Letourneau Brothers Construction Co.

National Labor Relations Board - Board Decisions

Dec 1, 1971

194 N.L.R.B. 413 (N.L.R.B. 1971)

LETOURNEAU BROS. CONSTRUCTION CO. 413
Letourneau Brothers Construction Company and
Carpenters Local 1792, affiliated with United
Brotherhood of Carpenters and Joiners of America.
Case 17-CA-4596
December 1, 1971
DECISION AND ORDER
BY MEMBERS FANNING, JENKINS, AND
KENNEDY
engaged principally in the residential construction industry
in Sedalia, Missouri. Annually, Respondent has a gross
volume of business in excess of $500,000, and a direct
inflow in interstate commerce of purchased materials
valued in excess of $10,000. Respondent admits, and I find,
that it is an employer engaged in commerce,3 and that the
Charging Party, herein also called the Union, is a labor
organization, within the meaning of the Act.
II. THE ALLEGED UNFAIR LABOR PRACTICES
A. The Essential Issues
On August 6, 1971, Trial Examiner Benjamin B.
Lipton issued the attached Decision in this proceed-
ing. Thereafter, the General Counsel filed exceptions
and a supporting brief, and the Respondent filed a
brief in answer to the General Counsel's exceptions.
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 Trial
Examiner's Decision in light of the exceptions and
briefs and has decided to affirm the Trial Examiner's
rulings, findings, and conclusions and to adopt his
recommended Order.
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 Trial Examiner and hereby orders that
the complaint be, and it hereby is, dismissed in its
entirety.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
BENJAMIN B. LIPTON, Trial Examiner : This case, with all
parties participating, was heard before me on June 2, 197 1,1
in Sedalia, Missouri , upon a complaint by the General
Counsel2 alleging that Respondent violated Section 8(a)(5)
and (1) of the Act.
Upon the entire record in the case , with due considera-
tion of the briefs filed by General Counsel and Respondent,
and from my observation of the demeanor of the witnesses
on the stand , I make the following:
FINDINGS OF FACT
1. JURISDICTION AND LABOR ORGANIZATION
Letourneau Brothers Construction Company, herein
called Letourneau or the Respondent, is a partnership
1 All dates are sequentially in 1970 and 1971 except as specifically
noted.
2 The charge was filed by the Union , and served on Respondent by
registered mail, on March 1, 1971.
3 E.g., United Slate, Tile and Composition Roofers, etc., AFL-CIO, Local
The complaint alleges, in substance, (a) that Sedalia
Builders Association is an organization of building
contractors in the Sedalia area which exists for the purpose,
inter alia, of bargaining collectively on behalf of its
members, including Respondent; (b) that all carpenter
employees of the Association members constitute a single
appropriate bargaining unit; (c) that about May 25, 1970,
the Union and the Association reopened an existing
contract and agreed to a new contract for 2 years effective
July 1; (d) that since November, and particularly on
January 19 and February 19, the Union requested
Respondent to execute , the contract and Respondent
refused; (e) since January 1, Respondent failed and refused
to abide by the terms of the contract; (f) about February 19,
Respondent unilaterally offered its employees increases in
wages and fringe benefits; and (g) that Section 8(a)(5) and
(1) of the Act were violated. Respondent denies each of
these allegations,, and additionally contends that all the
operative facts alleged in the complaint occurred prior to
the 6-month limitation period in Section 10(b) and are
therefore barred as substantive evidence.
B. The Alleged Employer Association
As noted, the complaint specifically refers to the "Sedalia
Builders Association," and asserts that the carpenters
employed by the Association' s members constitute a single
appropriate bargaining unit. Elsewhere in the record
various other names are assigned to an association of
building contractors in the Sedalia area . On this disputed
issue, it affirmatively appears that there have never been
any bylaws, rules, membership lists, dues, stationery, or
writing of any kind to reflect the existence of such an
association. And the evidence is clear that no association,
group, or agency has been authorized by any individual
contractor to negotiate on its behalf with any union, or to
bind any such contractor in a multiemployer contractual
relationship.
The particular contractors embraced in the purported
association at any given time are nebulously outlined. On
the testimony of General Counsel' s witnesses, they appear
to comprise all commercial and residential contractors in
the Sedalia vicinity. At various points in the record, about
12 such contractors are mentioned by name.4 Over a period
of 8 to 10 years, from four to eight contractors,
Union No. 57 (Atlas Roofing Co, Inc), 131 NLRB 1267; Hod Carriers,
Building & General Laborers' Union of America, Local No. 652, AFL-CIO
(Earl C Worley), 147 NLRB 380.
4 Tempel-Callison Co.; William E Yarboro; William Garner; Bill
Norman; Heimsoth & Borchers , Eichholtz & Son; Dean Construction Co.;
(Continued)
194 NLRB No. 70
414 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
unidentified, have met separately on two or three occasions
to consult with each other on union contract negotiations.
Ostensibly, a president and a secretary of the group are
"elected," but the nature of the voting, the contractors
present, and the functions and terms of office are obscure.
It was testified that the current president, , Melvin
Heimsoth, was elected at a meeting in the spring of 1970;
but Heimsoth stated that he first became aware of his office
in the fall of 1970 when Tempel called and simply told him
he was president. Yarboro testified that he has been the
secretary of the group for about 5 years. In January or
February 1971, Heimsoth attended two meetings with
Yarboro, Tempel, and Garner, and the addition of Norman
on the second occasion. These contractors met to consider
the formation of an organization which would have binding
authority on its members to negotiate with unions. The
proposition was not adopted. As particularly pertinent, the
evidence indicates that Respondent never attended any
contract bargaining meetings between contractors and the
Union before the negotiations in question in 1970, infra.
C. The Bargaining History
It was broadly testified that, in the past, the Sedalia
contractors negotiated only with the Union and the Cement
Finishers. The purpose was to negotiate "the basis for the
contracts and the contracts were executed with the
individual contractor." There is no testimony concerning
any particular bargaining meeting between the contractors
and the Union before 1970. The only prior existing contract
in evidence, effective from January 1, 1968, until December
31, 1970, is signed by only three contractors-Cramer,
Yarboro, and Gentry Patterson. The agreement itself
ambiguously states that it shall be in effect between the
Union "and the Contractors Association and/or the
Individual Contractors of-Sedalia."5 I find this was in fact a
contract between the Union and each of the three signatory
contractors, rather than a contract with an association
binding on other contractors who did not sign. General
testimony was given by Union Agent Middleton, based on
information he had received from union members, that the
terms of this contract were followed by other Sedalia
contractors. Without identification of particular contrac-
tors or a showing of actual knowledge by Middleton, such
testimony cannot quite be regarded as probative evidence.
However, it may be inferred from the record that some of
the nonsignatory contractors recognized and largely
adhered to the rates provided in the Union's contract as
reflecting the prevailing wage in the area. As to this
contract, Respondent's testimony is that it tried to pay
union scale or better; as for example, it paid 25 cents an
Cramer Construction Co , Gentry Patterson; Charles Patterson; Potts; and
Letourneau Brothers Construction Co Business Agent Richard C
Middleton testified that, in November 1970, he made a list of 10 to 12
member contractors verbally given to him by Yarboro as secretary of the
"Builders Association."
5 On a separate slip of paper stapled to the exhibit there appears a
typewritten and handwritten statement listing eight named contractors,
including Respondent, as "members Sedalia Contractors Association." The
list was not offered or admitted as being part of the contract, and was
otherwise not identified as to source.
6 The letter itself was not produced in evidence.
7 The testimony of Letourneau and General Counsel's witnesses Tempel
and Yarboro is consistent in this regard. I am unable to accept the version
hour above the contract rate to its foreman and certain
other carpenters. In other respects, Respondent did not
conform to specific contract provisions, e.g., payment of a
higher wage rate on commercial, as opposed to residential,
jobs; and the Union never protested that Respondent failed
to abide by the contract. In Respondent's experience, the
only union contract it ever signed was with the Laborers
Union in 1968 covering one employee of a subcontractor.
Thus, it seems entirely clear that there was no bargaining
history, based on contract or practice, between the Union
and any of the Sedalia contractors which would justify the
finding of an associationwide or multiemployer bargaining
unit prior to the 1970 negotiations-more especially as
would be binding on Respondent.
D. The 1970 Negotiations and Subsequent Events
About April 1970, Yarboro received a letter from the
Union's business agent, John Stanton, requesting a
reopening of the contract, which was due to expire
December 31, 1970.6 Yarboro then made arrangement for
meeting with the Union. It is found that two meetings were
held at the union hall between certain contractors and the
Union approximately in May and June 1970; and one
intervening meeting was held among certain contractors
alone, in Tempel's office, relating to contract negotiations.
Leo Letourneau first appeared at the separate contractors'
meeting, and was present only at the second meeting with
the Union .7 Apart from Letourneau, the contractors who
met with the Union were-Yarboro, Garner, Tempel, and
Borchers .8 In attendance for the Union were five or six
representatives, including Middleton and Montgomery.
At the first bargaining meeting, the parties were
concerned mainly with the Union's request for an increase
in wage rates. Certain other fringe benefits were discussed,
and the contractors agreed to contribute 2 cents an hour
into a joint apprenticeship fund. The existing contract
contained separate wage rates for commercial and
residential work (e.g., $4.60 an hour for commercial, and
$4.35 for residential). Some of the contractors were
considered primarily commercial (Tempel and Borchers),
and some primarily residential (Garner and Letourneau).9
The Union proposed a wage increase (apparently for
commercial jobs) of $2 per hour to be effected in 6-month
stages during a 2-year contract. 10 The contractors agreed to
increase the rate differential between commercial and
residential jobs.
of Richard C. Middleton and Ivan Montgomery, officers of the Union,
who placed Letourneau at both meetings with the Union. In any case, the
final result would not be affected
8 Borchers represented the firm of Heimsoth & Borchers . Heimsoth,
who was included by Yarboro as one of the participants, testified that he
never attended any meeting with the Union.
9 Letourneau stated that generally 5 to 10 percent of his work is
commercial.
io The sequence and substance of the wage proposals and
counterproposals are not clear or consistent in the testimony of General
Counsel's witnesses. The conflicts, however, are not of material
consequence , in view of the basic positions stated on each side and the
terms of the contract ultimately reached.
LETOURNEAU BROS . CONSTRUCTION CO. 415
At the subsequent meeting of the contractors
themselves,ii Letourneau indicated that he could not agree
to a reopening, as he had no contract, and that he could not
profitably operate with the Union's requested raise and
would not go along.
At the second meeting with the Union, Contractor
Garner counterproposed a 2-year contract with wage
increases of $1.33 for residential jobs, as follows: 25 cents
on July 1, 1970; 35 cents on January 1, 1971; 35 cents on
July 1, 1971; and 38 cents on January 1, 1972. This offer
was accepted by the Union, together with a total increase of
$1.90 in the commercial rate over the contract term.
Letourneau firmly stated his opposition to the raise
affecting residential jobs, but indicated he would pay the
commercial rate if he performed such work.12 It was not
until November 1970 that the Union had the contracts
printed and that various contractors were asked to sign.
When approached, Letourneau refused to sign, and he
requested a separate (i.e., different) contract for his firm,
which the Union declined. Only four contractors executed
the contract, each on an individual basis: Yarboro and
Eicholz on November 16, 1970; Garner on March 8, 1971;
and Tempel on or about February 1, 1971. In signing the
latter contract, Tempel wrote and initialed the following
language: "Subject to approval by the Sedalia Contractors
Association." The other executed contracts contain no such
entry. As a witness, Tempel did not explain the meaning of
this addition. There is no evidence that the contractors
subsequently met as a group to approve the contract as
written.13
On July 1, 1970, Letourneau did not pay the first rate
increase in the contract. In mid-July, after he was
approached by a carpenter employee to pay the prevailing
wage, he granted the increase effective as of July 1.
Throughout the summer of 1970, Letourneau performed
work on a commercial job, but did not pay the commercial
rate. Nor does it appear that he contributed to the point
apprenticeship fund. As of the present, he is paying some of
his carpenters above the union scale.
An employee testified that, on December 31, 1970, at a
New Years' party held in the Letourneau home, the
employees were told by Letourneau that he could not pay
the increase due under the contract on January 1, 1971, and
that "if anybody doesn't like it, they could find work some
place else." General Counsel alleged in the complaint as an
independent violation of Section 8(a)(1) that Letourneau
had said, in this context, he was "going non-union." The
allegation will be dismissed.
On January 19, 1971, the Union arranged and held a
11 Tempel, Garner, Borchers, Patterson, and Letourneau.
12 Middleton testified that at one of the negotiating sessions (he was not
sure which one), Letourneau proposed a raise of 65 cents over 2 years, and
that this was rejected by the Union at the following meeting Tempel and
Yarboro gave no such testimony. Whether Letourneau made such a
proposal at the single bargaining meeting he attended, I find it immaterial
in the disposition of the ultimate issues
13 As earlier shown, Heunsoth had been designated president of the
contractors group in the fall of 1970 His firm did not sign the 1970
contract, nor any previous contract.
14 This was testimony of the job steward, which I construe to mean that
Letourneau could not operate, as in the past, by paying the contract union
scale in residential work.
15 It is unclear which meeting on February 19 preceded the other, but it
meeting with Letourneau and six of his carpenters at the
union hall. Letourneau refused again to sign the contract,
and said that he would consider signing if the Union
organizes all the other residential contractors. He asked to
negotiate a separate contract, and was refused, assertedly
because it was contrary to the Union's bylaws. Middleton
testified that Letourneau then indicated that unless he
could get such a contract, he would "go CIU" or "go non-
union." The outcome of the meeting was that the Union
"would give Letourneau and his employees 30 days." On
February 19, 1971, there was a further meeting at the union
hall, with generally the same parties present. The Union
indicated it would begin picketing Letourneau on February
22 if he did not adhere to the contract. Letourneau replied
that he "didn't give a damn" about the contract. He would
pay $6 an hour for his better men, and let some men go. He
further stated the proposition that he would pay his
carpenters $240 a week, guarantee 24 months of work,
establish a pension program of $30 a month upon
retirement age of 62, and institute a profit-sharing policy,
such as a bonus, for those who worked for him Monday,
February 22. These proposed terms were put into writing
and signed by both Letourneau brothers. Also on February
19, four carpenter employees were at the Letourneau home,
near the jobsite, to obtain their regular paychecks.
Letourneau told them he could not pay the contract wage
increase; there was too much competition from nonunion
builders; he would either operate nonunion or go broke;14
and he did not feel that all his carpenters were equal or
should be paid the same wage. He offered the employees
the same wage and fringe proposal, described above, which
was put into writing at the union hall that day. His admitted
purpose was to induce the carpenters to stay with the firm
while it was being picketed.15 Whether the terms of this
offer were actually put into effect is not indicated.
E. Concluding Findings
Stated for the purposes of this case, the test of a
multiemployer bargaining unit is whether the employers in
question "have indicated from the outset an unequivocal
intention to be bound in collective bargaining by group
rather than individual action." 16 More specifically, as the
issues are framed in the complaint, the immediate questions
are whether Respondent was bound to the terms of the 1970
contract by virtue of (1) its inclusion in a prior existing
association or multiemployer bargaining unit, or (2) by the
independent evidence of its conduct in the 1970 contract
negotiations. As already indicated, the evidence is consider-
ably deficient to support a finding on the first ground.
may be inferred, particularly from the reference to the picketing, that the
meeting at the Letourneau home occurred later in the day.
16 E.g., Weyerhaeuser Company, et a!., 166 NLRB 299. Cf. The Kroger
Co. 148, NLRB 569, 573-holding that in multiemployer bargaining a
union and an individual employer member of the group are not
automatically precluded from negotiating separately on limited matters of
peculiar concern to the individual employer. Where the employer member
has indicated the requisite intention to be bound in collective bargaining
by group action, the multiemployer unit is appropriate even though the
employer may not have specifically delegated to an employer group the
authority to represent it in collective bargaining, or given the employer
group the power to execute agreements on its behalf, or where some
contracts have not been signed by all members of the group.
416 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Regarding the 1970 negotiations, it is essentially shown that
Respondent attended a separate meeting among several
contractors, participated in the second of two bargaining
meetings with the Union, but that it stoutly voiced its
refusal to accept the proposed terms, and declined to
execute the contract when proffered. As to Respondent, or
indeed any of the amorphous group of Sedalia contractors,
it could scarcely be held on this record that there was an
unequivocal intent to be bound by group bargaining. Of the
12 Sedalia contractors named in the record at one point or
another, only 4 individually signed the negotiated 1970
contract, and only 3 were shown as party to any prior
contract. Entirely too much reliance is placed by the
General Counsel on evidence, of a highly generalized
character, that some nonsignatory contractors, including
Respondent, tended to adhere to prevailing wage rates
reflected in the Union's contract in the area. Even assuming
the prior existence of a multiemployer or association unit, it
is not sufficient to bind nonmember employers solely on a
showing that they have adopted the terms of a contract
negotiated by the multiemployer group.17 All that is really
evident here is that some of the Sedalia contractors, in
varying combinations, informally associated themselves at
different times merely for the sake of convenience in
bargaining with the Union, without any intention to be
bound contractually as a group.is
The complaint allegations that Respondent violated
Section 8(a)(5) by refusing the Union's requests since
November, and particularly on January 19 and February
19, to execute the 1970 contract, and by refusing, since
January 1, to abide by the terms of such contract-must be
dismissed as devoid of merit. That Respondent orally
consented, in the course of the bargaining discussions, to
pay an increased commercial wage rate, and that it
subsequently failed to make such payment, is not alleged
17 See, e.g, Moveable Partitions, Inc, 175 NLRB No. 149.
18 E.g., Council of Bagel and Bialy Bakeries, etc, 175 NLRB No. 148
19 While a serious question would arise from Respondent's defense
and certainly cannot be found as a violation, absent
Respondent's commitment to the full 1970 contract.
There remains the further allegation that Respondent, on
February 19, unilaterally offered its employees increased
wages and fringe benefits. Under the complaint, General
Counsel has proceeded solely on the premise of a single
appropriate bargaining unit consisting of all carpenters
employed by members of the Sedalia Builders Association,
which purportedly includes Respondent. The existence of
such a unit was plainly not established. It generally appears,
although the question was not specifically litigated, that a
majority of Respondent's carpenters were members of the
Union. Assuming an appropriate unit confined to Respon-
dent as a separate employer, a refusal-to-bargain violation
would not he under the facts presented herein. The Union
did not seek recognition or bargaining in such a unit. And it
rejected Respondent's request for a separately negotiated
contract limited to Respondent's carpenters. It was
Respondent's practice to deal with its, carpenters individu-
ally in hiring and arranging conditions of employment. On
February 19, Respondent made the same offer directly to
employees which it specified at a meeting with the Union
the same day in the presence of employees. The Union
could reasonably have viewed Respondent's proposal as a
basis for negotiating an individual contract with Respon-
dent. However, such a course of bargaining had been ruled
out by the Union and rendered futile as to Respondent. It
therefore cannot, in any event, be held that Respondent
unlawfully sought to bypass the Union or to derogate from
its representative status by dealing directly with its
carpenter employees in such circumstances.
RECOMMENDED ORDER
Accordingly, it is hereby recommended that the com-
plaint be dismissed in its entirety.19
predicated on the 6-month limitation period under Section 10(b), it is not
necessary to reach or pass on such issue in view of the substantial failure of
the General Counsel to sustain the factual allegations of the complaint.