Magnin, Joseph, Company, Inc.

National Labor Relations Board - Board Decisions

Aug 10, 1981

257 N.L.R.B. 656 (N.L.R.B. 1981)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Joseph Magnin Company, Inc. and Department
Store Employees Union, Local 1100, United
Food and Commercial Workers International
Union, AFL-CIO. Case 20CA-14321
August 10, 1981
DECISION AND ORDER
On December 16, 1980, Administrative Law
Judge Martin S. Bennett issued the attached Deci-
sion in this proceeding. Thereafter, Respondent,
the General Counsel, and the Charging Party filed
exceptions and supporting briefs; Respondent filed
a brief in answer to the exceptions of the General
Counsel and the Charging Party; and the Charging
Party filed a brief in answer to Respondent's ex-
ceptions.
The National Labor Relations Board has consid-
ered the record and the attached Decision in light
of the exceptions and briefs and has decided to
affirm the rulings,' findings, and conclusions2 of the
Administrative Law Judge but to modify his rec-
ommended Order consistent with the additional
remedy granted herein.
The Administrative Law Judge concluded, and
we agree, that Respondent violated Section 8(a)(3)
and (1) of the Act by prohibiting the transfer of
hourly paid employees to its newly opened Gucci
specialty store on Post Street from stores at which
these employees were represented by the Union
pursuant to the terms of a collective-bargaining
agreement. The Administrative Law Judge found
that Respondent's refusal to permit the transfer of
union members was motivated by a desire to pre-
At the hearing, the Charging Party moved to defer resolution of the
8(a)(3) allegation to the decision of Arbitrator Grodin rendered otl July
16, 1979. Both Respondent and the General Counsel opposed the motion.
Without ruling formally on the Charging Party's motikon to defer. the
Administrative Law Judge formed independent conclusions concerning
the discrimination issue, although in so doing he found the arbitrator's de-
cisionl entitled to great weight Citing Spielberg Manutfucturing Comnpuny.
112 NLRB 1080 (1955). the Charging Party has renewed before the
Board its motion to defer in the form of an exception to the Decision of
the Administrative Law Judge. After careful consideration of the record
anid briefs, including the record in the arbitration proceeding, we are of
the opinion that deferral is inappropriate in this case. Arbitrator Grodin
was not presented with sufficient evidence by the parties and therefore
was unable to make findings of fact crucial to shaping the necessary
remedy with regard to backpay for the employees denied transfers by
Respondent. See Triple A Machine Shop. Inc., 245 NLRB 136 (1979) We
therefore hereby deny the Charging Party's motion to defer to the arbi-
trator's award, and we uphold the ruling of the Administrative Law
Judge.
2 We adopt the conclusion of the Administrative Law Judge that Re-
spondent violated Sec. 8(a)(1) and (3) of the Act by discriminating with
respect to transfer and employment opportunities at its new Post Street
store on the basis of union membership. In so doing, however, we do not
rely on the Administrative Law Judge's discussion of the Embarcadero
situation at sec 4, par. 6, to the extent that he appeared to flind independ-
ent violations of the Act based ol events which occurred outside the
statutory' 10(b) period We agree with the Administrative Law Judge's
analysis of the eenlts that occurred when the Embarcadero store was
opened, however, isofar as they provide only hackground evidence for
the violation found in the instant case
257 NLRB No. 86
vent the Union from gaining majority status at the
new store. Nevertheless, he dismissed the General
Counsel's allegation that Respondent violated Sec-
tion 8(a)(5) of the Act by refusing to recognize and
bargain with the Union because the evidence did
not establish that the Union had obtained an actual
majority at Post Street and because the number of
identifiable discriminatees was not sufficient to
demonstrate conclusively that the Union would
have obtained majority status had the unfair labor
practices not been committed. Both the General
Counsel and the Charging Party have filed an ex-
ception, arguing that a bargaining order is an ap-
propriate and necessary remedy for Respondent's
violation of the Act and that the record is suffi-
cient to establish the Union's entitlement to a legal
presumption of majority status as of October 1978.
While we disagree with the General Counsel and
the Charging Party that a nonmajority bargaining
order is an appropriate remedy in this case, we find
that the recommended Order of the Administrative
Law Judge falls short of the relief to which the
Charging Party is entitled.
At the time Respondent opened its store on Post
Street, the employees in all its other San Francisco
stores were represented by the Union in a single
bargaining unit. During a bargaining relationship of
30 or more years, Respondent and the Union have
routinely included in their collective-bargaining
agreements an after-acquired-stores clause designa-
ting the Union as the exclusive collective-bargain-
ing agent for the employees in all of Respondent's
San Francisco stores. Pursuant to this clause, Re-
spondent has in most cases3 voluntarily recognized
the Union whenever it opened a new store in San
Francisco. At the time this dispute arose, the bar-
gaining unit was comprised of approximately 200
employees of Respondent's 4 retail stores in San
Francisco and approximately 300 employees of Re-
spondent's headquarters on Harrison Street.
In Houston Division of the Kroger Co.,4 the Board
concluded that a contractual clause such as the one
by which Respondent is bound constitutes a waiver
of an employer's right to insist upon a Board-con-
ducted election when faced with a demand for rec-
ognition but that it does not relieve a union of its
obligation to provide the employer with proof of
its majority status among the employees in the
group to be added to the existing unit. By this in-
terpretation of after-acquired-stores provisions, the
Board allows parties as much freedom as possible
to structure their bargaining relationship through
:' The sole exception to the pattern of voluntary recognition occurred
at the Embarcadero store at which the Union subsequently won a Board-
conducted election.
i219 NLRB 388 (1975).
656
JOSEPH MAGNIN COMPANY, INC
negotiations without permitting them to deny to af-
fected employees the statutory right to select or
reject a bargaining representative. Under usual cir-
cumstances, therefore, Respondent's statutory duty
to recognize the Union as the representative of the
Gucci store employees and to apply the current
collective-bargaining agreement to the new oper-
ation would have arisen only if the Union present-
ed it with concrete evidence of support by a major-
ity of the Gucci store employees.
The circumstances of this case are not usual,
however. Here, Respondent carefully considered
the financial advantages of escaping its contractual
obligations to the Union and to the unionized em-
ployees if it could prevent the Union from gaining
majority support at the new Gucci store. Having
determined the desirability of reducing commis-
sions and labor costs, Respondent deliberately em-
barked on a course of conduct designed to forestall
union presence at the new facility and thus to
avoid application of the agreed-upon wage and
benefit structure.5 In this campaign Respondent
was entirely successful. It refused to transfer union
members to the Post Street store and, by requiring
that members of the bargaining unit quit their jobs
before even making application for jobs at the new
store, so discouraged application that at this point
it is not possible to determine precisely how many
employees would have sought transfers had the
quit-and-reapply requirement not been imposed. 6
We are thus faced with a situation in which the
traditional redress recommended by the Adminis-
trative Law Judge does not remedy all the unfair
labor practices committed by Respondent and does
not restore the status quo ante. As the agency en-
trusted with administration of the Act we cannot
sanction a party's attempt to avoid contractual obli-
gations lawfully undertaken when the method of
avoidance constitutes an independent unfair labor
practice. Nor should we place unnecessary restric-
tions upon our authority to remedy serious viola-
tions of the Act, since failure to grant appropriate
relief not only leaves injured parties without re-
dress but also encourages more violations of the
same nature. We therefore conclude that Respond-
ent must be required to reconstruct the first day of
its operation of the Post Street store as it would
have occurred absent Respondent's unlawful con-
duct. To that end, we shall require Respondent to
transfer immediately to the Gucci shop on Post
s When the Post Street store opened without a majority of union mem-
bers in the employee complement, Respondent unilaterally changed the
wage structure from the salary-plus-incentive-bonus system mandated by
the collective-bargaining agreement to a commission-against-draw system.
6 We note that the evidence adduced at the hearing establishes that Re-
spondent's discriminatory policy was well publicized among the employ-
ees affected by it.
Street all employees who applied for transfer and
were rejected because of their union affiliation, as
well as all employees who were discouraged from
applying for transfer because of their union affili-
ation, terminating employees presently employed at
Post Street, if necessary, to provide jobs for the
transferees. In addition, solely for the purpose of
remedying a past course of unlawful conduct, we
shall assume that, on the first day the Post Street
store opened for business, had Respondent commit-
ted no unfair labor practices, the Union would
have represented a majority of the Post Street em-
ployees and the contract between the parties would
have applied. Therefore we shall require that the
backpay due the transferees be computed on the
basis of the contractual wage and benefit structure
that would have been in effect had Respondent not
prevented the Union from gaining a majority in the
Post Street store. 7
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,
Joseph Magnin Company, Inc., San Francisco,
California, its officers, agents, successors, and as-
signs, shall:
1. Cease and desist from:
(a) Refusing to transfer hourly employees to
other of its departments, stores, or other facilities
because those employees are members of Depart-
ment Store Employees Union, United Food and
Commercial Workers International Union, Local
1100, AFL-CIO, or any other labor organization.
(b) Telling hourly employees that they must
resign their present positions in order to effect a
transfer to any of its other departments, stores, or
facilities because these employees are members of
the Union.
(c) In any like or related manner discriminating
against employees with regard to hire or tenure of
employment or any term or condition of employ-
ment for engaging in activities on behalf of a labor
organization or for engaging in activity protected
by Section 7 of the Act.
(d) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
ercise of any right guaranteed them by Section 7 of
the Act.
2. Take the following affirmative action deemed
necessary to effectuate the policies of the Act:
7 Ill fashioning such a retrospective remedy, we expressly declille to
order that Respondent apply the contract i /lluro or that it recognize
and bargain with the Union in the abhsence of a demonstration of majorit)
support
657
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(a) Rescind any personnel policy prohibiting the
interstore or intrastore transfer of hourly employ-
ees which is designed and intended to discriminate
against such employees because of their member-
ship in or activities on behalf of the Union.
(b) Immediately transfer to its Gucci store at 253
Post Street, San Francisco, California, any employ-
ees found to have been discriminated against be-
cause of union membership either by being denied
transfer opportunities or by being discouraged from
applying for transfer, discharging if necessary any
employees now filling the positions to which the
discriminatees are to be transferred, and make them
whole in the manner set forth in that section of the
Administrative Law Judge's Decision entitled "The
Remedy," as modified herein.
(c) Preserve and make available to the Board or
its agents all payroll and other records necessary to
determine the transfer rights and to compute the
backpay rights set forth herein and in the section of
the Administrative Law Judge's Decision entitled
"The Remedy."
(d) Post at its San Francisco, California, facilities
copies of the attached notice marked "Appendix."8
Copies of said notice, on forms provided by the
Regional Director for Region 20, after being duly
signed by its authorized representative, 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.
Reasonable steps shall be taken by Joseph Magnin
Company, Inc., to insure that said notices are not
altered, defaced, or covered by any other material.
(e) Notify the Regional Director for Region 20,
in writing, within 20 days from the date of this
Order, what steps Respondent has taken to comply
herewith.
I 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 Pursu-
ant to a Judgment of the United States Court of Appeals Enforcing an
Order of the National Labor Relations Board."
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing at which all sides had an opportu-
nity to present evidence and state their positions,
the National Labor Relations Board found that we
have violated the National Labor Relations Act, as
amended, and has ordered us to post this notice.
WE WILL NOT prevent hourly employees
from interstore or intrastore transfers because
they are members of Department Store Em-
ployees Union, Local 1100, United Food and
Commercial Workers International Union,
AFL-CIO, or any other labor organization.
WE WILL NOT tell hourly employees that
they must resign from their current positions
before they may transfer to another of our
stores, departments, or facilities because they
are members of the Union.
WE WILL NOT in any like or related manner
discriminate against employees with regard to
hire or tenure of employment or any term or
condition of employment for engaging in ac-
tivities on behalf of the Union, or any other
labor organization, or for engaging in activity
protected by Section 7 of the National Labor
Relations Act, as amended.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce employees in
the exercise of any right guaranteed them by
Section 7 of the Act.
WE WILL rescind any personnel policy pro-
hibiting the interstore or intrastore transfer of
hourly employees which is intended to dis-
criminate against employees because of their
membership in or activities on behalf of the
Union.
WE WILL immediately transfer to our Gucci
store at 253 Post Street, San Francisco, Cali-
fornia, any employees found to have been dis-
criminated against because of their union mem-
bership, discharging if necessary any employ-
ees now holding positions to which such dis-
criminatees are entitled.
We will make the aforementioned discrimin-
atees whole with interest for any losses they
may have suffered by reason of the discrimina-
tion practiced against them.
JOSEPH MAGNIN COMPANY, INC.
DECISION
STATEMENT OF THE CASE
MARTIN S. BENNETT, Administrative Law Judge: This
matter was heard in San Francisco, California, on
August 27 and 28, 1980, pursuant to a complaint issued
by the Acting Regional Director for Region 20 on De-
cember 18, 1979. The complaint is based on a charge
filed on January 10, 1979, and an amended charge filed
on November 1, 1979, by Department Store Employees
Union, Local 1100, United Food and Commercial Work-
ers International Union, AFL-CIO (hereinafter the
Union or the Charging Party). The complaint alleges
that Joseph Magnin Company, Inc. (hereinafter Respond-
658
JOSEPH MAGNIN COMPANY. INC.
ent)I has engaged in and is engaging in unfair labor prac-
tices violative of Section 8(a)(l), (3), and (5) of the Na-
tional Labor Relations Act, as amended (29 U.S.C. §151,
et seq.) (hereinafter called the Act).
All parties have been afforded full opportunity to
appear, to introduce evidence, to examine and cross-ex-
amine witnesses, and to file briefs. Briefs have been re-
ceived from the General Counsel, Respondent, and the
Charging Party.
Upon the entire record in the case, from my observa-
tion of the demeanor of the witnesses, and after careful
consideration of the briefs, I make the following:
FINDINGS OF FACT
I. JURISDICTION
Respondent Joseph Magnin Company, Inc., has been
since January 1, 1978, a corporate division under the
ownership of New Magnin, a Delaware corporation. Re-
spondent now has and at all times material herein has
had its principal place of business in San Francisco, Cali-
fornia, from which it operates a chain of department
stores under the name of Joseph Magnin and a chain of
stores under the name of Gucci which is engaged in the
retail sale of products manufactured by the family of that
well-known Italian designer. In the normal course and
conduct of these operations during the past fiscal year,
Respondent derived gross revenues in excess of $500,000
and purchased products valued in excess of $50,000 di-
rectly from suppliers located outside the State of Califor-
nia. Accordingly, I find, as admitted in the answer, that
Respondent is and at all times material herein has been
an employer engaged in commerce within the meaning
of Section 2(2), (6), and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
Department Store Employees Union, Local 1100,
United Food and Commercial Workers International
Union, AFL-CIO, is and has been at all times material
herein a labor organization within the meaning of Sec-
tion 2(5) of the Act.
Ill. THE ISSUES
1. Did Respondent Joseph Magnin Company, Inc.,
violate Section 8(a)(3) and (1) of the Act by prohibiting
the transfer of its hourly paid department store employ-
ees to a new "freestanding" Gucci store on Post Street in
San Francisco (which store is owned and operated by
Respondent) because said hourly employees joined, sup-
ported, or assisted the Union and engaged in concerted
activities for the purpose of collective bargaining or
other mutual aid or protection, and in order to discour-
age such activities?
2. Did Respondent violate Section (a)(5) and (1) of the
Act by refusing to recognize the Union as the collective-
' The complaint and the other formal documents in this case set forth
the name of Respondent as Joseph Magnin d/b/a Gucci Shop. While no
formal motions were made to do so, I have amended Respondent's name
herein to reflect the true name of Respondent as set forth in its answer to
the complainl
bargaining representative of employees at Respondent's
Post Street Gucci store?
3. Did the alleged unlawful acts of Respondent under
Section 8(a)(3) prevent the Union from acquiring a ma-
jority at the Post Street Gucci store? Is a bargaining
order an appropriate remedy in such a situation?
IV. THE ALLEGED UNFAIR LABOR PRACTICES
A. The 8(a)(3) Allegations
1. Background: The Embarcadero opening and the
no-transfer policy
A somewhat lengthy historical analysis is relevant and
necessary to a thorough understanding of the events and
issues raised in the instant matter.
Respondent and the Union have been signatories to
successive collective-bargaining agreements for some 30
years or more. Each of those agreements (including
those applicable to the events in the instant case, viz, the
agreements covering the periods 1975-78 and 1978-81,
respectively) contains the following clause which lies at
the bottom of this dispute:
Section 1. Recognition
The Union is recognized as the sole collective-bar-
gaining agent for all employees employed at the San
Francisco stores of Joseph Magnin except for ex-
ecutives as defined in Section 2 (Definition of Ex-
ecutives) and for the classifications listed in Appen-
dix A.
The General Counsel and the Union contend that sec-
tion I of the agreement is a valid "after-acquired-stores"
clause under applicable Board precedent; and it appears
that, at least until the opening of its Embarcadero store
in early 1977, Respondent construed section I in the
same fashion, and extended recognition to the Union
when it opened new stores in San Francisco during the
1960's and early 1970's. When Respondent opened its
Embarcadero store on February 10, 1977, however, it re-
fused to extend the contract and recognize the Union
and instead filed a petition for an election. The Union
then filed an unfair labor practice charge with the Board
alleging violations of Section 8(a)(1), (3), and (5). That
charge was premised on allegations that Respondent un-
lawfully withheld recognition and that Respondent had
refused to hire union members to staff the Embarcadero
store or to permit the transfer of hourly employees from
its other San Francisco stores (all of such employees'
being union members under the collective-bargaining
agreement's union-shop provisions) to the Embarcadero
store. The charge was dismissed following Region 20's
investigation and, on appeal to the General Counsel, that
dismissal was upheld; the Board then conducted an elec-
tion at the Embarcadero store, which the Union won.
The aspect of the Embarcadero events particularly rel-
evant herein is Respondent's refusal to transfer hourly
employees from its other San Francisco stores to the
new Embarcadero store. Respondent asserts that it has a
"longstanding" policy against the transfer of hourly em-
659
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ployees from one store to another; the one general ex-
ception is an employee's "relocation" from one geo-
graphic area to another, but Respondent has also permit-
ted transfers in what it deems "special circumstances"-
e.g., a job promotion. Respondent asserts that this no-
transfer policy applies to all of its hourly employees in
all of its stores, which the record shows are located in
various cities in California, Nevada, and Hawaii.
Four of Respondent's top management personnel testi-
fied to the existence of Respondent's policy of not per-
mitting the transfer of hourly paid employees from one
store to another. The policy was justified on two major
grounds: It was designed to promote the development of
a personal "book" of clients by each salesperson, and it
was designed to prevent raiding, i.e., stealing away of
productive sales employees by jealous store managers, as
well as to prevent the dumping of unproductive employ-
ees into other stores by disgruntled store managers.
Elsa Lane, who was hired as Respondent's director of
employee relations in March 1978, testified that Re-
spondent's no-transfer policy existed in writing at the
time of her hire and that she assumed that it had existed
prior to 1977. Michael Raskin, who joined Respondent as
its president in February 1978 but who has since left the
Company, testified that he learned of the no-transfer
policy in the spring of 1978 and that he was told that the
policy had existed for some time. Harmon Tobler, who
joined Respondent as a vice president in September 1978
and who is now its president, testified that shortly after
he joined the Company he learned of the no-transfer
policy from Elsa Lane. These executives each testified as
to the original or current justifications for the no-transfer
rule, such justifications being those recited above. Tobler
testified that he "was brought to Joseph Magnin" to de-
velop the personal clientele concept for Respondent's
salespeople; he further testified that "a major plank in
the program that I brought to Joseph Magnin" was re-
taining salespeople in the stores where they were, rather
than permitting transfers. Respondent introduced in evi-
dence a copy of its written no-transfer rule (Resp. Exh.
5); that excerpt from its policy manual is dated
"9/26/77."
Michael Richards also testified about Respondent's no-
transfer policy. Richards is the current manager of Re-
spondent's Montgomery Street store in San Francisco.
He has been a store manager since January 1975, and has
managed two stores in addition to the one on Montgom-
ery Street. Richards testified that Respondent's no-trans-
fer policy existed in writing when he became a store
manager in January 1975, and he also testified that "it
said in 1975 that an employee to be transferred from one
branch to another, there should be a specific reason for
the transfer and a job available, based upon qualifications
and openings."
This recitation of the facts raises several considerations
which went unanswered at the hearing. The Union did
not learn of any policy prohibiting transfers until the
opening of the Embarcadero store, and it contested the
application of the policy at that time. There is some
doubt in my mind as to whether a policy prohibiting
transfers actually existed, at least in writing, when the
Embarcadero store opened in early 1977. The policy
document produced in evidence herein bears a date some
7-1/2 months following the Embarcadero opening. That
document has spaces to record superseded policies and
the effective dates of such-those spaces appear blank on
the page from the policy manual placed in evidence
(Resp. Exh. 5). Richards, an experienced store manager
who should be familiar with all company personnel poli-
cies, testified that a written policy existed 2-1/2 years
before the date of the one submitted herein, yet no such
document was introduced nor was its absence explained.
Indeed, the policy Richards recited could arguably be in-
terpreted by its terms not to preclude transfers between
stores. Finally, Tobler asserted that a no-transfer policy
was a major part of his sales development scheme; yet he
testified as to his rationale to justify a policy, allegedly
longstanding, which preceded him by a year. No one
was produced to explain why the policy was originally
conceived-it predated the arrival of the three top man-
agement personnel by 4, 5, and 12 months, respectively.
Nor had its purpose ever been explained to Richards,
who over nearly 6 years has managed three stores. All of
these factors lead me to conclude that no clear policy
precluding interstore transfers existed prior to the Em-
barcadero opening, and that it was 7 months after that
opening before a policy to that effect was actually pro-
mulgated.
Several additional factors enhance the soundness of
such a conclusion:
(1) When Respondent opened its Magnarama operation
in a separate facility in 1975 (this operation-engaged in
the sale of "overbought" items at reduced prices-was
run as a department of Store 12), it transferred Store 1
employees to that facility, and then transferred them
back when Magnarama was closed in 1978.
(2) Nancy Nunes, Vicki Rae, and Ronna Schulkin
were permitted to transfer to the Embarcadero store
from the Oakland, California, store when the former
opened in early 1977. An estimated four employees from
other San Francisco stores of Respondent were not per-
mitted to transfer to Embarcadero (it was this event
which formed the basis for the 8(a)(3) charge filed in the
Embarcadero dispute alluded to above-the administra-
tive dismissal of that charge does not preclude me from
discussing those aspects of that case litigated herein).
Respondent contends that each of the three above-
named transferred employees falls within an exception to
its no-transfer policy. Nunes, Respondent contends,
transferred for more hours and thus received a promo-
tion; it contends that Rae and Schulkin each had an "es-
tablished San Francisco customer list." Respondent does
not attempt to explain these transfers on the basis of geo-
graphic relocation, the one clearly delineated exception
to its existing no-transfer rule (see Resp. Exh. 5) and,
indeed, could not logically do so. Nor does Respondent's
explanation of Nunes' transfer as a special circumstance
hold much merit, for, arguendo, it is not unreasonable to
assume, without deciding, that perhaps at least one of the
four San Francisco employees who unsuccessfully sought
transfer to Embarcadero had hoped to obtain longer
2 Store , or the O'Farrell Street store, appears from the record to be
the flagship olf Respondent's San Francisco Bay area department stores.
660
JOSEPH MAGNIN COMPANY, INC.
working hours available there. Similarly, Respondent's
explanations for the permitted transfers of Rae and
Schulkin lack substantial merit.
(3) Union Representative Susan Monihan testified
without contradiction or dispute that Elsa Lane had con-
ceded in a May 1979 meeting that certain of the employ-
ees listed in General Counsel's Exhibit 17 (a list of inter-
store employee movement accompanied by Respondent's
rationalizations therefor) were transfers or had been
transferred. The lack of a specific denial on this point is
particularly telling since that exhibit was the subject of
much discussion in the instant litigation. In view of all of
the above, the assertion that Respondent's policy prohib-
iting interstore transfer of hourly employees is longstand-
ing becomes doubtful at best. At the very least, the ad-
ministration of that policy has been inconsistent and per-
haps even arbitrary.
2. The Post Street opening
Sometime during 1977 or early 1978, Respondent
began formulating plans to establish a small store inde-
pendent of its department stores which would be en-
gaged in the sale of nothing but the various products of
Italian designer Aldo Gucci.3 Respondent had been sell-
ing Gucci's products from a boutique or department
within its store on O'Farrell and Stockton Streets in San
Francisco (Store 1) since sometime in the early 1970's;
apparently the Company had and continues to have simi-
lar Gucci boutiques in various of its other department
stores. On April 15, 1978, 4 Aldo Gucci and Respondent
executed an agreement whereby Respondent was, inter
alia, to open an independent or "freestanding" shop on
Post Street in San Francisco dealing exclusively in Gucci
products.
The Union first learned of the Company's plans for the
freestanding Post Street Gucci store in mid-1978. After
an employee of Store l's Gucci department reported a
rumor of the Post Street plans, Union Business Repre-
sentative Susan Monihan requested a letter from the
Company explaining the proposed Post Street Gicci
store. In a June 13 letter to Monihan and Union Secre-
tary-Treasurer Richard Williams, Elsa Lane, Respond-
ent's director of employee relations, indicated that:
. . a division has been created which will prob-
ably be operating a Gucci store on Post Street
.... I also understand that the Gucci department
in our Downtown San Francisco store (#1) will
remain open.
Also sometime during June, Monihan testified that she
attended a board of adjustment meeting in a conference
room of Respondent's headquarters building.5 She testi-
3 These products include leather goods, such as shoes, boots, handbags.
and belts and scarves, jewelry, and other "ready-to-wear" apparel items
4All dates hereinafter refer to 1978 unless otherwise stated.
That building is located at 59 Harrison Street in San Francisco. The
witnesses and the parties herein referred to it variously as the central
office building or the central operations building of Joseph Magnity all
referred to it in short as the COB I shall refer to it hereinafter s the
COB
fled that at this meeting, which was to deal with the
grievance or grievances of employee Vincent Washing-
ton, she observed artists' renderings of the Gucci store
that later opened on Post Street adorning the walls of
the meeting room. Monihan testified without contradic-
tion that:
. . . during the course of the adjustment board
[hearing], we had a caucus and the union took their
caucus inside the conference room and the company
left. That's when we first noticed the pictures. We
looked at them very carefully and then there was a
subsequent caucus in which the company asked the
union to leave, and when we came back to recon-
vene the adjustment board hearing, there was
brown paper over all the artists' renderings, cover-
ing them up.
Employee Lewis Silcox, who works in the Store I
Gucci department, testified that he and other employees
first learned of the planned Post Street Gucci store open-
ing when telephoned by customers who had read about
those plans in the column of San Francisco Chronicle
writer Herb Caen.
Sometime during September Margaret McCoy, an em-
ployee in Store l's Gucci department, apparently in-
quired about transferring to the new Post Street Gucci
store. While there is no direct testimony on this point,
McCoy apparently was told that she would have to
resign her current position and be rehired with a new
employment date in order to effect a transfer to Post
Street. (See G.C. Exh. 7, a letter from Union President
Walter Johnson to Elsa Lane alleging these facts.)
McCoy's attempt to transfer led to the scheduling of a
board of adjustment meeting where the Union apparently
hoped to grieve the issue.
On October 8 a classified advertisement appeared in
the Sunday San Francisco Chronicle-Examiner telling of
full-time and part-time sales openings in "The New
Gucci Shop Opening in Downtown San Francisco." The
ad gave no further identification of the employer, but
listed a telephone number to call for interview appoint-
ments. The number was to a Joseph Magnin COB exten-
sion; and, as the experience of Store I Gucci department
employee Christine Azzopardi demonstrated (discussed
in more detail infra), interested persons were to complete
application forms and be interviewed at the COB.
Three union officials (Monihan, Secretary-Treasurer
Williams, and President Johnson) and three members
(each of whom was a Store I Gucci department employ-
ee) met with Lane and Ben Waud, Respondent's counsel
at that time, to discuss the McCoy transfer grievance on
October 10. The union representatives stated that the
meeting was a formal board of adjustment hearing pursu-
ant to the collective-bargaining agreement, but apparent-
ly Waud disagreed. Waud and/or Lane explained that
the Post Street Gucci store was to operated by a sepa-
rate division of the Company ("the Gucci Division and
the Joseph Magnin Division, two separate organiza-
tions," Lane testified regarding her comments at this
meeting) and that consequently the Union's contract
with the Company would not and did not apply to the
Post Street Gucci store. Lane then told the union delega-
661
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
tion that "it was our plan to not transfer hourly employ-
ees to that store." Waud maintained that transfers were
not at issue because of the "separate corporation[s]," ac-
cording to Monihan's uncontradicted testimony. Johnson
then indicated that the Union's members had a right to
transfer under the terms of the collective-bargaining
agreement. The meeting ended in a deadlock on a vote
to proceed to arbitration. 6
The next day (October 11) Christine Azzopardi, one of
the Store I Gucci department employees who had at-
tended the previous day's meeting, went to the COB to
complete an application form and be interviewed for a
position at the Post Street Gucci store. Azzopardi had
seen the classified advertisement in the previous Sunday's
newspaper and, in response to that ad, had telephoned on
October 10 to arrange an appointment to fill out an ap-
plication form. Azzopardi testified that she dealt with
Patti Bauer (now Craig) of the personnel office, and that
the following took place:
I was given an application. I filled half of it out and
she glanced over to see how much I filled out and
she noticed that I had worked for Joseph Magnin
and she said oh, are you from the Las Vegas store
and I said no, I'm from Store No. 1. She had said
I'm sorry that you can't fill out this application and
I had answered can I have that in writing, and at
that point I stopped filling out the application and
she said excuse me for a moment and she retrieved
Elsa Lane, [who] was at a meeting at the time.
Azzopardi further testified that Lane emerged from her
meeting, saw that Azzopardi had completed half of the
application form, and then said (according to Azzopardi):
Chris, you know the procedure, and I said yes. We
had discussed it yesterday at an adjustment board
meeting. She said you know the procedure, you're
going to have to quit your job before you apply.
And I said are you denying me the right to fill out
this application. She said no, but for an interview,
yes.
Lane testified to a slightly different version of their con-
versation:
She was very angry that she-about the no transfer
stance. I told her that we, as she knew from the
6 The arbitration award underlying the instant litigation forms an im-
portant part of this Decision as will be seen infra, but it is convenient to
discuss the arbitration procedures at this point. Under the collective-bar-
gaining agreement, when an adjustment board vote on proceeding to ar-
bitration deadlocks, either party may request arbitration after 14 days.
After the requisite waiting time, the Union requested arbitration, and the
parties agreed on Professor Joseph R. Grodin (now a judge of the Cali-
fornia State Court of Appeals) as the arbitrator. Apparently the Company
then backed out of the agreement to arbitrate, and the Union sought and
obtained a state court order to compel arbitration. The arbitration then
proceeded, with Arbitator Grodin rendering his award (which will be
discussed in greater detail infra) on June 16, 1979, and a letter clarifying
that award on September 4, 1979. Sometime thereafter the Union filed in
California Superior Court a petition to confirm and Respondent filed a
cross-petition to "correct and then confirm" the arbitrator's award; the
court granted the petition to confirm and denied the petition to correct.
Respondent has appealed those rulings, and consequently the matter is
currently pending on appeal in the California state courts.
meeting yesterday, would not be transferring
people. She said do you mean you won't take my
application and I said no, Chris, you are perfectly
free to complete the application and leave it, I just
want you to understand that we intend not to trans-
fer people between the stores ...
Q. During that conversation, did you tell her that
she could complete an application but that she
could not be interviewed?
A. I did not say that. She said can I leave my ap-
plication and I said you are perfectly free to leave
the application, but our intent is not to transfer em-
ployees to that Post Street store.
While Lane's testimony on this score is more precise in
that she probably did not say to Azzopardi, as the latter
testified, "[Y]ou're going to have to quit your job before
you apply," I find that, as to the substance and effect of
Lane's comments, I am persuaded by Azzopardi's ver-
sion. This conclusion is founded in large part on Lane's
response to the following questions from counsel for the
General Counsel on cross-examination:
Q. Isn't it true that it would have been futile for
any of the employer's union employees to apply for
positions at Gucci without resigning first?
A. No.
Q. Employees could be considered for employ-
ment without resigning first?
A. They could have left the application with me
but, as I told Chris, we were not going to transfer
hourly employees.
Q. So it would have been a futile act to fill out
an application because if you were employed by
Joseph Magnin in a union store you weren't going
to be considered unless you resigned first. The act
of applying would have been a futile act, isn't that
true?
A. That's the interpretation that you are giving it,
that it would be futile.
Q. No, I want your interpretation. Don't you be-
lieve that the act of applying is futile when you
cannot be considered for the position?
A. If I were going to apply for a position for
which I could not be considered, I would think that
would be a futile effort, yes.
I conclude accordingly that the fact of the matter was
that if Azzopardi wanted to work at Post Street, she
could not be a current employee of Respondent-in
effect, she would have had to resign her then-current
employment and attempt to sign on as a new hire.
In addition to the events and incidents recounted
above, at various times during 1978 (sometimes unspeci-
fied) several employees of Respondent's Store I Gucci
department consulted supervisory personnel about the
possibility of transferring to the soon-to-open Post Street
Gucci store. The uncontradicted testimony of various
employee witnesses shows the following:
(I) Sometime in the spring of 1978 Lewis Silcox asked
Maria Manetti, then Respondent's Director of Gucci Op-
erations, about transferring to Post Street. Manetti indi-
662
JOSEPH MAGNIN COMPANY, INC.
cated that she did not know what the procedure would
be nor if there would be automatic transfers and she was,
according to Silcox, "very vague." Sometime later
Silcox asked Lillian Magnin, "the supervisory manager at
that time on the fifth floor [of Store 1]," about transfer-
ring. Initially she "was quite vague, too"; when Silcox
renewed his inquiry several weeks later Magnin told him
that:
. . .we would not be allowed to transfer and that if
we wanted to work at the Post Street shop we
would have to resign our present positions, thus
losing all of our seniority with Joseph Magnin, in
effect just to go to work for the same company, and
even to apply for a position at Post Street we
would have to resign our position.
(2) Cheryl Austin consulted Ila Adams, a personnel of-
ficer of Respondent, Keith Miller, Store I' s operations
manager, and Lillian Magnin about the possibility of
transferring to Post Street. Austin testified that, during
her meeting with those three supervisory personnel, she
was told by Magnin and Adams that she would have to
resign her position with Store I and reapply as a new
hire to work at Post Street. Austin, who apparently held
some type of low-level supervisory position herself at
Store I, in turn related the substance of this conversation
to Store I employee Lewis Rusel. Rusel testified that he
had considered applying for a job at Post Street until he
was told by Austin that he would first have to resign his
position at Store 1.
(3) Howard Ferrier was employed in Respondent's
supply department at the COB when he learned of the
Post Street plans in the fall of 1978. He asked Kurt
Bryan and Patti Bauer, personnel officers who apparent-
ly were involved in screening applicants for the Post
Street Gucci store, about the possibility of transferring to
that facility. Bryan told Ferrier that he would have to
resign his employment with Joseph Magnin to be consid-
ered for a position at the Post Street Gucci store.
(4) Mikio Hirata consulted Lillian Magnin sometime in
1978 about the possibility of transferring to Post Street.
Hirata, too, testified that Magnin told him he would
have to resign his job at Store I and then apply anew for
a position at Post Street. Respondent does not contest
the alleged agency or supervisory status of Maria Man-
etti, Lillian Magnin, Ila Adams, Kurt Bryan, or Patti
Bauer-Craig. Nor did Respondent produce any of these
individuals as witnesses to deny or contest the testimony
of any of the employees who did appear. Accordingly, I
infer that each of the conversations testified to did occur
as recited supra. I find, therefore, that in each instance at
least one of Respondent's agents or supervisory person-
nel told the employees who testified that the only
method of "transferring" to the new Post Street Gucci
store was to resign from their current position and apply
as a new hire.
3. Subsequent events
Union Representative Monihan testified to a meeting
she had with Harmon Tobler in January 1979. Tobler,
now the president and chief executive officer of Re-
spondent, was at the time of the meeting the vice presi-
dent for personnel and sales development. Monihan testi-
fied that at this meeting, ostensibly held for the purpose
of discussing the grievance of one Dorothy Patton, she
brought up the subject of transfers. She testified that she
told Tobler that the Company should not have a policy
against transfers. Tobler's response, according to Moni-
han, was that Respondent would not have the no-transfer
policy were it not for the pending dispute over the Post
Street Gucci shop. Tobler disputed Monihan's account of
their conversation in his testimony. He denied having
stated there would not be a no-transfer policy but for the
Gucci dispute and the forthcoming arbitration of that
dispute; he maintained that his sales management philos-
ophy favored salespeople's building a personal clientele
and thus disfavored transfers between stores. Both wit-
nesses appeared to testify in a straight forward, candid
manner. Nonetheless, Monihan's testimony regarding the
conversation was precise and unwavering on both direct
and cross-examination, while Tobler's testimony on the
point consisted of brief four-word answers to leading
questions on direct examination. Notwithstanding
Tobler's apparently rational business justifications for dis-
favoring a policy permitting transfers, and even though I
am aware of the dangers inherent in the fact that Moni-
han's testimony is quite self-serving, the form of their re-
spective testimony leads me to credit Monihan's version
as the more accurate. Furthermore, I believe that my
conclusions regarding the no-transfer policy as a whole,
supra, serve to bolster my judgment on this particular
credibility issue.
Sometime during the spring of 1979 the Union learned
of a job opening at Respondent's store on Montgomery
Street in San Francisco. Union Representative Monihan
accompanied Sarah Hill and Rosa Bullock, both of
whom had been laid off previously, to the Montgomery
Street store to inquire of Store Manager Michael Rich-
ards about the opening. When the threesome met Rich-
ards, according to Monihan:
Sarah asked Mr. Richards would he let her work
there, would he let her transfer there, and Mike said
I'd love to have you work for me, Sarah. You're a
fantastic worker, I know you from when I used to
work over at the Harrison Street building. But there
is a policy in the union stores that the company
won't let people transfer. He said I don't know why
they have that policy, it's only in the union stores.
Richards denied saying that the no-transfer policy ap-
plied "only in the union, stores," but he did admit, "I
said within the city [of San Francisco] stores." Richards
then attested to his knowledge that Respondent's no-
transfer policy applied throughout the Joseph Magnin
system, but subsequently again testified that, when Moni-
han and the two employees had asked about transfers
and where the policy applied, "I said the city stores."
Richards then testified that, despite the applicability of
the policy to all Joseph Magnin stores, "within the city
San Francisco stores we have a special situation because
we are a union operation." He testified that the situation
was "special" only because of the fact that all of Re-
663
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
spondent's San Francisco stores and the COB are cov-
ered by union contracts while none of its other stores are
unionized. Taken in whole, I find Richards' testimony to
be less than forthright. While he frankly admitted to
having told the employees and Monihan that the no-
transfer policy applied "within the city stores," the rest
of his testimony seemed to be designed in some way to
cover tracks. While Richards may not have said that the
policy applied "only in the union stores," it is clear that
he did say "within the city stores"-the unmistakable im-
plication being that the policy applied exclusively to the
city stores, which in fact are the only union stores. Ac-
cordingly, I lend more credence to Monihan's version of
the conversation.
4. Analysis and conclusions
The facts of the instant case must be analyzed under
the basis of the Board's recent decision in Wright Line, a
Division of Wright Line, Inc., 251 NLRB 1083 (1980),
wherein the Board formally established "a test of causa-
tion for cases alleging violations of Section 8(a)(3) of the
Act." That test calls for counsel for the General Counsel
to "make a prima facie showing sufficient to support the
inference that protected conduct was a 'motivating
factor."' Once that initial showing has been made, "the
burden [shifts] to the employer to demonstrate that the
same action would have taken place even in the absence
of the protected conduct." Wright Line, supra at 1089.
However, before proceeding to a discussion of this
case under the Wright Line analysis, I must deal with the
Charging Party's motion to defer to the award of Arbi-
trator Grodin, which award underlies in many respects
the instant litigation. The Board's decision in Spielberg
Manufacturing Company, 112 NLRB 1080 (1955), indi-
cates that, where "the proceedings appear to have been
fair and regular, all parties had agreed to be bound, and
the decision of the [arbitrator] is not clearly repugnant to
the purposes and policies of the Act," the Board will
defer to an arbitrator's award. Spielberg, supra at 1082.
The so-called Spielberg doctrine was recently enhanced
by the Board in Suburban Motor Freight, Inc., 247 NLRB
146 (1980), wherein the Board stated, "[W]e will no
longer honor the results of an arbitration proceeding
under Spielberg unless the unfair labor practice issue
before the Board was both presented to and considered
by the arbitrator." Suburban Motor Freight further re-
quires that "the party seeking Board deferral to an arbi-
tration award . . . prove that the issue of discrimination
was litigated before the arbitrator." Id. at 147.
In light of the above-enumerated standards, my exami-
nation of the arbitration establishes that the arbitrator's
award herein is entitled to great weight. Arbitrator
Grodin found that:
. . . the Employer's no-transfer rule operated to
preclude union employees from transferring from
Store #1 to Post Street in part precisely because
they are union employees and, therefore, to dis-
criminate against them "on account of membership
in . . . the Union" in violation of Section 3A of the
agreement.
The arbitrator reached this determination after considera-
tion of much of the same evidence that was presented in
the instant litigation. Further, he followed the procedure
which would be used in any Board determination follow-
ing Wright Line. supra: He found first that the evidence
presented by the Union was "sufficient to establish a
prima facie case of improper motivation"; he then found
not only that because of "significant gaps in the Employ-
er's case" Respondent had failed to rebut the Union's ini-
tial showing, but also that the reasons adduced to justify
the no-transfer policy failed to provide such a rebuttal.
Finally, the arbitrator indicated that in rendering his
award he relied by analogy on the policies of the Act as
interpreted by the Board; my reading of the award con-
firms this assertion, no contrary showing has been at-
tempted, and I find that, in accordance with Spielberg,
arbitrator Grodin's decision "is not clearly repugnant to
the purposes and policies of the Act" but that in fact it
effectuates those policies.
Even were I not to place such great weight on the
findings and conclusions of the arbitrator, I find that, in
accordance with Wright Line, supra, counsel for the Gen-
eral Counsel has made a prima facie showing of improper
motivation which Respondent has failed to rebut. This
conclusion is based upon the following factors:
Internal correspondence between top management offi-
cials in the fall of 1977 shows that Respondent was inter-
ested in cutting commissions and labor costs incurred via
the sale of Gucci products. The director of labor rela-
tions at that time, however, noted that the Union pre-
sented an obstacle to those interests. I infer that also at
or about this time Respondent was involved in business
negotiations and planning for the freestanding Gucci
store on Post Street because the agreement between
Joseph Magnin and Gucci regarding that store was ex-
ecuted within the next 5 months. A March 15, 1978,
memorandum of Maria Manetti, then the director of
Gucci operations for Respondent, extolled the virtues of
operating an exclusive "quality" specialty shop without a
union; labor costs could be significantly reduced and
there would be no restrictions on "the freedom of man-
agement policies." Then President Raskin testified that
the decision to open Post Street nonunion was not based
solely on the Manetti memorandum; yet, he admitted
that, at the time the decision was being made, Manetti's
recommendations formed at least part of the decision-
making proccess. Indeed, Raskin testified that Manetti
was only "one of many" involved in the decision who
advocated opening the Post Street Gucci store on a non-
union basis.
In view of Respondent's expressed desire to open its
Gucci store on Post Street sans a union, I find that from
February 1977 until Post Street opened in November
1978. the following scenario occurred: Respondent de-
cided not to extend automatically the Union's contract to
its new Embarcadero store, a break from its apparent
past practice (the contract was automatically applied
when the Stonestown, Fox Plaza, and Montgomery
Street stores opened, respectively). In an apparent effort
to dissuade the Union from obtaining a majority at the
Embarcadero Store, it prevented at least four union em-
664
JOSEPH MAGNIN COMPANY, INC.
ployees at San Francisco stores from transferring there
while at the same time permitting at least three nonunion
employees from the Oakland store to so transfer. This
occurred in conjunction with the announcement, for the
first time, of a policy prohibiting the interstore transfer
of hourly employees. After the Union disputed this
policy, and contemplating the opening of its Post Street
Gucci store, Respondent actually promulgated its "long-
standing" no-transfer policy; I think it is no coincidence
that the policy was promulgated at or about the same
time that planning was under way for the Post Street
Gucci store, viz, during the fall of 1977. I find it signifi-
cant that, as discussed supra, no one was called who tes-
tified (or who could have testified) as to the original rea-
sons for promulgating the no-transfer rule; nor were the
rule's antecedents (if any) produced, and I infer that,
prior to the Embarcadero dispute (and its culmination in
the promulgation of the no-transfer rule on September
26, 1977), no policy specifically prohibiting interstore
transfers existed. Colorflo Decorator Products Inc., 228
NLRB 408 (1977). Thereafter, with its no-transfer policy
in hand and intending to open a nonunion store, Re-
spondent through its agents and supervisors told any and
all of its San Francisco employees who, upon learning of
the plans for the Post Street Gucci store, sought to trans-
fer to that facility that they could not do so unless they
quit their current employment with Joseph Magnin.
I find this quit-and-reapply requirement to be remark-
ably similar to that found in Coated Products, Inc., 237
NLRB 159 (1978). While that case involved the closing
entirely of one plant and the subsequent reopening of a
new one, the remaining facts are quite relevant to the sit-
uation herein. Employees at the old plant who desired to
be transferred to the new one were required to resign
from their positions and make new applications: this re-
quirement was imposed even though there had been no
change in the corporate structure of the employer. In ad-
dition, nonunit employees were permitted to transfer to
the new plant without inhibition. Those factors, along
with other evidence tending to show union animus, led
to the conclusion that the respondent sought to "depress
the union component in the employee population at [the
old plant]." Coated Products, supra at 167. Accordingly,
Respondent's failure to permit transfers to the new facili-
ty was found to be a violation of Section 8(a)(3). Coated
Products is quite instructive with regard to the present
case. Herein employees of the San Francisco stores were
required to resign and reapply to effect a transfer despite
the fact that the Post Street Gucci Store is owned and
operated by Respondent. In addition, there is some evi-
dence herein of at least inconsistent application of Re-
spondent's claimed no-transfer policy and clearly the fact
that Respondent sought to operate the Post Street Gucci
store without having to deal with the Union cannot be
disputed.
Several additional factors support these conclusions. In
January 1979 then Vice President Tobler told Monihan
that there would not be a policy prohibiting transfers but
for the pending Gucci dispute. While Tobler denies this
assertion, I have credited Monihan's account. A few
months later, the Montgomeny Street store manager,
Richards, told two employees seeking a transfer to his
store that company policy prohibited such transfers in
the San Francisco stores, the only stores in Respondent's
chain which are unionized. He may even have said that
the policy applies only in the union stores. In any case, it
is clear from my findings, supra, that he did not know
why the policy existed, but knew only that he was not to
permit union member employees to come from another
store to the one he managed. Finally, on at least three
occasions Respondent attempted to conceal its plans for
the Post Street Gucci store in an effort to prevent em-
ployees from seeking transfers to what it hoped would
be a nonunion shop. It told union representatives in Oc-
tober that Gucci was a separate employer, even though
Respondent owns and in every respect operates the Post
Street Gucci store. Its advertisement soliciting applicants
for the Post Street Gucci store bears no identification of
the owner/operator of that shop, 7 and it attempted to
conceal artists' renderings of the proposed Gucci shop
from union representatives during a board of adjustment
meeting.'
In summary, therefore, I conclude that the findings
and award of the arbitrator are entitled to great weight. I
conclude that even absent consideration of the underly-
ing arbitration the General Counsel has established a
prima facie case supporting an inference of unlawful mo-
tivation and that Respondent has failed to rebut this
showing. Accordingly, I find and conclude that, by
adopting its policy prohibiting the interstore transfer of
hourly employees and by prohibiting the transfer of such
employees to its Post Street Gucci store because of their
union affiliation and because of its desire to run Post
Street nonunion, Respondent has violated Section 8(a)(3)
and (1) of the Act.
B. The 8(a)(5) Allegations
The complaint alleges that but for the unfair labor
practices of Respondent, as found supra, the Union
would have represented a majority of Respondent's em-
ployees at its newly opened Post Street Gucci store. The
complaint further alleges that since on or about October
1978 Respondent has unlawfully refused to recognize the
Union as the bargaining representative of its employees
at Post Street.9 For the reasons that follow, I conclude
that these allegations that the Respondent has violated
Section 8(a)(5) of the Act lack substantial merit.
Cf. Karl Kallman d ba l.ove ' Barbeque Restaurant No.;. 62: Ltm', E-
terprose. Inc., 245 NLRB 78. fil 10 (1979), a successorship situation in
which hiring was concealed from the union and its members in panrt by
use of all "unmarked" lnevspaper advertisement.
' As to this ltter point. Respondent called no witnesses to test ifN as to
this occurrence I infer that it happened according to the account of he
witness for he General Coun.sel Colorflo Decorator Products. lupra ;at
410
"I find that insofar as it is relevant, he Union first requested recogni-
tion a representaltlic of the Post Sreet empltyees on September 12 On
Ihat date Union PresidLl .t1.ler Johnson swrote to Elsal Lanie requesting
extensi, on ltf the Clltrlact to the lees facilits b operalion of ec I If hat
agreement. In hat letier, he also requested an adjustment board meeting
to discuss the transfer issuc Ihe record nakes no clear mention of any
slbseqiietIt icc oglinllon demannd', preLumanbl!. such a demand uas, re-
Ine' .ed at the board of a.ljuimnini meeting in Octber, and hence the date
of refusal to recognice which i, recited in the complaint
665
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Union claims representative status on the basis of
section I of the parties' collective-bargaining agreement.
The parties have stipulated and the arbitrator found that
section I is a valid "after-acquired-stores" or additional
stores clause under Board law. Houston Division of the
Kroger Co., 219 NLRB 388 (1975). Under Kroger, the
Board construes such clauses to be contractual waivers
of an employer's right to petition for a Board election
upon a request for recognition; but Kroger and its prog-
eny also clearly show that such clauses require recogni-
tion only upon proof of majority status by a union. As
the Board stated, in a situation such as the instant one:
[t]he principles of accretion do not resolve the issue
. . .inasmuch as the stores in question have a suffi-
cient separate existence to constitute separate appro-
priate units. .... [T]he Board has held that "addi-
tional store clauses" are valid in situations where
the Board is satisfied that the employees affected
are not denied their right to have a say in the selec-
tion of their bargaining representative. [Kroger,
supra.]
I can find nine employees of Respondent who, at the
very least, expressed some interest in transferring from
their jobs to positions at the new Post Street facility.
Thus, Christine Azzopardi went so far as to attempt to
complete an application form and obtain an interview.
Margaret McCoy initiated the grievance over the trans-
fer issue that resulted in the arbitration by Professor
Grodin. Lewis Silcox, Howard Ferrier, Mikio Hirata,
and Cheryl Austin individually consulted supervisors or
personnel officers about the possibility of transferring;
each was told they would not be able to do so without
resigning, and I find, accordingly, that Respondent dis-
couraged each of them from even attempting to apply.
Employee Austin then transmitted the substance of her
conversations to employees Lewis Rusel, James Murphy,
and Jack Smith; Rusel testified that consequently he was
discouraged from attempting to apply for a transfer, and
I conclude that Murphy and Smith were similarly so dis-
couraged. Various of the employee witnesses testified
that other of their fellow employees were discouraged
from inquiring about transfers, to Post Street; but since
no others were named or testified, I may not include
them in that class of employees who have at least ex-
pressed an interest in transferring. Similarly, while Terry
Dean and Geraldine Korss accompanied fellow employ-
ee Margaret McCoy to the October 10 board of adjust-
ment meeting where McCoy's transfer grievance was
discussed, to conclude that their presence at that meeting
indicated an interest in transferring would be an imper-
missible indulgence in speculation.
Neither the complaint nor the brief from counsel for
the General Counsel make any allegation as to the em-
ployee complement at the Post Street Gucci store. Nor is
there any testimony giving an exact indication of the size
of that complement. My review of the business docu-
ments placed in evidence indicates that Respondent
opened the Post Street Gucci Store in November with
21 employees. From that time until the selling period
ending April 7, 1979, 1 cannot determine that the number
of employees ever dropped below 18. Under such cir-
cumstances, even had all nine been permitted to transfer,
a majority would not have been obtained. '°
Furthermore, counsel for the General Counsel has ad-
duced no evidence that, even absent Respondent's dis-
criminatory no-transfer rule, all nine of the above-men-
tioned employees would have transferred to Post Street.
There is no showing that any or all of them had acquired
sufficient seniority under the contract. Nor does the
record show whether, following any reduction in the
size of the employee complement, any or all of the nine
had seniority sufficient to cause their retention at Post
Street.
Consequently, the requirements of Kroger have not
been fulfilled-the Union did not offer and I find that it
would have been unable to submit proof that it repre-
sented a majority of the employees at the Post Street
Gucci store. Under this standard, then, the additional
stores clause could not operate to apply the parties' col-
lective-bargaining agreement to that facility.
Nonetheless, counsel for the General Counsel urges
that a bargaining order should issue. He argues, by anal-
ogy to a line of the Board's successorship cases," that
but for Respondent's unfair labor practices under Section
8(a)(3) the Union would have had a majority at the Post
Street Gucci store; that uncertainties in ascertaining
whether a majority existed at the Post Street Gucci
Store, being uncertainties which have arisen due to Re-
spondent's unlawful conduct, must be resolved against
the wrongdoer; and that the wrongdoer must not be per-
mitted to benefit from its illegal acts. While at first blush
this argument is quite attractive, I find that the reliance
of counsel for the General Counsel on these successor-
ship cases is inapposite.
First, all of the cases cited by counsel for the General
Counsel may be distinguished factually. In each case the
successor employer refused to rehire the employees of its
predecessor in an already established bargaining unit. In
this case there is no preexisting bargaining unit. Obvious-
ly, Post Street is a new facility; indeed, under the princi-
ples of both Kroger, supra, and the Board's accretion de-
cisions, Post Street is of arguably sufficient separate ex-
istence to constitute a separate appropriate unit. Cf. W.
C. DuComb West A Division of W. C. DuComb Co.. Inc.,
239 NLRB 964 (1978), and cases cited therein.
An even greater distinction, however, is the fact that
in each of the successorship cases the union majority was
clearly established before the business involved changed
ownership. Here, of course, no previous majority status
was or could have been shown.
m" In its brief the Charging Party. after its ownl analysis f Respond-
clt's produclivity reportls, avers that "the normal complement of selling
cnmployees is approxinl atcl I." and hat. according lo Respondent s tes-
timonly. the 'Post Street emniploycc comrlplement als,o included 2 to 3 stock
employees. T'he Criol's claim (of majority status cannot be based on an
average number of employces for the year nor on its o n assertion of the
"normal complenentr. for the fact remain. that, according to his record.
it could not ha.,e had a mniajorit a tIhe tinre or soon after it requested
recognlitillon Furthermolre, my conclusiorns inrJru apply here as A ell
l" oodiwar of El Paro, .1 Dii io Kib/'inhell Frod, Inc.. 201 NLRB 933
(1973t (rauJbrd Container, Irc., 234 NlRBi 851 (1478); Karl Kallman
d/h/a l.over Baurblcqiu Rsrtaural No. 62, 'upra.
666
JOSEPH MAGNIN COMPANY, INC.
Of paramount importance is the right of all of the em-
ployees at the Post Street Gucci store "to have a say in
the selection of their bargaining representative." Kroger,
supra. The granting of a bargaining order in this instance,
requiring Respondent to recognize the Union as the ex-
clusive representative of its Post Street employees, may
operate to effectively disenfranchise those employees by
reason of a contract (and its additional stores clause) for
which they did not bargain. Cf. Melbet Jewelry Co., Inc.,
and I.D.S.-Orchard Park Inc., 180 NLRB 107, 109
(1969).
A useful analogy may be drawn here to cases where
the Board has issued bargaining orders in the context of
a union's organizational campaign. In those exceptional
cases marked by pervasive and outrageous employer
unfair labor practices, a bargaining order may properly
issue, but only where the employer's illegal conduct has
dissipated the union's majority. N.L.R.B. v. Gissel Pack-
ing Co., Inc., 395 U.S. 575 (1969). Thus the bargaining
order is a remedy designed to restore the status quo ante.
However, where, as herein, the union has never obtained
a showing of majority support-indeed, the Post Street
employees have apparently never had any opportunity to
demonstrate one way or another their sentiments regard-
ing the Union-a bargaining order does not serve to re-
store the status quo ante. United Dairy Farmers Coopera-
tive Association, 242 NLRB 1026 (1979).
The Board concluded in United Dairy Farmers, supra,
that the imposition of a bargaining order in a case where
no majority support was shown, and even where the em-
ployer's 8(a)(3) and () violations precluded an unencum-
bered election, presented a substantial risk of imposing a
union on nonconsenting employees. No substantial reme-
dial interest was found to justify imposition of such an
order. I think that the same risks-of imposing the Union
on nonconsenting employees-are attendant in this case.
Futher, I do not think that the unfair labor practices
herein are so pervasive and egregious as to prevent a
free and fair election should either of the parties petition
for one.
Thus, I conclude that Kroger and United Dairy Farmers
may be taken together to find that, under circumstances
such as those herein, an additional stores clause cannot
apply absent a showing of majority status, nor will an
"anticipatory" majority be presumed so as to deny em-
ployees of a new, arguably separately appropriate unit or
facility an opportunity to choose a bargaining representa-
tive.
Accordingly, I conclude that the evidence fails to
show that Respondent has violated Section 8(a)(5) of the
Act.
V. THE EFFECT OF THE UNFAIR ABOR PRACTICES
UPON COMMERCE
The activities of Respondent Joseph Magnin Compa-
ny, Inc., set forth in section IV, A, above, occurring in
connection with the operations of Respondent described
in section 1, above, have a close, intimate, and substantial
relation to trade, traffic, and commerce among the sever-
al States and tend to lead to labor disputes burdening and
obstructing commerce and the free flow of commerce.
CONCI.USIONS OF LAW
I. Joseph Magnin Company, Inc., is an employer
within the meaning of Section 2(2) of the Act engaged in
a business affecting commerce within the meaning of
Section 2(6) and (7) of the Act.
2. Department Store Employees Union, Local 1100,
United Food and Commercial Workers International
Union, AFL-CIO, is a labor organization within the
meaning of Section 2(5) of the Act.
3. At all times material herein the Union has been the
exclusive representative of all of the San Francisco em-
ployees of Respondent, as designated in section I of the
parties' collective-bargaining agreement and the appen-
dixes thereof, except for those employees employed by
Respondent at its Gucci store at 253 Post Street, San
Francisco, California.
4. By adopting a no-transfer policy for its hourly em-
ployees designed to discriminate against employees on
the basis of their union affiliation and by refusing to
permit interstore transfers of employees because of their
union affiliations, Respondent Joseph Magnin Company,
Inc., has violated and is violating Section 8(a)(3) and (1)
of the Act.
5. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
6. Respondent Joseph Magnin Company, Inc., has not
violated the Act in any other manner.
THE REMEDY
Having found that Joseph Magnin Company, Inc., has
engaged in certain unfair labor practices, I shall recom-
mend that it be ordered to cease and desist therefrom,
and that it take certain affirmative action designed to ef-
fectuate the policies of the Act. With regard to the
latter, I note first that the Charging Party has alleged
that employees of the Store I Gucci department lost
earnings as a result of the Post Street opening and the
prohibition against their transfer there. I note also that
this allegation was made in the arbitration proceeding,
and that Arbitrator Grodin was unable to reach a defini-
tive conclusion on its merits. In this light, I find that de-
terminations regarding any backpay owed discriminatees
herein may be deferred to the compliance stage of this
proceeding. For as Mr. Justice Frankfurter noted in his
concurring opinion in N.L.R.B. v. Deena Artware, Inc., et
al., 361 U.S. 398, 412 (1960), the separation of the finding
that an employer's conduct violated the Act from the de-
termination of the amounts of backpay owing is "an
eminently reasonable method for administering the Act."
See also The Torrington Company v. N.L.R.B., 545 F.2d
840, 842 (2d Cir. 1976), and The Florsheim Shoe Store of
Pittsburgh, Pennsylvania, et al. v. N.L.R.B., 556 F.2d
1240, 1247 (2d Cir. 1977), for cases where issues involv-
ing the scope of the remedy were deferred to the com-
pliance stage. Therefore, it is unnecessary at this point to
determine precisely the employees so affected according
to the Charging Party's allegations and the amounts of
backpay to which each may be entitled. Similarly, I
defer the determination of precisely which employees
would have been transferred but for the unlawful dis-
crimination to the compliance stage of this proceeding.
667
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Having found that Respondent illegally refused to
transfer union members to its Post Street facility, I shall
recommend that Joseph Magnin Company, Inc., be or-
dered to offer immediate transfer to those employees
who would have transferred but for the unlawful dis-
crimination, as determined in the compliance stage of
this proceeding, to the Post Street Gucci store, without
prejudice to their seniority or other rights or privileges,
dismissing, if necessary, anyone who may have been
hired or assigned to perform the work to which the dis-
criminatees would have been assigned. Additionally,
Joseph Magnin Company, Inc., will be required to make
whole any such discriminatees for any loss of earnings
they may have suffered by reason of the unlawful refus-
als to transfer, with interest on the amounts owing to be
computed in the manner prescribed in Florida Steel Cor-
poration, 231 NLRB 651 (1977), and with deductions for
interim earnings as prescribed by F. W Woolworth Com-
pany, 90 NLRB 289 (1950). See, generally, Isis Plumbing
& Heating Co., 138 NLRB 716 (1962), enforcement
denied on other grounds 322 F.2d 913 (9th Cir. 1963).
[Recommended Order omitted from publication.]
668