Liberty Homes, Inc.

National Labor Relations Board - Board Decisions

Mar 14, 1975

216 N.L.R.B. 1102 (N.L.R.B. 1975)

1102 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Liberty Homes, Inc. and ^ International Woodworkers
of America, AFL-CIO. Case 18-CA-4267
March 14, 1975
DECISION AND ORDER
BY MEMBERS JENKINS, KENNEDY, AND
PENELLO
On December 12, 1974, Administrative Law Judge
Fannie M . Boyls issued the attached Decision in this
proceeding . Thereafter, the Respondent filed excep-
tions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three -member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and brief
and has decided to affirm the rulings , findings, and
conclusions 1 of the Administrative Law Judge and to
adopt her recommended Order , as modified herein.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge as
modified below and hereby orders that the Respon-
dent, Liberty Homes, Inc., Dorchester, Wisconsin, its
officers , agents, successors, and assigns , shall take the
action set forth in the said recommended Order, as so
modified:
1. Delete from paragraph 1(b) the words "or
voluntarily assisting."
2. Substitute the attached notice for that of the
Administrative Law Judge.
We do not rely on Production Manager Spencers conduct , relative to
the preparation and completion of withdrawal forms , in concluding that
Respondent has refused to bargain with the Union in violation of Sec.
8(a)(l) and (5) pf the Act.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT solicit or use employees to act as
informers as to the number of employees attend-
ing union meetings , the matters discussed, or how
the membership voted at such meetings.
WE WILL NOT solicit employees to withdraw
their membership in International Woodworkers
of America, AFL-CIO.
WE WILL NOT attempt to undermine the
Union's strength by falsely informing employees
that the Union has refused to sign a collective-
bargaining agreement.
WE WILL NOT refuse to sign a collective-
bargaining agreement, the substantive terms of
which have been agreed upon, effective as of the
date of agreement upon such substantive terms.
WE WILL NOT in any like or related manner
interfere with , restrain , or coerce our employees
in the exercise of their rights guaranteed under
Section 7 of the Act.
WE WILL, upon request of the Union, now sign
the agreement negotiated and agreed upon on
July 15, 1974, and give it retroactive effect to that
date. In the event any of our employees suffered
material disadvantage in their conditions of
employment as a consequence of our refusal to
sign the agreement in July 1974, we will make
them whole for any losses thereby suffered.
In the event the Union does not now request
that we sign such agreement, WE WILL, upon
request of the Union, bargain collectively with it
and embody any understanding reached in a
signed agreement.
WE WILL make the Union whole for all
membership dues it has failed to receive as a
result of our failure to honor dues-checkoff
authorizations of employees who were members
of the Union on July 16, 1974, plus interest at the
rate of 6 percent per annum.
LIBERTY HOMES, INC.
DECISION
STATEMENT OF THE CASE
FANNIE M. Bons, Administrative Law Judge : This case,
initiated by a charge filed on July 24 , 1974, and a
complaint issued on September 9, 1974, was tried before
me at Abbotsford, Wisconsin, on October 10, 1974. The
complaint alleges that Respondent on and after July 8,
1974, during the course of bargaining negotiations with the
Union, used informers to ascertain what went on at union
meetings , attempted to destroy the Union 's majority status
by soliciting and assisting employees to withdraw from the
Union, refused to sign a union contract effective as of the
date it was agreed upon, and thereafter posted a notice to
its employees designed to encourage more employees to
resign from the Union and to destroy the Union's majority
status, thereby violating Section 8(axl) and (5) of the
National Labor Relations Act, as amended . Respondent
filed an answer denying that any of its conduct constituted
an unfair labor practice. Subsequent to the hearing the
General Counsel and Respondent filed briefs.
Upon the entire record in this case and from my
observation of the witnesses , I make the following:
216 NLRB No. 192
LIBERTY HOMES , INC. 1103
FINDINGS OF FACT
1. COMMERCE JURISDICTION
Respondent is an Indiana corporation, having an office
and place of business in Dorchester , Wisconsin , where it is
engaged in the manufacture, sale, and distribution of
mobile and motor homes and related products. During the
calendar year 1973, which is a representative period,
Respondent, in the course and conduct of its business
operations, purchased and caused to be transported and
delivered at its Dorchester facility directly from points
outside the State of Wisconsin goods and materials valued
in excess of $50,000. During the same period, Respondent,
in the course and conduct of its business , manufactured,
sold, and distributed directly to points outside the State of
Wisconsin products valued in excess of $50,000. On the
basis of these undisputed facts, I find that Respondent is
engaged in commerce within the meaning of Section 2(6)
and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
International Woodworkers of America, AFL-CIO
herein called the Union, is a labor organization within the
meaning of Section 2(5) of the Act.
III. THE UNFAIR LABOR PRACTICES ALLEGED
Whether the acts alleged in the complaint to constitute
violations of Section 8(axl) and (5) of the Act are in fact
violations can best be analyzed and determined if all the
conduct is viewed in the context in which it occurred. The
relevant facts will therefore be set forth in sequence. There
is little dispute as to the basic facts . The Union was
originally certified on May 26, 1972. On May 17, 1973, it
entered into a collective-bargaining agreement with Re-
spondent which was to be in effect from May 15, 1973,
through May 15, 1974, and from year to year thereafter in
the absence of a 60-day notice by either party to terminate
it. On March 8 , 1974, the Union mailed to Respondent the
required 60 days notice of its desire to terminate the
agreement and attached to the notice a list of proposed
amendments , additions, and terminations of articles of the
current agreement . In a letter dated March 11, 1974,
Respondent likewise gave notice of its desire to terminate
the agreement and in the same letter asked, if the Union
desired to negotiate a new agreement , whether it represent-
ed a majority of Respondent's production and mainte-
nance employees.
Thereafter, following an election pursuant to a decertifi-
cation petition, the production and maintenance employ-
ees again voted for representation by the Union and it was
certified on April 29, 1974.
The parties then met upon several occasions, beginning
on May 9 and ending July 15, to negotiate a collective-
bargaining agreement . They used the expired contract as
the basic agreement which was to be modified or added to.
At these meetings the Union was represented by its
regional vice president , John Hutter , and its president,
employee Robert Krause , with another employee member
of the negotiating committee , Harvey Cook, also attending
in July. Representing Respondent were its division manag.
er, William Zabrosky, and its attorney, Allan Kovar.
At the first meeting, on May 9, the Union requested that
the old contract be extended on a day-to-day or week-to-
week basis until the terms of a new contract were agreed
upon but Respondent declined this request. The remainder
of the meeting was devoted to a consideration of the
Union's proposed modifications or additions to the
contract which was to expire on May 15 but no agreement
was reached on any of the proposals. At the second
meeting, held on May 23, Respondent proposed a deletion
of the union security and checkoff provisions of the
contract, a removal of watchmen from the overtime
provisions of the contract, and a provision that they work
12-hour shifts, 3 days on and 3 days off, and an extension
of the contract as thus modified to May 15, 1975.
At the next meeting held on June 27, after further
bargaining with the Union , with a Federal mediator in
attendance, Respondent dropped the proposals that the
union security and checkoff provisions be deleted and
made two alternative proposals for contracts. One was for
a contract expiring on May 15, 1975, which would provide
(1) that the grievance procedure language of the 1973
contract would be revised to require that grievances be put
in writing at the first step, (2) that watchmen's overtime be
handled as proposed at the previous meeting, (3) that
material handlers would be paid on an incentive basis
rather than on an hourly rate basis, (4) that a list of the
current base rates would be part of the new contract, and
(5) that an individual employee would be permitted only
two successive job bids during one year. The second
alternative proposed contract was for a contract expiring
on May 15, 1976, and would include all the five provisions
listed above and in addition would provide for a 25-cent-
an-hour increase in pay for hourly-rated employees. The
Union informed Respondent that its proposal regarding
the watchmen was not acceptable to the watchmen and
Respondent replied that it thought the proposal would be a
"good dear" for the watchmen and that they could have it
if they wanted it but did not have to take it. In fact, all five
proposals were apparently considered by Respondent as
proposals which the employees would like and the union
representatives understood that they could accept or reject
any or all as they chose. Respondent had presented the,
proposals as matters it would like for the Union to
consider. Two of the proposals, those relating to grievances
and to job bidding, had in substance been among the
proposals already submitted by the Union.
It was undisputed by the parties that before any contract
proposals negotiated by the union representatives could be
effective they would have to be ratified by the union
membership. On July 8 the Union posted a notice on the
plant bulletin board announcing a meeting on July 1 I to
discuss and vote on Respondent's proposals and take a
possible strike vote.
On or about the same date, Respondent's production
manager, Dee Spencer, asked two of the employees in the
bargaining unit to call him after union meetings and tell
him what issues were discussed , how the , membership voted
on such issues, how many voted for and how many against
each issue, and how many employees attended the
1104 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
meetings . Spencer made these requests in the plant during
working hours while he was alone with the individual
employees. Thereafter, each of these employees did, as
Spencer had requested, call him on two occasions and
report the requested information to him. The facts set forth
above were stipulated by the parties at the hearing. Since
only two union meetings , one on July 11 and the other on
July 15, were thereafter held, it is clear that the employee
informers apprised Respondent of the information it had
requested after each of those meetings.
At the union meeting held on July 11, the employees
voted to reject both of Respondent's proposed contracts.
They also voted to strike on the morning of July 16 unless
another meeting with Respondent was held before that
date and an agreement was reached.
Another meeting between the Union and the Respon-
dent was held on July 15 commencing in the morning and
extending into the afternoon . As a possible alternative to
the contracts terminating on May 15, 1975, and May 15,
1976, theretofore proposed by Respondent (by this time
usually referred to by the parties as the 10-month and 22-
month contract proposals), Respondent submitted at this
meeting a proposal for a contract expiring in November
1975 (usually referred to as the 17-month contract
proposal), which, like the 22-month proposal, would
include the 25-cent-an-hour increase for hourly-paid
employees . The union representatives , after caucusing
during a recess, rejected this proposal , pointing out that
November was a bad time for the expiration of a contract
because work then was slack and employees were working
short weeks , but that in May the business was usually
operating at its full capacity . Later, in connection with
discussing the Union's proposal for a guaranteed work-
week , Respondent proposed as a means of alleviating the
hardships caused by the short workweeks in slack seaspns
that 10 percent be deducted from the paychecks of
employees in full employment periods and placed in a
savings account on which the employees could draw during
slack seasons . The union representatives rejected this
proposal also , pointing out that if the employees wanted to
put their money in a bank and let it draw interest during
the peak periods , they could do it themselves and did not
need Respondent to do it for them . Several counterpropo-
sals made by the Union were rejected by Respondent.
Respondent indicated that its own proposals were as far as
it intended to go. The meeting ended on a despondent
note , Respondent suggesting that all three of its alternative
proposed contracts be voted on by the membership but not
having any expectation that the union membership would
accept any of them.
At a union meeting hold on the night of July 15, after
union representatives explained all three of the alternative
proposed contracts to the membership and recommended a
vote only on the 10-month proposal, the membership voted
to adopt the 10-month extension with three of the optional
provisions.
On the same night , immediately following the union
meeting, Union President Krause telephoned Respondent
Production Manager Spencer and informed him of the vote
taken by the union membership. Respondent also presum-
ably learned independently from the employee informers it
was utilizing as to what had happened and how many
employees had voted for and how many against acceptance
of the 10-month contract proposal.
On the following morning, July 16, Union Representa-
tive Hutter telephoned Respondent Division Manager
Zabrosky to inform him of the Union's acceptance of the
10-month proposal. According to Hutter's undenied and
credited testimony, the following conversation took place:
I called Mr. Zabrosky the following morning and the
first thing he said was that he was extremely happy that
they didn't have a strike. I told him, "Yes, we accepted
your 10-month extension." We discussed briefly draw-
mg up the draft of the contract which the company was
to do. Then, I reiterated the points that had been
agreed on and after I had mentioned the 10-month
extension , I went into the five items that the union felt
had been presented to them on a take-it-or-leave-it
basis , they being put the grievance in writing in the first
step, limit successful bids to two in one year, take the
watchmen out of the overtime section of the contract
and put them on a 12-hour shift, three days on three
days off, to put the material handlers on the incentive
program and put the incentive rates in the contract.
Bill said at that point he felt it was a package deal,
that we were supposed to take all five or none of them.
I said , "Well, no, I felt throughout the course of
negotiations, the way our sessions were taking place
that it was a take it or leave thing. We could take any
one of the five or leave them." And he says, "O.K. You
can." And then I reiterated the three that the union had
previously indicated to the company that they were
interested in, put the grievance in writing in the first
step, limit job bidings to two successful bids in a year
and put the incentive rates in the contract.
Then I went on to say, "The effective date, of course,
is the date of ratification," and at that point Bill says,
"The effective date should be July 15th." And I says,
"Yes, that's the date I'm talking about." Then he kind
of caught himself and he says, "No, wait. That was
yesterday." I says, "Yes, it is." Then he says, "That will
be today." Then he kind of caught himself again and he
says, "I better check with Mr. Kovar." And I said,
"Well, go ahead and check with Mr. Kovar but the
union's position is that you made us the proposal on
the 15th of July and we accepted that proposal on the
15th of July and therefore we have a contract as of the
15th of July." That was pretty much the end of that
conversation on the phone that morning.
I am satisfied on the basis of this entire conversation
between Hutter and Zabrosky that although Zabrosky
initially took the position that he felt the five proposed
modifications of the expired contract constituted a "pa-
ckage deal," after discussing the matter further , he agreed
with Hutter's understanding of Respondent 's proposal,
that is, that the Union could take or leave any of the
proposals. I am also convinced on the basis of all the
evidence regarding the negotiations that although this
aspect of Respondent 's proposals had never been spelled
out in so many words, there had clearly been an implicit
understanding during the negotiations that Respondent's
LIBERTY HOMES, INC.
proposals were meant to be primarily for the employees'
benefit and could be accepted or rejected by them as they
pleased.
Also during the morning of July 16, just after the 9 a.m.
break, Production Foreman Paul Hruby approached
employee Neubauer at his work station and asked him if he
wanted to get out of the Union. Neubauer replied that he
had not made up his mind. Hruby then told him to think
about it and let him know if Neubauer decided to
withdraw. Later the same day Neubauer asked Hruby if he
still had some withdrawal forms.[ Hruby then obtained
two such letter forms addressed to the Union, the body of
which stated: "I hereby tender my resignation from Local
IV-67, International Woodworkers of America, effective
July 16, 1974." (The date, "July 16, 1974," was a part of the
xeroxed copies of the form supplied by Respondent for use
by its employees and, except for one employee, Neubauer,
employees signing the forms did not themselves date the
forms.) Neubauer signed both copies, gave one copy back
to Hruby and retained the other copy, which he knew was
supposed to be mailed to the Union's president. He never
mailed it, however, because, as he explained, he was not
certain that he wanted to withdraw. He later, in September,
signed a checkoff authorization slip. At the time Hruby
gave him the withdrawal forms, Neubauer told Hruby that
he could get himself into a lot of trouble if someone found
out he was handing out the forms. According to Neubauer,
Hruby replied that it would be Neubauer's word against
his, for he would never admit handing out the forms.
On the following day, according to the credited testimo-
ny of Eldon Westberg (who is now no longer working for
Respondent), Foreman Hruby approached him at the plant
and told him that if he was interested in withdrawing from
the Union, there were withdrawal forms around. Westberg
replied that he had just joined the Union a short time
before and that if he had not wanted to join, he would not
have done so.2
There had been talk among some employees about
withdrawing from the Union even during the week before
Hruby approached Westberg and Neubauer. Employee
Roger Bunkelman first learned of the withdrawal letters on
the morning of July 16 when he heard fellow employees
discussing them and the fact that Production Manager
Spencer was out of the forms but was having more "printed
up." Just after the morning break, Bunkelman and four
other employees asked their immediate supervisor, Wayne
Thompson, if forms were then available and he directed
them to Spencer's office. Spencer gave them the forms they
requested , asked each to sign his name on two copies and
leave them on his desk , explaining that he would get the
dates stamped on them and get them back to the
employees.3 Later that day Supervisor Thompson brought
i Respondent 's division manager had first prepared withdrawal form
letters and made them available to employees in May , at about the time the
initial collective-bargaining agreement expired . These xeroxed forms recited
that the employees were withdrawing effective May 16, the day after the
expiration of the contract , but were dated in ink on May 14 or May 15,
within the 10-day escape period provided in the dues deduction authonza-
tions.
2 Hruby testified that he did not recall talking to Westberg about
withdrawing from the Union . He further testified that although he had
discussions with several employees , including Neubauer , concerning
withdrawing from the Union , he never asked any of them whether they
1105
one copy of the signed withdrawal letters back to each
employee who had signed it and told each that he should
give the copy to Union President Krause.
In a letter dated July 17, Respondent counsel, Kovar,
enclosed four copies of a document entitled "Amendment
Agreement" which included all the provisions which the
union members had voted, on the night of July 15, to
approve, except that the document purported to have but
did not have attached thereto as an appendix the current
model and option incentive rates and the document recited
that the agreement would be "effective this date"-
meaning the date the parties signed it.
This document was received by Union Representative
Hutter on July 18 and on the same date he wrote Kovar
that the Union did not agree that the document would be
effective upon the date it was signed and that the effective
date was July 15, the date of acceptance by the Union of
Respondent's proposed contract. He also called attention
to the fact that the appendix referred to in the document
had not been attached and requested that it be furnished
the Union for its examination.
Following a telephone conversation between Hutter and
Kovar about the matter, Kovar wrote Rutter on July 19
that there was no final company proposal to the Union on
July 15 which the Union could have accepted, because
there had been no discussion as to the effective date of any
agreement and that no complete agreement had yet been
reached because of failure to agree upon the effective date.
He stated that the appendix containing incentive rates was
being prepared by President Zabrosky. The proposed
appendix was later mailed to Hutter on July 22.
It was at this juncture that the Union filed unfair labor
practice charges against Respondent on July 24. There-
after, on August 5, 1974, Respondent posted a notice to
employees on its bulletin board, stating in substance that
the Union had filed an unfair labor practice charge
alleging that Respondent had refused to sign "the
contract," but that Respondent was willing to sign and it
was the Union which was unwilling to sign unless the
contract was made retroactive to July 15. It stated that the
Union wanted to force back into the Union all those
employees who had resigned subsequent to July 15 and
that despite the Union's statement at the time of the
decertification proceeding that it wanted only what was
best for all Respondent's employees, it was now apparently
less concerned with getting a signed contract for their
protection than with forcing employees to pay dues against
their will. No agreement has yet been signed by the parties.
wanted to withdraw His recollection was very hazy as to how he knew
about the withdrawal forms and as to what was said in his conversations
about them . On the whole , I consider the recollections of Neubauer and
Westberg regarding what was said to them about the withdrawal forms
more accurate than that of Hruby and credit the testimony of these two
employees set forth above.
3 In addition to the July 16 date appearing m the body of the xeroxed
forms, there appears the same date stamped on all but one of the 20 July
withdrawal forms introduced in evidence . The date on one was stamped
July 18.
1106 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Analysis and Conclusions
In alleging that Respondent has unlawfully refused to
bargain with the Union , the General Counsel takes a
double pronged approach . He argues that Respondent was
refusing to bargain in good faith by the use of employee
informers to report to it on the major issues taken up at
union meetings and how the members voted on such issues
and by soliciting employees to withdraw from the Union
and assisting them in doing so in order to destroy the
Union's majority status, conduct which is also alleged to be
independently violative of Section 8(aXl) of the Act. The
General Counsel also argues that Respondent violated
Section 8(aX5) of the Act by refusing to sign a collective-
bargaining agreement which it had proposed and which the
union membership had accepted . He asserts that the notice
posted by Respondent on August 5 was unlawful because
at that time Respondent was under a duty to sign the
agreement effective as of the date the union membership
voted to accept it and that the notice was therefore a part
and parcel of Respondent's campaign to undercut the
Union. For the reasons set forth below, I find merit in the
General Counsel 's contentions.
Unquestionably Respondent's recruiting of two employ-
ees to attend union meetings and report back to it about
the matters discussed and how the employees voted on
such matters was an interference with the employees'
freedom to bargain collectively, proscribed by Section
8(a)(l) and (5) of the Act. Employees and their bargaining
representatives have a right to meet separately from
employer representatives and discuss issues and formulate
bargaining strategy just as employer representatives have a
right similarly to meet separately from the employees and
union representatives to discuss issues and their bargaining
strategy. In recognition of this right on the part of the
employer, the Board has traditionally excluded from the
bargaining unit confidential employees who by reason of
duties which enable them to obtain their employer 's secret
labor relations information , would be in a position to pass
such information on to the employees' bargaining repre-
sentative . Pullman Standard Division of Pullman , Inc., 214
NLRB No. 100; Star Brush Manufacturing Co.; Inc., 100
NLRB 679, 680-681 (1952); American Lithofold Corpora-
tion, 107 NLRB. 1061, 1065 (1954). As the Board aptly
stated in Obie Pacific, Inc., 196 NLRB 458, 459 (1972):
... [And employer ] may not seek to determine for
himself the degree of support, or lack thereof, which
exists for the stated position of the employees'
bargaining agent . If we were to sanction such efforts,
we would impede effective bargaining.
Part of the task facing a negotiator for either a union
or a company is effectively to coalesce an admixture of
views of various segments of his constituency, and to
determine , in the light of that knowledge , which issues
can be compromised and to what degree . A systematic
effort by the other party to interfere with this process
by either surreptitious espionage or open interrogation
constitutes clear undercutting of this vital and necessar-
ily confidential function of the negotiator . It is indeed
designed to undermine the exclusive agency relation-
ship between the agent and its collective principals.
By its recruiting and use of the informers in this case,
Respondent gained an unfair advantage in the bargaining
process and "so interfered with the exclusivity of the
Union's agency as to constitute a violation of Respondent's
duty to bargain in good faith with the employees' duly
designed representatives." (Ibid.) It thereby violated
Section 8(a)(1) and (5) of the Act.
Whether or not an employer may lawfully prepare and
furnish to his employees forms to be used by them in
withdrawing from a union depends upon the circumstances
under which those forms are provided. Where employees,
in a noncoercive atmosphere, request their employer to
prepare or assist them in preparing a withdrawal letter, it
has been held that the employer may lawfully do so.
Payless Drug Store of Port Angeles, Inc., 210 NLRB 134
(1974); Jimmy-Richard Co., Inc., 210 NLRB 802 (1974).
However, where the employer-as Foreman Hruby did in
this case-initiates the suggestion that an employee may
use a withdrawal form prepared by the employer if he
wishes to withdraw from the union, the Board has held the
solicitation or suggestion to be an unlawful interference
with the employee's exercise of his right to belong or not to
belong to a union. Jai Lai Cafe, Inc., 198 NLRB 781
(1972); Kay Electronics, Inc., 167 NLRB 1104, 1110, 1104
(1967); United Supermarkets, Inc., 214 NLRB No. 142
(1974). I find that Respondent, by seeking out at least two
of its employees, prior to any request by them for
withdrawal forms, and telling them that if they wished to
withdraw from the Union, Respondent would furnish
appropriate forms for that purpose, was in effect soliciting
their withdrawals from the Union, in violation of Section
8(aXl) of the Act. This conduct, as well as Production
Manager Spencer's voluntary preparation of withdrawal
forms and assistance to employees in completing them,
occurring at a critical time when Respondent was seeking
to delay the effective date of the substantive terms of a
contract upon which Respondent and the Union had
agreed, manifested an intention on Respondent 's part to
gain time in which to dissipate the Union 's strength, was
inconsistent with good-faith bargaining, and was another
element in Respondent's violation of its obligations under
Section 8(aX5) of the Act.
Let us now turn to the question whether Respondent
independently violated Section 8(a)(5) of the Act by
refusing to sign a contract having as the effective date the
date upon which the parties agreed upon the substantive
terms of a new agreement . At the outset, it should be
pointed out that although Respondent's several proposals
for a contract were referred to by the parties, as well as
occasionally herein, as "extensions" of the old contract, it
was clearly understood by all the parties that any
agreement reached as a result of the bargaining would be a
new agreement , adopting the provisions of the old contract
except insofar as they might be modified or added to. The
Union had requested , at the commencement of the 1974
bargaining negotiations , that the old contract be extended
from day-to-day or from week-to-week while bargaining on
the new contract was in progress and Respondent had
expressly rejected that request.
It is the General Counsel's contention that since
Respondent had offered and the Union had accepted a
LIBERTY HOMES, INC.
proposal for a 10-month extension contract which would
be effective through May 15 , 1975, the effective date is a
matter for mathematical calculation , that is : Ten months
prior to the end of May 15 , 1975, is midnight on July 15,
1974, or 12:01 a.m. on July 16, 1974. In similar vein, it
might also be argued that since the preamble of the expired
contract (which no one during the negotiations expressly
proposed should be rejected) provided that the effective
date of the agreement would be the date of execution or
May 15, 1973, whichever was earlier , there was an implied
agreement that the amendment agreement would contain a
similar preamble with appropriate new dates substituted.
However, I do not believe that the parties , during the
negotiations , ever expressly had in mind or regarded as
significant any detail such as the effective date of an
agreement.
This date became significant only when the parties, after
satisfying themselves that there was a meeting of their
minds as to the substantive provisions of the agreement,
had to turn their attention to the mechanics of reducing the
agreement to writing . In view of the maintenance of
membership provision of the contract , the Union, of
course , would naturally be interested in having the
contract effective as of the date the membership accepted
the terms offered by Respondent .4 Respondent, however,
was clearly interested in attempting to vindicate the rights
of its employees to withdraw from the Union and withhold
their financial support of the Union . On the morning it
received official notice of the union membership 's accept-
ance of its 10-month contract offer , it was busy preparing
forms dated July 16, 1974, for use by its employees in
withdrawing from the Union and knew that a delay in the
effective date of the contract would be needed to afford
dissident members ample time in which to execute the
withdrawal forms and deliver a copy to the Union.
I cannot accept the argument made in Respondent's
brief that there was never any complete proposal made by
Respondent which the union membership could have
accepted on the night of July 15 because there had been no
proposal or agreement as to the effective date of a contract.
Knowing, as Respondent did, that a strike would probably
occur the following morning unless the union membership
had before it on the night of July 15 a complete proposed
contract which it could vote to accept , I am satisfied that
during the last bargaining session Respondent did not
withhold from its offers any contract term which it felt was
necessary yet to negotiate . The weight of the authorities
support the view that once all the substantial terms of a
contract have been agreed upon , the fact that it was
contemplated that the contract would be reduced to
writing and signed does not mean that the contract is not
in effect until signed . In general , a contract is said to come
into existence when an offer made by one party is accepted
by the other party. The intention of the parties as to the
effective date is controlling, of course , but that intention, as
4 It is noted that the dues-checkoff authorization forms provided by the
Union , instead of providing that they should be effective during the life of
the contract, as many authorizations do, recite that the dues deductions
should continue for the life of the current contract and from year -to-year
thereafter, provided that the authorization could be revoked by the
employee only during a 10-day period immediately preceding the anniversa-
ry date of the agreement . Since the anniversary date of the agreement was
1107
here, may never have been expressed during the negotia-
tions. The law applicable in this situation has, I believe,
been clearly stated in Williston on Contracts, § 28A, and
authorities cited therein, as follows:
... Parties rarely express a direct intention as to the
moment when they conceive themselves to be bound by
a contract. The law attaches legal obligation, whether
they will it or not, when their acts fulfill the require-
ments of the law. If, therefore, the parties have
definitely agreed with one another upon all the terms
that a proposed written contract shall contain, there is
a contract, for they have made positive promises to one
another, certain in their content and sufficient as
consideration for one another. If it were true that in
spite of such a mutual agreement there is a presumption
that no contract exists until the writing is executed, a
preliminary agreement would be of the greatest rarity,
for apparently nothing could serve to make the
presumption inapplicable except an express statement
by the parties that they intended to be legally bound
prior to the execution of the writing.
Indeed, it has been held that in the absence of a definite
intention or a positive agreement that a contract whose
substantial terms are not in dispute, should not be binding
until reduced to writing and signed, such contract will be
considered as binding upon the parties at the time it is
orally agreed upon. Genesco, Inc. v. Joint Council 13, United
Shoe Workers of America, 341 F.2d 482, 486 (C.A. 2);
Federal Security Insurance Co. v. Smith, 259 F.2d 294, 296
(C.A. 10); H. B. Zachry Co. v. O'Brien, 378 F.2d 423, 426
(C.A. 10); Smith v. Onyx Oil and Chemical Company, 218
F.2d 104, 108 (C.A. 3); see also Corbin on Contracts, § 30
(1950). There is nothing peculiar to the labor relations field
that should exempt collective-bargaining agreements from
the salutary principles set forth by these authorities. On the
contrary, in the interest of industrial peace, a prime
objective of this statute, it is especially important that
contracts become effective when there has been a meeting
of the minds on the substantive provisions of a contract.
Moreover, it is not at all unusual for collective-bargaining
agreements to have effective dates different from those of
the written document signed by the parties which, like the
expired contract in this case, are earlier than the date of
execution. Volume I, BNA's Collective-Bargaining Negoti-
ations and Contracts.
On the basis of all the evidence and in the light of the
authorities cited, I fmd that a contract came into being and
was effective on July 15, 1974, when the union membership
accepted the 10-month contract terms proposed by
Respondent. By refusing the Union's request to sign a
contract having that effective date, Respondent has refused
to bargain within the meaning of Section 8(aX5) and (1) of
the Act. H. J. Heinz Company v. N.LR.B., 311 U.S. 514
May 15 and some employees had taken advantage of the 10-day escape
period by resigning from the Union prior to that date in 1974, it might be
argued that those not resigning during the escape period were bound by
their dues-checkoff authorizations for another year. I shall assume, however,
as the parties appear to have assumed , that resignations from the Union at
any time when a contract is not in effect , have the effect of canceling the
dues-checkoff authorizations.
1108 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(1941); Trade Mart, Inc., 204 NLRB 1 (1973). Even if,
contrary to my finding above, there had not been a mutual
understanding that the union membership could accept or
reject any of the five proposed modifications of the old
agreement until Zabrosky conceded on the morning of July
16 that the membership had that right , the contract would,
in any event , be in effect as of the moment Zabrosky made
that concession . The remedial order herein would, I
believe, be the same whether the effective date be
considered July 15 or July 16.5
Finally, I agree also with the General Counsel's
contention that since Respondent was under a duty to sign
the collective-bargaining agreement effective as of July 15
at the time it posted its August 5 notice to employees, the
notice, like Respondent 's assistance to the employees in
withdrawing from the Union, must be regarded as a part
and parcel of Respondent's campaign to undercut the
majority representative and encourage further withdrawals
from the Union. It was therefore another element in
Respondent's refusal to bargain in good faith and a
violation of Section 8(aX5) and (1) of the Act. Muncy
Corporation, 211 NLRB 263 (1974).
CONCLUSIONS OF LAW
1. By soliciting and using employees to act as informers
as to the number of employees in attendance at union
meetings, matters discussed , and how the membership
voted at such meetings ; by soliciting and assisting
employees in their withdrawal from the Union; and by
posting a notice falsely attributing to the Union a refusal to
sign a contract agreed upon , in an attempt to dissipate the
Union's strength, Respondent has interfered with, re-
strained, and coerced its employees in the exercise of their
rights guaranteed under Section 7 of the Act, in violation
of Section 8(axl) of the Act.
2. The Union is and has been at all times material
herein the collective-bargaining representative of Respon-
dent's employees in the following described appropriate
bargaining unit:
All full-time and regular part-time production and mainte-
nance employees employed at Respondent 's Dorchester,
Wisconsin, plant including inspectors, watchmen, janitors
and servicemen, excluding over-the-road truckdrivers,
office clerical employees , professional employees, guards
and supervisors as defined in the National Labor Relations
Act.
5 The precise date , it seems , would be significant to the parties only in
the event some union members effectively resigned from the Union prior to
the effective date of the contract . The record shows that forms prepared by
Respondent to facilitate its employees in withdrawing from the Union were
not available until after the morning break on July 16, that after they were
executed by some of the employees , Respondent retained them in order
later to place its official date stamp upon them and that Respondent did not
deliver the employees' copy back to them until sometime later in the day.
Before a resignation from the Union could become effective, it would, of
course, have to be tendered to the Union and it is unlikely that the Union
could have received the employee copies or any of them prior to the
telephonic conversation between Union Representative Hutter and Zabro-
sky on the morning of July 16, particularly if they were to be mailed to the
union president, as employee Neubauer testified . See N.LR.B. v. Interna-
tional Union, United Automobile Artcraft and Implement Workers of America,
3. By the conduct described in paragraph 1 above and
by refusing the Union 's request that it sign a collective-
bargaining agreement which the parties had agreed upon,
Respondent has refused to bargain with the Union in
violation of Section 8(a)(5) and ( 1) of the Act.
4. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
THE REMEDY
It having been found that Respondent has engaged in
unfair labor practices in violation of Section 8(a)(1) and (5)
of the Act, my recommended Order will require that it
cease and desist therefrom and take affirmative action of
the kind normally required to remedy the unfair labor
practices found.
In order to remedy the unlawful refusal to bargain, my
recommended Order will require that Respondent, upon
request by the Union, sign a contract embodying the
substantive terms agreed to by the parties on July 15, 1974,
effective as of that date. Should the Union request that
such contract be signed , Respondent will be required to
apply its terms retroactive to July 15, 1974, and compen-
sate any employee covered by the contract for any material
disadvantage he may have suffered as a consequence of
Respondent's refusal to sign the agreement . Trade Mart,
Inc., 204 NLRB 1 (1973).
The recommended Order will also require that Respon-
dent make the Union whole for any membership dues it
has failed to receive as a result of Respondent 's failure to
honor the dues-checkoff authorizations of employees who
were members of the Union on July 16, 1974, plus interest
at the rate of 6 percent per annum . Creutz Plating
Corporation, 172 NLRB 1 (1968); Ogle Protection Service,
Inc., 183 NLRB 682 (1970).
In view of the lapse of time and possible changed
circumstances since Respondent's refusal to sign a contract
effective as of the date the substantive terms were agreed
upon, the Union may not now request the signing of such
agreement . In that event, my recommended Order will
require that Respondent , upon request by the Union,
bargain collectively and embody any understanding
reached in a signed agreement.
Upon the foregoing findings of fact and conclusions of
law and the entire record , and pursuant to Section 10(c) of
the Act, there is issued the following:
ORDERS
AFL-CIO (John I. Paulding, Inc.) 320 F .2d 12 (C .A. 1 (1963); Mechanical
and Allied Production Workers Union, Local 444, AFL-CIO (Pneumatic Scale
Corporation, Ltd), 173 NLRB 325, 327 ( 1968); Local Union No. 621, United
Rubber, Cork, Linoleum and Plastic Workers ofAmerica , AFL-CIO (Atlantic
Research Corporation d/b/a R & G Sloane Manufacturing Division of
Atlantic Research Corporation) 167 NLRB 610 (1967); Aeronautical
Industrial District Lodge 751 Affiliated with the International Association of
Machinists & Aerospace Workers, AFL-CIO (The Boeing Company), 173
NLRB 450 (1968).
B In the event no exceptions are filed as provided by Sec . 102.46 of the
Rules and Regulations of the National Labor Relations Board , the fmdmgs,
conclusions , and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations , be adopted by the Board and become
its findings, conclusions , and Order, and all objections thereto shall be
deemed waived for all purposes.
LIBERTY HOMES, INC.
The Respondent , Liberty Homes, Inc., its officers,
agents, successors and assigns, shall:
1. Cease and desist from:
(a) Soliciting or using employees to act as informers as to
the number of employees attending union meetings, the
matters discussed, or how the membership voted at such
meetings.
(b) Soliciting or voluntarily assisting employees to
withdraw their membership in International Woodworkers
of America, AFL-CIO.
(c) Attempting to undermine the Union's strength by
falsely informing employees that the Union has refused to
sign a collective-bargaining agreement.
(d) Refusing to sign a collective -bargaining agreement
offered by Respondent and accepted by the Union
effective as of the date of acceptance.
(e) In any like or related manner interfering with,
restraining, or coercing its employees in the exercise of
their rights guaranteed under Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act:
(a) Upon request of the Union, sign and give retroactive
effect to the collective-bargaining contract agreed upon
between Respondent and the Union on July 15, 1974, and
compensate any employees covered by the contract for any
material disadvantage they may have suffered as a
r In the event that the Board 's Order is enforced by a Judgment of a
United States Court of Appeals, the words in the notice reading "Posted by
Order of the National Labor Relations Board" shall read "Posted Pursuant
1109
consequence of Respondent's refusal to sign that contract
in July 1974; and if no such request is made by the Union,
bargain, upon request , with the Union as the exclusive
bargaining representative of the employees in the previous-
ly described appropriate unit and embody any understand-
ing reached in a signed agreement.
(b) Reimburse the Union for all membership dues it has
failed to receive as a result of Respondent's failure to
honor the dues-checkoff authorizations of employees who
were members of the Union on July 16, 1974, plus interest
at the rate of 6 percent per annum.
(c) Post at its Dorchester, Wisconsin, facilities , copies of
the attached notice marked "Appendix." 7 Copies of the
said notice, on forms provided by the Regional Director
for Region 18, after being duly signed by Respondent's
authorized representative, shall be posted by Respondent
immediately upon receipt thereof, and be maintained by it
for 60 consecutive days thereafter , in conspicuous places,
including all places where notices to employees are
customarily posted . Reasonable steps shall be taken by
Respondent to insure that said notices are not altered,
defaced, or covered by any other material.
(d) Notify the Regional Director for Region 18, in
writing, within 20 days from the receipt of this Order, what
steps Respondent has taken to comply herewith.
to a Judgment of the United States Court of Appeals Enforcing an Order of
the National Labor Relations Board."