Murphy Motors, Inc.

National Labor Relations Board - Board Decisions

Aug 13, 1969

178 N.L.R.B. 15 (N.L.R.B. 1969)

MURPHY MOTORS, INC.
Murphy Motors , Inc. and American Federation of
Professional Salesmen . Case 13-CA-8809
August 13, 1969
DECISION AND ORDER
BY CHAIRMAN MCCULLOCH AND MEMBERS
FANNING AND ZAGORIA
On June 9, 1969, Trial Examiner William W.
Kapell issued his Decision in the above-entitled
proceeding, finding that the Respondent had
engaged in and was engaging in certain unfair labor
practices, and recommending that it cease and desist
therefrom and take certain affirmative action, as set
forth in the attached Trial Examiner's Decision.
Thereafter, the Respondent filed exceptions to the
Trial Examiner's Decision and a supporting brief
and the General Counsel filed a cross-exception and
an answering brief. The Respondent filed a reply to
brief of General Counsel.'
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
powers in connection with this case to a
three-member panel.
The Board has reviewed the rulings of the Trial
Examiner made at the hearing and finds that no
prejudicial error was committed. The rulings are
hereby affirmed. The Board has considered the Trial
Examiner's Decision, the exceptions, cross-exception
and briefs, and the entire record in this case, and
hereby adopts the findings, conclusions, and
recommendations= of the Trial Examiner with the
exception noted below.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the
Recommended Order of the Trial Examiner, as
modified below, and hereby orders that the
Respondent, Murphy Motors, Inc., Chicago,
Illinois, its officers, agents, successors, and assigns,
shall take the action set forth in the Trial
Examiner's Decision, as herein modified:
'The General Counsel's motion to strike Respondent 's reply to brief of
General Counsel is hereby denied as lacking in merit.
'The General Counsel excepted to the failure of the Trial Examiner to
provide that the year of the Union 's certification be extended to begin on
the date the Respondent commences to bargain in good faith with the
Union as the statutory bargaining representative in the appropriate unit in
accordance with Mar-Jac Poultry Company, Inc., 136 NLRB 785;
Commerce Company d/b/a Lamar Hotel, 140 NLRB 226, 229, enfd. 328
F.2d 600 (C.A. 5), cert . denied 379 U.S. 817; Burnett Construction
Company, 149 NLRB 1419 , 1421, enfd . 350 F.2d 57 (C.A. 10). We find
merit in this exception . Accordingly , the remedy is hereby revised to
provide for such extension in the certification year in order to insure that
the employees in the appropriate unit will be accorded the services of their
elected bargaining agent for the period normally accorded for this purpose.
15
Add as the second indented paragraph of the
notice the following:
WE WILL, upon request, bargain collectively with
American Federation of Professional Salesmen, as
the exclusive representative of all employees in the
unit found appropriate, for purposes of collective
bargaining with respect to wages, hours, and other
terms and' conditions of employment, as provided
in the Board's Decision and Order, and, if an
understanding is reached, embody such
understanding in a signed agreement.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
WILLIAM W. KAPELL, Trial Examiner: Case
13-CA-8809, a proceeding under Section 10(b) of the
National Labor Relations Act, as amended, herein called
the Act, was heard in Chicago, Illinois, on April 24, 1969,
with all parties participating pursuant to notice on a
complaint' issued on January 29, 1969, by the Regional
Director for Region 13 of the National Labor Relations
Board, hereinafter called the Board, alleging violations of
Section 8(a)(1) and (5) of the Act by Murphy Motors,
Inc., hereafter called Respondent or Company. The
complaint, as amended at the hearing, in substance alleges
that Respondent has refused to bargain collectively with
the Union, the duly certified bargaining representative of
its employees in an appropriate unit, with respect to the
terms and conditions of their employment, and has
unilaterally changed and modified certain specified
preexisting terms and conditions of their employment. In
its duly filed answer, Respondent denied the commission
of any unfair labor practices or that the Union is a labor
organization within the meaning of Section 2(5) of the
Act, and pleaded that, at all times material herein, the
Union and its officers were engaged in a conspiracy to
restrain trade and commerce in violation of the Sherman
Act, and that it will not effectuate the purposes of the Act
to accord the Union any relief thereunder.
All parties were accorded full opportunity to be heard,
to introduce relevant evidence, to present oral argument,
and to file briefs. Respondent and the General Counsel
filed briefs which have been duly considered. On the entire
record' in the case, and from my observation of the
witnesses, I make the following:
FINDINGS OF FACT
1. COMMERCE,
At all times material herein, Respondent has
maintained its principal office and place of business in
Chicago, Illinois, where it has been engaged in the retail
distribution and repair of automobiles, trucks, and related
products. During the calendar year 1968, the Respondent,
in the course and conduct of its business operations, sold
and distributed automobiles, trucks, and related products
valued in excess of $500,000, of which products valued in
excess of $100,000 were shipped to its place of business
'Based on a charge filed on December 19, 1968, by American Federation
of Professional Salesmen , hereafter referred to as the Union.
'Pursuant to General Counsel 's unopposed motion , the date of
"10/26/69" appearing on p. 26, 1. 3 of the transcript is corrected to
"10/26/68".
178 NLRB No. 9
16 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
directly from locations outside the State of Illinois.
Respondent admits , and I find , that at all times material
herein , it has engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.
11. THE LABOR ORGANIZATION INVOLVED
As indicated above, Respondent denied that the Union
is a labor organization within the meaning of Section 2(5)
of the Act. It was stipulated during the hearing that the
Union herein is the same organization which was involved
in several prior Board proceedings' in which the Union
was found to be a labor organization within the meaning
of the Act, notwithstanding claims that it was not a bona
fide labor organization and was engaged in violation of
the Sherman Act. Furthermore, as appears in Case
13-RC-11494, a related representation proceeding
involving the Union and Respondent, the Regional
Director found the Union to be an organization in which
employees, participate for the purpose of dealing with
employers concerning wages, hours, and other terms and
conditions of employment, and therefore a labor
organization within the meaning of Section 2(5) of the
Act. Following a Board-conducted election, the Regional
Director, on August 1, certified the Union as the
collective-bargaining representative of an appropriate unit
of Respondent's employees. Thereafter, following the
issuance of a Hearing Officer's report of a contested
hearing involving the resolution of a challenged ballot, to
which no exceptions were filed, the Board, on December
11, 1968,' issued an order affirming the certification of
representative issued by the Regional Director. It would
serve no useful purpose to reiterate or expound further the
grounds on which the foregoing rulings were based, and as
anticipated by Respondent, I find that the Union is a
labor organization within the meaning of Section 2(5) of
the Act.'
III. THE ALLEGED VIOLATIONS OF SECTION 8(a)(5)
A. The Failure of Respondent to Bargain with the
Union
As related above, the Union, following a representation
proceeding , was certified as the collective-bargaining
representative of a unit of Respondent ' s employees
composed essentially of automobile and truck salesmen. It
was stipulated that on August 17, the Union made written
request of Employers Association of Greater Chicago, of
which Respondent is a member, to bargain on behalf of
Respondent, and on November 30, 1968, and January 23,
1969, similar requests were made directly of Respondent,
but that no replies were received. Although Respondent
attacked the validity of the election and certification in the
related representation proceeding, the Board affirmed the
certification issued by the Regional Director. It is settled
policy of the Board that in the absence of newly
discovered evidence, previously unavailable evidence, or
"'Z" Frank , Inc.. 172 NLRB No. 254 ; Bonk Motor Sales , Inc., 173
NLRB No. 155 ; and Schmerler Ford, Inc., 175 NLRB No. 90.
All dates hereafter refer to the year 1968 unless otherwise noted.
'Respondent stated at the hearing that in its answer it denied the Union
was a labor organization and alleged it was engaged in a conspiracy to
restrain trade and commerce in violation of the Sherman Act in order to
preserve its pcsition on ultimate review that the Union was not entitled to
any relief under the Act because its purpose was to effectuate an unlawful
price-fixing agreement among the auto dealers in the area . The Board
rejected those defenses in the cases cited above.
special circumstances , issues concerning representation
may not be relitigated before a Trial Examiner in an
unfair labor practice case, which were or could have been
litigated in the prior related representation proceeding.'
The basic issue is whether Respondent was justified in
failing to respond to the requests of the Union to meet
and bargain . In view of the Board ' s order affirming the
Union ' s certification , and in the absence of tht, submission
by Respondent of any new or previously unavailable
evidence or special circumstances , I find that Respondent
unlawfully ignored the Union's request to bargain in
violation of Section 8 (a)(1) and (5) of the Act.
B. The Alleged Unlawful Unilateral Actions of
Respondent
The complaint, as amended, alleges that Respondent
unilaterally and without either notifying or affording the
Union an opportunity to bargain, changed existing terms
and conditions of employment of its employees by (a) on
or about October 1 reducing their percentage of
commissions on financial reserves' and insurance placed
on cars sold, (b) on or about October 20 increasing the
number of consecutive Sundays they were scheduled to
work, and (c) on or about November 18 increasing the
total number of hours they were scheduled to work.
John Murphy, Jr., Respondent's president, testified that
prior to October 1, company salesmen received 10 percent
of the financial reserve and since that date the percentage
has been reduced to 5 percent. Concededly, Respondent
did not consult with the Union concerning the reduction.
A similar reduction was also effected on the commissions
for placing the insurance on cars sold. Murphy explained
that prior to initiating the reductions on these
commissions, the salesmen were required to perform the
tasks of obtaining credit statements, shopping for
insurance , and other work incidental thereto. Concurrent
with the reductions, a new employee was hired by the
Company to relieve the salesmen of the work previously
involved in connection with the financing and insurance on
car sales . Under this arrangement, the new employee was
able to devote all his time on deals, especially those which
on their face seemed uninsurable, and successfully
completed many that formerly might not have been
completed. Also, as a result, the salesmen were able to
devote more time to selling cars and their income was
thereby increased. Murphy, however, did not deny that the
increases in the income of salesmen since the previous
October could have been attributed to a seasonal factor,
such as the advent of a new car model, and stated that
corporatewise company sales were up.
Joseph Bartoli , a salesman for Respondent since 1967,
testified without contradiction that on October 20,
Respondent instituted a new schedule of Sunday
workdays, which required each salesman to work on four
out of every five Sundays, whereas previous to that time
each salesman was off every other Sunday. He testified
further that on November 18, Respondent put into effect
a new schedule of afternoon work hours pursuant to which
salesmen were required to work from 2 p.m. to 9:30 p.m.
on those days in which they had previously been required
to work only from 4 to 9:30 p.m. Merlin Griffith, the
'National Labor Relations Board ' s Rules and Regulations , Series 8, as
amended , Sec. 102.67(f) and 102 . 69(c); and Clark 's Discount Department
Store , 175 NLRB No. 53.
"'Financial reserve" is the profit accruing to Respondent for arranging
the financing of a sale of a car by a bank on behalf of a purchaser.
MURPHY MOTORS, INC.
general secretary -treasurer of the Union , testified that the
Union was never consulted about the changes in the work
schedules for the salesmen.
Conclusions
The critical questions herein are whether the unilateral
changes in commission compensation to the employees
and/or the changes in their schedules of weekday hours
and Sunday work were reasonably within the bargaining
negotiations between the parties, and therefore required
Respondent to notify the Union and afford it an
opportunity to bargain concerning them. Respondent
sought to justify these changes on the ground that they
were matters concerning day-to-day operations of a de
minimis character and wholly within the managerial rights
of management . Yet, Respondent testified that the
changes were considered over a period of several months
before being adopted and implemented . Apparently, they
were regarded as of such reorganizational importance as
to require prolonged consideration . I find that these
changes constituted material and significant modifications
of the preexisting terms and conditions of employment.
Although Respondent had the right to determine the need
for a reorganization of its operations along more
profitable and efficient lines, the Act imposed upon it the
obligation to notify the Union of them , and to afford it an
opportunity to negotiate concerning changes in the plan
itself and the manner and timing of its implementation.
Moreover , Respondent did not show any circumstances
indicating that it was faced with an emergency requiring
immediate action. Rather, Respondent deliberately
determined , as a voluntary assertion of its own alleged
prerogatives , that it would unilaterally effectuate the
changes in its operations . Even accepting Respondent's
contention that they were instituted solely for the
economic purpose of augmenting profits and eliminating
inefficiency , there were many questions which might
probably have been the subject of collective bargaining if
Respondent had not foreclosed bargaining by its unilateral
action . As the Supreme Court remarked in Fibreboard
Paper Products v. N.L.R.B. 379 U.S. 203, 214,
cost -cutting decisions , even though not motivated by
discriminatory consideration , are "suitable for resolution
within the collective bargaining framework ," and "it is
not necessary that it be likely or probable that the union
supply a feasible solution but rather that the union be
afforded an opportunity to meet management ' s legitimate
complaints ......
Respondent also contended in justification of the
changes in commissions that they resulted in increased
earnings to the employees, but the evidence fails to
substantiate that claim . Even assuming increases in
earnings to employees following the changes in the
commissions , they could just as well be attributed to an
upsurge in sales concurrent with the advent of a new car
model or to extension of the working hours prescribed by
Respondent. In fact, the evidence does not establish
whether the overall effect of the changes in the
commissions has been to the detriment or benefit of the
employees . I also find no merit in Respondent's
contention that the increases in required hours and days of
work were de minimis . Increasing a daily work period by
2 hours and requiring the salesmen to work on four out of
every five Sundays instead of every other Sunday , patently
constitute material and substantial changes in
employment. Consequently, the substantial increases in
the required number of weekday working hours and
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Sunday work , regardless of whether the employees
previously voluntarily worked longer hours than required,
were mandatory subjects of collective bargaining, and
their unilateral implementation deprived the Union of its
bargaining rights.
Accordingly , I conclude and find that Respondent
violated Section 8(a)(5) and (1) of the Act by unilaterally
effectuating changes in the commissions paid to employees
and their required hours and days of work . N.L.R.B. v.
Katz , d/b/a Williamsburg Steel Products Co., 369 U.S.
736.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON , COMMERCE
The activities of Respondent set forth in section III,
above , occurring in connection with the Respondent's
operations described in section I, 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 commerce and
the free flow thereof.
Upon the foregoing findings of fact and upon the entire
record , I make the following:
CONCLUSIONS OF LAW
1. At all times material herein , Respondent has been
engaged in commerce as an employer within the meaning
of Section 2(6) and (7) of the Act.
2. At all times material herein , the Union has been a
labor organization within the meaning of Section 2(5) of
the Act.
3. Pursuant- to an election by secret ballot conducted by
the Board , the Union has been certified at all times
material herein as the exclusive bargaining representative
of the employees in the following unit.
All automobile and truck salesmen employed at the
Employer's Chicago , Illinois location , excluding office
and plant clericals, automobile mechanics , semi-skilled
help, parts department employees , guards and
supervisors as defined in the Act and all other
employees.
4. At all times material herein , the Union has been and
has remained the exclusive bargaining representative of
the aforesaid employees for the purpose of collective
bargaining in respect to wages, hours, and terms and
conditions of work within the meaning of Section 9(a) of
the Act.
5. The Union, since on or about August 17, has duly
requested Respondent to bargain with it as exclusive
bargaining representative pursuant to the aforesaid
certification.
6. At times material herein , Respondent has refused to
bargain upon request with the Union, and unilaterally and
without notice or affording the Union an opportunity to
bargain , changed the percentage of commissions paid to
employees for arranging the financing and placing of
insurance on cars sold by them and also changed the
schedules of daily hours of work prescribed for employees
and the number of Sundays worked by them, thereby
violating Section 8(a)(5) and (1) of the Act.
THE REMEDY
Having found that Respondent has unlawfully refused
to bargain with the Union, I shall recommend that it
cease and desist therefrom and take certain affirmative
18 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
action designed to effectuate the policies of the Act.
Having found that Respondent refused to bargain by
unilaterally changing the percentage of commissions
previously paid to employees for arranging the financing
and placing of insurance on the sale of cars, I shall
recommend that Respondent reinstate the status quo ante
by restoring the commission rates in effect prior to such
unilateral action, retroactive to the date when changed,
and pay backpay to all employees in the unit since that
date, in an amount equal to the difference, if any, between
the commissions paid them and the amounts that they
would have received had the commission rates not been
unilaterally changed. Having found that the hours of
weekday and Sunday work have been unilaterally
changed, I shall recommend that Respondent reinstitute
the schedules of weekday hours and Sunday work in effect
prior to their changes.
RECOMMENDED ORDER
Upon the basis of the foregoing findings of fact and
conclusions of law and the entire record in the case, I
recommend that Murphy Motors, Inc., its officers, agents,
successors , and assigns , shall:
1. Cease and desist from:
(a) Refusing to bargain collectively with American
Federation of Professional Salesmen as the exclusive
bargaining representative of
All automobile and truck salesmen employed at the
Employer's Chicago , Illinois location, excluding office
and plant clericals, automobile mechanics, semi-skilled
help, parts department employees, guards and
supervisors as defined in the Act and all other
employees.
with respect to rates of pay, wages, tenure of
employment, other conditions of employment, and
effectuating unilateral changes in wages or other working
conditions.
(b) Interfering with, restraining, or coercing employees
in any like or related manner in connection with the
exercise of the right to self-organization, to form labor
organizations, to join or assist American Federation of
Professional Salesmen, or any other labor organization, to
bargain collectively through representatives of their own
choosing, and to engage in other concerted activities for
the purpose of collective bargaining or other mutual aid or
protection, or to refrain from any or all such activities,
except to the extent that such right may be affected by an
agreement requiring membership in a labor organization
as a condition of employment as authorized in Section
8(a)(3) of the Act, as modified by the Labor-Management
Reporting and Disclosure Act of 1959.
2. Take the following affirmative action which will
effectuate the policies of the Act:
(a) Upon request, bargain collectively with American
Federation of Professional Salesmen, as the exclusive
representative of all employees in the unit found
appropriate, for purposes of collective bargaining with
respect to wages, hours, and other terms and conditions of
employment, and, if an understanding is reached, embody
such understanding in a signed agreement.
(b) Revoke the unilateral changes in commissions and
schedules of daily and Sunday work assignments instituted
on and after October 1, 1968, and revert to the
commissions and scheduled hours and days of
employment existing immediately prior to said date.
(c) Make whole the employees in the appropriate unit
for loss of pay, if any, they may have suffered by reason
of the unilateral changes in commission as set forth in the
section of this decision entitled "The Remedy."
(d) Preserve and, upon request, make available to the
Board or its agents, for examination and copying, all
payroll records, social security payment records,
timecards, personnel records and reports, and all other
records necessary to analyze the amount of backpay due
under the terms of this Recommended Order.
(e) Post at its plant in Chicago, Illinois, copies of the
attached notice marked "Appendix."' Copies of said
notice, on forms provided by the Regional Director for
Region 13, after being duly signed by Respondent's
representative, shall be posted by Respondent immediately
upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places,
including all places where notices to employees are
customarily posted. Reasonable steps shall be taken by
Respondent to insure that said notices are not altered,
defaced, or covered by any other material.
(f) Notify the Regional Director for Region 13, in
writing , within 20 days from the receipt of this Decision,
what steps have been taken to comply herewith.'
'1n the event that this Recommended Order is adopted by the Board, the
words "a Decision and Order" shall be substituted for the words "the
Recommended Order of a Trial Examiner" in the notice . In the further
event that the Board's Order is enforced by a decree of a United States
Court of Appeals, the words "a Decree of the United States Court of
Appeals Enforcing an Order" shall be substituted for the words "a
Decision and Order."
'In the event that this Recommended Order is adopted by the Board,
this provision shall be modified to read: "Notify said Regional Director, in
writing , within 10 days from the date of this Order, what steps Respondent
has taken to comply herewith."
APPENDIX
NOTICE TO ALL EMPLOYEES
Pursuant to the Recommended Order of a Trial
Examiner of the National Labor Relations Board and in
order to effectuate the policies of the National Labor
Relations Act, as amended, we hereby notify our
employees that:
WE WILL NOT refuse to bargain collectively with
American Federation of Professional Salesmen as the
exclusive bargaining representative of all our employees
in the following appropriate unit:
All automobile and truck salesmen employed at
the Employer's Chicago, Illinois location, excluding
office and plant clericals, automobile mechanics,
semi-skilled help, parts department employees,
guards and supervisors as defined in the Act and all
other employees.
WE WILL revoke the unilateral changes on
commissions on the financing and placing of
automobile insurance on the sale of cars instituted on
and after October 1, 1968, and revert to the
commissions existing immediately prior to that date.
WE WILL revoke the unilateral changes in the
schedules of daily and Sunday work assignments
instituted on and after October 20, 1968, and revert to
the schedules of hours and Sunday work existing
immediately prior to that date.
WE WILL make whole the employees in thej
appropriate unit for loss of pay, if any, they may have
suffered by reason of the unilateral changes in
commissions effected on and after October 1, 1968.
MURPHY MOTORS, INC.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce employees in the exercise of
the right to self-organization, to form, join, or assist
American Federation of Professional Salesmen, or any
other labor organization, to bargain collectively through
representatives of their own choosing, to engage in
concerted activities for the purpose of collective
bargaining or other mutual aid or protection, or to
refrain from any or all such activities, except to the
extent that such right may be affected by an agreement
requiring membership in a labor organization as a
condition of employment, as authorized in Section
8(a)(3) of the National Labor Relations Act, as
modified by the Labor-Management Reporting and
Disclosure Act of 1959.
MURPHY MOTORS, INC.
(Employer)
Dated By
19
(Representative ) (Title)
This notice must remain posted for 60 consecutive days
from the date of posting and must not be altered, defaced,
or covered by any other material.
If employees have any question concerning this notice
or compliance with its provisions, they may communicate
directly with the Board's Regional Office, 881 U.S.
Courthouse and Federal Office Building, 219 South
Dearborn Street, Chicago, Illinois 60604, Telephone
312-353-7570.