Shopping Kart Food Market, Inc.

National Labor Relations Board - Board Decisions

Apr 8, 1977

228 N.L.R.B. 1311 (N.L.R.B. 1977)

SHOPPING KART FOOD MARKET 1311
Shopping Kart Food Market , Inc. and Retail Clerks
Union Local 99, Retail Clerks International
Association , AFL-CIO, Petitioner . Case 28-RC-
2710
April 8, 1977
DECISION ON REVIEW AND
CERTIFICATION OF REPRESENTATIVE
On February 11, 1975, the Regional Director for
Region 28 issued a Second Supplemental Decision
on Objections to Conduct Affecting Results of
Election and Certification of Representative in the
above-entitled proceeding, in which he overruled the
Employer's Objection 1,1 and certified the Petitioner
as the representative of all of the Employer's
employees in the unit found to be appropriate.2
Thereafter, in accordance with the National Labor
Relations Board Rules and Regulations, Series 8, as
amended, the Employer filed a timely request for
review of the Regional Director's Second Supple-
mental Decision on the grounds, inter alia, that, in
overruling Employer's Objection 1, he departed from
well-established precedent.
By telegraphic order dated June 4, 1975, the
Employer's request for review was granted with
respect to Objection 1 and the certification of
representative was stayed pending decision on
review.
The Board has considered the entire record in this
case with respect to the issues under review and
makes the following findings:
During a meeting on the evening of June 19, 1974,
Petitioner's vice president and business representa-
tive, Roger W. Deason, told the employees that the
Employer had profits of $500,000 during the past
year. The uncontroverted evidence establishes that
the Employer's profits during this period amounted
to approximately $50,000. The election was conduct-
ed the next day, June 20, 1974, between the hours of
3 and 4 p.m. Deason did not explain to the
assembled employees how he arrived at the $500,000
figure.
Relying on Cumberland Wood and Chair Corp.,3 the
Regional Director concluded that the Petitioner's
statement did not constitute a material misrepresen-
tation within the Hollywood Ceramics rule4 because
there was no evidence that Deason either had or
could reasonably be perceived to have had knowl-
edge concerning the Employer's profits. Accordingly,
he overruled the Employer's objection and certified
the Petitioner.
We agree with the Regional Director that the
alleged misrepresentation does not warrant setting
aside the election, but so find for the reasons set forth
in Member Penello's dissenting opinions in Medical
Ancillary Services, Inc.,5 and Ereno Lewis.6 In sum,
we decide today that the Board will no longer probe
into the truth or falsity of the parties' campaign
statements. Accordingly, we hereby overrule Holly-
wood Ceramics.
As an initial matter, we understand this judgment
to be one which the Board is clearly authorized to
make. Thus, the Supreme Court has long recognized
that the Board possesses a "wide degree of discre-
tion" in performing its function of establishing
policies and procedures to safeguard the conduct of
representation elections.7 Most significant, in the
recent Weingarten decision,8 the Court held that the
exercise of our administrative discretion in the
decisionmaking process necessarily includes the
authority to revise or modify principles previously
adopted. The Court stated its holding in the
following emphatic terms: 9
The use by an administrative agency of the
evolutional approach is particularly fitting. To
hold that the Board's earlier decisions froze the
development of this important aspect of the
national labor law would misconceive the nature
of administrative decisionmaking. " `Cumulative
experience' begets understanding and insight by
which judgments . . . are validated or qualified or
invalidated. The constant process of trial and
error, on a wider and fuller scale than a single
adversary litigation permits, differentiates per-
haps more than anything else the administrative
from the judicial process." [Citation omitted.]
' Pursuant to a notice of hearing and order issued by the Regional
Director on November 21, 1974, a hearing was held to resolve the issues
raised by the Employer's Objection I insofar as it alleged that the
Petitioner's vice president and business representative misrepresented the
Employer's profits. In his Second Supplemental Decision, the Regional
Director affirmed the Hearing Officer's findings of fact, to which no
exceptions were filed, and adopted his conclusions of law
2 The appropriate unit is
All full-time and regular part-time selling and non-selling employees
employed by Shopping Kart Food Market, Inc, Maricopa County,
Arizona, excluding all meat department employees, watchmen, guards
and supervisors as defined in the Act
228 NLRB No. 190
The revised tally of ballots served on the parties on November 15, 1974,
indicated that 14 voted for, and 8 voted against, the Petitioner
3 211 NLRB 312 (1974).
4 Hollywood Ceramics Company, Inc, 140 NLRB 221 (1962).
5 212 NLRB 582 (1974).
6 217 NLRB 239 (1975)
7 N L R B v A. J Tower Company, 329 U S 324, 330 (1946) Accord,
N L R B v Wyman-Gordon Co, 394 U.S. 759, 767 (1969)
8 NLRB v J Weingarten, Inc, 420 U S 251 (1975)
9 Id at 265-266
1312 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Fifth Circuit reached a similar conclusion in
Foremost Dairies 10 in which it denied enforcement of
a Board Order, stating that it was merely applying
the Board's own "laboratory conditions" standard.
That standard, the court emphasized, was adopted
originally by the Board, not the courts, and,
accordingly, is controlling only "until the Board
announces a change and its reasons for the
change."" We announce that change today for the
reasons that follow.
Our more than 20 years' experience with the rule of
Hollywood Ceramics and its progenitor, The Gummed
Products Company, 112 NLRB 1092 (1955), has
revealed that although its adoption was premised on
assuring employee free choice its administration has
in fact tended to impede the attainment of that goal.
The ill effects of the rule include extensive analysis of
campaign propaganda, restriction of free speech,
variance in application as between the Board and the
courts, increasing litigation, and a resulting decrease
in the finality of election results. As has been
thoughtfully examined in several scholarly studies of
this subject, to a large degree the source of these
difficulties lies in the very nature of the standards we
have formulated and sought to administer. Thus,
Professor Bok, in his classic treatise on Board
election procedures,12 stated: "If a standard of truth
and accuracy could actually provide an administra-
ble norm, something might be said for adopting such
a view. But this possibility tends to dissolve on more
careful analysis. In the welter of words exchanged
during a heated campaign, it is plainly impractical to
intervene upon every misstatement made by the
agents of the union or the employer. Thus, judges
and administrators have long recognized that inaccu-
rate or misleading assertions should be proscribed
only under certain conditions. These qualifications,
however, immediately began to blur the line between
the licit and illicit." Professor Bok concluded that
restrictions on the content of campaign propaganda
requiring truthful and accurate statements "resist
every effort at clear formulation and tend inexorably
to give rise to vague and inconsistent rulings which
baffle the parties and provoke litigation." 13
A recent study by Robert E. Williams, Peter A.
Janus, and Kenneth C. Huhn analyzed the Holly-
wood Ceramics standards in the following terms: 14
10 Home Town Foods, Inc, d/b/a Foremost Dairies of the South v
N L R B, 416 F 2d 392 (C A 5, 1969)
11 Id at 399 Additionally, the Board itself has, in the past, modified its
approach and application of analogous rules for the conduct of elections
See, e g, NVF Company, Hartwell Division, 210 NLRB 663 (1974) (Members
Fanning and Jenkins dissenting, but not on the basis of lack of authority),
modifying the interpretation of Peoples Drug Stores, Inc and Peoples Service
Drug Stores, 119 NLRB 634 (1957)
12 "The Regulation of Campaign Tactics in Representation Elections
Under the National Labor Relations Act," 78 Harv L Rev 38, 85 (1964)
Determinations regarding the substantiality and
materiality of particular misrepresentations are
necessarily highly subjective. It would be difficult
for any tribunnal [sic] . . . to reach uniform and
consistent results in the application of such
standards. The timing test represents a logical and
necessary attempt to limit agency involvement to
cases of "last-minute" abuses, but even it may
raise vexatious issues of fact regarding what is
required for an "effective" opportunity for reply.
With respect to the source and independent
knowledge factors, the Board's decisions reflect a
fundamental ambivalence as to how much em-
phasis should be placed upon the voters' own
abilities to recognize campaign propaganda for
what it is and either disregard it or take
independent steps to verify it before voting in
reliance thereon. In some cases, the Board
appears to have regarded the employees as
exceptionally naive and in need of extensive
protection from the agency. In others, the Board
has seemed willing to impose a high degree of
responsibility on the voters themselves to protect
themselves from being misled by campaign
claims.
These authors conclude with the following caveat:
"As long as the Board continues to probe into the
truth or falsity of campaign statements and measure
their effect on election results by these uncertain
standards, parties unsuccessful in the balloting will
object routinely to their opponents' campaign state-
ments, and the Board will be forced to engage in a
painstaking analysis of everything that was said in
the campaign with the certification of the election
results delayed in the interim." 15
Certainly reasonable men can differ in the applica-
tion of these vague and flexible standards. Therefore,
it is not surprising that the years of litigation under
the Hollywood Ceramics approach have been marked
by frequent differences of opinion between the Board
and the courts. This variance in application is
illustrated by the several recent cases involving the
identical issue presented in the instant case, i.e.,
alleged union misrepresentations of an employer's
profits, in which courts have denied enforcement of
Board Orders.16 Regrettably, these differences fur-
ther encourage "protracted litigation before the
13 Id at 92
14 "NLRB Regulation of Election Conduct" at p 57, Industrial Research
Unit of the Wharton School, University of Pennsylvania (1974)
15 Id at60.
16 E g., Argus Optics, a Division of Argus, Inc v N L R B, 515 F 2d 939
(C.A 6, 1975), Lake Odessa Machine Products, Inc v NLRB, 512 F 2d
762 (C A 6, 1975), La Crescent Constant Care Center, Inc v N L R B, 510
F 2d 1319 (C.A 8, 1975); Henderson Trumbull Supply Corporation v
NLRB , 501 F 2d 1224 (C A 2, 1974)
SHOPPING KART FOOD MARKET 1313
Board and in the courts" and thus also serve to
detract from the election goal of giving "speedy
practical effect to the choice of employees for or
against collective representation." 17
The existence of many of these problems was
frankly acknowledged by the Board majority in
Modine Manufacturing Co.'s Thus, it was therein
noted that experience under the Hollywood Ceramics
approach has revealed that questions of materiality
and impact on voter choice are indeed "elusive
issues," the Board and the courts of appeals have
often disagreed on the application of the misrepre-
sentation standards, the parties are quick to seize on
these uncertainties and file objections, and the
resulting increase in litigation has an adverse effect
on the finality of election results. Notwithstanding
these "inherent dangers" which made abandonment
of the Hollywood Ceramics approach "in some degree
tempting," the Board majority decided that it was
"not yet ready" to leave the voters "to sort out, with
no protection from us, from among a barrage of
flagrant deceptive misrepresentations." 19
Despite the many difficulties in administering the
Hollywood Ceramics rule, we, too, would nevertheless
choose to continue to adhere to it if we shared the
belief that employees needed our "protection" from
campaign misrepresentations. However, we do not
find this to be the case. For our fundamental
disagreement with past Board regulation in this area
lies in our unwillingness to embrace the completely
unverified assumption that misleading campaign
propaganda will interfere with employees' freedom of
choice. Implicit in such an assumption is a view of
employees as naive and unworldly whose decision on
as critical an issue as union representation is easily
altered by the self-serving campaign claims of the
parties. If these postulates had any validity 20 years
ago at the time of Gummed Products, they are surely
anachronisms today. We decline to join those who
would continue to regulate on the basis of such
assumptions notwithstanding "improvements in our
educational processes, and despite the fact that our
elections have now become almost commonplace in
the industrial world so that the degree of employee
sophistication in these matters has doubtless risen
substantially during the years of this Act's existence
...." 20 Rather, we believe that Board rules in this
area must be based on a view of employees as mature
n Judge Feinberg dissenting in Henderson Trumbull Supply Corporation,
supra at 1233 See Samoff, "NLRB Elections Uncertainty and Certainty,"
117 U Pa L Rev 228 (1968)
i5 203 NLRB 527 (1973), enfd 500 F 2d 914 (C A 8, 1974)
Is 203 NLRB at 530
20 Id
21 Getman and Goldberg, "The Behavioral Assumptions Underlying
NLRB Regulation of Campaign Misrepresentations An Empirical Evalu-
ation ," 28 Stanford L Rev 263 (1976)
individuals who are capable of recognizing campaign
propaganda for what it is and discounting it.
The recently published results of an empirical
study of NLRB elections suggest that ours is the
more accurate model of employee behavior.21 In this
study, Professors Getman and Goldberg interviewed
over 1,000 employees in 31 elections conducted in
five States. The data cast doubt on the assumption
that employees are unsophisticated about labor
relations and are therefore easily swayed by cam-
paign assertions , as 43 percent of the study's
respondents had been union members elsewhere and
30 percent had voted in previous Board elections.
Perhaps the study's most significant fmding was that
the votes of 81 percent of the employees could be
correctly predicted from their precampaign intent and
their attitudes toward working conditions and unions
in general. Thus, the campaign did not influence the
majority of employees to vote contrary to their
predispositions for or against union representation.
Rather, the choices of these employees appear to be a
product of attitudes formed on the basis of their
everyday experiences in the industrial world. This
conclusion is supported by other data indicating that
employees are generally inattentive to the cam-
paign.22 Concerning the remaining employees who
voted contrary to their original intent or were
undecided at the outset of the campaign, only the 5
percent of the total sample who either switched to the
union or were originally undecided and ultimately
voted for the union could be said to have been
influenced by the campaign of the party for which
they voted.23
Based on assumptions of employee behavior which
we find dubious at best and productive of a host of ill
effects, we believe that on balance the Hollywood
Ceramics rule operates more to frustrate free choice
than to further it and that the purposes of the Act
would be better served by its demise. Accordingly,
we decide today that we will no longer set elections
aside on the basis of misleading campaign state-
ments. However, Board intervention will continue to
occur in instances where a party has engaged in such
deceptive campaign practices as improperly involv-
ing the Board and its processes , or the use of forged
documents which render the voters unable to
recognize the propaganda for what it iS.24 While the
22 Id at 276-279 This conclusion is also in accord with that of an earlier
study of NLRB elections. See Brotslaw , "Attitude of Retail Workers
Toward Union Organization ," 18 Lab. L J 149 (1967)
23 In contrast, the company campaign was found not to have an
analogous effect on "switchers" and originally undecided employees who
voted against the union
24 We are pleased that Chairman Murphy has decided to join us in
overruling Hollywood Ceramics, declining to examine oral or written
statements for mere truth or falsity, and adopting the above-described
(Continued)
1314 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
former standard represents no change in Board
law,25 by our adoption of the latter we choose to
revert to our earlier policy 26 of setting an election
aside not on the basis of the substance of the
representation, but the deceptive manner in which it
was made. The essential difference lies in the fact
that, while employees are able to evaluate mere
propaganda claims, there is simply no way any
person could recognize a forged document "for what
it is" from its face since, by definition, it has been
altered to appear to be that which it is not. Retention
of this standard is fully consonant both with our view
of employees as intelligent voters and with our duty
to insure the integrity of our election process. We
shall, of course, continue our policy of overseeing
other campaign conduct which interferes with
employee free choice outside the area of misrepresen-
tations which had been objectionable only under the
Hollywood Ceramics rule.
Accordingly, as the Employer's objection has been
overruled, and as the revised tally of ballots shows
that the Petitioner has received a majority of the
valid ballots cast in the election, we shall certify it as
the exclusive bargaining representative of the em-
ployees in the appropriate unit.
CERTIFICATION OF REPRESENTATIVE
It is hereby certified that a majority of the valid
ballots have been cast for Retail Clerks Union Local
99, Retail Clerks International Association, AFL-
CIO, and that, pursuant to Section 9(a) of the
National Labor Relations Act, as amended, the said
organization is the exclusive representative of all the
employees in the unit found appropriate herein for
the purposes of collective bargaining with respect to
rates of pay, wages, hours of employment, and other
terms and conditions of employment.
CHAIRMAN MURPHY, concurring:
Like Members Penello and Walther, I believe that
the time has come for the Board to recognize the
ineffectiveness of its present treatment of allegations
criteria as the basis for setting aside Board elections We note that the
Chairman "would also set aside an election where a party makes an
egregious mistake of fact " However , it is clear from her opinion that this
category is a very narrow one and would require setting an election aside
only "in the most extreme situations " Thus, she states that she did not and
would not direct a new election on the basis of such facts as those presented
in Henderson Trumbull Supply Corporation, 220 NLRB 210 (1975), where it
was alleged that the union made a hundredfold misrepresentation of the
employer's profits
25 See , e g, J Ray McDermott & Co, Inc, 215 NLRB 570 (1974)
2s This policy was set forth in United Aircraft Corporation, Pratt &
Whitney Aircraft Division, 103 NLRB 102 (1953), where one union
distributed a forged telegram in which its rival purported to apologize for its
conduct during the campaign Since the employees were deceived as to the
source of the "telegram ," they could not possibly evaluate its contents and
the Board set the election aside The United Aircraft decision was followed
in such subsequent cases as Sylvania Electric Products, Inc, 119 NLRB 824,
of misrepresentations of fact in preelection campaign
literature and statements and to overrule Hollywood
Ceramics, supra. Accordingly, I join with them in so
holding. I reach this conclusion reluctantly because I
agree with the basic principles as set forth in that
case ; 27 but the ruling has been so expanded and
misapplied as to have extended far from the original
intent of the Board.28 Further, I agree with my
colleagues that the Board's rules concerning preelec-
tion statements must recognize employees as mature
adults capable of recognizing and evaluating cam-
paign rhetoric for what it is.
In view of our decision herein, elections will no
longer be set aside solely on the basis of misleading
oral or written statements unless , for example, a
party has engaged in deceptive campaign practices
such as involve the Board and its processes or the use
of forged documents which render the voters unable
to recognize the propaganda for what it is. Needless
to say, however, I shall continue to set an election
aside in the event of misconduct involving threats,
promises of benefit, or similar improprieties.
My sole departure from the position of my
colleagues on the majority is that, unlike them, I
would also set aside an election where a party makes
an egregious mistake of fact. This is not to say that I
shall set aside elections even on gross errors or will
examine statements, oral or written, for mere truth or
falsity; nor shall I look to reliance or possible
reliance upon any such statements. I would only find
an egregious mistake of fact to constitute interference
with an election in the most extreme situations. For
example, I did not and would not direct a new
election on the facts in Henderson Trumbull Supply
Corporation, 220 NLRB 210 (1975),29 in which the
union's representative allegedly told employees that
the company made over $1 million, which was
construed to represent profits, whereas in fact its
gross profits were $260,371 and its net income was
$11,669 for the year. Nor did I or would I find
interference with an election on the facts in The
Contract Knitter, Inc., 220 NLRB 579 (1975),30 in
which the alleged misrepresentation consisted of the
827-830 (1957), and Cascade Corporation, 205 NLRB 638, in 2 (1973)
(Member Penello relying solely on the forgery as grounds for setting the
election aside)
27 As set forth by my colleagues , the basic rule was adopted for the
purpose of assuring employee free choice, but its administration has in fact
had the opposite effect and has restricted free speech.
28 See, e g, Medical Ancillary Services, Inc, 212 NLRB 582 (1974), GTE
Lenkurt, Incorporated, 209 NLRB 473 (1974), Aldon, Inc, 201 NLRB 579,
587-588 (1973), Bausch & Lomb, Incorporated, 185 NLRB 262 (1970), enfd
451 F 2d 873 (C A 2, 1971)
29 Member Jenkins Joined Member Penello and me in concluding that
the misrepresentation did not warrant setting the election aside
30 Member Jenkins also joined in this decision Cf Snokist Growers, Inc,
213 NLRB 368 (1974), facts set forth in 532 F.2d 1239 (C A 9, 1976),
denying enforcement of the Board decision in which Members Fanning and
Jenkins joined with the then Chairman Miller in finding no basis for setting
SHOPPING KART FOOD MARKET 1315
misstatement of the amount of earnings by employ-
ees at plants of another company which was
Contract Knitter's largest customer.31
The alleged misrepresentation here consisted only
of the Petitioner's representative telling the employ-
ees that the Employer had profits of $500,000 during
the preceding year, whereas the profits were actually
about $50,000. Under these facts, I find no basis for
setting this election aside, and as the Union won the
election I join in the certification of representative.
MEMBERS FANNING and Jenkins, dissenting in part:
Our colleagues are today departing from long-
established Board precedent concerning the treat-
ment of substantial misrepresentations in campaign
rhetoric incident to employee opportunity to elect a
bargaining representative. This Board will "no longer
probe into the truth or falsity of the parties'
campaign statements." It will no longer assess, as in
Modine,32 the "tendency materially to mislead,"
hence to destroy laboratory conditions.
In this particular case, the difference in approach
within the Board will not affect the result. All agree
to certify the Petitioner. On our part we have
carefully reviewed the record and are not convinced
that the employees considered Deason a credible
source in stating that the Employer made $500,000 in
profits when in fact the profit of the year in question
was $50,000, or that the employees of this relatively
small single store operation-in an industry having a
5-percent profit margin-were incapable of evaluat-
ing Deason's remarks. We note that at the hearing
four of the five witnesses presented by the Employer
testified that they believed Deason's statement to be
incorrect.
We are, however, deeply concerned at this signifi-
cant change in policy now undertaken by a majority
of the Board. The 1962 Hollywood Ceramics decision
was a clarification of this Board's firm belief that
employees should be afforded a degree of protection
from overzealous campaigners who distort the issues
by substantial misstatements of relevant and material
facts within the special knowledge of the campaigner, so
shortly before the election that there is no effective
time for reply. The standards embodied in Hollywood
Ceramics were written after years of careful and
periodic reevaluation.33 Less than 4 years ago, the
Board undertook another reevaluation in Modine,
supra, stating at 530:
aside an election where the union misinformed employees concerning the
extent of pension coverage that seasonal workers could expect under union
conditions.
31 Although I appreciate the majority's kind words, I do not deem myself
bound by their interpretation of my position , particularly as to what
constitutes egregious mistake of fact My concurrence herein speaks for
itself and is neither narrowed nor broadened by my colleagues ' opinion as
expressed by them in fn 24, supra
32 Modine Manufacturing Company, 203 NLRB 527, 531 (1973) (Member
[W ]e are not yet ready to say that we will leave all
our voters in all of our elections and in all
circumstances to sort out, with no protection from
us, from among a barrage of flagrant deceptive
misrepresentations.
We consider that statement just as valid today.
Now, however, a majority of this Board has come
to the conclusion that there is no need to protect
employee voters; that, if there ever was a need, the
passage of time has made employees so sophisticated
as to negate such need. Our colleagues suggest that
we have considered employees "naive," "unworldly,"
and easily swayed by a self-serving campaign. In
some cases , we have had such concerns. Overall we
would characterize our concern as stemming from
the desirability of maintaining election standards
that call a halt to misrepresentation considerably
short of fraud. It is well for the parties to have a
minimum of lingering doubt as to the fairness of the
election if bargaining ensues . Stability of the bargain-
ing relationship and, hence, industrial peace are
encouraged if that doubt is minimized.
In rationalizing their policy shift, our colleagues
rely upon studies whose authors essentially conclude
that employees do not attend closely to preelection
campaigns, and that employee voting predilections
are not easily changed by campaign information.
Therefore, say our colleagues, the Hollywood Ceram-
ics rule has done no more than protect free choice in
a few. That, we sincerely question. We are aware of
these studies and of the fact, as well, that our Nation
is given to opinion polling, a technique much used in
political campaigns, partly as a guide to tailoring
campaign content. In the recent study on "Behavior-
al Assumptions," the poll consisted of postelection
interviews in a five-state area of the Midwest and
Upper South, made within a few days after the
elections. To our colleagues it is significant that it
appears that 81 percent of the employee vote could
have been accurately predicted from individual
precampaign intent, as recalled postelection. Not
commented upon from the same study is the
apparent fact that 50 percent of the employees were
aware of union claims concerning wages elsewhere,
though the precise amount (within 10 percent of the
actual claim) was recalled by only 22 percent. We are
not prepared to view 22-percent "precise" recall as
insignificant. Even the 5 percent of voters who
Kennedy concurring without adopting the discussion on Hollywood
Ceramics, Member Penello questioned the rule but deferred discussion for a
future case), enfd. 500 F 2d 914 (C.A 8, 1974)
33 See Curtiss-Wright Corporation, 43 NLRB 795 (1942), Sears Roebuck
and Company, 47 NLRB 291 (1943); Maywood Hosiery Mills, Inc, 64 NLRB
146, 150 (1945); General Shoe Corporation, 77 NLRB 124 (1948), The
Gummed Products Company, 112 NLRB 1092 (1955); Kawneer Company, 119
NLRB 1460 (1958).
1316 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
appear to have admitted changing their minds due to
the campaign are not insignificant in our view.
Highly significant is awareness by half the voters of
the wages-elsewhere issue . In such circumstances, if
substantially inaccurate wage claims were made at
the last minute and the employees themselves had no
basis for evaluation, we consider it desirable for this
Board to rivet attention on a correction by holding a
second election. If the result, as here, is not to hold a
second election, the parties are nevertheless made
aware of the principle-that misleading matter has
been considered. An appropriate standard is thereby
maintained.
In 1974, the year the authors of "Behavioral
Assumptions" made their study, objections of all
kinds were filed in only 11 percent of the 9,000 or
more elections conducted by the Board. Board
elections held per year now top 10,000. The General
Counsel 's statistics for the last 6 years show that
objections based on misrepresentation averaged
between 3 and 4-1/2 percent:
Alleged union
misrepresentations
Percent sustained
1971 - 174 1.7
1972 - 176 9.1
1973 - 240 3.8
1974 - 142 10.6
1975 - 245 4.1
1976 - 223 3.6
Alleged employer
misrepresentations
1971 - 205 10.7
1972 - 150 11.3
1973 - 210 10.0
1974 - 104 15.4
1975 - 207 7.2
1976 - 84 21.4
Thus the Board considers some 300 to 400 cases per
year on the issue. Considering its importance, this
seems to us an excellent investment in maintaining
our election standards. The number of second
elections run as a result can hardly be viewed as
burdensome. For the above figures show that second
elections are directed in 7 percent (25 to 27 second
elections per year) of the cases in which misrepresen-
tation objections are filed under Hollywood Ceramics.
These figures demonstrate two facts of consider-
able importance to our decision in this case. First,
3' The 2 of 31 cases in which precampaign intent cannot serve as a
"predicator" of result is almost 7 percent of the total, about the same
percentage as the percentage of "rerun" elections under Hollywood
Ceramics
35 See, for example, LaCrescent Constant Care Center, Inc v N L,R B,
they refute the argument of critics of the Hollywood
Ceramics policy, adopted by our colleagues, that the
losing parties "will object routinely" to their oppo-
nent's campaign statements. Objections there may
be; routinely filed, no. Secondly, these figures also
refute our colleagues' view that the rule guaranteeing
investigation and resolution of misrepresentation
objections "operates more to frustrate free choice
than to further it and that the purposes of the Act
would be better served by its demise." For the
significance of these numbers lies not in the fact that
so few elections are set aside under Hollywood
Ceramics, but that in over 95 percent of the more
than 10,000 elections conducted each year the
employees can cast their ballots after responsibly
conducted campaigns. Indeed, even if one were
inclined to accept the view that the 31 elections
studied by the authors of "Behavioral Assumptions"
constitute a statistically significant sample-a dubi-
ous proposition at best-and the resultant conclusion
that precampaign intent can predict the result in 29
out of 31 cases, its validity is surely limited to
campaigns conducted in accordance with Hollywood
Ceramics standards.34 Were those standards to be
relaxed-to the "almost anything goes" standard
proposed by our colleagues-one result can be fairly
predicted. Campaign charges and countercharges
would surely escalate . For the parties will campaign,
and they will campaign on the assumption that what
they say may make the difference. As "bad money
drives out the good," so misrepresentation, if allowed
to take the field unchallengeable as to its impact, will
tend to drive out the responsible statement.
Our colleagues seek to eliminate the delay in
resolving objections under the present system and we
agree with them-and with those who thoughtfully
follow Board decisions and discuss them, often in
published writings-that this delay is a haunting
problem to us. This case in particular is egregious in
its postponement of election results. However, in
view of the consensus not to set aside, it is most
unfortunate that this case was not allowed to issue
and a more timely one chosen as the vehicle. Perhaps
that is inevitable in reevaluations.
We are unable to share our colleagues' concern at
the variance in application of the rule as between the
Board and the courts. We do not read these decisions
to mean judicial disenchantment with the rule, but
only disagreement with how strictly the rules should
be applied.35 It may seem desirable to have the
courts uniformly enforce our decisions, just as it
510 F 2d 1319, 1321, 1324 (C.A. 8, 1975), where, while differing with the
Board's decision to overrule an employer 's objection based on union
misstatements of company profits, the court quoted approvingly from
Hollywood Ceramics, and concluded that a particular statement "was a
complete falsehood which cannot be characterized as less than a `substantial
SHOPPING KART FOOD MARKET
would be desirable to have "uniform and consistent
results" in the application of the rule. But judges and
Board Members are human beings and unvarying
uniformity in end result is not only unlikely but,
should it occur, subject to deep distrust under our
system of government. As to the added time factor of
litigation, it seems to us an unavoidable characteris-
tic of maintaining campaign standards that we
consider highly beneficial to elections "across the
board."
Our elections are well known for the degree of
participation by eligible voters, which far exceeds
that in political elections where many voters appear
to be sufficiently disinterested to allow their fellow
citizens to decide the outcome for them. Early this
year the Board announced that the 30 millionth voter
in a Board election had now voted-at Millers Falls
Paper Co. in Massachusetts. The January 16 press
release stated:
Conducting such elections, with safeguards to
bar improper pressures on the voters by labor or
management, has been a major responsibility of
the NLRB for nearly 42 years. In some 300,000
elections employee participation has averaged
close to 90 percent. At Millers Falls, all but one of
the 114 eligible voters in the bargaining unit cast
ballots.
It seems to us that this degree of participation is
related to the nature of what is at stake: wages, job
security, pensions , health benefits, vacation privileg-
es, job conditions. All can be directly affected by the
ballot cast by an employee. And that ballot can be
directly and significantly affected by the campaign
propaganda of the employer and the union. Unlike
our colleagues, we are unwilling to permit the parties
to campaign, without challenge, on the basis of
misrepresentation and distortion of issues so directly
related to this economic security of workers.
We think it can fairly be said that the high degree
of voter participation in our elections is encouraged
by the longstanding policy that Hollywood Ceramics
represents and, indeed, that voters in political
elections may refrain from voting to the extent they
do partly because they are reluctant or unable to rely
departure from the truth' under the Hollywood Ceramics test" See also
N L R B. v. Carlton McLendon Furniture Co, Inc., 488 F.2d 58, 62 (C A. 5,
1974), where the court described its own parallel test and concluded that the
Regional Director erred in finding a last-minute handbill immaterial (to wit
the union had won a nearby election though the result was a one-vote
plurality with two unresolved challenges, later the subject of charges) In
N L R B v. Cactus Drilling Corporation, 455 F 2d 871 (C.A 5, 1972), the
court was not satisfied with the Board's "strict " application of its
opportunity-to-reply criterion, the Board having taken account of the
objecting party's failure to rebut, despite a clear opportunity to do so, and
balanced this against the fact that Board rules foster the rights of majorities.
The court viewed rebuttal as futile in the context but also observed that
1317
on the representations made where there is no
satisfactory method of review of campaign conduct.
The very fact of high voter participation in Board
elections counsels the continuance of Board effort in
the area of informed free will voting.
Do our colleagues forget that these are the days of
a serious search for ways to reform campaign
practices in political elections? Every force in our
society is moving away from the position taken by
our colleagues-truth in lending, truth in advertising,
Sunshine laws, freedom of information (not misinfor-
mation), financial disclosure in political campaigns,
and the like. Is it not most unwise to decide that this
is the time for the Board to cast aside a major part of
its election protection procedure and retreat to a rule
formulated over a generation ago and discarded for
good reasons? Pursuant to that procedure there is,
for example, the Excelsior rule,36 requiring an
employer to furnish eligibility lists, showing the
names and addresses of its employees. The Board
approved that addition to its election procedures in
1966, 4 years after the Hollywood Ceramics restate-
ment on misrepresentations. The purpose was to see
that all parties to the election, whatever their
viewpoint, have an opportunity to communicate with
the electorate to the end that the voters could cast an
informed ballot. Disclosure of the names and
addresses of the full unit complement in advance of
the election was deemed a key factor in insuring fair
and free elections by an informed electorate. Are our
colleagues now prepared to have these eligibility lists
used to grossly misinform the electorate? Or should
we interpret the step here taken with respect to
Hollywood Ceramics as just the first in dispensing
with time-honored election safeguards?
It is with astonishment that we note the contention
that one of the "host of ill effects" of Hollywood
Ceramics is the "restriction of free speech." Are our
colleagues equating the Board's assessment of the
impact of campaign misrepresentations on the
fairness of its elections with imposition of a prior
restraint upon the parties' expression of their views,
arguments, and opinions, in any manner deemed
desirable by them? The right of free speech guaran-
teed by the first amendment has never been
construed to our knowledge to leave the speaker
"there is certainly a proper place for the Board's Hollywood Ceramics
rule. .. See also Argus Optics, a Division ofArgus, Inc v N L R B, 515
F 2d 939 (C.A 6, 1975), where the court remanded for hearing, noting that
the Regional Director had failed to apply the Hollywood Ceramics test to one
of the letters sent by the union and to an election eve misrepresentation
concerning profits, Thiem Industries, Inc v. N L R B, 489 F.2d 788 (C A 9,
1973), where the court, applying Hollywood Ceramics, found, inter aha, that
"employees are liable to accept . . uncritically" a union's statements about
its own contracts , thus differing from the Board's assessment that accepting
credit for certain large wage increases in several industries was merely an
overexaggeration.
36 Excelsior Underwear Inc, 156 NLRB 1236 (1966).
1318 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
unaccountable for the impact or effects of his speech.
Similarly, a party to a Board election is free to say
what he will, but there is nothing in Section 8(c) to
preclude setting an election aside if it can be shown
that serious misrepresentations or distortions of
election issues have seriously impaired the fairness of
the electoral process. The Act contains no license for
unrestricted distortions and, though the Board may
have the requisite authority to pare sharply the
"laboratory conditions" standard it has developed,
the step our colleagues now take cannot be justified
on the assumption that our standard has restricted
free speech.
The right-of-free-speech argument of our col-
leagues raises doubt of their ultimate purpose.
Though they protest that they will continue to
oversee "employee free choice outside the area of
misrepresentations" their assurance is hardly persua-
sive. Setting aside elections on the basis of threats,
promises, and coercive interrogation can also be
labeled as requiring undue analysis of campaign
propaganda, litigation that results in variance,
postponed finality of elections, and restrictions on
the right of free speech. In fact, only fraud or
forgery-which have rarely intruded upon our
elections-appears suitable for resolution as effort-
lessly and expeditiously as our colleagues would
wish.
Thus, we are unimpressed by the mirage of ill
effects our colleagues see in the Hollywood Ceramics
policy. In our view, proof is entirely lacking that
administration of the rule has tended to impede
informed free will exercise of voter franchise. Rather,
in untold numbers of uncontested elections, it has
encouraged that objective.
MEMBER JENKINS, dissenting further:
The majority, in deciding that misrepresentations
in an election campaign are of no importance, relies
extensively, indeed perhaps solely, on a law review
article which the writers have since expanded into a
book.37 In evaluating this conclusion and where it
might lead, it is appropriate to examine the latest and
most complete expression of the writers' methods,
rationale, logic, and conclusions. Such examination
leads me to substantial reservations on all points.
These writers conclude (pp. 120-121) that potential
union supporters are unaffected by what they
perceive as an employer's unlawful campaigning.
They base this on their finding that, among the initial
union supporters, those who ultimately voted against
the union did not report unlawful campaigning in a
greater percentage of cases than those who voted for
the union. Yet, the most that can be drawn from this
37 "Union Representation Elections Law and Reality," Getman,
Goldberg and Herman (Russell Sage Foundation, New York, 1976)
"fact" appears to me to be that the depth of
conviction regarding union support varies with
individuals, and some of them can be turned around
while others cannot.
Using the same sort of "fact" and logic, the writers
conclude that discharges perceived as discriminatory
similarly have no effect in influencing employees'
votes (p. 126).
They also conclude that interrogation does not
affect employee attitudes, because "it was rarely
reported by employers as a campaign tactic" (p. 149).
Yet, the writers did not ask directly whether
interrogation had taken place and, nevertheless, 29
employees volunteered that it had occurred in
(seemingly) 16 of the 31 elections examined. This
appears to me to indicate that interrogation made a
substantial impression on the employees. The writers
further support their conclusion by the facts that 43
percent of the union voters believed the employer
knew their views, and 76 percent of these had
voluntarily disclosed their views to the employer.
Obviously, interrogation of these hardy souls, 33
percent of the voters, would be unimportant and
indeed needless-it is the other two-thirds that
concern us, and about whom the writers tell us
nothing.
They find that union authorization cards are
sufficiently reliable indicators of union support that
elections are really not needed (pp. 135, 153), but
then conclude that elections are preferable to
recognition on the basis of cards in order to allow the
employer to present his campaign (pp. 136, 153), and
they concede, contrary to what one would expect
from their willingness to ignore all election campaign
misconduct, that such campaigns are effective in
switching the position of the voters (p. 145).
With this sort of nonprobative factual data and non
sequitur logic, these writers find it easy to conclude
that discharges, other reprisals, grants of benefits,
threats, promises, interrogation, and misrepresenta-
tions should be eliminated as grounds for setting
aside elections (pp. 147-152). It is these uncertain
guides the majority is here following with regard to
misrepresentations. There is no reason to think the
same course will not lead them to disregarding
threats, promises, discharges, other reprisals, grants
of benefits, and interrogation. The number of Gissel
bargaining orders 38 issued on the basis of card
majorities after unions have lost elections tainted by
unlawful conduct shows that something is causing
voters to switch. It is this inescapable fact which my
majority colleagues, in reliance on these writers,
ignore.
38 N L R B v Gissel Packing Co, Inc, 395 U.S 575 (1969)