Premo Pharmaceutical Laboratories, Inc.

National Labor Relations Board - Board Decisions

Jul 30, 1942

42 N.L.R.B. 1086 (N.L.R.B. 1942)

I
In the Matter Of PREMO PHARMACEUTICAL LABORATORIES, INC . and
WHOLESALE AND WAREHOUSE WORKERS UNION, LOCAL 65, C I. 0
and FEDERAL LABOR UNION, LOCAL 20734; A F • OF L, PARTY'TO THE
CONTRACT
Case No C-2151-Decided July 30, 1942
Jurisdiction : drug processing industry
Unfair Labor Practices '
Interference, Restraint, and Coeicions statements by supervisory employee and
employee close to management that respondent was hostile to union, as-
sistance to rival labor organization by duetting solicitation of members foi
rival organization by supervisory employees, executing closed-shop contract
with favored union at time it did not represent majority and respondent had
notice of union's organizational efforts
Discrintinatton discharge of employee for failure to maintain membership in
favored union under closed-shop contract and foi membeiship in disfavored
union, held discriminatory-closed-shop contract with labor organization as-
sisted by unfair labor practices and not being exclusive bargaining representa-
tive, held not protected by proviso of Section 8 (3)
Remedial Orders . give no effect to contract, withdraw recognition of favored
union as exclusive representative until so certified, reinstatement and back
pay ordered -
Mr Richard J Hecleey, for the Board
Mr. Benjamin Levine, of New York City, for the respondent.
Mr Jacques Buitenkant, of New York City, for Federal.
Mr Bernard Orell and Mr Charles Ravitch, of, New York City, for
Local 65
Mary M Persinger, of counsel to the Board
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon charges and amended charges duly filed by Wholesale and
Warehouse Workers Union, Local 65, C I 0, herein called Local 65,
the National Labor Relations Boai d, herein called the Board by the
Regional Director for the Second Region (New York City) issued
its complaint dated January 12, 1942, against Premo Pharmaceutical
42 N L R B, No. 197. _
1086
PREMO PHARMACEUTICAL LABORATORIES, INC 1087
Laboratories, Inc, New York City, herein called the respondent, al-
leging that the respondent had engaged in and was engaging in un-
fair labor practices affecting commerce, within the meaning of Sec-
tion 8 (1) and (3) and Section 2 (6) and (7) of the National Labor
Relations Act, 49 Stat 449, het em called the Act Copies of the
complaint, accompanied by notice of heating, wen e -duly served upon
the respondent, Local 65 and Federal Labor Union, Local 20734,
A F of L herein called Federal
With respect to the unfair labor pi actices, the complaint alleged
in substance that the respondent (1) discharged Morton Olshansky on
October 31,`1941,.aincl.at all time,, since has refused to reinstate him,
because he joined or assisted Local 65, and refused to assist Federal;
(2) on or about Se'tember 11, 1941,,and thereafter, interrogated its
employees concerning their union affiliation, urged, threatened, and
warned them against affiliation truth Local 65; and urged, threatened,
and warned then to assist and affiliate with Federal; (3) on Septem-
ber 11, 1941, entered into a collective bargaining contract with Federal,
an organization which sponsored, manntamed,,^ assisted, and sup-
ported by the respondent's unfair labor practices and which did not
represent an uncoeiced maloiit^ of the employees in the bargaining
writ coveted by said contract when made, and (4) by the aforesaid acts
interfered with, restrained, and coerced its employees in the exercrie
of the rights guaranteed in Section 7 of the Act.
The respondent and Federal filed answers during the heating, deny-
ing, in effect, all allegations of unfair labor practices
Pursuant to notice duly served upon all the, parties, a hearing -*a"
held in New York City from March 2 to 6, 1942, before R N Denham,
the Trial Examiner duly designated by the Chief Taal Examiner
The Board, the respondent, and Feder al were represented by counsel,
and Locate 65 by a duly designated representative; all participated in
the hearing Full opportunity to be heard, to examine and cross-
examine witnesses, and to introduce evidence bearing upon the issues
-vi as afforded all parties At the close of the hearing, counsel for the
Board moved to amend the complaint to conform to the proof The
motion was granted without objection Motions by the respondent
and Federal to dismiss the complaint for lack of proof were taken
under advisement by the Trial Examiner and were denied in his Inter-
mediate Report During the hearing, the Trial Examiner made rul-
ings on other motions and on objections to the admission of evidence
The Board has reviewed the rulings of the Trial Examiner and finds
that no prejudicial error was committed The rulings are hereby
affirmed
On April 2, 1942, the Trial Examiner issued his Intermediate Re
port, copies of which were duly served upon all the patties He found
1088 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
that the respondent had engaged In and was engaging in unfair labor
practices affecting commerce , within the meaning of Section 8 (1) and
(3) and Section 2 (6) and ( 7) of the Act, and recommended that the
iespondent cease and desist from such unfair labor practices , includ-
ing the enforcement of its closed -shop contract with Federal, and
take certain affirmative action designed to effectuate the policies of the
Act On May 1, 1942, the respondent and Federal, respectively, filed
exceptions to the Intermediate Report
On June 4, 1942, pursuant to notice , a heaiiig was held before the
Board at Washington , D C, for the purpose of oral argument The
respondent and Federal were represented by counsel , and Local 65 by
a representative ; all participated in oral argument Thei. eafter,
pursuant to permission granted to all parties, the respondent and
Federal submitted memoranda in support of their exceptions The
Board has considered the exceptions and memoranda filed by the re-
spondent and Federal and, to the extent that the exceptions are in-
consistent with the findings of fact, conclusions of law, and order set
forth below , finds them to be without merit.
Upon the entire record in the case, the Board makes the following
FINDINGS OF FACT
I THE BUSINESS OF THE RESPONDENT
Premo Phaimaceutical Laboratories , Inc , is a New Yoik coi pot a-
tion having its office and principal place of business in New York City
The respondent is engaged in the processing and distribution of
pharmaceutical preparations which it sells under several trade marks
registered by it in the United States Patent Office At the present
time the respondent sells a small amount of its products to the United
States Navy -
In 1941 , the respondent pui chased aspirin, plienacitin , sulfinalimid,
sulfathiazol , ephedrine , quinine, pheno -barbital , and other drugs for
use in its business , of the value of about $550,000 Approximately 50
percent of these drugs were shipped to the respondent from points
outside the State of New York During the same period, the respond-
ent's sales of processed drugs amounted to about $850 ,000, and ap-
proximately, 45 percent of such drugs were shipped to points outside
the State of New York As of September , 12, 1941 , the respondent
employed approximately 120 persons at its plant in New York City.
II. THE ORGANIZATIONS INVOLVED
Wholesale and Warehouse Workers Union, Local 65 , C I. 0, and
Federal Labor Union, Local 20734, A F of L , are labor organizations
admitting to membership employees of the respondent.
PREMO PHARMACEUTICAL LABORATORIES, INC 1089
III THE UNFAIR LABOR PRACTICES
A Interference, restraint, and coercion
1 Sequence of events
In October 1937, Benjamin F Pross, business agent for Federal,
sent to Theodore A Blackman, the respondent's president, a copy of
a proposed closed-shop contract covering the respondent's employees.
Shortly thereafter, William Roth, a representative of Federal, called
at the plant and conferred nti ith Blackman During the conference,
Blackman questioned Roth's claun that Federal represented a major-
ity of the employees and demanded proof of the fact, whereupon Roth
exhibited a number of sheets of paper on which some names appeared,
but refused to permit Blackman to examine the sheets, stating that he
was not entitled to learn the names of Federal's members. Blackman
did not press his request for proof of majority. He refused, however,
to sign the proposed contract Roth thereupon threatened that the
respondent's plant would be picketed, and that delivery of materials
would be stopped Blackman replied, according to his own testimony,
that if and when Federal succeeded in organizing "the entire trade I
-would be glad to fall in line " .
Thereafter, negotiations with Federal were conducted by the
respondents attorney, Benjamin Levine, although Blackman fre-
quently conferred with Levine while the latter was meeting with
Federal's representatives On November 9, 1937, as a result of these
negotiations, the respondent wrote Federal a letter which embodied
a statement of the under standing which had been reached with respect
to Fedeial's demand for a closed-shop contract. Since this under-
standing between the parties is relied upon as the basis for subsequent
actions, discussed, an fra, it is quoted in its entirety:
NOVEMBER 9, 1937
FEDERAL LABOR UNION LOCAL #20734 OF
THE AMERICAN FEDERATION OF LABOR,
New York, N Y
GENTLEMEN You will please be advised that the undersigned
is sympathetic with and intends to recognize the above named
Union upon the following conditions '
It is understood that as soon as the following
Purity Drug Co
19 Greene St., New York City
American Pharmaceutical Co
525 W 34th St., New York City
Park Drug Co
460 W 34th St, New York City
47 2 814-4 2-vol 52-69
1090 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
have signed an Agreement with your Union, we agree to sign the
proposed copy heretofore left with our Attorney
Benjamin Levine, Esq
270 Broadway
New York City
However, should any other agreement be made with above parties
which is more favorable, it is understood and agreed that the
same clauses will be inserted in our agreement before the same is
signed by us
It is further understood that the Agreement submitted to us
is subject to minor changes and modifications which are to be
taken up with your representative before the signing of same
PREMO PHARMACEUTICAL LABS INO
By THEO. A BLACKMAN
Accepted-
FEDERAL LABOR UNION, 20734,
BENJAMIN F. PROSS,
Business Agent.
In the fall of 1938, the respondent and Fedeial executed a memo-
randum continuing in effect the terms of the "agreement" of November
9, 1937, above set out Similar memoiada of renewal were signed in
1939 and 1940. The 1940 "agreement" was not to expire until De-
cember 1941. During the period from 1937 to the hearing, pursuant to
a general understanding with Fedeial, the respondent maintained a
wage scale comparable to that paid in the industry According to,
the undenied testimony of Blackman, Fedeial did not attempt, how-
ever, to represent the employees with respect to grievances, nor did it
engage in any organizational activity at the plant so far as the re-
spondent was aware `
In July 1941 Business Agent Pioss sent the respondent a letter
demanding that a contract be entered into, and enclosing a form of
closed-shop contract Pross did not assert in this letter that the
conditions of the "agreement" had been met, and in fact not more than
two of the three plants mentioned in the 1937 "agreement" had been
organized Blackman was then preparing for an extended business
trip and referred Pross' demand to Levine, after discussing with the
latter the terms of the proposed contract Levine iri turn continued
negotiations with representatives of Federal and, on August 11, 1941,
Federal submitted a revised contract to the respondent. Blackman
and Levine considered this proposal and found it generally acceptable,
although requiring some minor changes which Levine discussed with
PREMO PHARMACEUTICAL LABORATORIES, INC. 1091
Federal1 In order to satisfy Pross' demand for immediate action,
Blackman, who was about to leave the city, initialled the proposed
eonti act submitted on August 11 as, substantially acceptable -This
contract contained the same closed-shop provision that is contained in
the contract that was signed later
On one occasion between July and September 11, 1941, Levine in-
quired, as Blackman had done in 1937, whether Federal represented a
majoiity of the respondent's employees Pross replied that it was
not Federal's policy to make public the names of its members At
the same time, however, Press took from a file cabinet a large number
of applications printed on letter-size sheets, but refused to allow
Levine to look at them, and Levine made no attempt to press the
matter. The question of majority was not thereafter discussed by any
representative of the iespondent with Federal Levine testified that
after this interview with Pross, and because he was anxious to pro-
tect his client from "labor uniest," he told Blackman in July 1941
that lie was "mote of less convinced" that Federal repiesented a major-
ity of the employees, and advised Blackman that it would be advisable
for the iespondent to sign a conti act with Federal Both Levine and
Blackman admitted at the heaiing that at all times prior to September
12, 1941, they were totally without knowledge concerning the number
of employees who had authorized Federal to repiesent them
By September 11, 1941, while Blackman Was stilt absent from the
city, Levine and representatives of Federal had reached an agreement
upon all the terms of the - pi oposed contract. On that day, George
Oneto, an organizer for Fedeial, appeared at the respondent's office
with some 75 or 100 membership application blanks Oneto told
Nathan Scharff, the respondent's office manager, according to the
undenied testimony of the latter, that "in-view of the fact that the
contiact was going to be signed and that they represented a majority
of our employees and 'that Mr Blackman would positively sign the
contract of take the consequences, he (Oneto) was going to distribute
the application forms, to the iemaining employees who had not signed
up " Scharff stated that he could not allow Oneto to distribute
applications in the plant but that he, Scharff, would "see that who-
ever wanted them got them " Oneto objected that the employees
"might be afraid to ask for them " Scharff thereupon volunteered
to have peisons in the plant distiibute the forms Oneto agieed to
this and left the plant Immediately thereafter, Scharff communi-
'Each contract Submitted by Federal contained closed-shop and check-off provisions
At no time were these objected to by the respondent They appeal to have been accepted
as provisions that were fundamentally inherent in any contract that might be made with
Federal
1092 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
cated with Levine, who promptly went to the respondent's office and
advised Scharff to have the applications distiibuted According to
the uncontroverted evidence in the iecoid which we accept, as did the
Trial Examiner, Scharff then called into the office several of the
foremen and leading woikinen, handed each of them it number of
application forms, and instructed hun to distribute the forms among
the employees and solicit their signatures. Irving Spinner, an em-
ployee, testified without contradiction, and we find, that Levine and
Superintendent Giinble AN eLe present when Scharff directed Spinner to
distribute the applications, and that Scharff opened the conversation
by stating, "We of Premo are forming an organization of the A F L "
Spinner further testified that either Levine or Scharff handed him the
applications to distribute, saying that he should give them to the
employees in his department, and tell them to "read it, sign it and
return it." Although Scharff testified that he told all those to whom
he gave applications to give them to the employees and "If they want
to sign them and return them it is perfectly all right; if they want
to return them unsigned, it is all iight, and if they don't return them
at all it is all right " Levine did, not, deny that he had so instructed
Spinner We find that Levine directed Spinnei on September 11 to
instruct the employees to sign and ietuin the applications for
membership in Federal'
Pursuant to the instructions of Schaiff and Levine, the foremen
proceeded immediately to distribute the application forms among the
employees, stating that a union was being foamed in the plant and
inviting employees to loin Neithel the supeivisois noi the employees
were informed at the time of the distribution that the respondent was
about to sign a closed-shop contract with Federal Befoie the close
of work that day, the applications were collected by the foremen
and placed in the drawer of Blackman's desk Only a few applica-'
tions were signed on September 11 Of the 102 applications exhibited
by Federal at the hearing, 2'bore the date of September 11, 1941, and
1 was undated. Of those Ieinainung, 8 were dated September 12, 1941.
and the other. 91 bore subsequent dates
Late in the afternoon of September 11, while Morris Rose was dis-
tributing applications among the employees in the finishing depart-
ment, of which he is foreman, Morton Olshansky, an employee in the
tablet, department and an active member 'of Local 65, observed Rose
making the distribution and stepped out into the hall toward Rose's
department, protesting' loudly that Rose had no right to distribute
Federal applications and that in doing so he was violating the law
Olshansky's protests attracted the attention of many of the employees
Rose retorted by telling Olshansky to go back to his work, at the
PREMO PHARMACEUTICAL LABORATORIES , INC. 1093
same time shoving him in the diiection of the tablet depaitment.2
Immediately thereafter , Olshansky telephoned Leo Bernstein, a rep-
resentative of Local 65 , and informed him of developments at the,
plant Bernstein testified that immediately after speaking to Olshan-
sky, he called the respondent 's plant and asked for Blackman, and
that when the girl at the switchboard told him that Blackman was
not in and he insisted on speaking to Blackman , she left the telephone
and, upon retuining , told Bernstein that Blackman might be reached
at Levine 's office, that he [Bernstein ] then called Levine's office and
was told that neither Blackman nor Levine was there , and that lie
left a message with Levine 's secretary to the effect that Local 65 rep-
resented the respondent's employees and desired the respondent to
cease its interference and intimidation of the employees Bernstein
further testified - that he left his name and telephone number with
Levine's secretary requesting that she ask either Levine or Blackman'
to call him back ; that he called the plant again and was told by the
switchboard operator , after a pause , that there was no one in charge
at the plant to whom he could speak , whereupon Bernstein left with
the plant operator 'the same message he had left with Levine's secre-
tary; and that later on the same day he called Levine's office and was
again informed that Levine was not available
After he had failed to reach Blackman and Levine on September
11, Bernstein wrote a letter to the respondent , protesting the activities
of the supervisory employees , advising the respondent that Local 65
represented a majority of the employees , and requesting a conference.
This letter was sent on September 11, by registered mail, in an en-
velope prominently displaying the name and address of Local 65, and
properly addressed to the respondent ; on the following day , Septem-
ber 12, it was returned to Local 65 with a notation on the envelope
to the effect that it had been refused by the addressee On the morn-
ing of September 12, Local 65 distributed circulars in front of'the
plant to employees going to work The circulars set forth a copy
of the letter above described , and invited the employees to join
Local 65 ,
Both Levine and Blackman denied that prior to the signing of the
contract on September 12, as discussed hereinafter , they knew that
Local 65 was active in the plant or that they had received any com-
munication from that organization We do not credit these denials
There was undenied testimony that some of the respondent's em-
ployees had become members of Local - 65; that Olshansky , who had
joined that organization early in August 1941 had generally solicited
' Our findings as to this incident are based upon the mutually corroborative and
uncontiadicted testimony of several witnesses for the Board
1094 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the employees for membership, and had peisistently urged his super-
visor, Jack Waltman, to join and that Waltman had based his re-
fusal to join Local 65 on the grounds that as a foieman he did not
need a union and because he held stock in the company and "had to
do anything the firm wanted him to do and he [Waltman] was pretty
sure that Mr. Blackman would not want a C. I O. organization in the
place . " Moreover, Olshansky testified without contradiction, and
we find as did the Trial Examiner, that several 'clays prior to Septem-
ber 11, Seymour Blackman, the son of Piesident Blackman, asked
Olshansky why he had joined Local 65, and stated that his father did
not want the C. I. O. in the plant These facts, together with Levine's
presence at the plant and his participation in the distribution of Fed-
eral application cards during the time Bernstein was attempting un-
successfully to reach him or the respondent, the failuie of the re-
spondent to call either the plant telephone operator or Levine's seci e-
tary to deny that they had delivered Bernstein's message, and the
unexplained refusal of the respondent to accept the registered letter
from Local 65 on September 12 ,3 convinces us, and we find, that both
Levine and Blackman had knowledge prior to the signing of the con-
tract on September 12, that Local 65 claimed to represent a majority
of the employees and was protesting the respondent's assistance to
Federal; and that Blackman had clearly indicated his reluctance to
deal with Local 65
Blackman returned to New York on the morning of September
12 Levine called upon him at the respondent's office at about 11
o'clock that morning, and submitted the contract which had been
agreed upon between Levine and Federal. Blackman immediately
signed the contract, which contained typical provisions relating to
wages, hours, vacations , and a grievance proceduie, and provided
for a closed-shop and check-off
On September 12, following the execution of the conti act, Federal
wrote to the respondent as follows :
SEPTEMBER 12th, 1941.
PREMO PHARMACEUTICAL LABORATORIES INC.
443 Broadway, New York City
GENTLEMEN Please advise all your employees who properly
come under the jurisdiction of the Union , who have not as yet
made application to report to the Union office, Monday, Septem-
ber 15th, 1941, immediately after work , so that we may accept
their application for membership , and issue proper Umon dues
books to them.
8 Counsel for the respondent sought unsuccessfully to elicit testimony that the letter
had been refused because Blackman thought that it might be a communication soliciting
advertising Assuming this to be the respondent's explanation for refusing to accept
the letter , we cannot belie%e that the explanation is advanced in good 'faith
PREMO PHARMACEUTICAL LABORATORIES , INC. 1095
Please advise all your employees that the contract signed be-
tween your Company and the Union is a closed shop contract,
and unless they have proper Union books by September 19th,
their application for member ship will not be accepted , and con-
sequently , they will have to be replaced with members of the
Union in good standing
Very truly yours,
FEDERAL LABOR UNION LOCAL 20734,
/s/ _
GEORGE J. ONETO,
President.
P S -PLEASE POST TIIIs ON BULLETIN BOARD.
On September 15, this letter was posted at various points through-
out the plant . Blackman then assembled the employees , called their
attention to the posted letter, and told them that if they all followed
the instructions contained in it, there would "be no trouble."
On the morning of September 16, 1941 , Olshansky , with seven other
employees all of whom were members of Local 65, called on Black-
man' to protest against- the closed-shop provisions of the contract,
and to request permission to post a C . I. O. notice in the plant.
Although granting the request to post the notice initially , before it
was posted Blackman summoned Olshansky and two of the com-
mittee members to the office, and explained that under the provisions
of the closed -shop contract , he could not permit the notice to be
posted and that he would , therefore , have to withdraw the permission
he had given them During this conference , Blackman related the
history of the respondent 's connection with Federal , including the
letter 'of November 9, 1937 , and the various renewal memoranda, all
of which he showed to Olshansky and the others , as justification for
his action in entering into the closed -shop contract.
On September 17, Oneto called at the plant and during working
hours addressed the employees on each floor explaining that Federal
had entered into a closed -shop contract with the respondent and that
if the employees desired to retain their positions , they would be
required to sign applications for membership in Federal on or before
September 19 By September 19 all the employees , including those
who were members of Local 65, had signed such applications.
2.. Concluding findings with respect to the September 12, 1941 contract
The closed -shop contract signed on September 12 must be evalu-
ated in the light of the proviso to Section 8 (3) of the Act. That
proviso reads.
Provided that nothing in this Act ... shall preclude an employer
from making an agreement with a labor organization (not
1096 DECISIONS OF, NATIONAL LABOR RELATIONS BOARD
I
established, maintained, or assisted by any action defined in this
Act as an unfair labor practice) to require as a condition of
employment membeiship therein, if such labor organization is
the representative of the employees as provided in Section 9 (a),
in the appropriate collective bargaining unit covered by such
agreement when made '
As indicated supra, prior to the signing of the contract, supervisory
employees distributed Federal's membership application cards among
the employees and solicited them to loin; and Waltman, a super-
visory employee and Seymour Blackman, son of President Blackman,
expressed the opinion that the respondent did not "want the C I 0
in the plant " It is clear that by virtue of these activities, Federal
was "assisted" by the respondent within the meaning of the express
'terms of the proviso, and that because of such assistance the contract
is inherently illegal and must be set aside 4
The contract is also illegal for the reason that at the time it was
entered into Federal was not the "representative of the employees
as provided in Section 9 (a) " of the Act As stated above, of
102 signed application cards exhibited by Federal at the hearing,
1 was undated, 2 were dated September 11, 1941, 8 weie dated Sep-
tember 12, and the remaining 91 bore subsequent dates Organizer
Oneto admitted that Federal had secured no more than 12 written
applications prior to September 12 At the hearing, Federal took
the position that it had secured oral authorizations from a majority,
of the respondent's employees prior to September 11 Oneto as-
serted that Federal had not secured written authorizations because
the employees, fearful of retaliation by their employer, had refused
to sign them. However, he cited no instance of intimidation by the
respondent. Moreover, although Oneto had had in his possession
since 1937 an,"agreement" by the respondent to sign a contract with
Federal as soon as pits competitors did so, he apparently did not use
this document to quiet the fears of those who allegedly feared to
make written application In addition, Oneto admitted that it was
"impossible" for him to mention the name of a single person who
had orally authoi ized Federal to represent him in 1941, although,
according to his testimony, be and other organizers for Federal had
been holding meetings with small groups of the employees since
1937. Nor did counsel for Federal call a single employee to testify
that 'he had orally authorized Federal to represent him prior to
September 116
4National Labor Relations Boaid v Electric Vacuum Cleaner Company, Inc and
International Molders' Union of North America , Local 4 30, et al, 62 S Ct 846
6 During the hearing counsel foi Federal offered "to prove through testimony by word
of mouth of each of the employees that they wanted the A F L prior to September 11 "
[Emphasis supplied ] The Trial Examiner first rejected such evidence , but later stated
PREMO PHARIIACEUTICAL LABORATORIES, INC 1097
If Federal actually had been orally designated by a majority , of
the employees prior to Septembe>_ 11-a majority which hesitated
to put evidence of membership into wilting because of fear of the
respondent-it is reasonable to suppose that on the 11th, when
foremen passed out Federal application cards with the open approval"
of the respondent's officials, this obscure and silent majority would
have quickly cast aside its cloak of anonymity and proclaimed the
allegiance it had already secretly avowed As the record indicates,
this did not occur. Of mole than 90 applications disti ibuted by
supervisory employees, only 2 or 3 were returned signed on Septem-
ber 11, 8 were dated September 12 and the remaining cards bore dates
subsequent to the signing of the closed-shop contract, when the em-
ployees fully understood that they must sign or they would be
discharged.
In October 1937 the respondent refused, in the face of threats of
economic reprisals by Federal, to sign a closed-shop contract with
that organization. Instead, the parties came to a written "under-
standing" which provided that when three named competitors of
the respondent signed a closed-shop contract with Federal, the re-
spondent would do likewise. In 1938, 1939, and 1940, despite similar
threats of economic reprisals the respondent continued to refuse to
enter into a closed-shop contract, but renewed the 1937 "understand-
ing" for the,following year. In September 1941, however, while the
"understanding" signed in 1940 still had 3 months,to run, Blackman
suddenly decided that it would be advisable to sign a closed-shop con-
tract with Federal, although the conditions of the "understanding" had
admittedly not been met. We are of the opinion that the only reason-
able explanation for this sudden change of position lies in the fact that
in 1941 the respondent knew that Local 65 had started to organize its
employees; we are further of the opinion that the' 1941 contract was
signed to foreclose such organization. The fundamental inconsisten-
cies in the evidence relied upon by the respondent and Federal clearly
demonstrate that the respondent was accepting what it regarded as the
lesser of two evils when it signed the agreement with the Federal;
and that that organization did not possess, nor did the respondent
reasonably believe that it possessed, authorizations from a majority
of the employees to act as their representative for'the purposes of
collective bargaining
We find that by entering into a closed-shop contract with Federal
at a time when it represented less than a majority of the employees,
that he would entertain a definite and specific offer of proof in this regard Counsel for
Federal did not thereafter make any offer of proof on the point We agree with the
Trial Examinei , that evidence introduced pursuant to the offer as first made, would
have had no probative value At most, it would have been only a showing of the -
subjective desires of the employees as of September 11, and not proof of designation such
as is required by Section 9 (a) of the Act
1098 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
by directing the distribution of applications for membership in that
organization among the employees, by the statements referred to
above, made by supervisory employees and persons closely related
to the management, and by the other acts set forth above, the respond-
ent has interfered with, restrained, and coerced its employees in the
exercise of the rights guaranteed in Section 7 of the Act. We fur-
ther find that the aforesaid closed-shop contract is illegal and of no,
effect
B The discharge of Horton Olshansky
At the time of his discharge, Olshansky worked in the tablet de-
partment under the supeivision of Jack Waltman. As heretofore
stated, Olshansky became a member of Local 65 in the early part
of August 1941, and had vigoiously, protested the illegal actions
of the supervisory employees when they distributed application
blanks for Federal on September 11, 1941 Thereafter, in order to
retain his position in the plant, Olshansky had applied for mem-
bership in Federal
On or about October 27, 1941, Levine, at Blackman's request, wrote
to Federal officials stating that Olshansky had been guilty of certain
misconduct in connection with his work, and suggesting that Olshan-
sky be called to Federal headquarters where he might be persuaded
to .mend his ways. 6 On October 29 Business Agent Pross wrote to
Olshansky_stating that a complaint had been made against him by
the respondent, and suggesting that he report to Federal's office
on the following Friday, October 31, so that the complaint could be
adjusted. Olshansky received the letter on October 30 and on the
following morning went to the plant where he tried, unsuccessfully,
to learn the substance of the complaint made against him When this
attempt failed, Olshansky, in some agitation, left the plant and went
to Federal's office-disregarding a suggestion by Blackman that he
return to his place in the tablet department and go to work.
Olshansky met Business Agent Pross at Federal's office, and Pross
showed Olshansky the letter from Levine During the conversation
which followed, Olshansky told Pross that not only had he formerly
belonged to Local 65 but that he was still a member of that organiza-
tion. Upon hearing Olshansky state that he was still an active mem-
ber of Local 65, Pross turned to his secretary, called -her attention to
what Olshansky had just said, and directed her to suspend him from
e The alleged misconduct attributed to Olshansky by witnesses for the respondent,
relating to alleged "loafing on the job," and the copying of secret formulae , was denied
by the formes Since this "misconduct" admittedly did not provide the motive for
Olshansky 's discharge, we find it unnecessary to resols a the conflicting testimony con-
cerning it
PREMO PHARMACEUTICAL LABORATORIES, INC 1099
good standing on the rolls of Federal 7 When he learned that he
had been suspended, Olshansky returned to the plant, where he was
advised by Gimbel, superintendent of the plant, that he (Gimbel)
had just been informed of Olshansky's suspension from Federal.
Gimbel then stated that under these circumstances, it would be im-
possible for Olshansky to continue to work at the plant Gimbel
personally paid Olshansky the money due him, and Olshansky col-
lected his working clothes and left the plant, after speaking to his
cousin, Theodore Paul, and telling the latter that he had been sus-
pended from Federal. 8
The respondent contended at the hearing that Olshansky had
voluntarily quit his job when he left work on the morning of October
31, to go to Federal's offices Upon the entiie record, however, it is
evident that Olshansky neither quit his job nor did the respondent
believe that he had done- so. According to the uncontroverted
evidence, Olshansky, after his visit to Federal's headquarters,
returned to the plant and was informed that because he was no longer
a member of Federal in good standing, he could not continue to work
for the respondent.
Subsequent to October 31, Olshansky visited the offices of Federal
several times in an' effort to obtain reinstatement at the plant, but
his efforts were fruitless
Upon the entire record, we find that the respondent discharged
Morton Olshansky on October 31, 1941, pursuant to the terms of the
closed-shop contract which we have held invalid, and has since failed
and refused to reinstate him because of his membership in and as-
sistance to Local 65, and because he failed to remain a member of
Federal, thereby discriminating in regard to his hire and tenure of
employment, discouraging membership in Local 65, encouraging mem-
bership in Federal, and interfering with, restraining, and coercing
its employees in the exercise of the rights guaranteed in Section 7
of the Act
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the respondent set forth in, Section III above,
occurring in connection with the operations of the respondent de-
scribed in Section I above, have a_close, intimate, and substantial
relation to trade, traffic, and commerce among the several States, and
tend to lead to labor disputes burdening and obstructing commerce
and the free flow of commerce
1 Fedei al has a rule which prohibits dual union membership
8 Our findings above , are based upon the uncontroverted testimony of Olshansky which
NNe credit , as did the Trial Examinee Gimbel and Pross were not called to testify
1100 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
V. THE REMEDY
1
Having found that the respondent has engaged in certain unfair
labor' practices within the meaning of the Act, we shall order the
respondent to cease and desist therefrom and, in order to effectuate
,the purposes of the Act,-to take certain affirmative action hereinafter
discussed
We have found that the respondent sponsored, maintained, assisted,
and supported Federal by obtaining from its employees applications
for membership in and authorizations for representation by Federal
as their representative for the purposes of collective bargaining. We
have further found that as a part of such conduct, the respondent,
on September 12, 1941, without regard to the fact that Federal did
not,repiesent a majority of its employees, entered into a closed-shop
contract with that organization In order to restore the status quo
and to permit employees of the respondent full freedom of self-
organization, without hindrance by reason of the respondent's unfair
labor practices, we shall order the respondent to withdraw all recog-
nition from Federal as the exclusive representative of its employees
for the purposes of collective bargaining, and to withhold such recog-
nition unless and until Federal shall have been certified by the Board
as the duly chosen representative of the employees of the respondent
for the purposes of collective bargaining.
Since the contract between the respondent and Federal embodies
recognition of Federal as the exclusive representative of respondent's
employees, and makes membership in Federal a condition of employ-
ment and represents the fruits of the respondent's unfair labor prac-
tices and a device to perpetuate their effects, we shall order the re-
spondent to cease and desist from giving effect to this or any other
agreement which it may, have entered into with Federal with respect
to rates of"pay, wages, hours of employment, or other conditions of
employment, provided, however, that nothing in our order shall re-
quire, authorize, or permit the respondent to reduce or minimize those
wage, hour, or other substantive features of its relations with the
employees themselves, which the iespondent may have established in
'performance of the invalid contiact, as extended, renewed, modified,
supplemented, or superseded.
We have further found that the respondent discriminated in re-
gard to the hire and tenure of employment of Morton Olshansky,
through the invocation of the closed-shop provisions of the invalid
contract In order to effectuate the policies of the Act we shall order
the respondent to offer Morton Olshansky immediate and full re-
instatement to his former or a substantially equivalent position with-
out prejudice to his former rights and privileges, and to make
Morton Olshansky whole for any loss of pay he may have suffered
PREMO PHARMACEUTICAL LABORATORIES, INC ' 1101
by reason of the aforesaid discrimination, by paying him a sum of
money equal to that which he normally would have earned as, wages
from the date of the discrimination to the date of the respondent's
offer of reinstatement, less his net earnings during such period 9
Upon the basis of the foregoing findings of fact and upon the
entii e record in the case, the Board makes the following
CONCLUSIONS OF LAW
1 Wholesale and Warehouse Workers Union, Local 65, C. I. 0,
and Federal Labor Union, Local 20734, A. F. of L, are labor organ-
izations within the meaning of Section 2 (5) of the Act.
2 By discriminating in regard to the hire and tenure of employ-
ment of Morton Olshansky, thereby encouraging membership in
Federal Labor Union, Local 20734, A F. of L, and discouraging
membership in Wholesale and Warehouse Workers Union, Local 65,
C I 0, the respondent has engaged in and is engaging in unfair
labor piactices, within the meaning of Section 8 (3) of the Act
3 By assisting Federal Labor Union, Local 20734, A. F of L., and
in other ways interfering with, restraining, and coercing its em-
ployees in the exeicise of the rights guaranteed by Section 7 of the
Act, the respondent has engaged in and is engaging in unfair prac
tices, within the meaning of Section 8 (1) of the Act
4 The afoiesaid unfair labor practices are unfair labor practices
affecting commerce, within the meaning of Section 2 (6) and (7) of
the Act
ORDER
Upon the basis of the above findings of fact and conclusions of
law, and pursuant to Section 10 (c) of the National Labor Relations
Act, the National Labor Relations Board hereby orders that Premo
Pharmaceutical Laboratories, Inc', New York City, and its officers,
agents, successors, and assigns, shall
1 Cease and desist from
(a) Discouraging membership in Wholesale and Retail Workers
Union, Local 65, C I 0, encouraging membership in Federal Labor
Union, Local 20734, A F of L, or discouraging or encouraging
membership in any other labor organization of its employees, by
discriminating in regard to hire or tenure of employment or any
term or condition of employment of its employees;
D By "net earnings" is meant eainmgs less expenses , such as for transportation, room,
and board , incurred by an employee in connection with obtaining cork and working else-
wheie than for the respondent , which would not have been incurred but for his unlawful
dischaigo and the consequent necessity of his seeking employment elsewhere See Hatter
of Crossett Lumber Company and United Brotherhood of Carpenters and Joiners of
America, Lumber and Sawmill Workers Union , Local 2590 , 8 N L R B 440 Monies
received for work performed upon Federal , State , county, municipal , or other work-relief
projects shall be considered as earnings See Republic Steel Corporation v N L R B,
311 U S 7
1102 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
i
(b) Recognizing Federal Labor Union, Local 20734, A F of L,
as the exclusive representative of its employees for the purposes of
collective bargaining, unless and until that organization shall have
been ceitified as such by the National Labor Relations Boaid,
(c) Giving effect to the contract of September 12, 1941, between the
respondent and Federal Labor Union, Local 20734, A F of L, or
any extension, renewal,, modification, or supplement thereof or to any
supei seding agreement or conti act ;
(d) Urging, peisuaduig, intunidating, or coercing its employees
to join Federal Labor Union, Local 20734. A F of L, or not to loin
Wholesale and Warehouse Workers Union, Local 65, C. I. 0., or to
join or not to join any other labor organization;
(e) In any other manner interfering with, restraining, or coercing
its employees in the exercise of the right to self-organization, to form,
loin, or assist labor organizations, to bargain collectively through
i epresentatives of their own choosing, or to engage in concerted
activities for the purposes of collective bargaining or other mutual
aid or protection, as'guaranteed by.Section 7 of the Act
2 Take the,followiizg affrrmativeraction which the Board finds will
effectuate the policies of the Act:
t, (a) Withdraw and withhold all iecogmtion from Federal Labor
Union, Local 20734, A. F. of L., as the exclusive representative of
its employees for the purpose of dealing with the respondent con-
cerning grievances, labor disputes, wages, rates of pay, hours of em-
ployment, or other conditions of employment, unless and until that
organization shall have been certified as such by the National Labor
Relations Board;
(b) Offer to Morton Olshansky immediate and full reinstatement
to his former or a substantially equivalent position without pi ejudice
to his seniority or other rights and privileges,
(c) Make whole Morton Olshans1 y for any loss of wages he may,
have suffered by reason of the respondent's discrimination against
111m, by payment to him of a sum of money equal to the amount which
he normally would have earned as wages from the date of the dis-
ci imination to the date of the respondent's ofter of reinstatement,
Jess his net earnings during said period,
(d) Post immediately in conspicuous places throughout its plant in
New York City, and maintain for a period of at least sixty (60)
consecutive days, a notice to its employees stating (1) that the re-
spondent will not engage{,in the conduct from which it is ordered to
cease and desist in paragraphs 1 (a), (b), (c), (d), and (e) hereof;
(2) that the respondent will take the affirmative action set forth in
paragraphs 2 (a), (b), and (c) hereof; and (3) that the respondent's
PREMO PHARMACEUTICAL LABORATORIES, INC. 1103
employees are free to become or remain members of Wholesale and
Waiehouse Woikers Union, Local 65, C T 0, and that the respondent
will not discriminate against any employee because of membership in
or activity on behalf of that organization,
(e) Notify the Regional Director for the Second Region in writing
within ten (10) days from the date of this Order, what steps the
respondent has taken to comply herewith
A1v GERARD D REILLY took no part in the consideration of the
above Decision and Order