Norris Industries

National Labor Relations Board - Board Decisions

Jul 29, 1977

231 N.L.R.B. 50 (N.L.R.B. 1977)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Norris Industries and International Union, United
Automobile, Aerospace and Agricultural Imple-
ment Workers of America, Local 509, UAW. Case
21 -CA- 14747
July 29, 1977
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
PENELLO AND WALTHER
On April 12, 1977, Administrative Law Judge
Maurice M. Miller issued the attached Decision in
this proceeding. Thereafter, the General Counsel and
the Charging Party filed exceptions and supporting
briefs, and Respondent filed a brief in support of the
Administrative Law Judge's Decision and in opposi-
tion to the exceptions of the General Counsel and
Charging Party.
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, find-
ings,' and conclusions of the Administrative Law
Judge 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 complaint be, and it hereby is,
dismissed in its entirety.
I The General Counsel and the Charging Party have excepted to certain
credibility findings made by the Administrative Law Judge. It is the Board's
established policy not to overrule an Administrative Law Judge's resolutions
with respect to credibility unless the clear preponderance of all of the
relevant evidence convinces us that the resolutions are incorrect. Standard
Dry Wall Products. Inc., 91 NLRB 544 (1950), enfd. 188 F.2d 362 (C.A. 3,
1951). We have carefully examined the record and find no basis for
reversing his findings.
DECISION
STATEMENT OF THE CASE
MAURICE M. MILLER, Administrative Law Judge: Upon
a charge filed on June 4, 1976, and duly served, the
General Counsel of the National Labor Relations caused a
complaint and notice of hearing dated July 22 to be issued
and served on Norris Industries, herein Respondent.
Therein, Respondent was charged with the commission of
unfair labor practices within the meaning of Section 8(a)(5)
and (1) of the National Labor Relations Act, as amended,
61 Stat. 136, 73 Stat. 519. Respondent's answer, duly filed,
conceded certain factual allegations within General Coun-
231 NLRB No. 16
sel's complaint, but denied the commission of any unfair
labor practices.
Pursuant to notice, a hearing with respect to this matter
was held before me in Los Angeles, California, on various
dates between October 28 and November 23, 1976. The
General Counsel, Complainant Union, and Respondent
were represented by counsel. Each party was afforded a
full opportunity to be heard, to examine and cross-examine
witnesses, and to introduce evidence with respect to
pertinent matters. Since the hearing's close, General
Counsel's representative and Respondent's counsel have
filed briefs which have been duly considered.
Upon the entire testimonial record, documentary evi-
dence received, and my observation of witnesses, I make
the following:
FINDINGS OF FACT
1. JURISDICTION
Respondent raises no question herein with respect to
General Counsel's jurisdictional claim. Upon the com-
plaint's relevant factual declarations - specifically, those
set forth in detail within the second paragraph thereof -
which are conceded to be correct, and on which I rely, I
find that Respondent herein was, throughout the period
with which this case is concerned, and remains, an
employer within the meaning of Section 2(2) of the Act,
engaged in commerce and in business operations which
affect commerce within the meaning of Section 2(6) and (7)
of the statute. Further, with due regard for presently
applicable jurisdictional standards, I find assertion of the
Board's jurisdiction in this case warranted and necessary to
effectuate the statutory objectives.
I1. COMPLAINANT UNION
International Union, United Automobile, Aerospace and
Agricultural Implement Workers of America, Local 509,
UAW, designated herein as Complainant Union, is a labor
organization within the meaning of Section 2(5) of the Act,
as amended, which admits certain of Respondent's em-
ployees to membership.
III. THE UNFAIR LABOR PRACTICE CHARGE
A. Issue
During April 1976 Respondent terminated the group
medical insurance coverage of various employees then on
medical leaves of absence; this was done consistently with
a provision within a designated "Letter of Understanding"
supplementing Respondent's then current collective-bar-
gaining contract with Complainant Union herein, which
had, shortly before, been concluded and signed. The
provision reads as follows:
Insurance terminates when the employee ceases to be a
full-time active employee; however, if an employee is
on economic, personal, or medical leave of absence,
group insurance coverage will be continued not later
than the end of the month following the month such
leave is first initiated.
50
NORRIS INDUSTRIES
General Counsel contends, herein, that, with reference to
workers on medical leaves of absence particularly, termina-
tions of medical insurance coverage bottomed upon this
provision constituted a departure from past practice; that
the provision, though concededly set forth within the
designated "Letter of Understanding" supplementary to
Respondent's fully executed contract with Complainant
Union herein, had never been specifically considered,
consensually negotiated, or consciously accepted by Com-
plainant Union's representatives; that its presence within
the contractual supplement noted reflects nothing more
than Respondent's gratuitous supposition that Complain-
ant Union had concurred with respect thereto; and that
terminations of coverage consistently with the provision -
without prior notification to, or consultation with, Com-
plainant Union herein - should, therefore, be considered
"unilateral" conduct, statutorily proscribed. Respondent
concedes that Complainant Union's negotiators had never
formally declared their conscious concurrence with the
particular "disputed language" previously noted herein.
Nevertheless, the firm contends that "the concept and/or
the exact language" pursuant to which it was terminating
medical insurance coverage for certain workers had been
presented for Complaina: t Union's consideration during
several collective-bargaining sessions; that Complainant
Union's negotiators had neither demurred nor protested to
Respondent's successive proposals; that the disputed
language's physical incorporation thereafter - within a
draft contract document which Complainant Union's
negotiators finally signed and within a contract booklet
subsequently printed - had never been challenged; that,
with matters in this posture, Respondent's management
representatives could reasonably presume Complainant
Union's consensual "acquiescence" with regard to their
medical insurance termination proposal; and that Respon-
dent's subsequent terminations of medical insurance
coverage, consistent with the disputed provision therefore
should not be considered "unilateral" conduct derogative
of Respondent's collective-bargaining obligation.
B. Facts
I. Background
a. Respondent's Vernon plant
Respondent manufactures various heavy metal products,
within several Southern California plants. However, we are
concerned herein solely with the firm's Vernon, California,
facility, where it manufactures automotive wheels, com-
pressed gas cylinders, and military products. Within its
Vernon facility, Respondent employs some 2,300 workers.
b. Respondent's collective-bargaining relationship
with Complainant Union
Complainant Union currently maintains separately
negotiated collective-bargaining relationships with Re-
spondent with respect to four Southern California facilities.
Within Respondent's Vernon plant, specifically, Complain-
ant Union has been a recognized collective-bargaining
representative since 1960; the organization's successive
contracts have covered some 2,000 production and mainte-
nance workers, within a single bargaining group. The most
recent contract negotiated by the parties - save for the
contract currently in dispute - had covered a 3-year term
between November 2, 1972, and November 1, 1975,
specifically.
c. Respondent's past practice with regard to
terminations of insurance coverage
Respondent's previously noted 1972-75 contract with
Complainant Union had contained no specific commit-
ment with regard to group medical insurance coverage for
Vernon plant workers. Necessarily, therefore, the contract
had reflected no consensus with regard to when persons on
leave or absence might have their medical insurance
coverage terminated. The parties had negotiated a side
"Letter of Understanding" with regard to fringe benefits.
However, that letter had merely stated, generally, that
Respondent had no intention to abolish currently main-
tained employee benefits, during the designated 1972-75
contract's term, but reserved the right to establish reason-
able rules designed to regulate and control the use of such
benefits.
Despite this contractual silence, Respondent had for
some years provided Vernon plant workers with a privately
funded group medical insurance plan. The Prudential
Insurance Company of America, Respondent's insurance
carrier, had provided booklets for Vernon plant workers
wherein the plan's benefits were described; these booklets
had been distributed, generally, within Respondent's plant.
Therein Respondent's workers had been notified, in
relevant part, that:
Insurance for yourself and your dependents will
terminate if you cease to be a full-time employee ...
Should you cease active work on a full-time basis
because of disability, leave of absence or temporary
lay-off, the insurance may be continued for such
duration as is permitted by rules established by the
Company in accordance with the terms of the Group
Policy.
In this connection, Prudential's group policy did provide,
with respect to persons on temporary layoff or leaves of
absence for reasons other than disability, that coverage
would not continue beyond the end of the policy month
which followed the specific month during which the
particular employee had ceased to perform full-time
service. With respect to disabled workers - regardless of
whether their disability derived from some work-related
illness or injury, or from causes which could not be
considered work related - the firm's group policy set no
time limits for medical insurance coverage continuation;
rather, the policy was permissive, since the policy holder
could define its own time limits.
Consistently with this group policy language, Respon-
dent's practice - with respect to persons on temporary
layoff and personal leaves of absence particularly - had
required the termination of group medical insurance
coverage at the end of the calendar month following the
month during which the layoff or leave commenced.
(Workers granted leaves of absence for military service, or
51
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
while holding union positions, had likewise had their
insurance terminated.)
However, with respect to disabled workers on medical
leaves of absence, the firm's most recent 1972-75 practice
had been to continue paying premiums, calculated to
maintain medical insurance coverage for 1 year where
medical leaves had been granted for nonwork-related
reasons, and for 2 years whenever medical leaves bottomed
upon some work-related disability had been granted.
Respondent's costs, directly related to such continued
group medical insurance coverage, could not reasonably
have been considered minimal. Though monthly premium
payments for particular covered workers might vary,
depending upon whether they required or did not require
coverage for dependents, the firm's monthly average
premium cost - so the record shows - had closely
approximated $60 per covered worker. During a represen-
tative month, between 30 and 100 workers would, normal-
ly, have been on medical leaves. While a witness,
Respondent's industrial relations manager proffered a
guess, which stands without challenge within the present
record, that, during the prior contract period, his firm's
premium costs, for workers on medical leave particularly,
had run between $2,000 and $3,000 monthly.
2. Contract negotiations
a. Preliminary statement
The question presented for determination herein, regard-
ing the proper scope of Respondent's contractually defined
right to terminate group insurance coverage, for workers
on medical leave, will require this Board's detailed
consideration of developments throughout a protracted
sequence of collective-bargaining sessions. With respect to
such developments, significant testimonial conflicts have
been noted, within the present record. Whenever such
conflicts can be considered crucial, credibility determina-
tions - calculated to resolve them - will be required. In
this connection, Respondent's counsel has, within his brief,
noted, cogently, that:
As is often the case in collective-bargaining, the process
by which the parties arrived at the current printed
contract was not neat and tidy or a logician's delight. It
was a long, drawn-out and sometimes confused process
spanning many months which cannot be capsulized in a
simple narrative description .... Thus it is not
surprising if there are discrepancies in the testimony of
the various participants. Under the circumstances even
a well-meaning witness could be erroneous in his
recollection, and, consequently, a key to resolving any
inconsistencies will be the objective and documentary
evidence accompanying the parties' testimony. The
history concerning the "disputed language" was partic-
ularly convoluted ....
Mindful of these considerations, I find myself persuaded
that most of General Counsel's and Respondent's witnesses
herein have, indeed, proffered their best recollections with
respect to relevant and material developments, throughout
their negotiations. The testimonial record, within my view,
reflects no deliberate witness-chair misrepresentations,
conscious evasions, or planned obfuscation. Within a
recent Administrative Law Judge's decision, however, it
has been noted that proffered testimonial recollections do,
sometimes, reflect partisanship, and that:
Witnesses do not emerge from antiseptic surroundings
nor do they testify in a vacuum which protects them
from the failings to which the human mind and spirit
are subject ....
while "unconscious mistakes" and "honest confusion"
may, likewise, color their purportedly factual reports.
Further, rationalizations may sometimes transmute or
modify memory. Whenever persuaded, during my review
of the present record, that this may have somehow taken
place, I have sought to resolve record conflicts with due
regard for whatever supportive documentation the parties
may have proffered, conceded or well proven matters,
logical probabilities, the total "weight of the evidence"
proffered, and reasonable inferences which might be drawn
therefrom. See N.LR.B. v. J.P. Stevens & Co., Inc., 464
F.2d 1326, 1328 (C.A. 2, 1972); Northridge Knitting Mills,
Inc., 223 NLRB 230 (1976). Compare Central Diagnostic
Laboratory, 206 NLRB 754, 756 (1973), and cases therein
cited. My determinations, therefore, will frequently reflect
some reasonable syntheses derived' from the complete
record; whenever considered necessary, however, record
justifications for particular factual conclusions will be
noted.
b. Discussions before formal negotiations commenced
Respondent's previously noted 1972-75 collective-bar-
gaining agreement contained a provision that, should either
party privy thereto desire their contract's modification or
termination, written notice would have to be given the
other party between August 1 and September 1 of that
contract's final year. Looking toward this contingency,
Ronald W. Flagg, industrial relations manager for Respon-
dent's Vernon plant, and Paul Bluto, Complainant Union's
financial secretary-treasurer and service representative, so
the record shows, held several preliminary discussions -
specifically during calendar year 1975's summer months -
wherein various questions which might be raised in the
course of their prospective contract talks were tentatively
canvassed.
With respect to these prenegotiation conversations,
Flagg's testimony reflects his recollection that, together
with several other subjects, Respondent's policy with
regard to terminating group medical insurance coverage,
for workers on leave, was discussed. (While a witness,
Flagg claimed that - though his firm's previously
determined general policy, with respect to terminating
group medical insurance coverage, would have, inter alia,
required terminations of such coverage for workers on
medical leave following the conclusion of the month
subsequent to the particular month within which their
leaves began - that policy, particularly within the firm's
Vernon plant, had not been followed. According to Flagg,
Bluto was told, therefore, that Respondent would seek
consensual commitments - during their forthcoming
52
NORRIS INDUSTRIES
negotiations - pursuant to which the firm's practice
regarding terminations of coverage, particularly for work-
ers on medical leave, would be modified to conform with
Respondent's general policy.)
Flagg recalled that, when Bluto protested Respondent's
proclaimed desire to reinstate a practice consistent with its
previously formulated general policy - particularly with
regard to the termination of medical insurance coverage for
workers on medical leaves granted in connection with
work-related disabilities - the service representative was
reassured that any problems with regard to continued
insurance coverage for workers so situated could be
overcome.
According to Flagg, his preliminary statement of Re-
spondent's position with regard to this particular matter
was, likewise, mentioned during a prenegotiation confer-
ence which he had with Larry Johnson, Complainant
Union's shop committee chairman. The latter, so Respon-
dent's industrial relations manager recalled, had vouch-
safed no protest.
Confronted with Flagg's testimony, Complainant
Union's Service Representative Bluto differed. Though he
did recall a discussion with Flagg, during September or
October 1975 specifically, when he had protested Respon-
dent's proposal to terminate medical insurance coverage
for workers on medical leaves due to work-related
disabilities, Bluto claimed that their conversation had
concerned workers then scheduled for layoff or termina-
tion in connection with a planned shutdown at Respon-
dent's Pico Rivera plant. However, when queried specifi-
cally about his discussions with Bluto, relative to Pico
Rivera's closure problems, Flagg could not recall whether
Respondent's policies regarding the termination of medical
insurance coverage for separated or laid-off workers had
been mentioned.
Upon this record, I conclude that Industrial Relations
Manager Flagg's proffered recollection, regarding the
substance of his prenegotiation conversations with Com-
plainant Union's Representative Bluto, may very well
reflect his genuine belief - now - with respect to what
they discussed; however, his present testimonial recollec-
tion, in my view, cannot be fully credited. I am satisfied
that Flagg and Bluto probably did participate in tentative
discussions - during the summer before their formal
negotiations began - with regard to various proposals they
might subsequently present. Nevertheless, I cannot con-
clude, consistently with the industrial relations manager's
testimony, that Respondent's desire to set a relatively strict
"termination of coverage" policy, for workers on medical
leave, was mentioned.
Within his brief, Respondent's counsel argues that -
since Flagg did proffer a specific contract proposal, dealing
with this subject, shortly after negotiations began - he
would, now, have more reason than Bluto to recall whether
he had mentioned the matter previously. I note, however,
the industrial relations manager's testimonial concession
that he had tacitly concurred with Bluto's purported
countersuggestion that no quick "termination of coverage"
policy should be set or implemented for workers on
medical leave because of work-related disabilities. If Flagg
had, really, conceded his willingness to seek a consensus
pursuant to which different "termination of coverage"
policies would be determined for workers on medical
leaves with work-related and nonwork-related disabilities,
language calculated to provide for such differentiated
policies could readily have been drafted in Respondent's
first formal proposal which dealt with the subject. How-
ever, when presented, that proposal (which will be
discussed subsequently within this decision) facially reflect-
ed Respondent's presumptive desire to pursue a single,
moderately restrictive "termination of coverage" policy
with respect to workers on medical leave, regardless of
their particular disability's cause. I am persuaded, there-
fore, that, since Flagg's first "Group Insurance" proposals
provided no differentiated "termination of coverage"
policies for workers on medical leave for so-called
industrial or non-industrial reasons, despite his claimed
concurrence with a purported suggestion proffered previ-
ously by Bluto that such workers should be treated
differently - the subject had not been broached during
their prenegotiation conversations.
Within his brief, Respondent's counsel does note
General Counsel's failure to recall Larry Johnson for the
purpose of rebutting Flagg's testimony relative to their
purported prenegotiation conversation on this subject.
Flagg's proffered recollection, so counsel contends, stands,
therefore, without contradiction. When considered within
its complete context, however, Johnson's failure to rebut
Flagg's testimonial recital - in my view - provides no
conclusive warrant for a determination that Respondent's
industrial relations manager had mentioned a proposed
modification of his firm's "termination of coverage" policy,
with respect to workers on medical leave, during their talk.
And, were I to conclude, nevertheless, that the subject had,
indeed, been mentioned, Flagg's claim that Johnson had
not reacted would persuade me, merely, that his mind had,
then, been focused upon some other facet of Respondent's
prospective insurance proposal; Flagg's purported com-
ment, therefore, could hardly have "familiarized" Com-
plainant Union's representatives with Respondent's pro-
spective proposal, or predisposed them toward subsequent
concurrence.
Respondent's counsel notes, finally, that, since March I,
1976, his client has, despite the broadly permissive
"disputed language" previously noted, continued insurance
coverage for workers on medical leave with so-called
industrial disabilities. Counsel suggests that: "If [Flagg]
had not had the conversation [with Blutol as he described
it, there would have been no reason to [continue medical
insurance coverage for such workers consistently with
Bluto's proposed] limitation." (Bracketed interpolations
provided to promote clarity.)
I have not, however, been persuaded. Bluto's testimony
does warrant a determination, which I make, that, during
his September-October 1975 conversations with Flagg regard-
ing Respondent's Pico Rivera plant closure, continued group
medical insurance coverage, for workers separated or laid
off while on medical leave for work-related disabilities, had
been requested; thus, Flagg's subsequent decision to except
certain Vernon plant workers from Respondent's general
"termination of coverage" policy could reasonably have
been premised upon Respondent's recognition of Bluto's
53
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
most recent September-October 1975 protest presented on
behalf of Pico Rivera's workers, rather than some represen-
tations which he had purportedly proffered previously.
c. The commencement of negotiations
On August 22, 1975, Industrial Relations Manager Flagg
notified Complainant Union, consistent with the provisions
of their collective-bargaining agreement, that Respondent
wished to negotiate a new contract.
Thereupon, commencing on September 3 and continuing
through January 1976, the parties held some 30 meetings.
During their various plenary bargaining conferences and
so-called executive sessions, between 30 and 40 hours were
devoted to discussions concerned with various substantive
matters dealt with in Respondent's group medical and
dental insurance proposals.
The firm's first concurrent proposal, however, concern-
ing the circumstances under which medical insurance
coverage would be terminated for workers on leave, was -
so far as the record shows - never consciously considered
or specifically discussed.
d. Respondent's October 15 proposal
During their October 15 bargaining session, Respondent
presented Complainant Union with its first economic
proposals. Suggestions with respect to 12 contractual
provisions were proffered, together with comprehensive
proposals on pensions and group insurance. Inter alia,
Respondent's group insurance proposal contained the
particular "disputed language" relative to coverage termi-
nations (previously noted within this decision) with which
we are herein concerned. That language, however, was
never specifically discussed. Following their concededly
cursory review of Respondent's five-page submission,
Complainant Union's negotiators - without discussion -
rejected the firm's proposals, completely; the proposals
were never presented to Complainant Union's member-
ship.
Thereafter, on November 1, Respondent's negotiators
presented Complainant Union with certain revised eco-
nomic proposals. Therein, Respondent's substantive group
insurance proposals were summarized within a single
paragraph; that paragraph, however, contained no specific
reference to conditions which might prompt a termination
of medical insurance coverage. (Respondent's group
insurance proposal did note that, should Complainant
Union prefer contributions to a qualified Taft-Hartley trust
fund which could provide various health care benefits,
Respondent would be willing to contribute certain speci-
fied sums for "qualified employees on the active payroll"
on the first working day of the month "who have been on
the active payroll" during the preceding full calendar
month. (Emphasis supplied.) Respondent contends that
this language of limitation would necessarily imply the
exclusion from coverage of workers on leaves of absence.)
Within a final paragraph, Respondent noted that its
proposal summarized "major economic items" but did not
compass "other economic or non-economic items" which
the firm proposed. Complainant Union's negotiators - so
Flagg's credible, undenied testimony shows - raised no
questions with regard to this language's significance.
e. November 6 negotiations
On November 6, the parties met for further negotiations,
with a Federal mediator present. Throughout a substantial
portion of this session, the Federal mediator - consistently
with his service's standard practice - placed the parties in
separate rooms; thereafter, he shuttled between them,
conveying proposals and counterproposals.
With respect to negotiations during this session, Industri-
al Relations Manager Flagg testified - with corroboration
from Robert Brady, his Vernon plant assistant - that
Commissioner Walters, the Federal mediator, had request-
ed them to make their best complete proposal. In
connection therewith, Flagg contended that Commissioner
Walters was, inter alia, given six documents for transmittal
to Complainant Union's representatives. Flagg designated
these documents as follows:
1. Four separate pages from a proposed multi-page
contract section dealing with training matters.
2. A one-page document headed "Pension" which
contained various substantive proposals, dealing with
that subject.
3. A one-page sheet headed "Group Insurance"
which contained certain substantive benefit proposals,
together with the specific "disputed language" relative
to coverage terminations with which we are herein
concerned.
While a witness, Flagg conceded that Commissioner
Walters had, later during the session, merely returned the
first three pages of Respondent's proffered "training"
proposals, with respect to which Bluto had proposed
certain changes.
Bluto's testimony, however, reflects contentions that
Commissioner Walters had merely supplied him with three
documents which reflected Respondent's substantive
"training" proposals; that he (Bluto) had made certain
changes therein; that he had, then, initialed those particu-
lar proposals; and that he had given them back to
Commissioner Walters, for re-transmittal to Respondent's
principal negotiator. Bluto and his fellow negotiators
denied that they had received Respondent's separate
"Group Insurance" or "Pension" proposals; further, they
denied receipt of Respondent's purportedly proffered
"training appendix" list.
All the witnesses, whether summoned for Respondent or
Complainant Union herein, recall that, toward the end of
their session, the Federal mediator called them together,
within a single room, where he went through a blackboard
exercise listing the major "economic" matters with respect
to which no consensus had been reached. The Federal
mediator, however, did not then list the so-called disputed
language with which we are herein concerned.
With matters in this posture, Respondent's negotiators
make no present contention that Complainant Union's
spokesman had, somehow, signified their concurrence with
a proffered "termination of coverage" proposal, during this
November 6 session. Respondent's witnesses concede,
54
NORRIS INDUSTRIES
rather, that they never received a response, pro or con, with
respect to their "Group Insurance" proposal, which
contained suggested coverage termination language. In his
brief, Respondent's counsel contends, however, that:
The significance of what occurred on November 6th
instead lies in the fact that it demonstrates that the
Company had not dropped the issue and that once
again no specific objection was voiced by the Union.
Thus, some determination must be made, herein, with
respect to whether Complainant Union's negotiators were
actually presented with November 6 substantive group
insurance proposals - containing suggested language on
coverage termination for Vernon plant workers on leave -
which they had a chance to review and consider. Upon this
record, such a determination cannot be cavalierly reached.
While testifying herein, Complainant Union's shop
committee chairman and secretary contended that they
had received no company proffered documents, transmit-
ted by the Federal mediator, during this November 6
session. And Complainant Union's service representative,
while conceding that he had received and reviewed several
"training" proposals, denied, likewise, that he had been
given Respondent's purportedly proffered "Group Insur-
ance" and "Pension proposals," either directly or through
the Federal mediator.
Copies of the firm's two, single-page proposals - which,
so Respondent claims, Commissioner Walters had been
requested to transmit - have been proffered for the
present record. Those documents, however, contain no
supplementary marks or notations persuasively corrobora-
tive of Flagg's testimony that they were submitted for
transmission to Complainant Union's negotiators, specifi-
cally, during the November 6 session now under consider-
ation.
Respondent's witnesses did testify that, throughout their
negotiations, various documents drafted for presentation to
Complainant Union's representatives had been customarily
prepared in multiple copies; and that these copies had been
date stamped with a rubber hand stamp prior to their
delivery. Flagg's personal "file" copy of Respondent's
group insurance proposal, however, contains no rubber
stamped date. Rather, it bears the industrial relations
manager's handprinted "11/6/75, to Union by Comm"
notation. Such a date record, of course, could either have
been made on November 6 - or, conceivably, sometime
thereafter. Further, Respondent's file copy contains a
handprinted, pen-and-ink modification which - so Flagg
testified - he had recorded shortly "before [he] gave
[Respondent's group insurance proposal] to the Union"
during their November 6 session, complying with a
superior's request. And Respondent's presently proffered
testimonial presentation, particularly with respect to this
language modification, raises a tangential question in my
view, regarding the November 6 session's course. First, I
note that Respondent's proffered copy of the firm's
"Group Insurance" proposal - which Flagg testimonially
designated a verbatim duplicate of the document which he
had given Commissioner Walters for transmission to
Complainant Union's representatives - bears no hand-
stamped "Nov. 6, 1975" date. Rather Respondent's
purportedly verbatim document, proffered for the record,
bears a photocopied date, which merely reproduces a hand-
stamped date found on some other copy of the firm's
"Group Insurance" proposal. Further, Respondent's rec-
ord submission shows Flagg's purportedly last-minute
modifying "insert" change, likewise, provided in photocopy
form. However, Flagg had, so he testified, hand-printed
that particular "insert" modification - directly following a
telephone conversation with his superior - shortly before
he gave his firm's "Group Insurance" proposal to Commis-
sioner Walters for transmittal to Complainant Union's
representatives; the record, therefore, provides no clear
indication with respect to when, or how, the firm's
proposal, purportedly readied for presentation with a hand-
stamped date and hand-printed modification could have been
photocopied When queried directly with respect to when
Respondent's insurance proposal - with these notations
- had been photocopied, Flagg testified that, "In order to
keep track of where we were and what had gone to the
Union, they were not stamped until they were officially
given to the Union ... On that particular [November 6]
morning we date-stamped, I believe it was, eleven or twelve
copies so that we could go to the meeting and present it to
the Union bargaining committee. The Commissioner asked
that he take it to the bargaining committee; and so we gave
him a copy to take, and we retained the others with the
date stamp on it." He testified, further, that Respondent's
"Group Insurance" proposal - with its hand-stamped date
and hand-printed modification had been xeroxed since then.
Thus, Respondent's document copy submitted for the
present record could, conceivably, have come into existence
sometime after the parties' November 6 session. However,
the fact that, theoretically, something could have been done
constitutes no proof that it was done. Upon this record, no
critical determination that Respondent's proffered docu-
ment was created merely to buttress Flagg's testimony
regarding its November 6 transmission would be warrant-
ed.
Nevertheless, the present record, considered in totality,
preponderantly warrants a determination in my view that
Complainant Union's negotiators were, indeed, given a
copy of Respondent's group insurance proposal sometime
during their November 6 bargaining session.
Flagg had previously presented such a proposal; his
October 15 submission, though somewhat less detailed, had
contained the particular "disputed language" with which
we are concerned. By November 6, however, no consensus
- particularly with regard to Respondent's pension and
group insurance proposals - had yet been reached. Thus,
when Commissioner Walters requested Respondent's
negotiators to present their contract language proposals
with respect to various "open" matters, logic suggests that
Flagg would have, inter alia, given the Federal mediator his
firm's group insurance and pension proposals. The negotia-
tor's testimony that he did turn over documents containing
these proposals, together with several other documents -
which testimony Brady, his assistant, corroborated -
merits credence, in my view.
In his brief, Respondent's counsel concedes, properly,
that credible testimony regarding a document's submission
to some Federal mediator for transmission does not,
55
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
without more, prove its consequent transmission or receipt.
And Complainant Union's representatives have denied
receiving "Group Insurance" and "Pension" proposals.
Since direct testimony, probative of their transmission,
could not be procured, solely deductive inferences may be
drawn.
The Federal Mediation and Conciliation Service pro-
scribes or discourages formal testimony by Federal
mediators, particularly with regard to whatever they may
have done, or learned, while discharging their professional
responsibilities. Thus, neither party herein summoned
Commissioner Walters for the purpose of soliciting his
recollection. Counsel have stipulated that no critical
inference should be drawn, disadvantageous to General
Counsel or Respondent, from the fact that Walters was
never requested to testify. Herein, the requisite deduction,
in my view, may properly be made. While a witness, Bluto
did concede that he had received certain "training"
documents from the Federal mediator; since I have
credited Flagg's testimony that six documents were given to
Commissioner Walters simultaneously, I have concluded
that he would more than likely have transmitted Respon-
dent's pension and group insurance proposals concurrently
with the various "training" documents which Bluto
concededly received.
The fact that Respondent's transmitted document con-
taining its group insurance proposal was never returned -
with Complainant Union's response - suggests merely
that union negotiators may well have had substantial
reservations or questions with respect thereto; they could
reasonably have concluded that further face-to-face discus-
sions, in extenso, would be more likely to produce a
consensus than capsulized notations within the document's
margin.
Finally, I note Flagg's testimony, which Bluto neither
challenged nor sought to qualify, that Complainant
Union's service representative had - shortly before their
session concluded - protested Respondent's presumptive
omission, from its final November 6 proposals of certain
pension provisions which can be found set forth within
Respondent's prepared document, proffered for the record,
dealing with that subject. Bluto's protest, in my view,
warrants a deductive inference, which I draw, that he had
- sometime previously during their November 6 session -
reviewed or considered Respondent's complete pension
proposal; having concluded that he did so, I would deduce,
further, that Respondent's concurrent group insurance
proposal had been, likewise, tendered for his consideration.
With matters in this posture, then, I conclude, consistent-
ly with Respondent's contention, that, during their Novem-
ber 6 negotiations, Complainant Union's representatives
were at least given the opportunity to consider Respondent's
group insurance proposal containing the particular "dis-
puted language" with which we are presently concerned.
On November 7 Flagg supplied Complainant Union with
a six-page document containing a summary of Respon-
dent's various November 6 proposals. With respect to
group insurance, the document set forth certain substantive
proffers. Inter alia, the proposal reflected Respondent's
willingness to make contributions to some qualified Taft-
Hartley trust fund for Vernon plant workers "who are on
the active payroll on the first working day of the month and
who have been on the active payroll during the preceding
full calendar month." (Emphasis supplied.) Further, Re-
spondent's submission contained a final textual paragraph
which read as follows:
Items outlined above summarize major economic items
as proposed by the company and do not include other
economic or non-economic items as proposed by the
company. Also, as mentioned in our original proposal,
the company reserves the right to add to, subtract from,
or modify its total proposal at any time during the
negotiations.
On November 8, Respondent's proposals were presented to
Complainant Union's membership. They were rejected.
During the discussion which preceded their rejection there
were no questions raised or comments made, so far as the
present record shows, relative to Respondent's proclaimed
willingness to make trust fund contributions for workers on
the Vernon plant's "active payroll" during specified
periods. Further, no questions were raised, so I find,
calculated to solicit some clarification with regard to
Respondent's comment that its proffered summary did not
compass "other" economic or noneconomic proposals
previously proffered.
Complainant Union's Vernon plant workers, following
tjeir November 8 rejection of Respondent's final Novem-
ber 6 proposals, struck the firm. Their work stoppage, so
the record suggests, continued until December 9; on that
date, so I find, the parties negotiated a substantial
contractual consensus, calculated to conclude the strike.
f. December 8 negotiations
Throughout the Vernon plant's work stoppage, noted
herein, Respondent and Complainant Union exchanged no
further proposals. Respondent did send its striking workers
a letter presumably calculated to define its position with
regard to pending negotiations. The present record,
however, provides no clue with respect to Complainant
Union's reaction.
Finally, on December 8, Respondent's negotiators and
Complainant Union's representatives reconvened. Their
marathon session, which began then, continued for some
36 hours; the negotiators reached a tentative contractual
consensus on December 10, at 4 o'clock in the morning.
During their talks, proposals were made orally; the
tentative consensus reached - which concededly was not
complete - was to be contingent upon ratification by
Respondent's Vernon facility "bargaining unit" members.
With respect to group insurance, consensual agreements
were reached which called for several substantive modifica-
tions of Respondent's prior November 6 proposal. The
present record, however, clearly warrants a determination,
which I make, that Respondent's disputed "termination of
coverage" language - which had been set forth within its
prior October 15 and November 6 proposals - was never
specifically considered.
Shortly before the parties concluded their marathon
session, Flagg proffered a general, catchall proposal
calculated to settle the disposition of those "open items"
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NORRIS INDUSTRIES
which had not theretofore been consensually reviewed.
With respect to Flagg's precise proposal, the present
record, however, reflects some testimonial conflict.
Complainant Union's shop committee chairman and
secretary both testified that Flagg had proposed a so-called
reversion to their past contract's language, with respect to
every residual open matter. Complainant Union Service
Representative Bluto, however, subsequently capsulized
Flagg's final comment thusly:
. . . that the open items would be as we had agreed to
before [namely, that past contract language would be
renewed] or some of them would be resolved on the
basis of what the company had proposed (bracketed
interpolation added to promote clarity).
According to Bluto, Flagg was then requested to designate
specific "open items" which would be resolved on the basis
of Respondent's most recent proposals. As Bluto recalled,
Flagg mentioned a subcontracting provision, certain
seniority provisions, and Respondent's prior proposal on
Union leaves of absence; however, no references were
made to Respondent's presently disputed "termination of
coverage" language, in its previously proffered group
insurance proposals.
Summoned in Respondent's behalf, Flagg testified that
he had proposed resolutions, with respect to various
remaining "open" matters, based solely upon Respondent's
last (namely, most recent), proposals; he recalled that,
when Bluto requested a clarification, subcontracting and
"two or three" further matters had been mentioned. Flagg
conceded that the presently disputed "termination of
coverage" language had not been discussed; he declared,
however, that, with respect to group insurance, he had
reiterated the firm's prior November 6 proposal with
certain substantive changes. When queried specifically,
Flagg initially denied that he had ever suggested a
reversion to prior contract language, with respect to any
remaining "open" matters, save in connection with "num-
erous classification changes" which Complainant Union
had proposed. Subsequently, however, he conceded that,
with respect to holidays, vacations, committee seniority,
overtime progression, and committee release time, the
parties had, actually, consensually reaffirmed their prior
contract's language.
With matters in this posture, I credit Bluto's testimony
regarding the significance of Flagg's final, catchall contract
proposal. In substance, Flagg had, so I find, suggested:
1. That, with respect to contractual provisions
regarding which Complainant Union had proposed
changes, but with respect to which no changes had been
consensually negotiated, prior contract language
should be reaffirmed; and
2. That, with respect to contractual provisions
regarding which Respondent had proposed changes,
but with respect to which no changes had been
consensually negotiated, Respondent's most recent
proposals should provide the conceptual bases for the
parties' prospective contract commitments.
Though consensus had been reached with regard to certain
substantive "Group Insurance" and "Pension" matters,
further details with respect to both subjects were, so the
record shows, still pending discussion and settlement. Inter
alia, the disputed "termination of coverage" language with
which we are concerned had not been specifically discuss-
ed. Thus, Flagg's final portmanteau proposal - verbally
given to Complainant Union's negotiators - necessarily
carried a suggestion that, with respect to group insurance
coverage terminations, Respondent's previously detailed
provision would be part of their final consensus.
On December 10, Flagg presented Complainant Union
with a document dated the previous day, which purported
to summarize Respondent's final proposal with regard to
various "major" matters. Respondent's submission con-
cluded with a paragraph which read as follows:
Items outlined above summarize major areas as
proposed by the company and do not include all
economic or non-economic items as discussed, it being
understood by the parties that these items will be as
outlined in the company's last proposal.
With respect to group insurance, Respondent's written
proposal dealt solely with substantive matters. The disput-
ed "termination of coverage" language (which had previ-
ously been presented for Complainant Union's consider-
ation, but never discussed) was not set forth. Complainant
Union's negotiators reproduced Respondent's proposal,
which was then presented to Complainant Union's mem-
bership, presumably, during a December I meeting. Inter
alia, Respondent's various substantive proposals with
respect to medical insurance and dental care benefits were
reviewed. Further, Service Representative Bluto's testimo-
ny warrants a determination, which I make, that someone
did question the significance of Respondent's final refer-
ence to a consensus bottomed upon terms "outlined in the
company's last proposal." In response, Bluto cited several
of Respondent's proposed classification changes; no
company proposal, calculated to define the conditions
pursuant to which medical insurance coverage might be
terminated, was mentioned.
g. Respondent's partial contract draft is reviewed
Sometime between December 10, 1975, and January 12,
1976, Flagg provided Complainant Union's shop commit-
tee with a partial contract draft which purportedly reflected
the contractual consensus previously reached. The record,
considered in totality, warrants a determination, which I
make, that Complainant Union's shop committeemen -
presumably on December 17, but certainly before the
Christmas holiday - did review Respondent's draft
document, and suggest revisions.
Respondent's proposed draft compassed 26 prospective
contract articles; both schedules A and B set forth within
draft articles II and VII respectively; schedules C and D
dealing with job classifications and rates of pay by labor
grade; and various "Training Program Outline" provisions,
compassed within a partial schedule E draft, with respect
to which six projected "training schedules" were still to be
written; together with certain draft "Letters of Under-
57
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
standing" set forth within three subsections. Respondent's
draft contract copy, so the record shows, contained no
proposed or consensually negotiated language dealing with
group insurance benefits or pensions. Necessarily, there-
fore, the draft contained no reference whatsoever to those
disputed "termination of coverage" provisions with which
we are presently concerned.
Complainant Union's shop committee chairman, so his
credible testimony shows, queried Brady, Flagg's assistant,
when he received Respondent's draft contract, with respect
to whether it was complete. Respondent's representative
conceded that it was not, though he merely cited "training
programs" when requested to designate the material which
was not being supplied. Brady's response, so the record
shows, may not have been comprehensive. Nevertheless, I
am satisfied that Complainant Union's shop committee
members were not really misled. They knew, or could
readily have determined, that specific language, drafted to
reflect their presumptive concensus with regard to group
medical insurance coverage and pensions, had not yet been
proffered for review.
h. The January 12 conference
Shortly before January 12, 1976, Industrial Relations
Manager Flagg notified Complainant Union's service
representative that he had prepared contract "language"
with respect to both group insurance and pension benefits.
Bluto was asked whether he wanted provisions with respect
to such matters made part of their prospective contract.
When Bluto took no position, Flagg declared that he
preferred to have their "Letters of Understanding" repro-
duced where Respondent's employees could read them.
Bluto then noted his acquiescence. The parties - so I find
- thereupon "set up a meeting" for January 12; according
to Flagg, the meeting's purpose was to "finalize the
language" with respect to Respondent's group insurance
and pension benefit programs.
With respect to what transpired on January 12, however,
Complainant Union's representatives and Respondent's
negotiator have presented significantly divergent testimo-
ny. Their concededly disparate recollections must therefore
be considered.
While a witness, Flagg recalled - with Brady's corrobo-
ration, in material part - that the parties met on January
12 pursuant to their prearrangement; that Service Repre-
sentative Bluto, and Complainant Union's shop committee
chairman, vice chairman, and secretary, together with
Complainant Union's local "skilled trades" representative,
were present; that he (Flagg) produced a three-page
document setting forth Respondent's complete "Group
Insurance" and "Pension" proposals, which, inter alia,
contained the currently disputed "termination of coverage"
language; that copies of these draft provisions were
distributed to each of Complainant Union's representa-
tives; that these drafts were read; and that Bluto thereupon
proffered three suggested changes. First: Respondent's
group insurance proposal, within a paragraph which
preceded the final paragraph containing the currently
disputed language, committed the firm to make a designat-
ed contribution for dental care, geared to straight-time
hours "worked" by qualified bargaining unit employees;
Complainant Union's service representative, so Flagg
testified, requested that Respondent's contribution should
be shown as based upon straight time hours "paid" rather
than hours worked. Second: Within several successive
paragraphs, set forth in Respondent's pension proposal, the
firm's progressively greater contribution commitments had
been likewise defined with respect to straight time hours
worked; Bluto suggested several parallel changes, consis-
tent with his prior suggestion, whereby Respondent's
contribution commitments would be geared to hours
"paid" rather than hours worked. Third: Flagg, when
presenting his draft proposals, had declared his desire to
rewrite part of his firm's draft pension provision, so that
Respondent could not be considered committed with
respect to contributions for "bargaining unit" workers to
both Complainant Union's labor-management group pen-
sion plan and his firm's previously maintained retirement
fund; thereupon, so Flagg testified, Bluto suggested a
strategically placed textual insertion of the single word
"both" which would accomplish Respondent's objective.
According to Flagg, no other language changes were
suggested; Complainant Union's representatives did not
even mention or discuss Respondent's proffered "termina-
tion of coverage" language in its group insurance proposal.
As noted, Complainant Union's several shop committee
members and Service Representative Bluto have, herein,
presented a somewhat different picture with respect to
what took place during their January conference with
Respondent's negotiator. They recalled a general "discus-
sion" with regard to certain administrative problems
connected with Respondent's proposed "pension" and
"dental plan" coverage commitments. Further, they re-
called a discussion regarding the calculation of Respon-
dent's proposed pension fund and dental benefit contribu-
tions, during which Respondent's industrial relations
manager had concurred with Bluto's suggestion that such
contributions should be based on hours "paid" rather than
hours "worked" by bargaining unit employees. (Initially,
Complainant Union's three shop committee representa-
tives could not recall precisely when their January
discussion, with regard to these several subjects, took place.
Bluto's testimony, however, reflects a tacit concession -
consistent with Respondent's present contention - that
their conference took place on January 12; I have so
found.)
Complainant Union's spokesman contended further that
they discussed the prior discharge of a particular worker,
Lupe Noriega, during this conference. While conceding
that verbal discussions had been pursued, with respect to
certain group insurance and pension matters, they denied
Respondent's contention that they had been supplied with
draft "Group Insurance" and "Pension" proposals which
they had reviewed. They did, however, testify - consis-
tently with Flagg's contention - that during their verbal
discussions Respondent's currently disputed "termination
of coverage" language, in its purportedly proffered "Group
Insurance" proposal, had neither been mentioned nor
discussed.
With matters in this posture, Flagg's testimonial recollec-
tions - specifically with regard to this January 12
conference - merit credence, in my view. My determina-
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NORRIS INDUSTRIES
tion, bottomed upon a complete record review, derives
from various considerations; those, among others which
may most reasonably be deemed weighty, should be
mentioned.
First: Complainant Union's shop committee secretary,
Leroy "Chico" Johnson, did concede during cross-exami-
nation that he had "reviewed" the specific language set
forth in the first four paragraphs of Respondent's negotiat-
ed "Pension" commitment before January 19, when, so the
record shows, representatives of the parties signed the
contract with which we are presently concerned. When
queried, then, with respect to precisely when he had
previously reviewed the specific language noted, Johnson
declared that he had done so some 2 weeks after
Complainant Union's December II contract ratification
vote, while he, together with Vice Chairman Valenti of
Complainant Union's shop committee, was "going over"
the partial contract draft which Respondent had prelimi-
narily compiled. The documentary record, however, clearly
reveals that Respondent's partial contract compilation -
which Complainant Union's shop committeemen were
given to review shortly before the Christmas holiday - had
contained no "Pension" provision whatsoever. Further,
Leroy Johnson did testify that he had seen two particular
paragraphs, currently found within Respondent's negotiat-
ed "group insurance" letter, before January 19; however,
he recalled seeing those paragraphs as part of Respondent's
previously proffered December 9 package proposal. When
reminded that those particular paragraphs had not been set
forth, in haec verba, in Respondent's December 9 group
insurance proposal, Johnson changed his mind, declaring
that he had not reviewed them. When considered, with due
regard for its complete record context, Johnson's less-than-
certain testimony, in my view, does suggest that he had
actually been given a chance to review the specific
contractual language now in dispute, inter alia, sometime
before Complainant Union's representatives signed the
contract with which we are concerned. Certainly his
proffered recollections can hardly be considered sufficient-
ly persuasive to foreclose such a determination.
Second: Leroy Johnson's further testimony reflects his
claimed recollection that, during the January 12 conference
which we are now considering, the parties discussed Lupe
Noriega's termination, previously noted; that they sched-
uled future conference dates, when various pending
grievances would be discussed; and that they discussed a
possible special arrangement calculated to preserve pen-
sion rights for some 10-17 Vernon plant workers. However,
January 12, 1976, fell on Monday; Complainant Union's
shop committee and Respondent's representatives normal-
ly discussed grievance matters - so the record shows -
during Thursday conferences. Further, Respondent's wit-
nesses have testified - credibly, I find - that when the
parties held their January 12 conference, Noriega's written
grievance had not yet been filed. Mindful of this, I
conclude that Johnson's professed memories, with regard
to particular matters related to grievance disposition which
the parties discussed, cannot be considered completely
reliable. His presumptively mistaken recollections, with
regard to subjects which purportedly were discussed,
necessarily renders his concomitant denial that Respon-
dent's draft proposals on group insurance and pension
matters were proffered for review less than persuasive.
Third: During cross-examination, Complainant Union's
shop committee chairman, Larry Johnson, did concede
that various pension matters had been discussed during the
parties' January 12 conference; further, he did concede -
despite a professed failure of recollection - that Com-
plainant Union's representatives "may have had" some
document, with specific pension language, before them. In
that connection, Johnson speculated that certain designat-
ed sections of Respondent's contractual "pension" com-
mitment may have been proffered for Complainant
Union's consideration when the firm's so-called "Decem-
ber 9th" written proposals were presented; a review of that
compilation, however, reveals that it did not contain the
specific language to which reference was made. Johnson
finally recalled having seen such language, but could not
recall precisely where or when he had seen it. With due
regard for his conceded failures of recollections, I find his
direct testimony - that Respondent's spokesman had
presented no draft "Group Insurance" or "Pension"
proposals for group consideration during their January 12
conference - less than persuasive.
Fourth: Complainant Union's representatives have sever-
ally conceded, within their testimonial recitals, that, during
their conference, Service Representative Bluto had request-
ed Respondent's commitment to calculate monthly "pen-
sion" and "dental" plan contributions geared to hours
"paid" rather than hours worked. Mindful of this conces-
sion, Respondent's counsel - within his brief - notes
cogently that:
Parties do not discuss language changes unless they are
reviewing documents and the changes which the Union
witnesses admitted discussing are consistent with . . .
the documents and testimony of Mr. Brady and Mr.
Flagg.
Despite Bluto's witness chair declaration that, "I don't
believe that I ever had a document before me when the
issue was being discussed," I find these comments
persuasive. In this connection, further, I note Bluto's
testimonial concession that he had suggested a second
language change calculated to forestall any possibility that
Respondent might be committed to contribute for two
pension plans. He had merely suggested that the specific
word "both" should be inserted within a single designated
sentence. Clearly such a suggestion - succinctly phrased
and limited in scope - would most likely have been made
with reference to specific contractual language which the
parties then were considering.
Fifth: Complainant Union's representatives contend that
much of the language currently found within their
consensually negotiated "Letters of Understanding" deal-
ing with group insurance and pension benefits derived
from Respondent's December 9 proposal, which Com-
plainant Union's membership had subsequently ratified.
The signed contract document with which we are con-
cerned, however, contains three paragraphs which Respon-
dent's negotiators had not yet presented, verbatim, for
Complainant Union's consideration, when Flagg proffered
his written recapitulation of their December 9 consensual
59
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
commitments. (The disputed "termination of coverage"
language can be found within the last of these three
paragraphs.)
Further, Respondent's current "Pension" letter reflects
some comprehensive, nonsubstantive, textual revisions of
Flagg's December 9 formulation dealing with retirement
plans. Substantially, therefore, General Counsel would
seem to be seeking a determination herein that Industrial
Relations Manager Flagg was trying to quietly "shoehorn"
three paragraphs concerned with group insurance benefits,
plus a significantly revised "Letter of Understanding"
dealing with pension benefits, into the parties' prospective
contract documents, though Complainant Union's negotia-
tors had never been given a chance before January 19 to
review their definitive textual formulation. The suggestion,
in my view, carries no persuasion. Respondent's negotiator,
so I find, had theretofore pursued negotiations with
complete good faith; the fact that his "Group Insurance"
and "Pension" proposals may not have been thoroughly
canvassed before January 12 derived solely from the
exigencies of the parties' collective-bargaining situation.
Complainant Union's spokesmen, herein, may have
genuinely convinced themselves that they could not,
consciously, have concurred with Respondent's currently
disputed "termination of coverage" proposal. Consequent-
ly, they may have further convinced themselves that they
had never been presented with such a broadly permissive
"Letter of Understanding" provision - which dealt, inter
alia, with termination of medical insurance coverage for
workers on medical leave. However, their testimonial
protestations, within my view, cannot withstand scrutiny. I
find, consistently with Respondent's contention, that
before Complainant Union negotiators were finally pre-
sented with a draft contract ready for signature, they had,
indeed, been given a proper opportunity to review Flagg's
definitive formulation of Respondent's group insurance
proposal.
i. The draft contract is signed
Directly following the January 12 conference with which
we have been concerned, Brady had Respondent's master
copy of Flagg's draft group insurance and pension
proposals modified to conform with Bluto's several
suggestions. The conjoined letters, thus modified, were
subsequently photocopied; reproductions of both modified
draft formulations were placed in Brady's so-called
contract file folder. Thereafter, when Flagg directed Brady
to collect and bind the various documents which com-
passed Respondent's contractual consensus, the latter
bound the firm's draft "Group Insurance" and "Pension"
provisions with his previously prepared partial contract
draft, noted herein.
On January 19, Complainant Union's concerned staff
representatives, local officers, and shop committeemen met
with Respondent's several management representatives, for
a so-called celebration dinner in a community restaurant.
Copies of their negotiated contract, ready for signature,
were supplied. (The contract copies, bound with metallic
paper fasteners, contained the several current "Letters of
Understanding" which the parties had negotiated. Inter
alia, these compassed a designated sec. D which contained
Respondent's previously drafted and consensually modi-
fied "Group Insurance" and "Pension" benefit programs;
the firm's group insurance letter contained the disputed
"termination of coverage" language with which we are
herein concerned. The bound contract draft further
contained a complete collection of those provisions which
the parties had consensually negotiated, save for six
"training schedule" appendixes which had not yet been
completely formulated.)
In a general atmosphere of friendly convivial relaxation,
Bluto queried Flagg with respect to whether his proffered
contract draft reflected the consensus which Respondent
and Complainant Union had reached. Upon receiving
Flagg's reassurance that it did, Bluto and his fellow union
representatives signed the contract. The record, however,
warrants a determination, which I make, that no union
representative thumbed through or reviewed the docu-
ment's contents before signing it.
Shortly thereafter Brady was given delegated responsibil-
ity for getting the contract printed. His testimony - which
I credit in this connection - reveals that he took
Respondent's complete contract draft, together with
various "Letters of Understanding" including his firm's
pension and group insurance benefit letters, and submitted
them to Respondent's previously selected printer.
3. Subsequent developments
a. Complainant Union's review of contract galley
proofs
On January 30, while Respondent's printer was still
working on their contract, several company representatives
so I find met with Service Representative Bluto to consider
some procedural questions which Respondent's controller
wanted resolved concerning the prospective implementa-
tion of their negotiated pension plan. During their
discussion, those present - so Flagg's credible, uncontra-
dicted testimony shows - referred to paragraphs B
through E in Respondent's designated "Letter of Under-
standing" dealing with pension matters.
These paragraphs can be found - in the specified letter
- set forth on the same photocopy page which contains
the disputed "termination of coverage" language, relative
to workers on medical leave, closing the prior group
insurance letter. Mindful of this, I conclude - consistent
with Respondent's contention - that during this January
30 conference Service Representative Bluto's personal
attention would necessarily have been focused upon
pension "letter" language closely proximate to the disputed
group insurance provision noted. Necessarily, therefore, his
knowledge that Respondent's management, then, consid-
ered these final letter formulations - concerned with both
its group insurance and pension commitments - part of
their negotiated consensus, may reasonably be inferred; I
so find.
Sometime later, during February 1976, Brady received
from Respondent's printer two sets of galley proofs for the
contract "booklet" which Respondent would thereafter
have printed. He supplied Larry Johnson, Complainant
Union's shop committee chairman with a galley set, which
Complainant Union's representatives could proofread.
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NORRIS INDUSTRIES
According to Brady, Complainant Union was given a
collected set of galley pages which contained the complete
text of what subsequently became Respondent's printed
contract booklet, save for six training schedules. Specifical-
ly, Brady testified that the galley set which he transmitted
compassed a complete "Letters of Understanding" compi-
lation, which Respondent and Complainant Union had
agreed they would reproduce in their printed contract
booklet. More particularly, Brady recalled that the galley
set included Respondent's negotiated "Group Insurance"
and "Pension" benefit commitments.
Complainant Union's witnesses, however, have proffered
diverse recollections with respect to what they received.
Specifically: Shop Chairman Johnson declared that the
galley set which Brady provided contained merely the first
80 pages of their prospective printed contract. Substantial-
ly, Johnson's declaration reflects his recollection that
Complainant Union was supplied with a galley set which
merely compassed the parties' formal contract, together
with schedules "C" and "D" previously noted; thus,
according to Complainant Union's shop chairman, the
galleys contained no schedule "E" training program
outline, no "Letters of Understanding" whatsoever, and no
detailed training schedules. However, Vice Chairman
Valenti of Complainant Union's shop committee testified
that, when he was requested to proofread galleys, Chair-
man Johnson gave him a collection of galley sheets which
included Respondent's schedule "E" training program
outline, plus various "Letters of Understanding" with the
exception of those concerned with group insurance and
pension benefits.
The record considered in totality persuades me that
Brady's proffered recollection, particularly with reference
to this galley set's substantive content, merits credence.
When requested to provide Respondent's printer with draft
material for a prospective "contract" booklet, Brady would
have had no reason to withhold any part of the January 19
compilation which Complainant Union's representatives
and Respondent's management spokesmen had signed; I
conclude that nothing was withheld. The compilation
which he sent to Respondent's printer, so I have found,
would, therefore, have contained draft "Letters of Under-
standing" concerned with pension benefits, medical insur-
ance coverage, and dental plan benefits. Further, Respon-
dent's last designated "Group Insurance" letter submission
would have contained the disputed "termination of
coverage" language with which we are concerned.
Further, Brady's testimony that he received from
Respondent's printer galley sheets which contained com-
plete "Group Insurance" and "Pension" letters, and that he
transmitted those galley sheets to Complainant Union's
representative has documentary support. That support -
which could be described with circumstantial detail would,
however, require a rather lengthy exposition; suffice it to
say, therefore, that Respondent's collection of galley pages,
submitted for the present record, reflects a system of
pagination provided by the firm's printer, which persua-
sively demonstrates that a galley sheet numbered "23"
which contained complete "Group Insurance" and "Pen-
sion" letter texts had been provided for proofreading. (The
record does show that Respondent's printer subsequently
provided Brady with a second collection of galley sheets.
While a witness, Shop Committee Chairman Johnson,
testified that, when he was given this second compilation
for proofreading, he was told, "This is one that's got the
Letters of Understanding and Training Programs in it."
My review of Respondent's documentary submission,
however, has persuaded me that Johnson's testimony
reflects faulty recollection. The printer's pagination marks,
in his second set of galley sheets returned for proofreading,
clearly reveal that it covered merely six training schedules.)
True, Vice Chairman Valenti of Complainant Union's
shop committee did testify that, when he proofread the first
collection of galley sheets which Brady had provided, he
merely reviewed "Letters of Understanding" within sec-
tions A, B, and C thereof, but not those compassed within
section D which dealt, inter alia, with "Group Insurance"
matters and contained the currently disputed "termination
of coverage" language. However, Valenti's testimonial
recitals, in my view, reflect his possible confusion or
defective recollection. (Valenti testified initially that he had
proofread merely the printer's first 22 numbered galley
sheets. When reminded that this would mean he could not
have proofread sec. C of the galley sheets "Letters of
Understanding" portion completely, since that section had
been continued for several paragraphs on page 23 in the
galley sheet collection, Valenti changed his testimony; he
declared that he had proofread sec. C completely, includ-
ing the portion reproduced on page 23 noted.)
Should a determination be considered warranted that
Valenti did indeed review section C completely, in the
galley sheets "Letters of Understanding" portion, but that
he reviewed nothing further therein, this Board would be
constrained to conclude, perforce, that Respondent's
printer had provided a partially filled galley sheet page 23
in a proof set which contained further numbered galley
sheets; nothing within the present record, however, would
support a determination that such a partially filled galley
sheet had ever been provided. Clearly, Respondent's
documentary record calls for determinations, rather, that
Valenti received and reviewed 25 completely filled galley
sheets which - in their designated "Letters of Understand-
ing" portion - did contain a sheet numbered 23 with
section C's final paragraphs, plus complete "Group Insur-
ance" and "Pension" letters. Necessarily, therefore, Vice
Chairman Valenti could have, inter alia, proofread the
disputed "termination of coverage" language with which
we are presently concerned.
Further proof that Flagg did, indeed, provide Complain-
ant Union's representatives with galley sheets which
contained their consensually negotiated section D benefit
letters can be cited. In Respondent's January 12 draft
"Group Insurance" proposal and the January 19 draft
contract - compassing a modified "Group Insurance"
letter - which the parties signed, some draftsman or typist
had made a typographical error; the firm's promised
contribution rate for certain designated "dental plan"
coverage, which should have been shown as 11.5¢ per
straight time hour paid, was shown as .115¢ per straight
time hour. The contract booklet which Respondent's
printer finally produced, however, reflects the firm's
promised contribution rate correctly. Clearly the requisite
61
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
correction must have been made after the particular galley
sheet which reflected the error had been proofread. With
respect thereto, Brady testified that the printer's presump-
tive .115¢ mistake had been noticed and mentioned, during
a conversation, by Leroy Johnson, Complainant Union's
shop committee secretary; that Brady had, thereupon,
corrected his galley copy, which he returned to Respon-
dent's printer; and that the printer had subsequently
submitted a corrected galley sheet with the contribution
rate properly shown. Before Brady testified, Leroy Johnson
had initially conceded that he "could have" had a
conversation with Brady regarding this mistakenly repro-
duced monetary figure; directly following his concession,
however, Johnson had proffered a retraction, contending
that he could not remember. Thereafter, when summoned
in rebuttal, subsequent to Brady's testimony, Johnson
declared initially that they had not had "any" discussion
regarding this .115¢ mistake; secondarily, however, he
recalled a conversation during which Brady had mentioned
certain "corrections or additions" which the galleys would
require based upon his notes; finally, Johnson reiterated his
prior testimony that he could not remember discussing
"decimal points" with Respondent's representative. Since
Johnson's proffered recollections considered in totality
clearly reflect his lack of certainty in this connection,
Brady's witness chair recital with respect to their conversa-
tion, in my view, merits credence.
With matters in this posture, I conclude - consistent
with Respondent's contention - that, when Complainant
Union's representatives reviewed and proofread galley
sheets for their prospective contract booklet, they were
provided, inter alia, with a fully complete opportunity to
consider Respondent's group insurance commitments,
their defined limitations, and, more particularly, the
disputed "termination of coverage" provision which Gen-
eral Counsel challenges herein.
b. Respondent's implementation of the disputed
language
Sometime after March 1, Respondent implemented the
disputed language with which we are concerned. According
to Flagg - whose testimony in this respect merits credence
- no determinations with respect to medical insurance
coverage suspensions had been made prior thereto, because
March I had been designated the consensually determined
"effective date" for various insurance coverage options
which Respondent's Vernon facility workers would be
given a chance to choose. Respondent's personnel manager
- so Flagg's testimony shows - was thereafter designated
to draft a letter, directed to workers then on medical leave,
notifying them that their group medical insurance coverage
would be terminated prospectively at the close of the
month following the month during which their leave had
commenced.
Shortly thereafter, sometime in late March or April 1976,
Shop Committee Chairman Johnson received a telephone
call from a Vernon facility worker; the latter reported that
he had just received a letter notifying him his medical
insurance coverage would be terminated should his leave
continue for another 30 days. Johnson promptly called on
Flagg; when the latter reiterated Respondent's purpose to
effectuate terminations of medical insurance coverage,
thereafter, consistent with the provision dealing with that
subject in their "Group Insurance" letter, Johnson asked
how terminations of coverage would be handled. His
testimony with respect to what he understood Flagg's reply
to convey, which I credit, reads as follows:
. . . [He] went on to explain that people that were off
on sick leave, if they're hurt on company property, they
will go ahead and continue to cover them. If it's a
personal leave or a personal sick leave, then they would
terminate it 30 days after the month in which they left.
However, if they went out on [work-related] sick leave,
it would cover them for that injury only, and drop the
dependents and all this other.
When, thereafter, Shop Committee Chairman Johnson told
Service Representative Bluto that permissive "termination
of coverage" language had been incorporated in their
negotiated "Group Insurance" letter, Bluto promptly
called upon Flagg; he queried the latter with regard to how
this had happened. Flagg declared that Complainant
Union's representatives had "agreed" with respect to the
disputed language's inclusion during their January 12
conference. Bluto protested, however, that his negotiation
files contained no "document" which reflected a consensus
reached relative to the disputed "termination of coverage"
language; he contended that Complainant Union's spokes-
man had never "discussed" such a broadly permissive
provision during their contract talks.
c. Complainant Union proposes a revised contract
for Respondent's concurrence
Thereafter, so the record shows, Bluto conferred several
times with Flagg and various representatives of Respon-
dent's management. Flagg, however, would not consider a
modification of Respondent's newly determined policy and
practice with regard to group medical insurance coverage
terminations for workers on medical leave.
On or about June 3, so the record shows, Bluto prepared
a revised contract with the disputed language deleted.
More particularly, he prepared a complete contract with a
revised "Group Insurance" letter; there the designated
letter's final sentence - which, inter alia, contained the
disputed language calculated to permit Respondent's
termination of group insurance coverage for workers on
medical leave - had been excised completely. Bluto
requested Flagg to sign his proffered document as revised;
Flagg, however, refused. Shortly thereafter Complainant
Union's charge herein was filed.
C. Discussion and Conclusions
1. Issue
The duty to bargain collectively, which Section 8(a)(5)
and Section 8(b)(3) of the statute, taken together, lay
conjointly upon concerned employers, labor organizations,
and their representatives, compasses a consequential duty
requiring both parties to execute written contracts "incor-
porating any agreement reached" when requested. See,
specifically, Section 8(d); cf. H. J. Heinz Company v.
62
NORRIS INDUSTRIES
N.L.R.B., 311 U.S. 514, 526 (1941). This much, presum-
ably, Respondent's principal negotiator and Complainant
Union's representatives would, herein, concede.
The statute, however, lays down a further requirement.
When collective-bargaining contracts have been, finally,
negotiated and signed, neither party may modify the terms
and conditions provided for therein, save in situations
where the party desirous of some modification has
complied with certain designated preconditions. Inter alia,
the party desiring a modification must "offer to meet and
confer with the other party" for the purpose of negotiating
a modified contract. Neither party, however, may be
required to discuss or consent to modifications of particu-
lar terms and conditions, defined within a contract for
some fixed period, should the moving party propose a
modification which would become "effective" before some
designated contract reopening date.
General Counsel's representative, herein, concedes -
necessarily - that Complainant Union and Respondent
have negotiated and signed a written contract, with
"Letters of Understanding" supplementary thereto, which
taken at face value purports to reflect their reciprocal
consensual commitments. Nevertheless, he (General Coun-
sel's representative) seeks a Board determination, now,
which would partially modify their "Group Insurance"
letter's terms and conditions, by proscribing Respondent's
claimed right to terminate group insurance coverage for
disabled workers on medical leave coterminously with "the
end of the month following the month" in which their leave
commenced. More particularly, he contends that there was
no consensual "meeting of the minds" between Complain-
ant Union and Respondent, pursuant to which the
disputed "termination of coverage" language previously
noted herein - which would facially validate the firm's
current practice - became part of their negotiated "Letter
of Understanding" dealing with group insurance benefits.
In this connection, General Counsel's representative
seeks a determination that Complainant Union's negotia-
tors reasonably believed Respondent's disputed "termina-
tion of coverage" language would not be compassed within
the specific "Letter of Understanding" with which we are
concerned. (Since the record considered in totality would
clearly warrant a determination, which I make, that
Respondent's proposed "termination of coverage" provi-
sion was never particularly considered, discussed, or
rejected, in haec verba, during the parties' negotiations,
General Counsel's contention, in my view, could have been
proffered more appropriately with obverse phraseology;
namely, that Complainant Union had never been given
reason to believe that Respondent wanted the disputed
language with which we are concerned specifically incorpo-
rated in their proposed "Group Insurance" letter.)
In his brief, General Counsel's representative further
notes Respondent's manifest belief that Complainant
Union's representatives had "agreed" or "acquiesced"
regarding the specific inclusion of Industrial Relations
Manager Flagg's proposed "termination of coverage"
provision within a consensually negotiated "group insur-
ance" benefit program. Then, since the record considered
in totality reveals, so General Counsel contends, that
Complainant Union's representatives and Respondent's
principal negotiator honestly held divergent subjective
beliefs, particularly with regard to whether Flagg's pro-
posed "termination of coverage" language should have
been considered part of their negotiated consensus, he
suggests that no true meeting of the minds with respect
thereto had been reached. Having made this point, General
Counsel submits further that:
... Respondent's implementation of the changes
[permitted byl the disputed language on March 1, 1976,
must be found to have constituted a unilateral change
in conditions of employment .... It is well establish-
ed that an employer is not only under a duty to bargain
exclusively with the chosen representative of its
employees concerning the terms and conditions of their
employment, but is under the correlative obligation not
to unilaterally change established conditions without
consultation and bargaining with a representative of its
employees, in the absence of circumstances excusing or
justifying such unilateral action .... In this case,
there was no agreement between the parties and there
are no circumstances which justify or excuse Respon-
dent's unilateral action.
Consequentially, Respondent's course of conduct, in
General Counsel's view, should be considered a statutory
"refusal to bargain" violative of Section 8(a)(Xl1) and (5) of
the statute. Supporting this contention, he cites Reapp
Typographic Service, Inc., 204 NLRB 792 (1973), where
Administrative Law Judge Peterson determined, with
Board concurrence, that a respondent employer had
violated Section 8(a)(5) and (1), during a contract's term,
through its unilateral discontinuance of sickness, accident,
and life insurance programs which - pursuant to contrac-
tual requirements - the designated respondent had
previously provided.
Respondent contends, contrariwise, that Complainant
Union's representatives - through their course of conduct
during the negotiations with which we are concerned and,
specifically, through their failure to protest or question the
formulation of Flagg's proffered "termination of coverage"
provision in Respondent's January 12 group insurance
proposal - had, indeed, demonstrated their acquiescence
with respect thereto. Their failure to protest or raise
questions, Respondent's counsel suggests, should be con-
sidered a competent "manifestation of assent" sufficient to
warrant Respondent's conclusion that a negotiated consen-
sus, with respect to group insurance benefits generally,
reflected Complainant Union's concurrence, inter alia, with
the firm's permissive "termination of coverage" language
compassed therein.
2. Conclusion
With matters in their present posture, General Counsel's
representative seeks a Board determination which would
essentially confirm Respondent's present contractual and
supplementary "letter" commitments, but would neverthe-
less abrogate the firm's currently claimed right to make
decisions - with regard to terminations of group insurance
coverage for certain Vernon facility workers on medical
leave - which its negotiated "Group Insurance" letter
63
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
facially and clearly permits. Substantially, therefore,
General Counsel's representative - through his contention
that Respondent's current course of conduct, which has
been consistent with a patently permissive "Letter of
Understanding" provision, should nevertheless be consid-
ered "unilateral action" statutorily proscribed - really
seeks a reformation of the firm's completely memorialized
consensus previously reached with Complainant Union's
representatives. See 66 Am. Jur. 2d 521, "Reformation of
Instruments," Section I, ff. There we find certain princi-
ples, germane herein, set forth:
§ 1. The equitable remedy of reformation of written
instruments is the remedy afforded . . . to the parties
. . . to written instruments which import a legal
obligation, to reform or rectify such instruments
whenever they fail, through mistake or fraud, or a
combination of fraud and mistake, to express the real
agreement or intention of the parties. The action for
such relief rests on the theory that the parties came to
an understanding, but in reducing it to writing, through
mutual mistake or mistake andfraud, some provision or
language was omitted, inserted, or incorrectly worded,
and the action is to change the instrument so as to
conform it to the contract agreed on. Reformation of a
written instrument is permitted only on the supposition
that it does not represent the true agreement of the
parties, and is ordered so as to effectuate their true
intent. If the instrument embodies the actual contract
of the parties, reformation will be refused. And
reformation will also be refused if the minds did not
meet and there was no preexisting agreement and
common intention to which the instrument can be
conformed [Emphasis supplied.]
§4. Inasmuch as the relief sought in reforming a
written instrument is to make it conform to the real
agreement or intention of the parties, a definite
intention or agreement on which the minds of the
parties have met must have preceded the instrument in
question. There can be no reformation unless there is a
preliminary or prior agreement, either written or verbal,
between the parties, furnishing the basis for rectifica-
tion or to which the instrument can be conformed
.... Mutual mistake in a written instrument presup-
poses a prior or preceding agreement between the
parties, and to show the mutual mistake, the preceding
agreement must ex necessitate be shown. Both parties
must have understood the contract as it ought to have
been and in fact was, except for the mistake ....
§6. Although both seek to arrive at the intention of
the parties, there are obvious differences between the
construction of a written instrument and its reforma-
tion. When a court construes a written instrument, it is
assumed that the instrument reflects the actual agree-
ment of the parties, and the language calls for
construction because it is uncertain or ambiguous. On
the other hand, ambiguity or uncertainty has nothing to
do with the reformation of a written instrument, but
rather reformation is adjudged because the instrument,
by reason of mistake or fraud, does not embody the
true agreement of the parties ....
§11. Upon the reformation of an instrument, the
general rule is that it relates back to, and takes effect
from, the time of its original execution. [Note: General
Counsel seeks a remedial directive herein whereby
Respondent would be required to reinstate insurance
coverage for workers whose coverage had not been
properly terminated, and to make whole such workers
for whatever losses they may have suffered, or medical
expenses they may have been required to bear.]
§12. There are two basic grounds for the reforma-
tion of written instruments which do not correctly state
and embody the intention and pre-existing agreement
of the parties to the instrument, namely, (1) mutual
mistake of the parties, and (2) ignorance or mistake of the
complaining party coupled with or induced by the fraud
or inequitable conduct of the other or remaining
parties .... [Emphasis supplied.]
§ 13. There must be an antecedent agreement which
the written instrument evidences, and the mistake must
have been in the drafting of the instrument, not in the
making of the contract .... A mistake which is
relievable in equity has been defined as some uninten-
tional act, omission or error arising from ignorance,
surprise, imposition, or misplaced confidence ....
[T]he ignorance must be unconscious, and not a mental
state of conscious want of knowledge as to something
that may or may not exist ....
§22. [W]hen no question of fraud, bad faith, or
inequitable conduct is involved and the right to reform
an instrument is based solely on a mistake, it is
necessary that the mistake be mutual . . . it follows
from the above that in the absence of fraud or
inequitable conduct by the other party . . . unilateral
mistake is not a ground for reformation, the remedy in
such case being cancellation or recision of the instru-
ment.
§23. A mutual mistake, for which an instrument will
be reformed, is one which is reciprocal and common to
both parties, each alike laboring under the same
misconception in respect to the terms of the written
instrument. It is a mistake shared by both parties to the
instrument at the time of reducing their agreement to
writing, and the mistake is mutual if the contract has
been written in terms which violate the understanding
of both parties - that is, if it appears that both have
done what neither intended . .. . By the statement that
the mistake must be mutual is not meant that both
parties must agree at the hearing that the mistake was
in fact made, but that the evidence of . . . mutuality
must relate to the time of the execution of the
instrument and show that the parties then intended to
say one thing and by mistake expressed another and
different thing .... [Emphasis supplied.]
§24. Fraud practiced in drawing and executing an
instrument so that it does not speak the real terms of
the contract which the parties have agreed on, or
unconscionable conduct amounting to fraud, consti-
tutes grounds for a reformation of the instrument if it is
essential to protect from in ury the innocent party
thereto..... Of course, tne right to reformation
64
NORRIS INDUSTRIES
cannot be based on the ground of fraud if the other
party did nothing to mislead the complainant.
§49. A court of equity . . . may strike out of an
instrument subject matter not embraced within the
actual agreement of the parties, and also clauses inserted
by the mutual mistake of the parties or by the scrivener or
draftsman against the intention of the parties. [Empha-
sis supplied.]
§75. If a party acquiesces in an instrument after
becoming aware of the mistake, he loses his right to
reformation. The acquiescence may be direct or implied
§79. [M]ere negligence in executing or accepting a
written instrument is not a bar to reformation where the
ground for relief is mutual mistake. Mistakes nearly
always presuppose negligence, and so it must be
evident that the rule which permits reformation on the
ground of mutual mistake does not contemplate that
mere negligence will bar reformation . . . It is clear
that a unilateral mistake is not of itself a ground for
reforming a written instrument. If, therefore, a party
who seeks reformation proves only a unilateral mistake
he has not established a cause of action; he is not
entitled to relief even if he has exercised the highest
possible degree of care; and there is no point in talking
about negligence .. .. [Emphasis supplied.]
§83. In accord with the rule that mere negligence is
not a defense to a complaint or reason to reform an
instrument, it is held that the negligent failure of the
complaining party to read an instrument before he
signed it does not of itselfbar reformation, or does not
necessarily bar reformation. Where the parties to a
contract have reached an agreement on its terms and
one of them has undertaken to reduce the contract to
writing or to prepare a writing which embodies the
agreement, the other party is ordinarily entitled to
assume that the written instrument is correct, and is not
barred from reformation by signing or accepting it
without reading it. .... [Note. however, that the party
desirous of reformation must still show that the
challenged error within the instrument was a product of
mutual mistake, which he negligently failed to detect.
Interpolation provided to promote clarity.]
Mindful of these principles, I find no justification, in the
present record, for determinations - consistent with
General Counsel's contention - that Respondent's course
of conduct reflects a statutorily proscribed refusal to
bargain. Rather, I find Respondent's current policy and
practice, with respect to terminations of group insurance
coverage for Vernon facility workers on medical leave,
properly bottomed upon "Letter of Understanding" lan-
guage with respect to which Complainant Union should be
considered bound. Several considerations which have led
me to this conclusion may be noted.
First: I note, despite the General Counsel's contrary
contention, that Complainant Union's negotiators before
their January 19 contract signing ceremony had been given
"reason to believe" that Respondent's spokesman desired
certain language, calculated to define various situations in
which group insurance coverage for bargaining unit
workers would be terminated, set forth in a definitive
"Letter of Understanding" consensually negotiated. Re-
spondent's specific formulation, drafted for that purpose,
had concededly been presented for Complainant Union's
consideration, inter alia, during their October 15 session.
(Respondent's complete proposal had then been rejected.
Complainant Union's representatives had not catalogued
their reasons; clearly, however, they had not been con-
cerned particularly with Respondent's proffered "termina-
tion of coverage" provision. The firm's principal negotiator
certainly had not been given notice that his proffered
formulation, with respect thereto, would be disapproved.)
Respondent's industrial relations manager subsequently
presented his suggested provision without change through
a Federal mediator; Complainant Union's representatives,
so I have found, proffered no protest. True, they probably
were primarily concerned throughout their November 6
session with several different matters; the record, however,
warrants a determination in my view that they were then
given a sufficient chance to note the broadly permissive
scope of Respondent's reiterated "termination of coverage"
proposal. Thus, when Respondent's industrial relations
manager - toward the conclusion of their subsequent
December 8 - 10 marathon session - finally suggested
that certain "open" matters should be considered resolved
"on the basis of what [Respondent] had proposed" his
proffer necessarily conveyed a further reiteration of
Respondent's previously drafted "termination of coverage"
language, compassed in a comprehensive "Group Insur-
ance" proposal with respect to which substantial consensus
had been reached. (Though Flagg, when requested to
designate various matters which might be resolved consis-
tent with his suggestion, did fail to mention Respondent's
previously proffered "termination of coverage" provision,
his lapse, in my view, reflected neither guile nor any
purpose of concealment. In its situational context, rather,
Flagg's failure to vouchsafe a complete, comprehensive
reply, when confronted with Bluto's query, reveals nothing
more than presumptive fatigue, sufficient to warrant a
deduction that he probably suffered from a memory failure
following the parties' lengthy, stressful bargaining session.)
Finally, during their subsequent January 12 conference,
Respondent's principal negotiator, so I have found,
presented Complainant Union's representatives with a
definitive "Group Insurance" draft letter proposal which,
inter alia, contained once more Respondent's desired
"termination of coverage" language. The firm's draft and
Respondent's concurrently presented "Pension" letter
proposals were reviewed. Changes with respect to both
proposals were suggested and considered; consensus was
reached. Though Respondent's proffered coverage termi-
nation provision concededly was not then discussed,
Complainant Union's negotiators were neither precluded
from considering it, nor misled regarding its purpose. With
matters in this posture, General Counsel's present conten-
tion - that no proper "meeting of the minds" between
Complainant Union and Respondent can be found with
particular reference to Respondent's proffered "termina-
tion of coverage" provision - carries no persuasion.
Compare A. Schlecht v. Hiatt, 271 F.Supp. 644 (D.C. Ore.,
1967), reversed on jurisdictional grounds 400 F.2d 875
(C.A. 9, 1968), in this connection. Therein, the district
65
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
court, confronted with a complainant union's claim for
relief bottomed upon a written contract, found that, while
the particular contract provision which the labor organiza-
tion cited to justify its claim had not been discussed in
detail during the contracting parties' negotiations, no union
representative had made "false or misleading" statements
with respect thereto; that the concerned employer had
been given a full opportunity to read and study the
contract; that he had "elected" not to read its provisions;
and that he should, under the circumstances, be considered
bound thereby.
Second: Respondent's present contention that Complain-
ant Union's course of conduct, throughout their negotia-
tions and specifically during their January 12 conference,
should be considered a competent "manifestation of
assent" sufficient to warrant Respondent's belief that a
consensus with respect to group insurance coverage
terminations had been reached merits Board concurrence.
In his brief, Respondent's counsel suggests that:
· . . [A] contracting party should not be able to avoid
the clear effect of language in a document which he has
had a fair opportunity to review, regardless of any lack
of realization that the language existed, when he has
remained silent .... Certainly the non-negligent party
should not be penalized for the negligence of the other
party .... [T]he mental reservation of a party to a
bargain does not impair the obligation he purports to
undertake unless perhaps the other party has reason to
know of the reservation ....
This recapitulation of legal principles, proffered as ger-
mane herein, I find persuasive. Compare Federico v. Frick,
3 Cal.App. 3d 87.2 (1970). Complainant Union's represen-
tatives - throughout several bargaining sessions during
which they discussed various substantive portions of
Respondent's proposed group insurance program - may
never have consciously considered or raised questions with
regard to Flagg's suggested "termination of coverage"
language; nothing in the present record, however, would
warrant a determination that Respondent's negotiator was
thereby given "reason to believe" that his draft formula-
tion, with respect thereto, might be subsequently chal-
lenged. In a comparable collective-bargaining context,
silence - whether chargeable to negligence or bottomed
upon some purely subjective misconception - has been
found sufficient to signify consent. Machinists Automotive
Trades District Lodge No. 190 of Northern California, et al.
(Peterbilt Motors Company), 227 NLRB 486 (1976). Herein,
Respondent's negotiator was privileged to conclude, in my
view, that Complainant Union's spokesmen had "ac-
quiesced" with respect to his several-times-proffered
termination provision. Compare Theodore Mayer & Broth-
ers, 62 LA 540, 542 (1974), and Paper Converting Machine
Co., 55 LA 1074 (1970); separate arbitrators have reached
similar conclusions.
Third. General Counsel's riposte proffered in his brief -
that Respondent's defense substantially reflects a nonper-
suasive contractual "waiver" claim - carries no persua-
sion. In that connection, General Counsel suggests that a
labor organization's waiver of its right to bargain with
regard to working conditions must be clear and unmistak-
able; he contends that Complainant Union's mere "failure
to raise a challenge" with respect to Respondent's pro-
posed "termination of coverage" provision, therefore,
should not be considered sufficient. However, Respondent
claims no presumptive "unilateral" right bottomed upon
managerial prerogatives to terminate group insurance
coverage for particular workers because of demonstrable
contractual silence with respect thereto. Further, Respon-
dent proffers no claim that Complainant Union's represen-
tatives - through a consciously negotiated management-
rights clause or contractual "zipper" provision - have
necessarily waived their statutory right to bargain, with
respect to group insurance coverage termination. (Respon-
dent's industrial relations manager, so far as the record
shows, never did claim - during their protracted contract
negotiations or thereafter - that Respondent's currently
claimed right to terminate group insurance coverage for
workers on medical leave was nonbargainable, or that
Complainant Union's spokesman should be considered
precluded from discussions with respect thereto. The firm's
principal negotiator, rather, laid Respondent's group
insurance proposal - with the currently "disputed"
provision specifically set forth therein - before Complain-
ant Union's spokesmen. Though he may not have specifi-
cally solicited their reaction with respect to that provision,
there can be no doubt that whatever protest they might
have proffered would have been considered. Substantially,
therefore, Respondent recognized Complainant Union's
right to bargain.)
With matters in their present posture, therefore, this
Board's decisional "waiver" rubric cannot reasonably be
considered pertinent. The contractual language, pursuant
to which Respondent justifies its current policy and
practice with respect to group insurance coverage termina-
tions, stands "clearly and unmistakably" stated. Should
Complainant Union be considered bound thereby? That
constitutes the sole question presented for determination
herein. In my view, Complainant Union should be
considered committed. Respondent, so I have found, has
not challenged its right to bargain; the record, rather,
warrants a determination, which I have made, that union
negotiators were really given a fair "opportunity to
bargain" regarding group insurance coverage terminations.
Their failure to consciously consider, discuss, or question
Respondent's proposal with respect thereto derived, so the
record shows, from their understandable preoccupation
with various other substantive provisions compassed within
Respondent's group insurance proposal. The question
presented, therefore, requires no determination with re-
spect to whether Complainant Union's course of conduct
constituted a clear and unmistakable "waiver" with respect
to currently disputed contract language; rather, the Board
must determine merely whether Complainant Union's
course of conduct should be considered a binding "mani-
festation of assent" with respect thereto.
Fourth: Though, currently, Complainant Union and
Respondent may profess different subjective conceptions,
particularly with regard to the true nature and scope of
their negotiated "Group Insurance" consensus, the present
record will support a determination, in my view, that their
January 19 signed contract, with its supplementary letters,
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reflects a legally sufficient "agreement" whereby both
parties may properly be considered bound. More particu-
larly, General Counsel's presentation will not preponder-
antly warrant a determination, in my view, that Respon-
dent's principal negotiator and Complainant Union's
representatives permitted a definitive "termination of
coverage" provision to become part of their negotiated
group insurance letter through mutual mistake. No persua-
sive showing has been made that both parties privy thereto
did what neither desired; stated otherwise, no determina-
tion would be warranted that both parties planned to say
one thing, particularly with reference to Respondent's
claimed right to terminate group insurance coverage, but
mutually declared something different mistakenly. In his
brief, Respondent's counsel notes persuasively that:
The Company intended to propose a change in the
treatment of employees on leave of absence, drafted
clear language to that effect, gave the Union ample
opportunity to review it, and the Union did in fact read
the language, regardless of whether its import regis-
tered.
Further, while Complainant Union's negotiators may have,
innocently but mistakenly, failed to note the broadly
permissive scope of Respondent's proposed "termination
of coverage" provision, no determination would be
warranted, on the present record, that their mistake had
been causally "induced" through inequitable, duplicitous,
or conceivably unconscionable conduct chargeable to
Respondent's representative. We confront a situation,
therefore, which reflects nothing more than Complainant
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.
Union's truly "unilateral" mistake for which Respondent's
principal negotiator cannot be held responsible. Whatever
innocent misconceptions Complainant Union's representa-
tives may have shared - particularly regarding the nature
and scope of Respondent's contractually validated "termi-
nation of coverage" policy and practice - those miscon-
ceptions were solely theirs; Flagg's broad view of Respon-
dent's specifically confirmed rights bottomed upon their
negotiated consensus was, I find, objectively justified. With
due regard for conventional principles of contract law,
therefore, I find both parties bound consistent with their
negotiated "Group Insurance" letter's substantive and
procedural provisions. No basis for a contractual reforma-
tion, through the complete negation of Respondent's
claimed "termination of coverage" rights, or some newly
declared portion thereof, has been demonstrated herein.
Since Respondent and Complainant Union have, there-
fore, reached a legally confirmed "agreement" particularly
with reference to Respondent's defined right to terminate
group insurance coverage, inter alia, for Vernon facility
workers on medical leave, the firm's consequential termina-
tions of such coverage for particular workers consistent
therewith cannot reasonably be considered "unilateral"
conduct statutorily proscribed.
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, as amended, I hereby issue the following recommend-
ed order:
ORDER
The complaint is dismissed in its entirety.
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.
67