforcing the Board's Order in full.
NLRB v. Lauren Mfg. Co., 712 F.2d 245 (6th Cir.
1983). The Respondent refused to bargain and ad-
hered to the position set forth in its 11 September
1981 letters until the date of the Sixth Circuit's de-
cision.
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Respondent has provided health insurance
coverage to all employees in the bargaining unit
for a number of years. On 6 January 1983,1 while
the certification challenge was pending before the
Sixth Circuit, the Respondent sent a letter to em-
ployees announcing that it was changing the terms
of the existing health insurance coverage. In the
letter, the Respondent informed employees that it
was switching to a new cost sharing insurance
plan, that the plan emphasized outpatient care, that
employees who incurred large medical bills would
receive less benefits under the new plan, and that
the employees' deductible would be increased $150.
The Respondent did not notify the Union directly
about this intended change. On 25 January an em-
ployee informed a union field representative that
the Respondent was instituting changes in health
insurance coverage on 27 January. The Respondent
put the announced changes into effect on 27 Janu-
ary.
In a 22 February letter to the Respondent, the
union field representative requested bargaining
over insurance coverage. The Respondent did not
reply to this letter. In March the union representa-
tive spoke with the Respondent's president and re-
quested bargaining over the insurance coverage
changes. The Respondent's president replied that
the union representative's letter had been sent to
the Respondent's counsel. The parties stipulated
that they have not had any other conversations re-
garding the alteration of insurance coverage and
that the Respondent's decision to change insurance
coverage was motivated solely by economic con-
siderations.
C. Contentions of the Parties
The General Counsel contends that health insur-
ance benefits are a mandatory subject of bargain-
ing; that the Respondent had a duty to bargain
with the Union at the time of the unilateral change
notwithstanding the ongoing certification test; that
the Respondent did not afford the Union a reasona-
ble opportunity to bargain about the insurance ben-
efit change before it unilaterally implemented the
change; and therefore that the Respondent violated
Section 8(a)(5) and (1) of the Act.
The Respondent contends that it did not violate
the Act because the Union and employees knew
about the intended change before it was imple-
mented and nevertheless failed to request bargain-
ing over it. The Respondent cites a number of
Board cases that hold, generally, that a union loses
its right to bargain over or complain about a unilat-
eral change if the union has notice of the proposed
1 Unless otherwise stated, all dates are 1983.
change and does not timely request bargaining.
E.g., American Buslines, 164 NLRB 1055, 1055-
1056 (1967). The Respondent contends here that
the Union had ample time to demand bargaining
about the insurance change, and that the change
was not announced as a fait accompli. Finally, the
Respondent contends that the Board should adopt
a new rule precluding institution of 8(a)(5) com-
plaints during ongoing good-faith legal challenges
to unit certifications.
D. Discussion of Law and Conclusions
It is settled that an employer violates Section
8(a)(5) and (1) of the Act by unilaterally changing
terms and conditions of employment without first
providing the collective-bargaining representative
of its employees with a meaningful opportunity to
bargain about the changes. NLRB v. Katz, 369 U.S.
736, 741-743, 747 (1962). It is also well settled that
an employer has an obligation to bargain with a
union which has been certified by the Board and
that an employer is not excused from this bargain-
ing obligation even though the employer is pursu-
ing a good-faith postcertification challenge to the
union's status. A refusal to bargain in these circum-
stances violates the Act. Old King Cole, Inc. v.
NLRB, 260 F.2d 530, 531-532 (6th Cir. 1958);
Louisville Chair Co., 161 NLRB 358, 375-376
(1966), enfd. 385 F.2d 922, 928 (6th Cir. 1967), cert.
denied 390 U.S. 1013 (1968). We decline the Re-
spondent's invitation to overrule this longstanding
precedent. Accordingly, since the Union was prop-
erly certified in 1981, the Respondent was under a
duty to bargain with the Union in January 1983
when the Respondent altered the insurance plan.
We find that the Respondent violated Section
8(a)(5) and (1) of the Act by unilaterally changing
the terms of the employee medical insurance plan.2
The Respondent admits that it changed the plan
without bargaining with the Union, but contends
that the notice of the change it gave to the Union
provided the Union with a meaningful opportunity
to bargain, that the Union then failed to request
bargaining, and that it therefore acted lawfully.
Assuming arguendo that the Respondent's notice
might have been sufficient where an employer had
recognized its general bargaining obligation,3 we
I Employee medical insurance is a mandatory subject of bargaining.
See, e.g., Rose Arbor Manor, 242 NLRB 795, 798 fn. 6 (1979).
3 But see M. A. Harrison Mfg. Co., 253 NLRB 675, 676 (1980), enfd.
682 F.2d 580 (6th Cir. 1982) (3-day interval between announcement and
institution of unilateral change not enough time for adequate opportunity
to bargain; change unlawful). Member Hunter finds M. A. Harrison to be
factually distinguishable from the instant case and therefore he finds it
unnecessary to rely on that case in concluding that the Respondent here
violated the Act.
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LAUREN MFG. CO.
reject the Respondent's contention that its notice
provided the Union with a sufficient opportunity to
bargain. In September 1981 the Respondent in-
formed the Union and employees that it would not
bargain with the Union until the certification issue
was resolved by a court of appeals. It also rejected
a request for bargaining information for the same
reason. In January 1983 when the Union learned of
the proposed change, the Respondent had for over
15 months consistently maintained its position and
refused the Union's request to bargain. The certifi-
cation litigation was still pending and the Respond-
ent gave no indication that its previously an-
nounced position had changed in any respect.
Given the Respondent's manifest refusal to bargain
on any point in January 1983, the Union did not
have a meaningful opportunity to bargain about the
unilateral changes. In these circumstances, "the
union could not be expected to make what prom-
ised to be a totally futile gesture-another demand
for bargaining." NLRB v. Union Carbide Caribe,
423 F.2d 231, 235 (lst Cir. 1970). See Sunnyland
Refining Co., 250 NLRB 1180, 1181 fn. 3 (1980),
enfd. 657 F.2d 1249 (5th Cir. 1981). Indeed, the Re-
spondent completely ignored the February 1983
bargaining demand that the Union did make. Ac-
cordingly, the Respondent did not afford the Union
a meaningful opportunity to bargain about the
changes to the insurance plan before it unilaterally
instituted them, the Union did not waive its right
to bargain, and the Respondent violated Section
8(a)(5) and (1) of the Act. NLRB v. Union Carbide
Caribe, 423 F.2d 231, 234-235 (lst Cir. 1970); Peat
Mfg. Co., 261 NLRB 240, 240 fn. 2, 242 (1982).
CONCLUSIONS OF LAW
1. The Respondent, Lauren Manufacturing Com-
pany, is an employer engaged in commerce within
the meaning of Section 2(6) and (7) of the Act.
2. The United Rubber, Cork, Linoleum and Plas-
tic Workers of America, AFL-CIO-CLC, Local
No. 1091 is a labor organization within the mean-
ing of Section 2(5) of the Act.
3. All production and maintenance employees,
including regular part-time employees, line opera-
tors and quality control inspectors employed by the
Respondent at its facility located at 2228 Reiser
Avenue, S.E., New Philadelphia, Ohio, but exclud-
ing the scheduler, all office clerical employees, and
professional employees, guards and supervisors as
defined in the Act constitute a unit appropriate for
the purpose of collective bargaining within the
meaning of Section 9(a) of the Act.
4. The Union is now, and at all times material
herein has been, the exclusive representative for
the purposes of collective bargaining of the em-
ployees in the aforesaid unit within the meaning of
Section 9(a) of the Act.
5. By unilaterally implementing changes in its
employee medical insurance plan on 27 January
1983 without giving the Union the opportunity to
bargain about such changes, the Respondent has
engaged in an unfair labor practice within the
meaning of Section 8(a)(5) and (1) of the Act.
6. The aforesaid unfair labor practice affects
commerce within the meaning of Section 2(6) and
(7) of the Act.
THE REMEDY
Having found that the Respondent has engaged
in an unfair labor practice, we shall order it to
cease and desist therefrom and to take certain af-
firmative action designed to effectuate the policies
of the Act. We shall order the Respondent to make
whole all its unit employees for losses or expenses
they suffered as a result of the Respondent's unilat-
eral change, as prescribed in Ogle Protection Service,
183 NLRB 682 (1970), plus interest as computed in
accordance with Florida Steel Corp., 231 NLRB
651 (1977).
ORDER
The National Labor Relations Board orders that
the Respondent, Lauren Manufacturing Company,
New Philadelphia, Ohio, its officers, agents, succes-
sors, and assigns, shall
1. Cease and desist from
(a) Refusing to bargain collectively with the
Union by unilaterally implementing changes in its
employee medical insurance plan without affording
the Union an opportunity to bargain over such
changes.
(b) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
ercise of the rights guaranteed them by Section 7
of the Act.
2. Take the following affirmative action neces-
sary to effectuate the policies of the Act.
(a) On request, bargain collectively in good faith
with the Union as the employees' exclusive collec-
tive-bargaining representative with respect to em-
ployee medical insurance coverage and any
changes in the coverage.
(b) Revoke any unilateral changes made to the
employee medical insurance plan on 27 January
1983 and restore employee medical insurance cov-
erage as it existed before the unilateral change,
until such time as the Respondent negotiates with
the Union in good faith until agreement or an im-
passe in negotiations is reached.
(c) Apply the restored insurance coverage to all
employee medical insurance claims that originated
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
after the unilateral change, and make whole all em-
ployees who suffered monetary losses as a result of
the Respondent's unilateral change, with interest as
provided in "The Remedy."
(d) Preserve and, on request, make available to
the Board or its agents for examination and copy-
ing, all payroll records, social security payment
records, timecards, personnel records and reports,
and all other records necessary to analyze the
amount of payments due under the terms of this
Order.
(e) Post at its New Philadelphia, Ohio place of
business copies of the attached notice marked "Ap-
pendix." 4 Copies of the notice, on forms provided
by the Regional Director for Region 8, after being
signed by the Respondent's authorized representa-
tive, shall be posted by the Respondent immediate-
ly upon receipt and maintained for 60 consecutive
days in conspicuous places including all places
where notices to employees are customarily posted.
Reasonable steps shall be taken by the Respondent
to ensure that the notices are not altered, defaced,
or covered by any other material.
(f) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondent has taken to comply.
4 If 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 Na-
tional Labor Relations Board" shall read "Posted Pursuant to a Judgment
of the United States Court of Appeals Enforcing an Order of the Nation-
al Labor Relations Board."
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representa-
tives of their own choice
To act together for other mutual aid or pro-
tection
To choose not to engage in any of these
protected concerted activities.
WE WILL NOT refuse to bargain collectively with
the Union, United Rubber, Cork, Linoleum and
Plastic Workers of America, AFL-CIO-CLC,
Local No. 1091, as the representative of our em-
ployees in the following appropriate bargaining
unit, by unilaterally implementing changes in em-
ployee medical insurance coverage without afford-
ing the Union an opportunity to bargain over such
changes:
All production and maintenance employees, in-
cluding regular part-time employees, line oper-
ators and quality control inspectors employed
by the Employer at its facility located at 2228
Reiser Avenue, S.E., New Philadelphia, Ohio,
but excluding the scheduler, all office clerical
employees, and professional employees, guards
and supervisors as defined in the Act.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce you in the exer-
cise of the rights guaranteed you by Section 7 of
the Act.
WE WILL, on request, bargain with the Union
with respect to employee medical insurance cover-
age and any changes in the coverage.
WE WILL revoke any unilateral changes made to
the employee medical insurance plan on 27 January
1983 and restore employee medical insurance cov-
erage as it existed before the unilateral change,
until such time as we negotiate with the Union in
good faith until agreement or an impasse is
reached.
WE WILL apply the restored insurance coverage
to all employee medical insurance claims that origi-
nated after the unilateral change.
WE WILL make whole all unit employees who
suffered monetary losses as a result of the unilateral
change.
LAUREN MANUFACTURING COMPANY
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