Schaeff Namco, Inc.

National Labor Relations Board - Board Decisions

Jul 31, 1986

280 N.L.R.B. 1317 (N.L.R.B. 1986)

SCHAEFF NAMCO, INC
Schaeff Namco, Inc. and Lodge 1426, International
Association of Machinists and Aerospace Work-
ers, AFL-CIO. Case 18-CA-8537
31 July 1986
DECISION AND ORDER
BY MEMBERS JOHANSEN , BABSON, AND
STEPHENS
On 26 November 1984 Administrative Law
Judge Martin J. Linsky issued the attached deci-
sion . The Respondent filed exceptions and a sup-
porting brief, and the General Counsel filed cross-
exceptions and a supporting brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge' s rulings, findings, I and
conclusions only to the extent consistent with this
Decision and Order.
As set forth more fully in the judge's decision,
the Respondent and the Union were parties to a
collective-bargaining agreement effective from 1
September 1981 to 31 August 1984. Included in the
agreement was article XX, section 3, a wage-re-
opener clause for the third year, which provided:
On August 1, 1983, the contract shall be re-
opened for a period of thirty (30) days, which
period shall end at midnight, August 30 (Aug.
30-31). The sole topic for negotiations shall be
hourly wages. During this period either party
may initiate economic action to support its po-
sition, i.e., a strike or lockout, but if no action
is taken within the opening period, the provi-
sions of Article III shall be effective on
August 31, 1983. If no action is taken and no
agreement is reached, the Company shall put
into effect its wage offer for the next year ef-
fective September 1, 1983.2
In August 19833 the Respondent contacted the
Union on several occasions in an attempt to post-
pone the wage-reopener period. The Respondent
informed the Union by letter on 30 August that if
the Union would not agree to postpone the wage-
reopener negotiation period , the Respondent would
i The Respondent has excepted to some of the judge's credibility find-
ings The Board's established policy is not to overrule an administrative
law judge's credibility resolutions unless the clear preponderance of all
the relevant evidence convinces us that they are incorrect. Standard Dry
Wall Products, 91 NLRB 544 (1950), enfd. 188 F.2d 362 (3d Cir. 1951).
We have carefully examined the record and find no basis for reversing
the findings.
2 Art III, set forth fully in the judge's decision, is a broad clause pro-
hibiting strikes, lockouts, or boycotts during the term of the agreement.
a Unless otherwise indicated, all dates hereafter refer to 1983.
1317
put a 10-percent wage reduction into effect during
the first full pay period in September. Although the
parties met on 31 August, they were unable -to
reach agreement on either a wage rate or -a post-
ponement of the wage-reopener period. The Re-
spondent then put the 10-percent wage reduction
into effect.
Thereafter, the Respondent and the Union filed
unfair labor practice charges against each other al-
leging that the other had failed to bargain in good
faith during the wage-reopener negotiations. On 20
October the parties entered into a settlement agree-
ment which provided that the parties would with-
draw their charges; the Respondent would reinstate
the old contract wages and pay employees for any
wage loss resulting from the 10-percent wage re-
duction; and article XX, section 3, of the contract
would be modified as follows:
On November 1, 1983, the contract shall be re-
opened for a period of 14 days, which period
shall end at midnight, November 14. The sole
topic for negotiations shall be hourly wages.
During this period either party may initiate
economic action to support its position, i.e., a
strike or lockout, but if no action is taken
within the opening period, the provisions of
Article III shall be effective on November 15,
1983. If no action is taken and no agreement is
reached, the Company shall put into effect its
wage offer for the next year effective Novem-
ber 16, 1983.
The parties met only twice during this 14-day re-
opener period. The first meeting on 9 November
lasted only 10 to 15 minutes, during which the Re-
spondent proposed a 10-percent wage reduction
and the Union agreed to present the Respondent's
proposal to its membership. On 11 November a
majority of the employees voted to reject the Re-
spondent's wage reduction offer and to authorize
strike action. On the same day, the Union notified
the Respondent of the rejection of the offer, the
authorization of strike action, the notification to the
Federal Mediation and Conciliation Service
(FMCS) of the dispute, and the Union's availability
for negotiations during the week of 14 November.
The parties next met on 14 November. At that
meeting, the Respondent once again offered a 10-
percent reduction in wages. The Union responded
with an offer to freeze wages and suggested that, if
wages were reduced, the contract should contain a
provision to build back wages. The Respondent re-
jected the offer of a wage freeze and stated that al-
though it would consider a build back wage provi-
sion, that provision would have to be linked to in-
creased sales . When the Respondent proposed to
280 NLRB No. 150
1318 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
extend negotiations for 1 more week, the Union in-
dicated that it would have to check with its attor-
ney before it could respond. The Respondent
stated that it viewed the Union's response as a re-
jection of the proposal to extend negotiations. The
Union then raised a question concerning the em-
ployees' right to strike in view of the notice re-
quirements of Section 8(d)4 of the Act and the no-
strike clause in the contract. Although the Re-
spondent had provided the Union with a written
memo setting forth the Respondent's view of the
employees ' rights under Section 8(d), the negotia-
tion session ended with the Respondent promising
to answer the Union's question whether the em-
ployees would have the protection of the Act if
they went out on strike. The Respondent never
contacted the Union on this matter.
That afternoon the Union sent a certified letter
to the Respondent requesting a variety of financial
information to aid its evaluation of the wage reduc-
tion proposal. The letter was delivered on 16 No-
vember, after the wage-reopener period had closed.
The Respondent refused to provide the informa-
tion, stating that although some of the requested in-
formation might have been relevant during negotia-
tions, negotiations had concluded pursuant to the
language of the parties' settlement agreement. The
Respondent then implemented its 10-percent wage
reduction effective 21 November.
The judge found that the Respondent had violat-
ed Section 8(aX5) and (1) of the Act by unilaterally
implementing the wage reduction without having
bargained in good faith to impasse during the
wage-reopener period. He reasoned that by negoti-
ating during only two brief sessions, by failing to
modify its bargaining position, by considering the
Union's reasonable request to consult an attorney
before responding as a rejection of its offer to
extend negotiations, and by failing to respond to
the Union's question concerning the application of
4 29 U.S.C. § 158(d). That section, in pertinent part , provides that a
party to a collective-bargauung agreement may not terminate or modify
that agreement unless it:
(1) serves a written notice upon the other party to the contract of
the proposed termination or modification sixty days prior to the ex-
piration date thereof, or in the event such contract contains no expi-
ration date, sixty days prior to the time it is proposed to make such
termination or modification;
(2) offers to meet and confer with the other party for the purpose
of negotiating a new contract or a contract containing the proposed
modification;
(3) notifies the Federal Mediation and Conciliation Service within
thirty days after such notice of the existence of a dispute , and simul-
taneously therewith notifies any state or Territorial agency estab-
lished to mediate and conciliate disputes within the State or Terri-
tory where the dispute occurred , provided no agreement has been
reached by that time, and
(4) continues in full force and effect , without resorting to strike or
lockout, all the terms and conditions of the existing contract for a
period of sixty days after such notice is given or until the expiration
date of such contract , whichever occurs later
Section 8(d), the Respondent had not bargained in
good faith to impasse.
The judge also found that in light of his conclu-
sion that the Respondent had not bargained in
good faith to impasse , the Respondent's refusal to
provide the requested financial information consti-
tuted an independent violation of the Act. Al-
though the judge concluded that it was unneces-
sary to address whether the requirements of Sec-
tion 8(d) applied because of his finding of a viola-
tion, he stated that Section 8(d) would appear to
apply. The Respondent excepts to the judge's find-
ings that it did not bargain in good faith to impasse
and that Section 8(d) applies in this situation. We
find merit in the Respondent's exceptions.
Contrary to the judge, we find that the record
fails to support a finding of bad-faith bargaining on
the Respondent's part. In determining whether a
party has negotiated in good faith, the Board scru-
tinizes the totality of the party's conduct. See, e.g.,
Pipe Line Development Co., 272 NLRB 48, 49
(1984). Article XX, section 3, of the parties' con-
tract, as modified by the 20 October settlement
agreement, limited negotiations to the sole topic of
hourly wages . It also set forth a specific time limit
of 14 days in which to reach an agreement. The
first session lasted only 10 or 15 minutes because
the Union terminated the meeting in order to con-
sult its membership regarding the Respondent's
wage reduction offer. In light of these facts, we do
not find two brief negotiation sessions to be evi-
dence of bad-faith bargaining. Moreover, during
the second session the Respondent offered to
extend the negotiations for another weeks and
stated that it would consider a wage build back
provision. Finally, the Respondent's failure to
modify its bargaining position is not bad-faith bar-
gaining because an adamant insistence on a bargain-
ing position is not itself a refusal to bargain in good
faith. See, e.g., Times Herald Printing Co., 221
NLRB 225, 228 (1975); Atlanta Hilton & Tower, 271
NLRB 1600, 1603 (1984). Considering the totality
of the Respondent's conduct, we cannot say that
the Respondent bargained in bad faith during the
wage-reopener period.
We also disagree with the judge's conclusion
that the Respondent could not unilaterally imple-
ment its wage reduction because the parties were
not at impasse . Assuming arguendo that the parties
were not at impasse, we nevertheless find that the
5 Although the Respondent treated the Union 's request to consult its
attorney before responding as a rejection of this offer, we do not find this
action to be evidence of bad -faith bargaining because the negotiations
were scheduled to terminate later that day pursuant to the contract.
Moreover, the Respondent had no obligation to extend this offer and the
Union did not accept the offer
SCHAEFF NAMCO, INC.
parties' contract permitted the Respondent to im-
plement its final offer of a 10-percent wage reduc-
tion. Specifically, the language of article XX, sec-
tion 3, as modified by the settlement agreement,
opened the contract for hourly wage negotiations
for 14 days, "which period shall end at midnight,
November 14." The parties thus contemplated a
limited amount of time in which to negotiate the
third-year wage rates. The contract further provid-
ed that if neither party had initiated economic
action and an agreement concerning hourly wages
had not been reached by midnight on 14 Novem-
ber, the Respondent "shall" put its wage offer into
effect. As the record demonstrates , the parties had
not reached an agreement on the third-year wage
rates nor had either party initiated economic
action6 by the specified date. Pursuant to the
agreed-to contractual language, the Respondent
was required to put its wage offer into effect. Ac-
cordingly, we find that regardless of whether the
parties otherwise were at impasse in their negotia-
tions, the parties' contract permitted the Respond-
ent to implement its wage reduction offer.7
In light of our conclusion that the Respondent
bargained in good faith until negotiations ceased
pursuant to the contract, we find that the Respond-
ent did not violate the Act when it refused to pro-
6 The General Counsel argues that the Union's vote to authorize a
strike constitutes initiation of economic action . She argues that in light of
the waiting period provision of Sec . 8(d), the Union initiated all econom-
ic action it could lawfully take In light of our discussion, infra, that Sec.
8(d) does not apply, we disagree.
7 EPE, Inc, 273 NLRB 1375 (1985), does not require a different result
here. The parties in that case had agreed to a 15-1/2-month contract, sub-
ject to annual renewal, which included a permissive wage-reopener pro-
vision . That provision , which permitted either party to reopen the con-
tract for a limited period to discuss wage rates , stated that either party
could cancel the "Agreement" after a 5-day notice if the parties had
failed to reach an agreement on new wage rates by 15 December 1983
The facts established that the company "reopened" the contract by pro-
posing wage increases that already had been given unilaterally to the em-
ployees and were later found to be unlawful by the Board. After the
company stated that its proposal did not contain any new money because
it could not afford any increases , the parties failed to meet and, therefore,
they did not reach an agreement on a new wage rate by the specified
date . The company then canceled the collective-bargaining agreement
after giving the union the requisite 5-day notice The judge found that
the company had violated Sec 8(a)(S) by dealing in bad faith with the
union because it had not validly reopened the contract when it submitted
a proposal that was only a demand for approval of its prior unlawful
action . He further found that even if the company had validly reopened
the contract, the company still could not have lawfully canceled the col-
lective-bargauung agreement He noted that the parties were not at im-
passe, the wage-reopener provision by its terms permitted cancellation of
only the wage-reopener agreement and not the entire collective-bargain-
ing agreement, and the parties had not complied with the notice provi-
sions of Sec 8(d).
The Board in EPE adopted the judge 's conclusions concerning the ab-
sence of impasse and the noncompliance with Sec . 8(d), but found it un-
necessary to rely on his conclusion that the wage -reopener provision did
not permit the company to cancel the entire collective-bargaining agree-
ment. Here, by contrast , we find no bad-faith bargaining , and we find
that the contractual language gave the Respondent the right to imple-
ment its wage reduction regardless of whether the parties had reached
impasse.
1319
vide the Union with the requested financial infor-
mation. The Union requested the information to aid
its consideration of the Respondent's wage reduc-
tion offer. The Respondent received the request
after midnight on 14 November. Under the lan-
guage of the contract, negotiations had ceased at
that point and the Respondent was obligated to im-
plement its wage offer. Consequently, the Union's
request was no longer relevant to its bargaining
duties, and the Respondent's refusal to provide the
information was justified.
We next turn to a consideration of whether the
Respondent violated Section 8(d) of the Act by its
unilateral implementation of its wage reduction
offer. Citing the Supreme Court's opinion in NLRB
v. Lion Oil Co., 352 U.S. 282 (1957), the General
Counsel argues that the notice and waiting provi-
sions of Section 8(d) apply to midterm wage-re-
opener provisions such as article XX, section 3, of
the parties' contract. Relying on the fact that the
Respondent unilaterally implemented its wage re-
duction only 9 days after the Union notified the
FMCS of its intention to strike, the General Coun-
sel contends that the Respondent's action violated
the waiting requirements of Section 8(d)(4).8 Alter-
natively, she argues that because Section 8(d)(4)
prohibited the Union from striking, the Union initi-
ated all economic action it could lawfully take
when it authorized a strike. According to this argu-
ment, the contract's wage-reopener provision (art.
XX, sec. 3) therefore precluded the Respondent
from implementing its wage offer because the
Union initiated economic action during the relevant
14-day period. Contrary to the General Counsel,
we find that Section 8(d) does not apply for the
reasons set forth below.
Although the Supreme Court in Lion Oil de-
clared that the provisions of Section 8(d) apply to
contract-reopener clauses, we find that the Court
was addressing reopener clauses which permit a
modification or termination of the contract.9
Indeed, Section 8(d) by its terms presupposes that
the notice and waiting provisions are activated
only when a party seeks to terminate or modify the
contract.' ° In this case, however, no termination
or modification of the contract occurred. The par-
ties specifically left open the wage rates for the
8 See fn 4.
9 The contract considered in Lion Oil specifically permitted either
party to "amend" the terms of the agreement , and the Court found that
the union gave the company notice of its desire to "modify the contract."
352 U.S at 286
10 Sec 8(d), in pertinent part, states that "the duty to bargain collec-
tively shall also mean that no party to such contract shall terminate or
modify such contract, unless the party desiring such termination or modifi-
cation" complies with the notice and waiting provisions of Sec 8(d) (em-
phasis added)
1320 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
third year and provided for a limited period of ne-
gotiations in which to establish the new rates. In
the event that the parties failed to reach an agree-
ment or initiate economic action in a specified
period, the contract provided that the Respondent
"shall" implement its wage offer. Accordingly,
when the Respondent implemented the wage re-
duction, it did not modify the contract's terms.
Rather, it acted pursuant to the contract's terms."
If the Union had struck in support of its wage
offer, it similarly would not have violated Section
8(d) because its wage offer would not constitute a
modification of the contract. Instead , the strike
would have occurred in order to obtain an objec-
tive which the contract had not settled (the third-
year wage rates). The procedural requirements of
Section 8(d) therefore would have been inapplica-
ble. See Mine Workers Local 9735 v. NLRB, 258
F.2d 146 (D.C. Cir. 1958). Moreover, an employee
strike in support of the Union's position on third-
year wage rates would not have resulted in the loss
of employee status because the strike would not
have sought to terminate or modify the contract.
See Mastro Plastics Corp. v. NLRB, 350 U.S. 270
(1956).
We therefore find that in light of the specific
contractual language presented in this case, the
provisions of Section 8(d) are inapplicable because
neither party terminated or modified the contract.
Accordingly, it was unnecessary for the Respond-
ent to comply with the procedural requirements of
Section 8(d) when it implemented its wage reduc-
tion. Furthermore, the Union could have lawfully
struck in support of its third-year wage offer
during the 14-day reopener period. The Union
therefore did not initiate all of the economic action
it could have lawfully taken. The contract there-
fore required the Respondent to implement its
wage offer because the parties had neither reached
an agreement nor initiated economic action.
We conclude that the Respondent bargained in
good faith during the wage-reopener negotiations
and did not violate the Act when it unilaterally im-
plemented the 10-percent wage reduction . We shall
therefore dismiss the complaint in its entirety.' z
11 We do not agree with the General Counsel's contention that the 10-
percent wage reduction modified the wage rates in effect pursuant to the
settlement agreement. The settlement agreement, winch reinstated the
second-year wage rates, was an attempt to place the parties where they
were before the expiration of the initial wage-reopener period. The fact
remains, however, that the contract did not set a wage rate for the third
year. The Respondent's implementation of a third-year rate, in accord-
ance with the contract's provision, therefore could not modify a third-
year wage rate because no such rate existed.
12 During the hearing, the judge permitted the General Counsel to in-
troduce into evidence, without written consent, a letter written by the
Respondent's counsel to the Regional Director. The Respondent has ex-
cepted to the judge's failure to find that the letter's introduction into evi-
dence violated the Board's Rules and Regulations. In reaching our con-
ORDER
The complaint is dismissed.
elusion that the Respondent did not violate the Act, we do not rely on
the contents of that letter. We therefore find it unnecessary to address the
merits of the Respondent's exception.
Everett Rotenberiy, Esq., for the General Counsel.
Soren S. Jensen, Esq., of Omaha, Nebraska, for Respond-
ent.
DECISION
STATEMENT OF THE CASE
MARTIN J. LINSKY, Administrative Law Judge. The
trial of the complaint was held on July 16, 1984, in Sioux
City, Iowa . The complaint had previously issued on June
18, 1984, by authority of the General Counsel for the
National Labor Relations Board and was signed by the
Acting Regional Director for Region 18. The complaint
was issued following the filing of a charge by Lodge
1426, International Association of Machinists and Aero-
space Workers, AFL-CIO (the Union) on November 25,
1983 . The complaint alleges that Schaeff Namco, Inc.
(Respondent) violated Section 8(a)(1) and (5) of the Na-
tional Labor Relations Act by failing to bargain in good
faith with the Union in refusing to turn over financial
and other information to the Union and by implementing
a 10-percent wage reduction for unit employees.
On the entire record in this case , to include posthear-
ing briefs filed by the General Counsel and Respondent,
and on my observation of the demeanor of the witnesses,
I make the following
FINDINGS OF FACT'
1. JURISDICTION
Respondent admits and I find that it is an employer en-
gaged in commerce within the meaning of Section 2(2),
(6), and (7) of the Act. Further, Respondent admits and I
find that it is an Iowa corporation with an office and
place of business in Sioux City , Iowa, where it is en-
gaged in the manufacture of farm machinery and imple-
ments.
II. LABOR ORGANIZATION
Respondent admits and I find that the Union is a labor
organization within the meaning of Section 2(5) of the
Act.
III. THE UNFAIR LABOR PRACTICES
Respondent and the Union were parties to a collec-
tive-bargaining agreement effective from September 1,
1981, to August 31, 1984. The agreement fixed wages for
the first 2 years of the contract and contained a wage-
reopener clause for the third year of the contract.
1 The General Counsel's motion to correct transcript is noted and cor-
rected.
SCHAEFF NAMCO, INC.
Article XX, section 3 (the wage-reopener clause), of
the contract provided as follows:
On August 1, 1983, the contract shall be re-
opened for a period of thirty (30) days, which
period shall end at Midnight, August 30 (Aug. 30-
31). The sole topic for negotiations shall be hourly
wages. During this period either party may initiate
economic action to support his position , i.e., a strike
or lockout, but if no action is taken within the open-
ing period , the provisions of Article III shall be ef-
fective on August 31, 1983. If no action is taken and
no agreement is reached, the Company shall put
into effect its wage offer for the next year effective
September 1, 1983.2
During the wage reopener of August 1983 the parties
were unable to reach agreement regarding either a new
wage rate or whether to postpone negotiations on the
wage reopener to a later date. Respondent, on August
31, 1983, put into effect a 10-percent wage reduction. In
September 1983, both Respondent and the Union filed
unfair labor practice charges against the other with the
Board . Each alleged that the other had failed to bargain
in good faith during the wage reopener.
On October 20, 1983, the parties entered :nto a stipula-
tion that settled the unfair labor practice, charges each
had filed. The agreement provided, inter alia, that both
Respondent and the Union would withdraw the charges
they had filed. Further, Respondent would reinstate the
wage rate as of August 30, 1983 (prior to the 10-percent
wage rate), and make the employees whole for any loss
of wages resulting for the 10-percent wage reduction.
The parties also agreed to modify article XX, section 3,
of their contract to provide as follows:
On November 1, 1983, the contract shall be re-
opened for a period of 14 days which period shall
end at midnight, November 14. The sole topic for
negotiations shall be hourly wages . During this
period either party may initiate economic action to
support his position , i.e., a strike or lockout, but if
no action is taken within the opening period, the
provisions of Article III shall be effective on No-
vember 15, 1983 . If no action is taken and no agree-
ment is reached , the Company shall put into effect
its wage offer for the next year effective November
16, 1983.9
2 Art III provided as follows:
Article III
Prohibition against Strikes, Lockouts or Boycotts
Section 1 . During the term of this agreement there shall be no
strike, boycott, work stoppage , slowdown, sympathy strike or sus-
pension or dimunition of work on the part of the Union or its
membrs or any employee in the bargaining unit, nor shall there by
any lockout on the part of the Company
Section 2. The Union and its members further agree that they will
in no way interfere with the business of the Company by sanctioning
or conducting a boycott on the handling of goods procured from a
source or destined to a point where a labor controversy may exist.
It seems clear that the parties inadvertently failed to specifically
change the reopener period from 30 days (August 1 -30) to 14 days (No-
1321
Lastly, the stipulation settling the previously filed
unfair labor practice charges provided that "The Union
and the [Respondent] agree that in no event will wages
be reduced in excess of 10 percent.
Thereafter , the parties met on only two occasions, No-
vember 9, 1983, for approximately 10 minutes, and on
November 14, 1983, for approximately 1 hour. Respond-
ent's only position was that a 10-percent wage reduction
had to be agreed to by the Union because of the dire
economic condition of Respondent . Respondent and the
Union failed to reach an agreement concerning wages.
Following the second meeting , the Union sent a letter re-
questing financial data to Respondent which is set out at
footnote 4.4 Respondent, without further contact with
vember 1 -14). The clear intent of the parties was that the reopener
period would extend from November 1 through 14, 1983 See the D.C.
Exh. 3.
4 The body of the letter provided , in pertinent part , as follows:
This is pursuant to your recent request for a reduction in wage
rates existing in the current labor Agreement between LAM Local
1425 and Schaeff-Namco.
It should be pointed out from the outset that the IAM opposes all
efforts to cut wages and benefits which were gained over the years
through good -faith bargaining . Further, before the IAM can serious-
ly consider such a request , it is necessary that we be furnished cer-
tam information for operations at the plant . Such information should
include annual data for each year for a period of not less than five
years , plus comparable data that might be available for 1983.
Specifically , the information required, for both the Company as a
whole and the specific plant involved , is as follows:
(1) Most recent available balance sheet with details as normally
prepared by the Company.
(2) Revenue and cost breakdown as follows, for the past five
years:
a. Revenues : Actual sales separated from any other income, such
as sales of assets , investment income, etc. When feasible, include
data in the number of units of production : Le„ value of shipments,
units produced, etc.
b. Costs: This should include a detailed breakdown (such as is
normally contained in an auditor's supplementary report) of all
costs of products sold, including administrative and selling ex-
penses. This data should include wages , together with all fringe
benefit costs (including pensions, insurance and payroll taxes) paid
to members of LAM Local 1426 . Similar data should be provided
for all nonrepresented employees.
(3) Hours worked by
a. Employees represented by IAM Local 1426
b Other hourly employees, and,
c. All nonrepresented, salaried employees.
(4) Copies of federal corporate income tax returns.
(5) Copies of your reports for the Annual Survey of Manufactur-
ers Reports (MA 100), or Form 1OK Reports of the SEC, which
will tend to verify and confirm the revenue and cost data request-
ed in item 2.
(6) Any available operating and financial projections for the next
year
(7) Details concerning any cuts in wages and/or benefits of nonre-
presented employees, including management personnel, initiated
due to current financial situation.
To repeat, the purpose of this and any other information which
might be requested is to enable the Union to examine and analyze
intelligently the extent to which labor costs affect the Company's
current financial problems . The above-mentioned data will be treated
on a confidential basis. Such data will be returned to the Company
upon completion for our investigation, if desired . Further, the above
information is being requested of and supplied by all other compa-
nies seeking to enter "concession bargaining" with the JAM.
1322 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the Union , put into effect the 10-percent wage reduction,
effective November 21, 1983.
Respondent refused to furnish the bulk of the informa-
tion requested by the Union on the grounds that al-
though some of the information might be relevant during
negotiations since negotiations were concluded and Re-
spondent 's last offer (and only offer) put into effect there
were no more negotiations.
The Union and the General Counsel claim that Re-
spondent did not bargain in good-faith to impasse during
the wage reopener and was therefore without authority
to implement its last offer . Further, because the Union
took action with a view toward a strike, it had initiated
"economic action" within the meaning of article XX,
section 3, of the contract and Respondent could not
therefore put into effect its last wage offer.
It is my conclusion that Respondent , if it had bar-
gained in good-faith to impasse during the wage reopen-
er period, would be legally entitled to put into effect its
last offer, but in this case Respondent did not bargain in
good faith to impasse during the reopener period , there-
fore , it was without authority to put into effect the 10-
percent wage reduction . The remedy , of course, would
be for Respondent to return matters to the status quo
ante, make the employees whole , and bargain in good
faith.
I note for the record that neither Respondent nor the
Union have requested that the Board defer taking action
in this case for the parties to seek resolution of the dis-
pute through resort to the arbitral process . See United
Technologies Corp ., 268 NLRB 557 (1984).
When the parties entered into the contract in Septem-
ber 1981 , it seems clear that they envisioned the wage re-
opener in August 1983 to concern itself only with how
large a wage increase the bargaining unit employees
should get and not with any sort of wage reduction. I
credit the testimony of union negotiator Richard Stur-
geon that during the negotiations in 1981 Respondent's
spokeman Sam Jensen said with respect to the wage re-
opener language (art. XX, sec. 3) "he said that if we did
not strike the company reserved the right to put the
wage increase into effect , but if you strike us you ain't
going to get it." (Tr. 43 .) In addition , Respondent,
through Sam Jensen , wrote a letter to the Union on
August 18 , 1981 , which clearly indicates that the wage
reopener would concern itself only with a wage increase
and not a wage reduction. (See G.C. Exh. 11.)
Nevertheless, the language in the contract concerning
the wage reopener is such that on its face a wage reduc-
tion could result from the wage reopener talks . In addi-
tion, when the parties settled their previously filed unfair
labor practice charges in October 1983 and entered into
a written stipulation , they agreed to a wage reopener in
November 1983 which would be unlimited in regard to
wage increases but as to wage decreases provided that
"in no event will wages be reduced in excess of 10%."
Although the contract specifies that Respondent shall
put into effect its wage offer if no agreement is reached
and no economic action, i.e., a strike or lockout, is taken,
the contract does not prohibit Respondent from putting
its last offer into effect if no agreement is reached but
economic action has been initiated by the Union. Eco-
nomic action is defined as a strike or lockout. The
Union, as explained below, was not on strike when Re-
spondent put into effect its last offer, nevertheless they
had taken all the actions they could with a view toward
going on strike without actually going on strike . In addi-
tion, going on strike would have been illegal at the time
the Respondent put its offer into effect (November 21)
because 30 days had not expired since the Federal Medi-
ation and Conciliation Service (FMCS) had been notified
of the dispute between Respondent and the Union.
The Union and Respondent, as noted earlier, had only
two negotiating sessions during the November reopener.
On November 9, 1983, Respondent and the Union met
for approximately 10 minutes at the Howard Johnson
Motel in Sioux City. Respondent made but one proposal,
a 10-percent wage reduction , and the Union said it
would present that proposal to its members . Two days
later the proposals was presented to the membership and
a strike vote was taken . Five of the six bargaining unit
employees present voted to strike . At this time the unit
varied between 5 and 16 in number . The Union, through
Business Representative Richard Sturgeon , informed Re-
spondent of the strike vote orally on November 11, 1983,
and hand delivered a copy of a letter so advising Re-
spondent that same day . The letter advised that the
Union rejected Respondent's offer of a 10-percent wage
reduction, that the Union was notifying FMCS of the
dispute, that the employees had voted in favor of a
strike, and that the Union was available to meet with Re-
spondent to negotiate at any time during the week of
November 14, 1983. On November 12, 1983, the Union
sent a notice to the FMCS pursuant to Section 8(d) of
the Act, i.e., the 30 days notice to FMCS which must be
sent prior to the commencement of a strike or lockout
when parties are terminating or modifying a collective-
bargaining agreement.
On November 12, 1983, Union Representative Stur-
geon received a telegram at his home from Respondent
setting up a meeting for November 14, 1983, at 9:30 a.m.
Sturgeon called Coon, a representative of Respondent, to
confirm that the Union would be at the meeting on No-
vember 14. Coon at that time advised Sturgeon that Re-
spondent had spoken with counsel and was waiving the
written 30-day notice requirement to FMCS , the effect
of which would be that if the employees went on strike
Respondent would not consider them to be economic
strikers and still employees and would not consider them
to be striking in violation of Section 8(d) of the Act and,
therefore, deprived of the protection of the Act as illegal
strikers.
The second and last negotiating session took place on
November 14, 1983 . It lasted approximately 1 hour. Re-
spondent did not modify its proposal of a 10-percent
wage reduction . The Union proposed a 1-year extension
of the contract and a 2-year wage freeze (i.e., a wage
freeze for the third year of the 1981 to 1984 contract and
for the 1-year extension). The Union suggested that if
wages were cut, that a provision to build back wages be
agreed on. Respondent said any build back would have
to be tied to sales, that they would consider it, but Re-
spondent said nothing further about this proposal. Re-
SCHAEFF NAMCO, INC.
spondent stuck to its one and only proposal of a 10-per-
cent wage reduction. Respondent claimed its poor finan-
cial picture mandated the wage reduction. Respondent
presented no financial records or data to support its posi-
tion, although the Union was undoubtedly well aware
that in the prior 3 or 4 years the number of Respondent's
employees had dropped from approximately 100 to ap-
proximately 16.
Respondent proposed that negotiations on the wage
reopener be extended for 1 more week to November 21,
1983. The Union said it would have to consult with
counsel before agreeing to the extension of negotiations.
A reasonable request, but Respondent immediately said
that because the Union was not promptly agreeing to
extend negotiations, Respondent considered the proposal
to extend negotiations to be rejected by the Union.
During the meeting Union Representative Sturgeon was
given a written memo by Respondent in which Respond-
ent waived any rights it might have under Section 8(d)
of the Act and stating that, in Respondent's opinion, no
8(d) notice was required to be given to FMCS. The
memo did not address the "no strike no lockout" clause
of the contract and its effect, if any, on the Union's right
to strike. The November 14 meeting ended at approxi-
mately 10:30 a.m. with one of Respondent's three repre-
sentatives, Sam Jenson, promising to get back to Union
Representative Richard Sturgeon about whether the em-
ployees, if they went on strike, would still have protec-
tion under the Act in light of the notice requirement to
FMCS and the "no strike no lockout" clause of the con-
tract. In other words, could the employees legally go on
strike? I credit Sturgeon that Jensen did say he would
get back to him over Jensen's less-than-clear denial that
he said he would do so. (Tr. 160.)
The Union returned to its office an prepared a letter
requesting financial information from Respondent and
sent the letter by certified mail that afternoon. Respond-
ent implemented the 10-percent wage reduction effective
November 21, 1983, and answered Respondent's letter by
stating that, although the Union might be entitled to
some of the requested data during negotiations, they
were not entitled to it at that time because negotiations
had concluded and Respondent was putting its last pro-
posal into effect.
It is my conclusion that Respondent was without au-
thority to unilaterally implement the 10-percent wage re-
duction unless they had first bargained in good faith to
impasse during the reopener period, and I find that Re-
spondent did not bargain in good faith to impasse during
the reopener. Only two negotiating sessions occurred.
The first one lasted 10 minutes. The second lasted ap-
proximately 1 hour. Respondent never modified its posi-
tion." The second and last session ended not with im-
6 T is case contrasts sharply with the Board 's recent decision in Bell
Transit Co, 271 NLRB 1272 (1984), in which, although there were only
three short negotiating sessions , the respondent had made three different
proposals to the union . Each of the proposals was better then the one
before for the employees, and the respondent implemented the best and
last of its three proposals The Board found good-faith bargaining in Bell
Transit Co.
1323
passe , but with Respondent's representative promising to
get back to the union representative. The Respondent
proposed to extend negotiations for 1 week, but consid-
ered its proposal rejected when the union representatives
said they wanted to consult with their attorney about an
extension. Respondent's actions in this regard indicate it
was not serious about further negotiations, and the
Union's request to consult its attorney was most reasona-
ble considering the 8(d) notice requirement issue and the
"no strike no lockout clause" of the collective-bargaining
agreement . More than 13 hours remained during the re-
opener period (10:30 a.m. to 12 midnight, November 14),
and Respondent never contacted the Union again, but
simply implemented its proposal. Further, the uncontra-
dicted testimony of Ronald Coon, Respondent's own
witness, was that at no time during negotiations did any
representative of either Respondent or the Union say
that impasse had been reached.
On the state of this record I cannot conclude that Re-
spondent had exhausted the prospects of concluding an
agreement. See Taft Broadcasting Co., 183 NLRB 475
(1967), petition for review denied 395 F.2d 622 (D.C.
Cir. 1968).
Because I conclude that Respondent could not unilat-
erally implement its last offer as it had not bargained in
good-faith during the wage reopener, I must conclude
that good-faith bargaining should have continued. Ac-
cordingly, when the Union sent its letter (which is set
out at fn. 4) it was requesting relevant information to
which it was entitled because Respondent was pleading
inability to pay during the reopener, i.e., Respondent's
representatives were asking for a wage reduction necessi-
tated by Respondent's economic situation which was de-
scribed as being "in distress, very bad." (Tr. 98.) Under
these circumstances, the Union would be entitled to the
financial data it requested in its letter. NLRB v. Truitt
Mfg. Co., 351 U.S. 149 (1956).
The remedy for these violations of Section 8(a)(5) of
the Act, namely, the unilateral implementation by Re-
spondent of a 10-percent wage reduction without bar-
gaining in good faith with the Union and the failure to
produce financial records and data relevant to Respond-
ent's claim of inability to pay should be as follows: re-
scission of the 10-percent reduction, commence bargain-
ing in good faith, turn over the requested financial data
to the Union, and make employees whole for any loss of
earnings incured by the wage reduction. Lastly, Re-
spondent should cease and desist from engaging in these
or similar unfair labor practices.
It is not necessary for me to address a matter discussed
at length in the briefs of the parties, namely, whether the
8(d) notice requirement applies to midterm wage reopen-
ers. It would appear that the 8(d) notice requirements do
apply to midterm wage reopeners and that the parties
cannot waive the applicability of Section 8(d) because
the purpose of Section 8(d) is to allow Federal and state
mediation services an opportunity to assist the parties in
settling their differences so that the economic chaos and
hardship caused by strikes and lockouts can be avoided.
See NLRB v. Lion Oil Co., 352 U.S. 282 (1957). It is not
necessary for me to address this issue because I have
1324 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
concluded that even if the Union took strike action
within the meaning of article XX, section 3, of the con-
tract, Respondent was entitled to put its wage offer into
effect on November 16, 1983, but only if Respondent
bargained in good faith during the reopener period. Be-
cause it did not bargain in good faith during the reopen-
er, it violated the Act when it put their wage offer into
effect. The record reflects that the Union did not, either
30 days after notice to FMCS or at any time, go on
strike.
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce,
and in operations affecting commerce, within the meain-
ing of Section 2(2), (6), and (7) of the Act.
2. The Union is a labor organization within the mean-
ing of Section 2(5) of the Act.
3. By unilaterally putting into effect a 10-percent wage
reduction without bargaining in good-faith with the
Union during a wage reopener and by refusing to
produce relevant fmancial records requested by the
Union to support Respondent 's claim of financial inabil-
ity to pay Respondent violated Section 8(a)(1) and (5) of
the Act.
4. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
[Recommended Order omitted from publication.]