McAX Sign Co.

National Labor Relations Board - Board Decisions

Aug 31, 1977

231 N.L.R.B. 957 (N.L.R.B. 1977)

McAX SIGN COMPANY
McAx Sign Company, Inc. and Local Union 59,
International Brotherhood of Electrical Workers,
AFL-CIO. Case 16-CA-6726
August 31, 1977
DECISION AND ORDER
BY MEMBERS JENKINS, MURPHY, AND
WALTHER
On May 4, 1977, Administrative Law Judge Henry
L. Jalette issued the attached Decision in this
proceeding. Thereafter, Respondent filed exceptions
and a supporting brief and the General Counsel filed
a brief in support of the Administrative Law Judge's
Decision.
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
briefs and has decided to affirm the rulings, findings,
and conclusions of the Administrative Law Judge, to
modify his Remedy,' and to adopt his recommended
Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge and
hereby orders that the Respondent, McAx Sign
Company, Inc., Dallas, Texas, its officers, agents,
successors, and assigns, shall take the action set forth
in the said recommended Order.
I In accordance with our decision in Florida Steel Corporation, 231
NLRB 651 (1977). we shall apply the current 7-percent rate for periods pnrior
to August 25. 1977. in which the "adjusted prime interest rate" as used by
the Internal Revenue Service in calculating interest on tax payments was at
least 7 percent.
DECISION
STATEMENT OF THE CASE
HENRY L. JALETTE, Administrative Law Judge: This
proceeding involves allegations that the above-named
Respondent violated Section 8(a)(5) and (1) of the Act by
refusing to sign a collective-bargaining agreement, the
terms of which had been agreed to by an alleged
multiemployer association. The issue presented is whether
or not Respondent is bound by the agreement reached by
the alleged association. The proceeding was initiated by a
charge filed on August 9, 1976,1 by the above-named
Union, pursuant to which complaint issued on September
231 NLRB No. 158
23. On December 3 and 4, hearing was held in Dallas,
Texas.
Upon the entire record, including my observation of the
witnesses, and after consideration of the briefs filed by the
parties, I hereby make the following:
FINDINGs OF FACT
I. THE FACTS
Respondent is an employer engaged in the design,
manufacture, and erection of electrical signs. 2 Prior to
1976, Respondent was a party to three collective-bargain-
ing agreements with the Union for periods from June 20,
1968, to June 30, 1971; July 1971 to June 30, 1973; and
July 1, 1973, to June 30, 1976. These agreements purported
to be between the Union and the Neon and Electric Sign
Companies of Dallas, Texas (herein called NESCDT), but
the contracts were signed by individual contractors.
When the time for renewal of the contracts arrived, it
was the practice of the Union to submit proposed changes
to the individual contractors and the individual contractors
would, in turn, submit their proposed changes directly to
the Union. On April 30, Respondent, Heath and Company,
and J. F. Zimmerman & Sons, each submitted proposals to
the Union. Thereafter, a negotiating meeting was sched-
uled for May 18.
The May 18 meeting was attended by Respondent's
president, Donald Simpson, and the two contractors
named above, plus a representative of the A.B.C. Sign
Company. Union Business Agent Herbert Hicks was made
chairman of the meeting and Dan Rippe, the representative
of Heath and Company, was made secretary with the
duties of keeping minutes of the meeting and making
necessary contacts with the contractors in between meet-
ings. After May 18, the parties met again on May 25 and
June 1, 8, 15, and 22.
At the end of the June 22 meeting, according to Hicks,
the parties had pretty well ironed out all the problems
except for a difference of 10 cents with regard to an hourly
wage increase and Hicks told the contractors that a
mediator should be obtained for the next meeting. The
following day, Mahaffey of Heath and Company called
and asked to meet again. Because the contract was about to
expire and the Union had a membership meeting sched-
uled for June 28, the parties agreed to meet on June 28. On
that date, the union representatives and all the contractors
who had been meeting since May 18, except Respondent,
held a meeting at which an agreement was reached
providing, inter alia, for a wage increase 10 cents per hour
more than had been agreed to earlier. That same day, the
union membership ratified the agreement.
On July 2, in accordance with past practice, Hicks
mailed to each contractor a copy of the changes agreed to.
Thereafter, each contractor, except Respondent, notified
the Union by mail or telephone that the changes as set
forth in his letter were as agreed to in negotiations. The
Union received no reply from Respondent and Hicks
testified he telephoned on July 12 but was unable to speak
to Simpson. On July 22, the Union wrote to Respondent
' Lnless otherwise indicated all dates hereinafter are in 1976.
2 Jurisdiction is not in issue. Respondent admits it meets the Board's
direct inflow standard for the assertion of jurisdiction.
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
serving notice of the change in the rate of pay of
journeymen effective July I and advising Respondent to
take appropriate action if the rate had not been raised as of
July I.
Respondent did not reply to this letter and it was not
until July 29 that Hicks was able to reach Simpson by
telephone after several unsuccessful calls. On that date,
Simpson told Hicks he had not had a chance to review the
changes, but he would do so and call Hicks the next day.
When he did not do so, Hicks hand delivered a copy of the
contract on July 30.
On August 2, Respondent sent a letter to the Union in
which it stated that it would not sign the agreement
because it failed to include requested changes and it
included changes to which it had not agreed.
Analysis and Conclusions
General Counsel contends that Respondent violated
Section 8(a)(l) and (5) of the Act by refusing to sign the
agreement orally agreed to on June 28. Whether Respon-
dent was obligated to sign that agreement depends on
whether or not Respondent had indicated an unequivocal
intention to be bound in collective bargaining by group
rather than individual action.3 In this case, there are no
express statements either by Respondent or by the other
contractors engaged in group negotiations signifying what
their intention was in bargaining as a group, nor is there a
formal delegation of authority from the individual employ-
er to the multiemployer group. Moreover, there is no
formal association structure binding the bargaining partici-
pants. (The agreements which the contractors have negoti-
ated over the years purported to be between the Union and
NESCDT; however, there is no organization of that name,
and no one knew when, where, or how such a name came
into existence.)
On the basis of the foregoing facts, plus the facts that the
Union submitted its contract proposals to the individual
contractors, who, in turn, submitted separate proposals,
formulated by each individual contractor without consulta-
tion with other contractors, and that the contractors
participated individually in the negotiations without a
spokesman (if one contractor spoke more than others, there
is no evidence it was attributable to his having been
designated spokesman), Respondent contends a finding
that it had agreed to be bound by group bargaining is not
warranted. I do not agree.
In evaluating an employer's intention when engaged in
group bargaining, the Board has pointed out that: 4
The manifestation of an "unequivocal intention" to
be bound requires something less, however, than a
solemnly executed document signed and sealed with
hot wax. A commitment to bargaining on a multiem-
ployer basis will not be made to depend on the presence
of a formal associational structure among the bargain-
ing participants or on the formal delegation of
authority from the individual employer to the multiem-
ployer group. Nor will the Board, faced with outward
manifestations of intent to engage in group bargaining,
: Bill O'Grady Carpet Service, Inc., 185 NLRB 587 (1970).
4 Joseph McDaniel, an Individual Proprietorship d/b/a Custom Colors
Contractors, 226 NLRB 851, 853 (1976).
consider as controlling an employer's private manifes-
tations of dissent. An employer who, through a course
of conduct or otherwise, signifies that it has authorized
the group to act in its behalf will be bound by that
apparent creation of authority.
From that statement, it can clearly be seen that the
absence of evidence of a formal delegation of authority by
Respondent to the contractors engaged in negotiations
with him and the absence of any evidence that NESCDT
had any formal structure do not preclude a finding of the
requisite unequivocal intention. The objective facts appear-
ing in the record are that for a number of years Respondent
and the other contractors referred to above, have negotiat-
ed jointly and have been cosignatories to a single contract.
While NESCDT did not have any existence in the sense of
having a constitution and bylaws, membership require-
ments, a place of business, and the like, its name did
appear on the contracts which Respondent and his fellow
contractors have signed for years as the "Employer" and it
may reasonably be inferred that its use reflected the fact
that those contractors had agreed to act jointly.
As to the prenegotiation procedure of individual submis-
sions of proposals, Respondent rightly argues that such
procedure is an indicium of individual bargaining; how-
ever, union representative Hicks testified that during the
negotiations, after caucusing, the contractors consolidated
the separate proposals into a single set of proposals which
formed the basis of negotiations thereafter. The minutes of
the May 25 meeting confirm the testimony. Section IV
thereof states: "It was agreed to try for a package to
present Local 59 covering all parties involved at the next
meeting, i.e., to drop or hold on proposals." The minutes of
the June I meeting reveal in section VI that the contrac-
tors' proposals were consolidated. Section VII of the
minutes recites that "Union agreed to take under advise-
ment as a committee proposals: e, f, h, g, i." Such conduct
is patently group action. Respondent argues otherwise on
the ground that at no time during the negotiations did
Simpson state that he was dropping any of his proposals.
However, Respondent adduced no testimony whatsoever
that at any of the meetings did Simpson assert a position
independent of the group position and that he told the
Union he reserved the right to reject any contract that did
not include his proposals. In effect, then, Respondent's
position is reduced to a "private manifestation of dissent."
The evidence of Respondent's intention to be bound by
group action does not end with the June 22 meeting. As
Hicks testified, on July 2 he mailed to Respondent a copy
of the contract changes agreed to. Respondent never
replied and offered no explanation for not doing so. Nor
did it reply to Hicks' letter of July 22. Even on July 29, 1
month after the meeting at which agreement was reached,
when Hicks finally succeeded in reaching Simpson, and
when Simpson knew that the Union deemed him bound by
the contract as evidenced by its July 22 letter, Simpson did
not assert that he was not bound. To the contrary, he stated
he had not had a chance to review the changes. Even if that
were the case, he knew the contract called for a 10-cent
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McAX SIGN COMPANY
wage increase more than he had agreed to and could have
so stated. In short, Respondent's reasons for rejecting the
contract as set forth in its August 2 letter are clearly a
belated attempt to avoid the legal consequences of its past
conduct.
As to the June 22 meeting, there is a conflict in testimony
regarding which issues remained unresolved at the end of
the meeting and whether or not Hicks admitted to an
impasse. Were it necessary for decision, I would credit
Hicks' testimony; however, assuming, arguendo, that
Simpson's testimony was credited, it would not alter the
result. Simpson said nothing at the meeting to negate the
conclusion that he was committed to group action, and, if
Hicks declared an impasse, it avails Respondent nothing as
it did not withdraw from the multiemployer group either
then or until its rejection of the contract on August 2 after
the impasse had been broken. It was then too late.
In summary, in light of a bargaining history which was to
all outward appearances on a group basis, including the use
of an association name, with all the contractors cosigning
the same contract, plus the fact that the negotiations
revealed a group approach to bargaining, the conclusion is
warranted, and I find, that Respondent had manifested an
intention to be bound by group rather than individual
action and that its refusal to sign the agreement agreed to
by the group on June 28 was a refusal to bargain within the
meaning of Section 8(a)( ) and (5) of the Act.
II. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
The activities of Respondent set forth above, occurring
in connection with its operations described above, have a
close, intimate, and substantial relationship to trade,
traffic, and commerce among the several States and tend to
lead to labor disputes burdening and obstructing com-
merce and the free flow of commerce.
III. THE REMEDY
Having found that Respondent has engaged in unfair
labor practices in violation of Section 8(a)(1) and (5) of the
Act, I shall recommend that it be ordered to cease and
desist therefrom and to take appropriate affirmative action
designed to effectuate the policies of the Act. In particular,
I shall recommend that Respondent be ordered to execute
and honor the collective-bargaining agreement containing
all of the provisions of the collective-bargaining agreement
entered into by the other members of the Neon Electrical
Sign Contractors of Dallas, Texas.5
It appears that employees of Respondent have suffered
loss of earnings and other benefits by reason of Respon-
dent's refusal to sign the above-mentioned agreement.
Accordingly, it is hereby recommended that Respondent
I The record indicates that sec. 2.29 of the contract which was ultimately
signed by the other members of NESCDT was different from sec. 2.29 in the
contract submitted to Respondent for execution on July 30. This is no
reason to excuse Respondent from executing the contract as it is clear that
the other members of NESCDT have acquiesced in the change in sec. 2.29
(which relates to the submitting of work) and Respondent is bound bhy that
action.
15 No affirmative evidence of the Union's majonty status in the
appropriate unit was adduced at the hearing, but there is a presumption of
make its employees whole for any loss of earnings or
benefits they may have suffered to be computed in
accordance with the formula set forth in F W. Woolworth
Company, 90 NLRB 289 (1950), with interest at the rate of
6 percent per annum in accordance with Isis Plumbing &
Heating Co., 138 NLRB 716 (1962). In addition, Respon-
dent shall make all payments to the Local Employees
Benefit Board as provided for in said agreement. N.LR.B.
v. Joseph T. Strong, d/b/a Strong Roofing and Insulating
Co., 393 U.S. 357 (1969).
CONCLUSIONS OF LAW
I. McAx Sign Company, Inc., is an employer engaged
in commerce within the meaning of Section 2(6) and (7) of
the Act.
2. Local Union 59, International Brotherhood of
Electrical Workers, AFL-CIO, is a labor organization
within the meaning of Section 2(5) of the Act.
3. All production and maintenance employees engaged
in manufacturing, assembling, erection, service, disman-
tling, and removing operations employed by Employer
members of Neon and Electrical Sign Companies of
Dallas, Texas, and by McAx Sign Company, Inc., but
excluding office clericals, guards, watchmen, and supervi-
sors as defined in the Act, constitute a unit appropriate for
purposes of collective bargaining within the meaning of
Section 9(b) of the Act.
4. Local Union 59, International Brotherhood of
Electrical Workers, AFL-CIO, has been at all material
times herein, and is now, the representative of a majority of
the employees in the aforesaid unit, and by virtue of
Section 9(a) of the Act, has been, and is, the exclusive
representative of all employees of said unit for the purposes
of collective bargaining.6
5. By failing and refusing to execute or become party to
the collective-bargaining agreement negotiated by the
Employer members of Neon and Electrical Sign Compa-
nies of Dallas, Texas, and Local Union 59, International
Brotherhood of Electrical Workers, AFL-CIO, Respon-
dent has engaged in, and is engaging in, unfair labor
practices within the meaning of Section 8(aX)(1) and (5) and
2(6) and (7) of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record in this case, and pursuant to Section
10(c) of the Act, I hereby issue the following recommend-
ed:
ORDER7
The Respondent, McAx Sign Company, Inc., Dallas,
Texas, its officers, agents, successors, and assigns, shall:
1. Cease and desist from:
majonty ansing out of the history of collective bargaining and the Union's
incumbency as representative of the unit employees, a presumption which
was not rebutted by Respondent.
7 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 findings.
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.
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(a) Refusing to bargain with Local Union 59, Interna-
tional Brotherhood of Electrical Workers, AFL-CIO, as
the exclusive representative of its employees in the unit
described above, by failing and refusing to execute or
become party to the collective-bargaining agreement
negotiated between Neon and Electrical Sign Companies
of Dallas, Texas, and Local Union 59, International
Brotherhood of Electrical Workers, AFL-CIO.
(b) In any like or related manner interfering with,
restraining, or coercing its employees in the exercise of
their rights to self-organization, to form, join, or assist the
above-named labor organization, or any other labor
organization, to bargain collectively through representa-
tives of their own choosing, and to engage in concerted
activities for the purpose of collective bargaining or other
mutual aid or protection as guaranteed by Section 7 of the
Act or to refrain from any or all activities.
2. Take the following affirmative action designed to
effectuate the policies of the Act:
(a) Forthwith execute and honor the agreement negotiat-
ed by the Employer members of Neon and Electrical Sign
Companies of Dallas, Texas, and Local Union 59,
International Brotherhood of Electrical Workers, AFL-
CIO.
(b) Make its employees whole for any loss of earnings or
other benefits they may have suffered by reason of
Respondent's failure and refusal to execute and abide by
the aforesaid agreement in the manner set forth in the
section entitled "The Remedy."
(c) Pay to the Local Employees Benefit Board the sums
provided for in the aforesaid agreement.
(d) Post at its Dallas, Texas, facility, copies of the
attached notice marked "Appendix."8 Copies of said
notice, on forms provided by the Regional Director for
Region 16, after being duly signed by Respondent's
authorized representative, shall be posted by it immediately
upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places, includ-
ing 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.
8 In the event that this Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by Order
of the National Labor Relations Board" shall read "Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board."
(e) Notify the Regional Director for Region 16, in
writing, within 20 days from the date of this Order, what
steps it has taken to comply herewith.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT refuse to bargain collectively with
Local Union 59, International Brotherhood of Electri-
cal Workers, AFL-CIO, by failing and refusing to
execute and honor the agreement negotiated with said
Union by The Neon and Electrical Sign Companies of
Dallas, Texas. The appropriate bargaining unit is:
All production and maintenance employees en-
gaged in manufacturing, assembling, erection,
service, dismantling, and removing operations,
employed by Employer members of Neon and
Electrical Sign Companies of Dallas, Texas, and
by McAx Sign Company, Inc., but excluding
office clericals, guards, watchmen, and supervi-
sors as defined in the Act, constitute a unit
appropriate for the purposes of collective bargain-
ing within the meaning of Section 9(b) of the Act.
WE WILL NOT in any like manner interfere with,
restrain, or coerce employees in the exercise of their
rights guaranteed in Section 7 of the Act.
WE WILL forthwith execute and honor the agreement
negotiated by Neon and Electrical Sign Companies of
Dallas, Texas, and Local Union 59, International
Brotherhood of Electrical Workers, AFL-CIO.
WE WILL make our employees whole for any loss of
earnings or other benefits they may have suffered by
reason of our failure and refusal to execute and abide
by the aforesaid agreement.
WE WILL pay to the Local Employees Benefit Board
the sums provided for in the aforesaid agreement.
McAx SIGN COMPANY, INC.
960