Oak Cliff-Golman Baking Co.

National Labor Relations Board - Board Decisions

Dec 26, 1973

207 N.L.R.B. 1063 (N.L.R.B. 1973)

OAK CLIFF-GOLMAN BAKING COMPANY 1063
Oak Cliff-Golman Baking Company and Bakery &
Confectionery Workers International Union - of
America,' AFL-CIO, Local No. 111. Case
16-CA-4532
December 26, 1973 -
SECOND DECISION AND ORDER
BY CHAIRMAN MILLER AND MEMBERS
FANNING AND JENI{INS
On March 21, 1973, a panel of the National Labor
Relations Board composed of Members Fanning,
Jenkins, and Penello issued its, Decision and Order in
this proceeding finding in agreement with the
Decision of Administrative Law Judge Henry L.
Segall that Respondent had-violated Section 8(a)(5)
and (1) of the Act.2 Thereafter, Respondent filed
with the United States Court of Appeals for -the Fifth
Circuit a petition to review the Board's Order.
On August 24, 1973, while the case was pending
before the court, the Board, sua sponte, requested the
court to remand the case to it for further considera-
tion. On September 12, 1973, the court granted the
request. Thereafter, Member Penello excused himself
from participating in the decision and the Board
decided that the case should be considered de novo
by a panel composed; of Chairman Miller and
Members Fanning and Jenkins. Accordingly, and
pursuant to Section 3(b) of the -National Labor
Relations Act, the Board duly delegated its authority
in this proceeding to a panel composed of the three
members, named supra.
The Board has -considered the entire record in the
case and the Decision of Administrative Law Judge
Henry L.'Segal in light of the exceptions and briefs,
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge, to the
extent consistent with the decision herein, and adopt
his recommended Order.
The complaint alleged, the Administrative Law
Judge- found, and we all agree that Respondent
unilaterally modified its collective-bargaining con-
tract with the Union within the meaning of Section
8(d) of the Act and thereby violated Section 8(a)(5)
and (1) of the Act. The relevant facts are undisputed.
At all times here relevant, Respondent was a party
to a bargaining contract with the Union which was
effective by its terms until July 22, 1972, and which
covered its employees as part of a multiemployer
unit. In October 1971,3 Respondent's business faced
a dire financial crisis. Respondent decided that,
rather than close its operations and lose good
employees, it would attempt to remain in operation
by reducing the wages and -salaries of all its
employees. It' informed the Union of its financial
plight' and of its-wage reduction decision at meetings
held October 5 and 8, and asked for the Union's
"blessings." The Union refused to agree to the wage
cuts primarily because it did not wish to open the
contract's provisions with respect-to other employees
in the multiemployer unit. Respondent -nonetheless
implemented its decision and, commencing with the
payroll of October ,14, began paying its employees
both in the unit and outside of it at reduced rates of
pay. On- October 18, the Union filed a formal
grievance about Respondent's reduction of the wages
of the unit employees and, on October-22, it filed the
charge initiating this proceeding.
In resisting the complaint; Respondent sought at
the outset to obviate any decision on the merits on
two grounds. We discuss each seriatim.,
- First, Respondent claimed that the policy enunciat-
ed by the Board in Collyer Insulated Wire, A Gulf and
Western Systems Co., 192 NLRB 837, required
deferral of the,basic differences between Respondent
and- the Union in this case to the contractual
grievance-arbitration procedures which, as noted
supra, the Union had invoked before it filed the
charge herein. The Administrative Law Judge reject-
ed this claim. Although all of us agree his conclusion
was proper, Chairman Miller differs with his col-
leagues as to the proper predicate for that conclu-
sion. He would find, in agreement with the Adminis-
trative Law Judge's reasoning, that deferral is
inappropriate in this case because there is no claim,
and indeed no room for any finding, that the
contract's terms even arguably authorized the action
taken by Respondent here. Obviously therefore,
unlike Collyer, the question of whether Respondent's
action was in violation of its statutory obligations
does not turn on any underlying dispute over the
meaning of the contract's terms. Chairman Miller
would not, therefore, find that determination of the
violation issue in this case on its merits conflicts with
the policy enunciated in Collyer. As Members
Fanning and Jenkins do not, however, subscribe to
the policy enunciated in Collyer (for reasons they
have expressed in their dissent in that and in
subsequent cases), they would not defer to arbitra-
tion here in any event.
Next, Respondent claimed that its action in
reducing wages was at most a breach of contract with
the Union of a kind which Congress has indicated
i The title of "Trial Examiner" was changed to "Administrative Law
Judge" effective August 19, 1972.
2 202 NLRB 614.
3 Unless otherwise stated, all dates hereafter mentioned are for 1971.
207 NLRB No. 138
1064 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
should be remedied by other processes and ultimate-
ly by the courts.4 The Administrative Law Judge
rejected this claim as well. All of us agree he did so
properly, not only for the reasons set out in his
Decision but also for the following additional ones.
It cannot be gainsaid that an employer's decision in
midterm of a contract to pay its employees for the
remainder of the contract's terms at wage rates below
those provided in the collective-bargaining agree-
ment affects what is perhaps the most important
element of the many in the employment relationship
which Congress remitted to the mandatory process of
collective bargaining under the Act. Because so
substantial a portion of the remaining aspects of a
bargaining contract are dependent upon the wage
rate provision, it seems obvious that a clear repudia-
tion of the contract's wage provision is not just a
mere breach of the contract, but amounts, as a
practical matter, to the striking of a death blow to the
contract as a whole, and is thus, in reality, a basic
repudiation of the bargaining relationship. We
believe the jurisdiction granted us under the Act
clearly encompasses not only the authority but the
obligation to protect the statutory process of collec-
tive bargaining against conduct so centrally disrup-
tive to one of its principal functions-the establish-
ment and maintenance of a viable agreement on
wages.
Turning to the merits, Respondent alleges there is
no room in the facts for any finding that its conduct
violated the "good-faith" bargaining standards im-
posed upon it by the Act. It urges, in this respect,
that its sole motive and intent in reducing wages was
to meet an economic crisis; that its action in fact had
the salutary effect of preserving for employees jobs
they would otherwise have lost; and that it advised
the Union fully of all the reasons for its action and of
4 Respondent here refers to certain statements contained in the House
Conference Report (No. 510, p. 41) on the Taft-Hartley Amendments to the
Act (H .R. 3020), and to the Board's acknowledgment, in its decisions, that a
breach of contract is not ipso facto an unfair labor practice . See e.g.
the financial facts supporting it. We have no doubt
that Respondent 's description of its motive and its
object is a truthful one . But we have here a situation
where these considerations are irrelevant . The unam-
biguous language of Section 8(d) of the Act explicit-
ly: (1) forbade Respondent 's midterm modification
of the contract 's wage provisions without the Union's
consent ; and (2) granted the Union the privilege it
exercised to refuse to grant consent . Nowhere in the
statutory terms is any authority granted to us to
excuse the commission of the proscribed action
because of a showing either that such action was
compelled by economic need or that it may have
served what may appear to us to be a desirable
economic objective . To borrow the words of the
Supreme Court , what must here be recognized is that
"[t]he law is its own measure of right and wrong, of
what it permits , or forbids, and the judgment of the
courts [and of the Board] cannot be set up against it
in the supposed accommodation of its policy with the
good intention of parties , and, it may be, of some
good results ." Standard Sanitary Mfg. Co. v. U.S.,
226 U .S. 2049 . From all this , it follows that
Respondent's unilateral modification of the wage
provisions of its contract violated Section 8(a)(5) and
( 1) of the Act as alleged.
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 Respondent, Oak Cliff-Golman
Baking Company, Dallas, Texas, its officers, agents,
successors, and assigns, shall take the action set forth
in the said recommended Order.
American Vitrified Products Company, 127 NLRB 701; United Packinghouse
Workers of America, CIO, and Locals 49, 86, 93, 102 and 104 (Wilson & Co.,
Inc.), 89 NLRB 310.