Rutland Court Owners, Inc.

National Labor Relations Board - Board Decisions

Sep 29, 1942

44 N.L.R.B. 587 (N.L.R.B. 1942)

In the Matter Of RUTLAND COURT OWNERS, INC. aired UNITED CONSTRUC-
TION WORKERS ORGANIZING COMMITTEE, LOCAL 120, BUILDING SERVICE
AND MAINTENANCE EMPLOYEES, AND BUILDING SERVICE EMPLOYEES
INTERNATIONAL UNION, LOCAL 82
Case No. C-1639.-Decided, September 29, 194
Jurisdiction : operation of cooperative apartment building in District of Co-
lumbia.
Unfair Labor Practices
lnterfetence, Restraint, and Coercion: closed-shop contract with assisted union.
Discrimination: discharge of employees because of union membership and ac-
tivity, not within proviso to Section 8 (3) where effected to resolve a question
concerning representation which had arisen, near the expiration of a validly-
made 1-year closed-shop contract.
Collective Bargaining: charges dismissed ; respondent had genuine doubt of
union's majority status under the circumstances, although the discharge of a
majority of the employees for having designated that union and the execution
of a closed-shop contract with assisted rival union were found illegal.
Remedial Orders : contract made after illegal assistance by discriminatory dis-
charges, abrogated ; reinstatement and back pay awarded, excluding period
between Proposed Findings and Order, in view of proposed dismissal of com-
plaint without prejudice; recognition of assisted union as representative of any
employees ordered withheld until certification.
Mr. Samuel M. Spencer, for the Board. -
Mr. J. Barrett Carter and Mr. Lyle F. O'Rourke, of Washington,
D. C., for the respondent.
Mr. Joseph Kovner and Mr. Eugene Davidson, of Washington, D. C.,
for the, C. I. O. Local.
Mr. Joseph A. Pad-way, by Mr. Robert A. Wilson, of Washington,
D. C., for the A. F. of L. Local.
Mr. Milton E. Harris, of counsel to the Board.
DECISION-
AND
ORDER
STATEMENT OF THE CASE'
Upon charges duly filed by United Construction Workers Organize
ing Committee; Local 120, Building Service and Maintenance Em-
ployees, affiliated with the Congress of Industrial Organizations, herein
44 N. L. R B, No. 112.
587
588' D'EiCISIOVS OF NATIONAL LABOR' RELATIONS BOARD '
called the C. I. O. Local,' the National Labor Relations Board, herein
called the Board, by the Regional Director for the Fifth Region (Bal-
timore, Maryland), issued its complaint dated May 22, 1940, against
Rutland Court Owners, Inc.,2 Washington, D. C., herein called the
respondent, alleging that the respondent had engaged in and was
engaging in unfair labor practices affecting commerce, within the
meaning of Section 8 (1), (3), and (5) and Section 2 (6) and (7) of
the National Labor Relations Act, 49 Stat. 449, herein called the Act.
Copies of the complaint, containing a notice of hearing thereon, were
duly served upon the respondent, the C. I. O. Local, and Building
Service Employees International Union, Local 82, affiliated with the
American Federation of Labor, herein called the A. F. of L. Local.
With respect to the unfair labor practices, the complaint alleged
in substance (1) that the respondent on or about December 15, 1939,
discriminatorily discharged and thereafter refused to reinstate Na-
thaniel Blackmone; on or about December 18, 1939, discriminatorily
discharged and thereafter refused to reinstate Walter S. James, Jr.;
.and,-on or about, December i9, 1939, discriminatorily discharged and
thereafter refused to reinstate Eleanor J. Banks, Fredrycka P.
Weaver, and Spurgeon H. Weaver; (2) that the respondent on or
about December 15, 1939, and on May 22, 1940, refused to negotiate
or bargain with the C. I. O. Local, although the C. I. O. Local at
such times was, the exclusive representative of the respondent's em-
ployees in a unit appropriate for the purposes of collective bargaining;
(3) that the respondent since December 15, 1939, has otherwise en-
couraged.membership in the A. F. of L. Local, and on or about Decem-
ber 20, 1939, entered into a closed-shop contract with the A. F. of L.
Local, which was then assisted by the respondent and did not repre-
sent a majority of the respondent's employees; and (4) that the re-
spondent has otherwise discouraged membership in the C. I. O,. Local,
and has interfered with, restrained, and coerced its employees in the
exercise of the rights guaranteed in Section 7 of the Act. ,
On June 1, 1940, the respondent filed its answer, admitting the al-
legation of the complaint that it was engaged in the'business of operat-
ing and maintaining an apartment house in the District of Columbia,
but denying that it was engaged in "trade and traffic," within the
meaning of Section 2 (6) of the Act, or that it had engaged in any
of the alleged unfair labor practices.
Pursuant to notice, 'a hearing was held in, Washington, D. C., on
June 3 and 4, 1940, before George Bokat, the Trial Examiner duly
'The C . I 0 Local was originally designated as United Buildin g Service Employees Local
Industrial Union , Local No 675 On April 3 , 1942 , the parties stipulated that this desig-
nation should be changed as above ' set forth
2 This is the correct designation , as amended without objection during the hearing.
RUTLAND COURT OWNERS, INC. 589
designated.bythe Chief Trial Examiner. The Board, the respondent,
and the A. F. of L. Local were represented by counsel and the C. I. O.
Local by a representative. All parties participated in the hearing
and were afforded full opportunity to be heard, to examine and cross-
examine witnesses, and to introduce evidence bearing on the issues.
During the course of the hearing, the Trial Examiner made various,
rulings on motions and on objections to the admission of evidence.
The Board has reviewed the rulings of the Trial Examiner and finds
that no,prejudicial errors were committed. The rulings are hereby
affirmed. Pursuant to the Trial Examiner's' request, the respondent
and the A. F. of L. Local duly filed briefs.
On July 18, 1940, the Board issued and duly served on the parties
an order transferring the case to and continuing it before the Board,
in accordance with Article II, Section 36, of'National Labor Relations
Board Rules and Regulations-Series 2, as amended, for action pur-
suant to Article II, Section 37, of said Rules and Regulations. The
order further directed that no Intermediate Report be issued, that.
Proposed Findings of Fact, Proposed Conclusions of Law, and Pro-
posed Order be issued, pursuant to Article II, Section 37 (c), of said
Rules and Regulations, and that the parties be granted the right to file
exceptions and request oral argument within 20 days of the date of said
Proposed Findings of Fact, Proposed Conclusions of Law, and Pro-
posed Order; and to file a brief within 30 days of the date thereof,
pursuant to Article II, Section 37, of said Rules and Regulations.
On August 4,1941, Proposed Findings of Fact, Proposed Conclusions
of Law, and.Proposed Order were issued, and copies were duly served
on the respondent, the C. I. O. Local, and the A. F. of L. Local. In
the Proposed Findings of Fact, Proposed Conclusions of, Law, and
Proposed Order a majority of the Board tentatively found that, the
respondent was not engaged in commerce, within the meaning of Sec-
tion 2 (6) and (7) of the Act, and proposed to dismiss the.complaint
without prejudice. One member of the Board filed an opinion stating
that he would find that the respondent's activities affected commerce
and that the respondent had engaged in unfair labor practices, within
the meaning of Section 8 (1), (3), and (5) of the Act.
On August 23, 1941, the C. I. O. Local duly filed exceptions to the
Proposed Findings of Fact, Proposed Conclusions of Law, and Pro-
posed Order and to other parts of the record. On September 10, 1941,,
the C. I. O. Local duly filed a brief in support of its exceptions.
Pursuant to notice, a hearing for the purpose of oral argument was
held before the Board in Washington, D. C., on September 16, 1941_
The respondent, the C. I. O. Local, and the A. F. of L. Local were
represented by counsel and participated therein.
590 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Board . has considered the exceptions and briefs , and finds that
the exceptions , insofar as they are , inconsistent with the findings,
conclusions , and order hereinafter set forth , are without merit.
Upon the entire record in the case, the Board makes the following:
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
The respondent , a Delaware corporation , owns, operates , and main-
tains an apartment house building at 1725 Seventeenth Street, N. W.,
Washington , D. C. The apartment house building contains 90 indi-
vidual apartments , each of which, is represented by certain stock in
the respondent corporation . Ownership of such stock entitles a per-
son to the specific individual . apartment represented thereby. So far
as the respondent is concerned , the stockholders are the owners of the
individual apartments . Whatever articles °of equipment are in the
apartments , such as stoves or refrigerators , belong to the respective
stockholders , and whatever redecoration is done is ordered and paid
for by them . They may rent or sell their apartments ( by assigning
their stock ). Only about 10 or 20 of the 90 apartments are occupied
by their "owners ." The remaining 70 or 80 apartments are operated
for profit by their respective stockholder "owners ." The respondent
has no control over the sale , leasing, or other use of individual apart-
ments except that it has authority to prevent action inimical to the
other individual apartments and the common parts of the building.
The respondent employs a manager and seven non-supervisory em-
ployees for the purpose of operating the building ; it purchases coal,
water, and/ electricity for the same purpose; it pays the local real
estate and unemployment insurance taxes, and the national taxes under
the Social Security Act; and it abides by the minimum wage law of
the District of Columbia . To defray the costs, of operating the build-
ing, the stockholders are assessed a certain amount determined by the
respondent each month . On request , the respondent, as the agent of
-a stockholder , will show his individual apartment to a prospective
assignee or subtenant , and will collect the rent from a subtenant and
pay it over to the stockholder after deducting the monthly assessment.
The building is known as a cooperative apartment house because of
the method of its operation.
The respondent contends that it is not in business for its own profit,
but operates for the benefit of its members or stockholders, and that
-its activities therefore should be found not to affect commerce , within
the meaning of Section 2 (6) and (7) of the Act. In our proposed
Findings we proposed to dismiss this proceeding on the basis of a lack
RUTLAND COURT OWNERS, INC. - 591
of jurisdiction, as the respondent urges. We have reexamined the
record and considered the exceptions and the arguments of the parties,
in the, light of the legislative history and purposes of the statute and
controlling judicial precedents. Upon the basis of such consideration
we conclude and find that the respondent is engaged in trade within
the District of Columbia and that its activities constitute 'commerce,
within the meaning of Section 2 (6) of the Act.3
II. THE ORGANIZATIONS INVOLVED
United Construction Workers Organizing Committee, Local 120,
Building Service and Maintenance Employees, is a labor organization
affiliated with the Congress of Industrial Organizations.
Building Service Employees International Union, Local 82, is a
labor organization affiliated with the American Federation of Labor.
Botlh labor -organizations admit employees of the respondent to
membership.
III. THE UNFAIR LABOR PRACTICES
A. Chronology - ,
On October 26, 1938, the respondent's seven non-supervisory build-
ing service employees joined the A. F. of L. Local and designated
that organization as their collective bargaining representative.' On
December 14, 1938, the respondent entered into a closed-shop contract
with the A. F; of L. Local, providing in part that the building service
employees shound maintain membership in the A. F. of L. Local "as
per charter" during the calendar year 1939.
About a year later, in November 1939, Dr. John A. Nelson, a repre-,
sentative of the respondent, commenced negotiations with the A. F. of
L. Local's business representative, James Kimbro, concerning a new'
closed-shop contract to succeed the 1939 contract. The employees
were dissatisfied with the way in which the A. F. of L. Local had
represented their interests, however, and on December 6 one of them,
' See Associated Press Y. N L. R. B, 301 U S 103, 125, 182-9 (affirming 85 F. (2d)
56 (C C A. 2), which enforced Matter of The Associated Press and American Newspaper
Guild, 1 N L R. B. 788), where the Supreme Court of the United States held that the
employer involved, although "a membership cotpoiation . . which does not operate for
profit . . . [and] a cooperative organization . [whose] service is not sold but the
entire- cost is apportioned amongst the members by assessment," came within the terms
of Section 2 (6) of the Act. The Court added that its conclusion on the question of
jurisdiction was "unaffected by the fact that the petitioner [employer] . . . does not operate
for profit " See also Matter of North Whittier Heights Citrus Association and Citrus
Packing House Workers Union, Local No 21091, 10 N L R B 1269, enf'd 109 F (2d) 76
(C. C. A 9), cert. den. 310 U. S. 632, rehearing den. 311 U S 724; United States v
American Medical Association, et al, 110 F. (2d) 703 (C A, D C ), cert den 310 U S 644.
4 The designation signed by the employees stated that they "do hereby agree to remain
a member of the Union . . . for a period of one ( 1) year , after , the consummation [sic]
of a contract
592 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Walter S. James, Jr., went to the headquarters of the C. I. O. Local
to inquire about a transfer of affiliation. He spoke to a representative
of the C. I. O. Local, Jack Zucker, and was told that, in view of the
closed-shop provision, the employees must continue their membership
in the A. F. of L. Local until the end of the year, and that the C. I. O.
Local could accomplish nothing for them before that time. At a meet-
ing on December 14, when the closed-shop provision had only 27/2
more weeks to run, six of the seven employees signed cards designating
the C. I. O. Local to represent them for collective bargaining. On
December 15, 1939, Kimbro, having heard that one of these six erii-
ployees, Nathaniel Blackmone, was advocating a transfer of affiliation
to the C. I. O. Local, told the respondent's manager, Celia M. Evans,
that he (Blackmone) "had not paid his dues and was creating dissen-
sion among the people," and demanded his discharge. Evans dis-
charged Blackmone at once.
On December 16, 1939, the respondent received a letter from the
C. I. O. Local, advising the respondent that the C. I. O. Local
represented a majority of the employees and that a representative
would call shortly to arrange a collective bargaining meeting.
On December 18, 1939, Kimbro called on the respondent's attor-
neys, Carter and O'Rourke, to inquire whether the respondent would
sign the new closed-shop contract which he had previously submitted.
Lyle F. O'Rourke replied that further negotiations concerning the
contract would have to be discontinued because he '"was not' sure he
[Kimbro] represented a majority."- Kimbro threatened to call a
strike unless the contract were signed within the next few days.
O'Rourke then told Kimbro that if the A. F. of L. Local could prove
its majority, the respondent would sign the contract. Kimbro at
once went to the apartment-house building, and with O'Rourke's
approval induced Ellis M. Clement, the respondent's president, and
Manager Evans to call the employees into the office for questioning
as to their union membership. President Clement agreed to do so,
according to her own testimony, "to enable us to know what their
membership really was." The employees were then called in, warned
in Kimbro's presence that they would be discharged if they did not
reaffirm their allegiance to the A. F. of L. Local, and asked in sub-
stance whether they intended to be members of the A. F. of L. Local
or the C. I. O. Local for the corning year.,' Clement testified at the
hearing that the employees "were not being quite frank with us" in
their answers, but that she was of the opinion that "if anything they
Four of the employees were questioned at' this time : James, Spurgeon H Weaver,
Eleanor J Banks, and Mason Martin ' A fifth employee , Fredrycka 1. Weaver, who was
then off duty at her home, was questioned over the telephone by Clement immediately
afterward'
RUTLAND COURT OWNERS, INC. 593
were still members of the A. F. of L." She testified further that
even if a majority of the employees wanted representation by the
C. I. O. Local, she would not have bargained with that organization
prior to the expiration of the 1939 contract, on the ground that "up
to 1940, we were under contract" with the A. F. of L. Local. Despite
the warhings given to the employees, only Martin agreed to remain
a member of the A. F. of L. Local for the coining year. Kimbro then
told Clement and Evans that the four remaining employees (James,
'Banks, Spurgeon Weaver, and Fredrycka Weaver) had "doubled-'
crossed" him, and that he would have to "clean out the job" and
replace them.
On the same day, December 18, 1939, Zucker telephoned the re-
spondent to 'arrange for a meeting on behalf of the C. I. O. Local,
but was referred to the respondent's attorneys. On telephoning the
attorneys, Zucker was advised that the respondent proposed to file a
petition under Section 9 (c) of the Act, in view of the claims of the
two unions, and meanwhile would not bargain with either union.
However, the respondent did not file such a petition. On the
following day, December 19, Kimbro brought new persons to replace
the four old employees who had not redesignated the A. F. of L.
Local, and Evans discharged James, Banks, Spurgeon Weaver, and
Fredrycka Weaver.6 The new persons who replaced them then desig-
nated the A. F. of L. Local to act as their collective bargaining
representative, and on or about December 30 the respondent entered
into a new contract, dated December 20, with the A. F. of L. Local.
The contract provided in part for a closed-shop for 1940 and yearly
thereafter unless notice to the contrary were given by one party to
the other 60 days before the close of any yearly period. In view of
these events, Zucker made no further effort to induce the respondent
to bargain with the C. I. O. Local.
B. Concludingin.dings
Upon the foregoing facts, it is clear and we find that the respondent
discharged the five named employees because of their union member-
ship and activity. The respondent and the A. F. of L. Local do not
contest this finding, but claim that the discharges did not constitute
unfair labor practices because they were covered by the proviso of
Section 8 (3).' The precise issue thus presented is whether a closed-
6 Two of the four employees, Fredrycka Weaver and James, were off duty at the time.
° Section 8 ( 3) provides that it shall be an unfair labor practice for an employer-
By discrimination in regard to hire or tenure of employment or any term or condi-
tion of employment to encourage or discourage membership in any labor organization .
Provided, That nothing in this Act . , shall preclude an employer from making
an agreement with a labor organization , ( not established , maintained , or assisted by
any action defined in this Act as an unfair labor practice ) to require , as a condition
of employment , membership therein, if such labor organization , is-the representative
487498-42-vol 44-38
594 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
shop agreement for 12 months made in conformity with the conditions
of the proviso may operate as a defense to otherwise discriminatory
discharges effected toward the end of the contract term when the
employees covered by the agreement seek to change their collective
bargaining representative for the next contractual period.
The legislative history shows that the proviso was inserted merely
to avoid the interpretation of the Act which, some had given to Sec-
tion 7 (a) of the National Industrial Recovery Act that closed-shop
-contracts were outlawed under all circumstances.,, Accordingly, the,
proviso is so worded as to protect the "making" of closed-shop con-
tracts if certain conditions are satisfied. By reasonable inference,
the Board has held, the proviso also protects the performance of such
contracts.' But the mere fact that all closed shops are not unlawful,
by virtue of the proviso, is no reason for holding that closed shops
may be made perpetual because validly initiated pursuant to the
proviso. Thus, for example, in the Ansley Radio case the Board con-
fined its decision, that discharges made under a validly executed closed-
shop contract did not constitute unfair labor practices, to cases where
the agreement was "for a reasonable period of time" or "for a reason-
able duration." 10 In the instant case, a consideration of the facts
of the employees as provided in section 9 (a), in the appropriate collective bargaining
unit covered by such agreement when made
At the hearing the A. F of L. Local objected to the introduction of evidence with respect
to,whether the employees had ceased to be members in good standing of the A F of L
Local The Trial Examiner oveiruled the objection and admitted evidence on'that issue.
The A F of L Local thereupon moved to strike all such evidence on the ground that the
respondent was entitled to rely on the statement of the A F of L Local's ieprcsentative
with respect to the membership of employees under the closed-shop agreement. The Trial
Examiner reserved ruling on this motion Since we determine the merits of this case on
other grounds, we need not, and accoi dingly do not, rule on this motion
s The Senate Committee on Education and Labor in its report on the Act stated the
following .
The reason for the insertion of the proviso is as follows
Accoiding to some interpretations, the provision of Section 7 (a)- of the National
Industrial Recovery Act, assuiing the freedom of employees "to organize and bargain
collectively thiough representatives of their own choosing," was deemed to illegalize
the closed shop. The committee feels that this . . is not the intent of Congress
today . But to prevent similar misconceptions of this bill, the Pi oviso in question
states that nothing . . shall be held to prevent the making of closed-shop agree-
ments . . . (74th Congress, 1st Sess., Senate Rept No 573, p' ll )
9 Cf Matter of Ansley Radio Corporation and Local 1221, United Electrical & Radio Workers
of America, C 10, etc, 18 N L R B 1028
19Cf Matter of Metro-Goldwyn-Mayer Studios etc and Scieen Writers Guild Inc, 7
N L R B 662, Matter of Columbia Broadcasting System Inc and American Coinmunica-
tions Association etc. 8 N. L. R B 508; Matter of M & J Tracy Inc and Inland Boat-
man's Union, 12 N L R. B 916 ; Matter of the River side & Fort Lee Ferry and United
Marine Division etc, 23 N L' R B. 493; Matter of Rosedale Knitting Company and Rosedale
Employees Association, 23 N R. L B. 527 ; Matter of Lewis Steel Products Corp and
Local 1225 of the United Electrical, Radio & Machine IVoikers of America, 0 I 0, 23
N L R B 793; Matter of Kahn & Feldman, Inc, and United Textile Workers of America,
A F of L, 30 N L R B 45; Matter of Presto Recoi'ding Corporation and Local 1140 of
the United Electrical, Radio & Machine Woo leers of America, C. 1. 0., 34 N L R B 28;
Matter of Owens-Illinois Pacific Coast Co and International Longshoremen's and Ware-
housemen 's Union , Local 6, C 1 0, etc, 36 N L R B 900;'Matter of Mill B, Inc , division
of Irwin & Lyons , partners, doing business under the assumed ' name of Irwin &- Lyons and
International Woodworkers of America, Local 116, C 1 0, 40 N L R B. 346.
RUTLAND COURT OWNERS, INC. - 595
will demonstrate that to sustain the contention of the respondent and
the A. F. of L. Local would be to enforce a closed shop for an un-
reasonable period, indeed for an indefinitely long period or perhaps
even in perpetuity.
The movement to initiate the C. I. O. Local began on December 6,
1939, only 31/2 weeks before the collective agreement executed in Decem-
ber 1938 was about to expire. The respondent had already commenced
negotiations with the A. F. of L. Local concerning a new con-
tract for the year 1940. The employees had become dissatisfied with
the way in which the.A. F. of L. Local was representing their interests
and accordingly desired the C. I. O. Local to represent them in nego-
tiating a contract for the next term. The C. I. O. Local advised the
respondent on December 16 that a majority of the employees had desig-
nated the C.J. O. Local. The respondent then suspended negotia-
tions with the A.Y. of L. Local and informed the C. I. O. Local that
it would file a petition under Section 9 (c) of the Act in view of the
claims of the two unions. Under these circumstances, it is clear, and
the respondent understood, that a question concerning the representa-
tion of its employees for the forthcoming. year had arisen. Neverthe-
less, the respondent discharged the employees who desired to be
represented by the C. I. O. Local for future bargaining, and executed
another closed-shop contract with the A. F. of L. Local. If these
employees could lawfully be discharged, as the respondent and the
A. F. of L. Local contend, because when their contract was about to
expire such employees evinced a desire to have a different representa-
tive negotiate their next contract, then as each succeeding contract
was about to expire the respondent and the, A. F. of L. Local could
renew the process of eliminating all employees who wished to change
their representative for the forthcoming contract period. Thus, the
respondent and the A. F. of L. Local are in substance contending that
they may lawfully bar the employees in perpetuity from changing to
a representative of their own free choice even if the A. F. Of L. Local
is not the choice of a single employee affected at the threshold of
each new contract period.
This could riot have been the intent of Congress. The fundamental
policy of the Act, in the light of which all its provisions-including
the proviso to Section 8 (3)-must be read," is to "promote industrial
peace," thereby fostering commerce, through the protection of self-
-organization and the encouragement of collective bargaining by repre-
"The narrow goal sought to be achieved by the insertion of the proviso lends , additional
force to the traditional canon of statutory construction, that provisos limiting the scope
of remedial legislation are to be strictly consti ued Cf Thompson v United States, 258 F
(2d) 196 , cert . den. 251 U. S . 553; Fleming v. Hawkeye Pearl, Button Co ., et al., 113 F. (2d)
52 (C. C A. S)
596 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
sentatives of the employees' own choosing.12 The employees' right to
select representatives to be meaningful must necessarily include the
right at some appropriate time to change representatives." Just as
in political elections the voters are permitted, before the term of the
existing officeholder expires, to campaign for any candidate for the
next term, so in selection of a bargaining agent the employees must be
able, before the, term of the existing representative has come to an
end, to affiliate with and campaign for any union for the next period.
Effectuation of the basic policies of the Act requires, as the life of the
collective contract draws to a close, that the employees be able to
advocate a change in their affiliation without fear of discharge by an
employer for so doing.
A contrary construction would in large part nullify the statutory
scheme by which questions concerning the representation of employees,
are to be determined by the Board, using the machinery created for
that very purpose under the Act. Since the contract here in question.
was about to expire, according to established Board policy the time
was appropriate for a change of representatives, if the employees so,
desired. The Board, under such circumstances, would normally direct
an election to resolve the question concerning representation and de-
termine whom the employees currently desired as their exclusive repre-
sentative 14 The discharge of the very employees whose representation
is in issue, because they have placed their representation in question, is
clearly inconsistent with the whole policy and general scheme of the
Act 15 -
n See Section 1 ; National Licorice Co v N L R B , 309 U S 350 ; Amalgamated Utility
Workers v Consolidated Edison Co , 309 U S 261.
13 See. ,for example , Hamilton -Brown Shoe Company v N L. R B , 104 F F. (2d) 49
(C C A 8) "Having in mind that it is the fundamental policy of the Act to permit em-
ployees freely to choose their representatives ; it follows that the employees have a right
to change their choice . . Cf N. L R B. v Electric Vacuum Cleaner Co, lite, et, al ,
315 U S 685.
14 Matter of Cared Radio Corporation and Local 430 of the United Electrical , Radio it
Machine Workers of America , C I 0., 29 N L R B 184; Matter of Midwest Mfg Co and
Federal Labor Union #22278, affiliated with the American Federation of Labor, 26 N. L. R. B.
172; Matter of Cardinale Macaroni Manufacturing Co,, Inc. and Macaroni it Noodle Workers'
Union , Local 102 , Bakery it Confectionery Workers' International Union of America , affiliated
with A F of L, 29 N . L R B. 1145, Matter of Fada Radio it B lectrio Company , Inc and'
Local 430 of the United Electrical Radio it Machine Workers of America, C I. 0., 29'
N. L R B 191; Matter of United Scientific Laboratories , Inc. and Local 430 of the United
Electrical, Radio it Machine Workers of America, C I 0, 29 N. L R B 198; Matter of
Certain-Teed Products Corporation and International Longshoremen's it Warehousemen's
Union, Local 1-6, 28 N L. R B '915; Matter of Drummond Packing Company and Packing
House Workers Organizing Committee , Local 119, C. I. 0, 27 N L it. B 8; Matter of Trans-
former Corporation of America and Local 1130 of the United Electrical , Radio it Machine
Worker s of America, C 1 0 , 26 N L R B 476 In the Mill B. case, cited supra in footnote
10, where a "union shop" was involved , the Board observed that the "safeguard against
the perpetuation of a baigaining agent . . . lies in the power of the employee to give notice
of a claim to 'a new bargaining agent within the time limited by the contract ," thereby
making possible a representation proceeding. '
11 It may be pointed out in this connection that the Board does not hold elections where
there is no reasonable probability that a majority of the employees will designate a rep--
RUTLAND COURT OWNERS, INC. 597
The A. F. of L. Local, in its argument, recognizes that were its
-view to prevail the strike would be the only weapon remaining to the
employees who wished to transfer their affiliation to the C. I.'0. Local
immediately prior to the negotiation of a new contract. That the
Act was designed to avert industrial strife, however, is clear beyond
-dispute." The Act contemplates that if self-organization is pro-
tected and collective bargaining by genuine employee representatives
is encouraged,, then collective bargaining contracts will result which
will stabilize industrial relations and hence be conducive to industrial
Teace'17 The view advocated' by the respondent and the A. F. of L.
Local is inconsistent with this basic policy. To insist that employees
can never transfer their affiliation from one union to another, or to
prevent employees toward the close of one contract period from
changing their representatives for the purpose of negotiating and
administering a new contract for the succeeding term is to impair
rather than protect self-organization, to thwart rather than encourage
collective ' bargaining by, representatives of ' the employees' genuine
'choice, and accordingly to produce contracts which will not tend to
stabilize mutually satisfactory labor relations or safeguard industrial
peace.is The stability intended by the Act is not that involved, in a
perennial suppression of the employees' will.
We conclude, and find, that the five named employees were dis-
charged when the 1939 contract was about to expire, and the time w1as
resentative, among other reasons, because the Boaid, absent such a limitation, would be
conducting so many elections that its aelmanrstiative machinery would break down, and
the purpose of the Act would thereby be frustrated (Sixth Ann Rep, N L R B , p 55).
The Board therefore requires as a prerequisite for directing an election that a union show
substantial representation among the employees in the appropiiate unit See for example,
Matter of Montgomerj Ward and Co and Office Employees Union etc, 31 N L R B
912. By the discharge of the employees upon whose designations a rival labor organiza-
tion relies to justify an election, an employer discourages resort to the Board, defeats
determination of a genuine question concerning repiesentation by the methods contemplated
by the Act, and theieby encourages resort to strikes disiuptive of commerce
16 As the Circuit Court of Appeals for the 7th Circuit stated. "By the Labor Act,
Congress . . expressed intent to prevent industrial strife and to promote industrial
peace." Singer Manufacturing Co v. N L. R. B, 119 F. (2d) 131 (C. C. A 7), cert denied,
313 U S 595
17 See Section 1; National Licorice Co v N L R. B , 309 U S 350; Amalgamated Utility
1110) hers v. Consolidated Edison Co., 309 U S 261 Cf H J Heinz Co v N L R B , 311
U S 514; Consolidated Edison Co V. N. L R B, 305 U S 197; N L. R. B. v Newark
Morning Ledger Co, 120 F. (2d) 266 (C C A. 3), cert denied, 62 S Ct 363
11 Indeed, collective contracts other than those which culminate from negotiation between
an employer and the real representative of the employees are a definite obstacle to mdustiial
peace Cf. N L R B v Stackpole Carbon Co, 105 F. (2d) 167, 179, (C C A 3),-cert.
denied 308 U. S 605, where the Court pointed out that a contract, negotiated by a labor
organization which did not represent the employees' free choice, was not "insurance against
future industrial strife" and that the "execution of the contract .jncreased, the bitterness
of feeling between the parties to the conti oversy "
On the other hand, the Board has recognized that where a collective bargaining contract is
executed by the properly designated representative of the employees, it would not effectuate
the policies of the Act to interfere with its operation during a reasonable period See, for
example, Matter of Ansley Radio Corporation and Local 1221, United Electrical & Radio
Workers of America, C. I 0, etc, 18 N. L R B 1028; Matter of Mill B, Inc, division of
Irwin & Lyons, partners, doing business under the assumed name of Irwin d Lyons and
International Woodworbes of America, Local 116, C 1 0, 40 N. L R B 346
i
1
598 DECISIONS OF NATIONAL LABOR RELATIONS 'BOARD
appropriate for negotiation of a new contract with representatives
currently desired by the employees; that before the execution of the
1940 contract a question concerning the representation of the em-
ployees had arisen; that the discharge of'the five employees was for
union membership and activity and tended to forestall or defeat a
determination of the representation question in a manner consonant
with the policies and provisions of the Act,; and that the proviso to
Section 8 (3) does not constitute a defense.1° We find, accordingly,
that the respondent, by its discharge of the five named employees,
discriminated in regard to hire and tenure of employment, thereby
discouraging membership in the C. I. 0. Local and encouraging mem-
bership in the A. F. of L. Local, and interfered with, restrained,
and coerced its employees in the exercise of the rights guaranteed in
Section 7 of the Act.
The respondent assisted and maintained the A. F. of L. Local by
these unfair labor practices. Consequently, we find that the closed-
shop contract executed in December 1939 by the respondent and the
A. F. of L. Local is not protected by the proviso to Section 8 (3),
and that by such contract the respondent further discouraged mem-
bership in the C. I. 0. Local, encouraged membership in the A. F. of
L. Local and interfered with, restrained, and coerced its employees in
the exercise of the rights guaranteed in Section 7 of the Act.20
The A. F. of L. Local, in reliance upon its closed-shop contract,
and the C. I. 0. Local, in reliance upon. the employees' current
designations of it, each claimed to be the exclusive representative
entitled to negotiate the new contract. Because of these rival claims,
the respondent, doubting whether the A. F. of L. Local or the C. I. 0.
Local was the statutory representative, was justified in suspending
negotiations with the A. F. of L. Local, refusing to open negotiations
with the C. I. 0. Local, and declaring its intention to file with the
Board a petition for investigation and certification of representatives.
It is true that thereafter the respondent resolved its doubts against
the C. I. 0. Local's claim to be the exclusive representative by unlaw-
ful discharges, and then entered into an unlawful contract with the
A. F. of L. Although such conduct under other circumstances might
indicate that the respondent was not predicating its refusal to bargain
with the C. I. 0. Local upon a genuine doubt of that organization's
majority status'21 we are satisfied upon the present record that the
discharges and the execution of the 1940 contract were induced by
19 Although Blackmone was discharged a few days before the other four employees and
immediately before the C. 1 0 Local communicated with the respondent, the clrcumstanceo
under which he was discharged show that his discharge was also intended to defeat a
change of representation, at a time when such change was protected by the Act.
20 N. L R B. v Electric Vacuum Cleaner Go, Inc , et al , 315 U S 685.
21 Cf Matter of West Oregon Lumber Co. and Lumber and Sawmill Workers, etc., 20
N L R B 1.
J
RUTLAND COURT OWNERS, INC. 599
the respondent's misapprehension of its obligations under the 1939
contract in relation to the Act, and that the respondent refused to
bargain' with the C. I. 0. Local for that,reason.22 Moreover, under
circumstances such as are here disclosed; namely, two previously
unassisted labor organizations making bona fide and,rival claims to
being the exclusive representative, we believe that the appropriate
method of determining who is the exclusive representative, if any,
is- by an election by secret ballot in a representation proceeding.23
Upon the entire record, we find that the respondent has not unlawfully
Iefused to bargain collectively with the C. I. 0. Local. -
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
We find that the activities of the respondent set forth in Section
III above, occurring in connection with the operations of the respond-
ent described in Section I above, have a close, intimate, and substan-
tial relation to trade, traffic, and commerce within the District of
Columbia, and tend to lead to labor disputes burdening and obstruct-.
ing commerce and the free flow of commerce.
V. THE REMEDY
Having found that the respondent has engaged in unfair labor
practices, we shall order it to cease and desist therefrom and to take
certain affirmative action which we find will effectuate the policies of
the Act.
We have found that the respondent discriminatorily discharged
Blackmone, James, Banks, Fredrycka Weaver, and Spurgeon Weaver.
We shall order the respondent to offer such persons immediate and
full reinstatement to their former or substantially equivalent posi-
tions, without prejudice to their seniority and.other rights and privi-
leges, if necessary dismissing the persons hired since the date of the
discharges. We shall also order the respondent to pay to each of
these employees an amount equal to that which he would normally
have earned as wages from the date of his discharge to the date of
his reinstatement, less his net earnings 24 during said period. Since,,
22Cf N L R B v Remington Rand , Inc, 94 F. (2d) 862 (C C A 2), cert denied 304
U S 576, 585, Matter of Bonafide Mills. Inc and International Brotherhood of Pulp,
Sulphate and Paper Mill Workers (A F L ), 38 N L R B 661.
25 Cf Matter of Monroe Calculating Machine Co. and United Electrical, Radio & Machine
Workers of America, etc., 29 N L R B 653; Matter of Ansley Radio Corporation and
Local 1321, United Electrical & Radio Workers of America, C. I. 0, etc, 18 N L R B. 1028.
24 By "net earnings" is meant earnings less expenses , such as for transportation, room,
and board , incurred by an employee in connection with obtaining work and working else-
where than for the respondent , which would not have been incurred but for his unlawful dis-
charge and the consequent necessity of his seeking employment elsewhere. See Matter of
Crossett Lumber Company and United Brotherhood of Carpenteis and Joiners of America,.
Lumber and Saiainill Workers Union , Local 2590 , 8 N L R B 440 . Monies received for
600 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
however, the Board' in its Proposed Findings of Fact, Proposed Con-
clusions of Law, and Proposed Order stated that it would dismiss
the complaint, we will exclude from the computation of back pay the
period from the date of the,proposed findings to the date of the
Decision, and Order herein.25
We have found that the respondent unlawfully encouraged mem-
bership in the A. F. of L. Local. The contract between them dated
December 20, 1939, embodies recognition of the A. F. of L. Local as
exclusive representative, and imposes membership therein as a con-
dition of employment. We find that it represents the fruit of the
'respondent's unfair labor practices and a device by which to per-
petuate their effects. Accordingly, we will order the respondent to
cease and desist from giving effect to this or any other agreement
which it may have entered into with the A. F. of L. Local in respect
to rates of pay, wages, hours of employment, or other conditions of
employment, and to cease and desist from recognizing the A. F. of
L. Local as the representative of any of its employees unless and
until it is certified as such by the Board.26 Nothing in the Order,
however, shall be taken to require the respondent to vary those wages,
hours, and other such substantive features of its relations with the
employees themselves, which the respondent may have established in
performance of the contract as extended, renewed, modified, supple-
mented, or superseded. Of course, this proviso does not privilege the
respondent to impose as a condition of employment membership in
the A. F. of L. Local.
Upon the basis of the foregoing findings of fact, and upon the
entire record, in the case, the Board makes the following :
CONCLUSIONS OF LAW
1. United Construction Workers Organizing Committee, Local 120,
Building Service and, Maintenance Employees, affiliated with the
Congress of Industrial Organizations, and Building Service Em-
ployees International Union, Local 82, affiliated with the American
Federation of Labor, are labor organizations, within the meaning of
Section 2 (5) of the Act. -
2. By discriminating in regard to, the hire and tenure of employ-
ment of Nathaniel Blackmone, Walter S. James, Jr., Eleanor J.
work performed upon Federal, State, county,,municipal, or other work-relief projects shall
be considered as'eatnings See Republic Steel Corporation v N L R B, 311 U S 7
25 Matter of E R Haffelfinger Co., Inc. and United Wall Paper Crafts of North America;
Local No 6, 1 N L R B 760
20 Warehousemen's Union v N L. R B, 121 F. (2d) 84 (App D C ), cent denied 62 S.
Ct 138, ent'g as mod, Matter of McKesson & Robbins, Inc, etc, and International Long-
shoremen & Warehousemen's Union, etc., 19 N L R B 778 See also Matter of Abraham B.
Karron, doing business under the trade name of Pennsylbanta handbag Frames Manu-
facturing Company and Local 1224 , United Electrical, Radio , and Machine Workers of America,
C. I. 0 , et at, 41 N L R B 1454
RUTLAND COURT OWNERS, INC. 601
Banks, Fredrycka P. Weaver, and Spurgeon H. Weaver, thereby
discouraging membership in United Construction Workers Organiz-
ing Committee, Local 120, Building Service and Maintenance Em-
ployees, affiliated with the Congress of Industrial Organizations, and
encouraging membership in Building Service Employees Interna-
tional Union, Local 82, affiliated with the American Federation of
Labor, the respondent has engaged in and is engaging in unfair
labor practices, within the meaning of Section 8 (3) of the Act.
3: By interfering with, restraining, and coercing its employees in
the exercise of the rights guaranteed in Section 7 of the Act, the
respondent. has engaged in and is engaging in unfair labor practices,
within the meaning of Section 8 (1) of the Act.
- 4. The aforesaid unfair labor practices are unfair labor practices
affecting commerce,-within the meaning of Section 2 (6) and (7) of
the Act.
5. The respondent has not refused to bargain collectively with
United Construction Workers Organizing Committee, Local 120,
Building Service and Maintenance Employees, affiliated with the
Congress of Industrial Organizations, within ' the meaning of Sec-
tion 8 (5) 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 Rutland
Court Owners, Inc., Washington, D. C., its officers, agents, successors,
and assigns, shall :
1. Cease and desist from:
(a) Discouraging membership in United Construction Workers
Organizing Committee, Local 120, Building' Service and Maintenance
Employees, affiliated with the Congress of Industrial Organizations,
or any other labor organization of its employees, or encouraging
membership. in Building Service Employees International Union,
Local 82, affiliated with the American Federation of Labor, or any
other labor organization of its employees, by discharging any of its
employees, or in any other manner discriminating in regard to their
hire or tenure of employment or any term or, condition of employment;
(b) Recognizing Building Service Employees International Union,
Local 82, affiliated with the American Federation of Labor, as the
,representative of any of its employees for the purposes of negotiating
with respect to grievances; labor disputes, -,wages, rates of pay,-hours
of employment, or other conditions of employment, until that organ-
ization shall have been certified by the Board as their representative;
(c) Giving effect to any contract made with Building Service Em-
ployees International Union, Local 82, affiliated with the American
602 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Federation of Labor, in respect to rates of pay,- wages, hours of em-
ployment, or other conditions of employment, or recognizing Building
Service Employees International Union, Local 82, affiliated with the
American Federation of Labor, as the representative of any of its
employees, unless and until such organization is certified by the Board
as their representatives;
(d) In any other manner interfering with, restraining, or coercing
its employees in the exercise of the right to self-organization, to form,
join, or assist labor organizations, to bargain collectively through rep-
resentatives of their own choosing, or to engage in concerted activities
for the purposes of collective bargaining or other mutual aid or
protection.
2. Take the following affirmative action, which the Board finds will
effectuate the policies of the Act : -
(a) Offer to Nathaniel Blackmone, Walter S. James, Jr., Eleanor
J. Banks, Fredrycka P. Weaver, and Spurgeon H. Weaver immediate
and full reinstatement to their former or substantially equivalent
positions, without prejudice to their seniority and other rights and
privileges ;
(b) Make whole Nathaniel Blackmone, Walter S. James, Jr.,
Eleanor J. Banks, Fredrycka'P. Weaver, and Spurgeon H. Weaver for
any loss of pay they may have suffered by reason of the respondent's
discrimination against them, by payment to each of them of a sum
of money equal to the amount which he normally would have earned
as wages from the date of his discharge to the receipt of the Proposed
Findings of Fact, Proposed Conclusions of Law, and Proposed Order,
and from the receipt of the Decision and Order herein to the date of
the respondent's offer of reinstatement, less his net earnings during
such periods;
(c) Withhold recognition from Building Service Employees Inter-
national Union, Local 82, affiliated with the American Federation of
Labor, as the representative of any of its employees for the purposes
of negotiating with respect to grievances, labor disputes, -wages, rates
of pay, hours of employment, or other conditions of employment, un-
less and until that organization shall have been certified by the Board
as their representative ;
(d) Post immediately in conspicuous places throughout its apart-
ment house building in Washington, D. C., and maintain for a period
of at least sixty (60) consecutive days from the date of posting,
notices to its employees stating: (1) that the respondent will not en-,
gage in the conduct from which it is ordered to cease and desist in
paragraphs 1 (a), (b), (c), and (d) of this Order; (2) that it will
take the affirmative action set forth in paragraphs 2 (a), (b), and (c)
of this Order; and (3) that its employees are free to become or remain
members of United Construction Workers Organizing Committee,
0
RUTLAND COURT OWNERS, INC. 603
`Local 120, Building Service and Maintenance Employees, affiliated
with the Congress of Industrial Organizations, and that the respond-
ent will not discriminate against any employee because of membership
or activity in behalf of United Construction Workers Organizing
Committee, Local 120, Building Service and Maintenance Employees,
affiliated with the Congress of Industrial Organizations; and
(e) Notify the Regional Director for the Fifth Region in writing
within ten (10) days from the date of this Order what steps the re-
spondent has taken to comply herewith.
AND IT IS FURTHER ORDERED that the complaint be, and it hereby is,
dismissed insofar as it alleges that the respondent has engaged in and
is engaging in unfair labor practices within the meaning of Section 8
,(5) of the Act.
MR. WILLIAM M. LEISERSON, dissenting :
There is no contention in this proceeding that the closed-shop con-
tract of 1939 is invalid.. The discharges were made pursuant to the
terms of that contract and are therefore within the terms of the proviso
to Section 8 (3) of the Act. To reach a contrary result the majority
has in effect assumed authority to suspend enforcement of the pro-
visions of a valid collective bargaining agreement although this Board
has previously held that it was not permitted to do so.27 If valid
closed-shop contracts, which are expressly permitted by the Act, have
undesirable effects, it is for the Congress, and not for the Board, to
make the modifications. I would dismiss the complaint.
27Matte, of Ansley Radio Corporation, 18 N. L. R B 1028. The effect of the majority
,decision is also to set aside provisions in union constitutions like the following
Any member accepting membership in the Industual Workers of the World, the
Working Class Union, the One Big Union, or any' other dual organization not
affiliated with the Congress of Industrial Organizations, or membership in the
National Chamber of Commerce, or the Ku Klux Klan, or the Communist Party,
shall he expelled from the United Mine Workers of America . .
(Article SIV, Sec. 2, Constitution of the International Union, United Mine Workers of
America, adopted at Columbus, Ohio, February 1, 1940 )