Southern Colorado Power Co., a Corporation

National Labor Relations Board - Board Decisions

Jul 19, 1939

13 N.L.R.B. 699 (N.L.R.B. 1939)

In the Matter Of SOUTHERN COLORADO POWER CO., A CORPORATION
and H. H. STEWART AND I. L. WATKINS, INDIVIDUALS
Case No. C-936.-Decided July 19, 1939
Electric Utility Industry-Interference, Restraint, and Coercion: repeated
expressions of opposition by executives and supervisory employees to pro-
posed formation of a labor organization among office employees : threats to
replace office employees with labor-saving machines if unionization continued :
threats to discharge or lay off employees , if they went on strike : granting of
general wage increase to deter and discourage unionization-Discrimination:
discharges of two employees, leaders of organization of office employees,
chosen in reduction of force dictated by legitimate business considerations
because of their union activity-Reinstatement Ordered-Back Pay: awarded.
Mr. Newell N. Fowler, for the Board.
Mr. Harry S. Petersen, Mr. John T. Barbrick, Mr. T. E. Lang-
don, and Mr. R. M. Campbell, of Pueblo, Colo., for the respondent.
Mr. Eugene R. Tliorrens, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon charges duly filed by H. H. Stewart and I. L. Watkins, the
National Labor Relations Board, herein called the Board, by Aaron
W. Warner, Regional Director for the Twenty-second Region
(Denver, Colorado), issued its complaint dated May 7, 1938, against
Southern Colorado Power Co., Pueblo, Colorado, 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) and (3) and Section 2 (6) and (7) of the
National Labor Relations Act, 49 Stat. 449, herein called the Act.
Copies of the complaint, accompanied by notice of hearing, were
duly served upon the respondent and upon Stewart and Watkins.
In respect to the unfair labor practices, the complaint alleged, in
'substance, that on or about November 30, 1937, the respondent dis-
charged, and thereafter refused to reinstate, H. H. Stewart and I. L.
Watkins, employees of the respondent, for the reason that they
attempted to form a union among the employees of the respondent
and engaged in concerted activities with other employees for the
13 N. L. R. B., No. 79.
699
700 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
purpose of collective bargaining and other mutual aid and protec-
tion; that during the period from February or March 1937 to the
date of the complaint, the respondent urged, persuaded, and warned
its employees to refrain from engaging in concerted activities for
the purpose of collective bargaining. and to refrain from forming
or becoming members or participating in the activities of a labor
organization, and threatened the employees with discharge and other
reprisals if they engaged in such activities; and, that by such dis-
charges, persuasion, warnings, and threats, and by other acts, the
respondent had interfered with, restrained, and coerced its employees
in the exercise of the rights guaranteed in Section 7 of the Act.
On May 24, 1938, the respondent, appearing specially, filed a mo-
tion to dismiss the complaint for lack of jurisdiction. Contempo-
raneously with the filing of this motion, the respondent filed an
answer, expressly preserving therein its special appearance and juris-
dictional objections, in which, in substance, it denied the alleged
unfair labor practices, admitted certain allegations of the complaint
and denied others concerning the respondent's business, and reiterated
the various jurisdictional and constitutional grounds set forth in its
motion to dismiss the proceedings.
Pursuant to notice, a hearing was held at Pueblo, Colorado, on
June 2, 3, 4, and 6, 1938, before S. H. Jaffee, the Trial Examiner duly
designated by the Board. The Board and the respondent were rep-
resented by counsel and participated in the hearing. Full oppor-
tunity to be heard, to examine and cross-examine witnesses, and to
introduce evidence bearing on the issues was afforded all parties.
At the commencement of the hearing the Trial Examiner announced
that he reserved his ruling upon the motion to dismiss the complaint,
made prior to the commencement of the hearing, pending introduc-
tion of evidence bearing upon the issue therein involved, and the re-
spondent repeated its jurisdictional objections before participating in
the hearing. At the close of the Board's case, at the close of the re-
spondent's case, and again at the close of all the evidence, the re-
spondent renewed its motion to dismiss the proceedings for lack of
jurisdiction and on the additional ground that the evidence failed to
sustain the allegations of the complaint of unfair labor practices.
During the course of the hearing the respondent moved to strike cer-
tain testimony. The Trial Examiner reserved his rulings upon these
motions pending the issuance of his Intermediate Report. At the
close of all the evidence, the Board moved to conform the complaint
to the proof. The Trial Examiner granted the motion in so far as it
applied to misspelled words, dates, and places mentioned in the
record. After the close of the hearing, the attorney for the Board
and the respondent's counsel entered into a written stipulation to cor-
SOUTHERN COLORADO POWER COMPANY 701
rect the transcript of the testimony to conform to the testimony given,
and the Trial Examiner ordered the stipulation embodying the cor-
rections made part of the record.
At the close of the testimony, the parties were given 10 days from
date for the filing of briefs, and were informed that they would be
given 10 days from the date of receipt of the Trial Examiner's Inter-
mediate Report to request oral argument before the Board. The re-
spondent submitted a brief to the Trial Examiner.
Thereafter the Trial Examiner filed his Intermediate Report, dated
September 15, 1938, in which he denied the motions of the respondent
to dismiss the proceedings, and denied in part and granted in part the
respondent's motions to strike certain testimony, upon which the Trial
Examiner had reserved rulings at the hearing. He found that the
respondent had engaged in and was engaging in unfair labor prac-
tices affecting commerce within the meaning of Section 8 (1) and (3)
and Section 2 (6) and (7) of the Act, and recommended that the re-
spondent cease and desist from its unfair labor practices, offer rein-
statement with back pay to H. H. Stewart and I. L. Watkins, and
take other affirmative action to effectuate the policies of the Act.
On September 29, 1938, the respondent filed exceptions to the Inter-
mediate Report and thereafter submitted a brief in support of the ex-
ceptions. Neither party exercised the privilege of requesting oral
argument, and none was held.
The Board has reviewed the rulings of the Trial Examiner on mo-
tions and objections to the admission of evidence and finds that no
prejudicial errors were committed. The rulings are hereby affirmed.
The Board has considered the exceptions to the Intermediate Report
and briefs filed by the respondent and finds the exceptions to be
without merit.
Upon the entire record in the case, the Board makes the following :
FINDINGS of FACT
1. THE BUSINESS OF THE RESPONDENT
Southern Colorado Power Co., a Colorado corporation, having its
principal office and place of business at Pueblo, Colorado, is a public
utility engaged in the business of generating, buying, transmitting,
selling, and distributing electrical energy, operating a street railway
system in Pueblo, and purchasing, selling, and distributing electrical
appliances and equipment at retail. The respondent is a subsidiary
of Standard Gas and Electric Company, a Delaware public utility
holding corporation with its principal office at Chicago, Illinois,
herein called Standard, which owns substantially all the voting
capital stock of the respondent, when dividends are not in arrears,
702 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and 64 per cent of the voting stock when dividends are in arrears
for a period of one year.' By majority voting stock ownership,
Standard controls public utility operating corporations in approxi-
mately 20 States other than Colorado. Each subsidiary is operated as
an independent company. The various subsidiaries together own
the capital stock of Public Utility Engineering and Service Cor-
poration, a Delaware corporation with its principal office at Chicago,
Illinois, which performs certain advisory, fiscal, engineering, tech-
nical , statistical, and purchasing services for each of them. The
Board of Directors of the service corporation consists of the presi-
dents of the several operating subsidiaries.
In the production and distribution of electrical energy, the re-
spondent operates steam plants in Pueblo and Cannon City, Colorado,
and a hydro-electric plant at Skaguay, Colorado. All the coal used
at the steam plants is mined in Colorado and all the water necessary
for the operation of the hydro-electric plant originates within Colo-
rado. The respondent's property is situated in, and its lines extend
over, 6 Colorado counties. The respondent also supplies electrical
energy at wholesale to the Western Public Service Corporation, a
public utility company which distributes such electrical energy to
its customers over its own lines in Bent County, Colorado. All
transmission and distribution facilities and equipment, and all other
properties owned by the respondent and used in its business, are
'located within Colorado.
The respondent serves a population of approximately 104,970 per-
sons in an area covering about 7,000 square miles in the southeastern
part of the State of Colorado. No competing source of electrical
power exists in the area served by the respondent. Other electric
utility companies doing business in Colorado do not operate parallel
lines.
During 1937 the respondent generated 84,508,360 kilowatt hours
and purchased 2,390,600 kilowatt hours of electrical energy, having
a total sales value of $2,054,682.11. Of the total amount purchased
and generated, the respondent sold approximately 758,630 kilowatt
hours of electrical energy to interstate transportation and communi-
cation agencies, 4,141,692 kilowatt hours to manufacturing concerns
which sell part of their products outside Colorado, 250,637 kilowatt
hours to newspapers, 70,701 kilowatt hours to radio broadcasting
and service stations, and 56,997 kilowatt hours to United States post
offices. As of November 30, 1937, the respondent employed 399 per-
sons and had an annual pay roll, including annuities and separation
allowances, of $732,669.90.
1 At the time of the healing , the respondent had paid no dividends for approximately
4 years
SOUTHERN COLORADO POWER COMPANY 703
Purchase of materials in interstate commerce
In 1937, the respondent purchased cable wire, meters, transformers,
poles, ties, coal, and various other materials (excluding merchandise
equipment and appliances) for construction purposes and in the
operation of its business amounting to approximately $564,283.92.
Of this amount, $172,364.24 represented a non-recurrent capital ex-
penditure for materials used in the construction of a new transmis-
sion line between Pueblo and Rocky Ford, Colorado. Thirty-five
and six-tenths per cent of the total amount of such materials pur-
chased during 1937, aggregating $200,903.00, were shipped to the re-
spondent by manufacturers from points outside Colorado.
Purchases and sales of electrical equipment and appliances in inter-
state commerce
During 1937 the respondent purchased radios, refrigerators, wash-
ing machines, ironers, lamps, and other electrical equipment and
appliances having a total gross value of $122,484.91, which it sold to
retail customers, dealers, and distributors within Colorado. Approx-
imately 10 per cent of the total of such purchases were shipped to the
respondent by manufacturers from points outside Colorado, and sub-
stantially all the equipment and appliances were manufactured in
States other than Colorado.
Dependence of particular consumers on electric energy supplied by
the respondent
Counsel for the Board and counsel for the respondent entered
into written stipulations to supplement oral testimony bearing on the
question of jurisdiction , which among other things , set forth data
with respect to a number of particu l ar consumers showing the
dependence on the electrical energy supplied by the respondent of
various types of important businesses engaged in interstate transpor-
tation and communication and of manufacturing concerns which sell
a portion of their products in interstate commerce and the effect on
such commerce that would result from a stoppage of the flow of
power from the respondent , such as would tend to accompany a labor
dispute between the respondent and its employees.
Railroads .-The respondent furnishes electrical energy to the
Atchison, Topeka and Santa Fe Railway Company, the Denver and
Rio Grande Western Railroad Company, and the Missouri Pacific
Railroad Company , all interstate railroads , having lines extending
from the State of Colorado into other States and hauling interstate
and local traffic. The electricity purchased from the respondent is
used by the railroads for the lighting of railroad stations , for power
704 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
purposes in repair shops, and in the operation of block signal devices,
all within Colorado. A cessation of the flow of power from the
respondent would seriously curtail the operation of the signalling
systems of the various railroads, and since train movements are
dependent on the proper and precise operation of the signalling
system, such stoppage would impede considerably interstate train
movements, inasmuch as the stand-by power devices of the railroads
are designed for use only in short-lived emergencies.
Telegraph.-The respondent supplies electrical energy to the West-
ern Union Telegraph Company and the Postal Telegraph System.
Both of these companies receive and transmit messages into and out of
Colorado. The electricity is used in the lighting of their offices and
stations and for the operation of equipment which is utilized for the
transmission of local and interstate messages. Cessation of the flow
of electrical energy from the respondent, in the case of the Postal
Telegraph Company, would completely stop the operations of its
Colorado offices and branches, and in the case of the Western Union
Telegraph Company, would interfere with its normal methods of
transmitting interstate messages.
Telephone.-The respondent supplies electrical energy to The
Mountain States Telephone and Telegraph Company, which has
telephone lines extending from the State of Colorado into other
States, for use in lighting its offices and stations and for the operation
of equipment utilized in the transmission of local and interstate mes-
sages.
Radio.-The respondent furnishes electrical energy to Station
KGHF, Pueblo, Colorado, for the purpose, among others, of supply-
ing power for the operation of equipment utilized in connection with
the broadcasting of National Broadcasting System programs which
are received by Station KGHF over telephone lines from States out-
side Colorado.
Airports.-The respondent also supplies Airway Radio Service,
Pueblo, Colorado, at its Pueblo, Colorado, airport, with electrical
energy for the operation of a radio beam guide and for the operation
of a radio communication system used in dispatching arriving and
departing airplanes, some of which carry United States mail.
United States post ofoes.-The respondent supplies electrical
energy to the Federal Government for the operation of United States
post offices. The electricity is used for lighting the post offices and
in the operation of stamping and other machines. A stoppage of
the flow of electrical energy from the respondent would necessitate
the hiring of additional employees to offset the discontinuance of
labor-saving devices which are operated by electricity.
Newspapers.-The respondent supplies electrical energy for power
and lighting purposes to 19 newspapers, 4 of which are daily and 16
SOUTHERN COLORADO POWER COMPANY 705
weekly publications. The daily newspapers receive Associated Press
and/or United Press Association service. Twenty-five per cent of the
advertising which the Pueblo Chieftain and Pueblo Star Journal, a
daily newspaper whose circulation is confined within Colorado, car-
ries is national advertising, that is, advertising which originates out-
side Colorado. This newspaper has no auxiliary equipment for use
m the event of a cessation of the flow of electrical energy from the
respondent.
It also appears from the evidence that a large number of indus-
tries, such as manufacturing, situated in the area served by the
respondent and engaged in shipping commodities in interstate com-
merce, are dependent on the respondent for electric power and light
which are essential to the operation of their plants. In the written
stipulations concerning the respondent and its business there are
listed 25 of the respondent's largest customers and their purchases of
electrical energy during 1937. As above indicated, the stipulation
shows that seven of these concerns, which ship a portion of their
finished products in interstate commerce , alone purchased from the
respondent approximately 4,141,692 kilowatt hours of electrical
energy in 1937 for lighting and power purposes.
It should be noted with regard to both transportation and corn-'
munication that some of the companies which use power supplied
by the respondent but which have auxiliary devices to serve in the
event of interruption of that power, would have to rely on such
emergency equipment as gas engines, batteries, small motors, and
similar devices. Since it is apparent that reliance on such substitutes
would create an increased break-down hazard, and in any event neces-
sitate the continued periodic replacement of the makeshift equipment,
such a change to operations on an emergency basis in itself would
constitute a burden upon and obstruction of these instrumentalities
of commerce.2
Conclusions with respect to the respondent's relation to commerce
It is evident from the above findings (1) that the respondent re-
ceives large quantities of cable, wire, cross arms, poles, railway
material, electrical equipment, and appliances, as well as other com-
modities, in interstate commerce; (2) that a large area in the Sate
of Colorado containing industrial, commercial, and residential con-
sumers, is wholly dependent upon the respondent as a commercial
source of electrical energy; (3) that a labor dispute between the
respondent and its employees, interrupting the respondent's opera-
2 Cf. Matter of Consumers' Power Company and Local No. 740, United Electrical,
Radio h Machtnc Workers of America , 9 N. L. R . B. 701 ; Mattel, of Southern California
Gas Company and Utshty Workers Organizing Committee, Local No. 132, 10 N. L. R B.
1123.
706 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
tions, would seriously affect the flow of large quantities of the above-
mentioned and other commodities in interstate commerce; (4) that a
cessation of the flow of electrical energy from the respondent, such
as would tend to accompany a labor dispute between the respondent
and its employees (a) would tend to burden and obstruct the opera-
tions of various instrumentalities of interstate transportation and
communication by compelling them to use emergency substitutes for
their normal supply of power, as well as by causing, in some cases,
complete shut-downs, and in others, temporary interruptions of serv-
ice, and (b) would directly cause a cessation of the operations of the
businesses served by the respondent with electrical energy, which
ship commodities in interstate commerce similar to that which would
accompany simultaneous labor disputes in all such businesses thereby
causing a substantial diminution in the flow of commodities in
interstate commerce.
In further support of its motion to dismiss the proceedings for lack
,of jurisdiction, the respondent contends that it is exclusively subject
to the public utility and labor laws of the State of Colorado. An
examination of the legislative provisions cited by the respondent,
however, reveal that the State of Colorado has enacted no comprehen-
sive code for the supervision of labor relations for employers in intra-
state enterprises similar to that established by the Act with respect
to interstate or foreign commerce. Moreover, so far as appears, no
proceedings have been taken under Colorado laws in relation to the
unfair labor practices alleged in the complaint.3
II. THE UNFAIR LABOR PRACTICES
A. Interference, restraint, and coercion
Early in the spring of 1937 the operating employees 4 of the re-
spondent circulated a petition for an increase in wage rates. H. H.
Stewart, an accountant in the respondent's general accounting depart-
ment, was approached by one of the operating employees and asked
to solicit office employees' signatures to the petition. Stewart dis-
cussed the advisability of joining in the petition with other office
employees, and together they decided to consult W. J. Benning, a
director, and officer 5 of the respondent in charge of accounting,
before taking any action with reference to the petition. When the
office employees presented the matter of the petition to Benning, he
requested that they withhold action until lie consulted with W. N.
3See Consolidated Ednson Company of New York, Inc, ct at, v. National Labor Rela-
tions Board, 305 U. S. 197 (1938).
4 Which include linemen, groundmen, engineers, machinists, repairmen, and others.
5 Vice president and treasurer.
SOUTHER\ COLORADO POWER COMPANY 707
Clark, presideut of the respondent. Later, Benning called Stewart
into the vice president's office and advised him that Clark had ex-
pressed the desire that the office employees refrain from becoming
involved with the petition. Benning stated to Stewart that if the
respondent should decide to grant the operating employees a pay
increase the office employees would be similarly treated. After Stew-
art reported this to his fellow office workers, the office employees
decided to abide by Clark's wishes and ignore the petition.
These events occurred in April 1937. About this time, representa-
tives of the Committee for Industrial Organization, herein called
the C. I. 0., attempted to organize the employees. It also appears
that the International Brotherhood of Electrical Workers, affiliated
with the American Federation of Labor, herein called the I. B. E. W.,
communicated with the respondent. Lester Morrell, an operating
employee who later became president and business manager of the
I. B. E. W. local of operating employees thereafter organized at
the respondent's plant, urged the petition for the wage increase upon
Clark with the argument that it would be better for the respondent
to grant the increase because he, Morrell, feared that the employees
were becoming "C. I. O.-minded." In denying the operating em-
ployees' petition, Clark stated to Morrell that Bell, the international
vice president of the I. B. E. W., had spoken to Clark and that the
respondent had decided not to grant the pay increase until the
I. B. E. W. completed its organizational work among the employees.
During the course of the I. B. E. W. membership campaign which
followed, various operating employees approached Stewart with a
view of enlisting his aid in soliciting the oemployees to associate'1
with the operating employees in the projected labor organization.
Stewart discussed the matter with other office workers, and they de-
cided to consult an officer of the respondent before taking this step.
Accordingly, Stewart conferred with Benning who requested that the
matter be held in abeyance until he talked to Clark concerning it.
Later, Benuiug informed Stewart that Clark disapproved of the plan
to organize the office force in the I. B. E. W., but rather preferred to
deal with those employees on an individual basis. Benning assured
Stewart that the office workers "would be taken care of" if they did
not join a labor organization. In various other conversations with
Stewart during the I. B. E. W. organizational drive, Benning ex-
pressed his opposition to having a union for office employees.
Stewart conveyed Benning's messages from Clark to his fellow
workers. As a result, the office employees decided not to join a labor
organization.
The I. B. E. W. thereafter formed Local 667 for the operating
employees and on May 12, 1937, secured a contract from the respond-
708 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ent. When Stewart learned that the respondent contemplated sign-
ing a contract with the I. B. E. W. covering the operating em-
ployees, he again took up with, Benning the matter of pay raises for
the office workers. Once more, a similar procedure followed. Ben-
uing consulted with Clark and reported to Stewart that Clark de-
sired the office employees to wait until the pending negotiations with
the I. B. E. W. terminated.
About May 20, Clark departed for a trip to Europe and Benuing
went to Chicago. When Benning returned in June, Stewart again
broached the matter of pay raises. Benning stated that nothing
could be done until Clark returned from Europe. Consequently the
office employees became restive. Stewart discussed with them the ad-
visability of organizing themselves in a separate union without
waiting for Clark's return. In July the office employees decided to
hold a meeting on Monday night, August 9, at the Labor Temple in
Pueblo, for the purpose of forming such a labor organization.
Clark returned to his desk about August 1. On Saturday morn-
ing, August 7, Robert Miller, the secretary and assistant treasurer
of the respondent and assistant to Benning in charge of the general
accounting department, called Stewart to Miller's desk. Miller in-
formed Stewart that a conference of the respondent's executive offi-
cers had been held earlier that morning in Clark's office and that at
the conference Benning was instructed by Clark that he wanted the
office employees not to organize a labor union. Stewart told Miller
that the office employees were compelled to band together because
Clark and Benning had failed to keep their promises with respect to
salary increases. Miller then informed Stewart, in substance, that
the respondent had decided to grant pay increases to the office em-
ployees, thus rendering unnecessary their formation of a labor or-
ganization. In the same conversation with Stewart, Miller added :
" ... they could install accounting machines, and . . . let off some
of (those) in the general office." The same morning Miller also in-
formed T. F. Roach, an accountant in the general accounting depart-
ment, of a raise for him, and declared : ". . . Mr. Clark was against
the office organizing and if they did go ahead and organize, they
could install accounting machines which would replace possibly a
good many in the accounting department." In his testimony Miller
stated that he did not recall making these statements, but admitted
that he might have said something in a similar vein to the employees.
Benning failed to deny at the hearing the testimony of Logan Ragle,
Jr., a minor supervisory employee, to the effect that, apparently be-
fore the August 9 meeting, he was told by Benuing, his superior, that
in his opinion the office employees did not need a union and, if the
respondent had "a lot of labor trouble," bookkeeping machines could
SOUTHERN COLORADO POWER COMPANY 709
be installed. We find that Beuning made the statements attributed
to him by Ragle, Jr.
The same day, Saturday, Roach spoke to Milliken, an officer of the
respondent, concerning the unrest in the office and suggested to
Milliken that if the respondent would receive a committee of em-
ployees, the union activity might be stilled. On Monday morning
Roach was summoned to Clark's office. There Clark stated that he
would not see a committee, asserted that he opposed the contem-
plated organization of the office employees, and declared that if the
office workers formed a labor organization, no pay increases would
be granted, and if such organization should call a strike the entire
office personnel would be replaced. According to Roach, he was in-
structed by Clark to deliver his message to the other employees, but
Roach declined, suggesting that Clark might send Miller, or some
other executive officer, if Clark did not care to attend the meeting.
At the hearing Clark admitted that he told Roach of the respond-
ent's opposition to the formation of the proposed union, but he de-
nied directing Roach to deliver any message at the meeting. Clark
also sought to explain away his apparent threat to replace strikers
by reference to the respondent's contract with the I. B. E. W.,
which contains a provision allowing the respondent to hire substi-
tutes in the event that the employees should strike rather than submit
disputes to arbitration. Although Clark claimed that he had heard
that the office employees contemplated affiliation with the I. B. E. W.
plant local, it is significant that the above-mentioned contract con-
tained no provisions applicable to office employees. Under these cir-
cumstances we find that Clark made the statement in question to
Roach.
On Monday night, Stewart presided as chairman at the Labor
Temple meeting which 19 or 20 of the respondent's office employees
attended at the solicitation of Stewart and I. L. Watkins, a collector
in the respondent's local accounting department. After addresses to
the workers .by local labor leaders, the meeting adjourned to the
Wednesday following the next pay day, without the taking of defi-
nite action towards the formation of a union and in order to await
the promised salary increases and the effect of such increases, if
granted, upon the employees with respect to their willingness to
organize.
Two or three days after the August 9 meeting, Clark began a con-
versation about the proposed union when he met Stewart in the men's
room. Clark voiced the opinion that the office employees could not
gain admittance to the I. B. E. W. Stewart disagreed, pointing out
that the office workers might obtain a separate charter from the Ameri-
can Federation of Labor or affiliate with a C. I. O. office employees'
187930-39-vol. 13-46
710 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
organization as alternative choices, in addition to associating them-
selves with the I. B. E. W. plant local.
The next pay day, August 16, the office employees received a gen-
eral pay increase. As a result, Stewart and Watkins, after consulta-
tion with other office employees, decided to cancel the Wednesday
night meeting, and to postpone active organizational work pending
dissipation of the psychological effect of the salary increases upon
the employees.
It is plain that the respondent granted the pay increases, in part at
least, to lessen the need for a labor organization among its office em-
ployees and to discourage them from introducing such. an organiza-
tion as their collective bargaining representative. In his testimony
Benning admitted that he knew of the existence of agitation for a
union among the office employees and of the scheduled August 9
Labor Temple meeting when he presented the pay-increase matter to
Clark upon his return from Europe; that Clark was informed at
that time by Benning of the employee movement for organization;
and, that Benning's knowledge of the extent to which the movement
had progressed stimulated him to induce Clark to grant the
increases.6
In their testimony supervisory employees sought to justify their
expression to the respondent's office employees of opposition to their
establishment of a labor organization. The supervisory staff claimed,
and the respondent urges in its briefs, that the office workers have a
confidential relationship to the respondent and occupy a position of
intimate association with the management which call for the applica-
tion of the individual merit system in the respondent's dealings with
these employees. The alleged confidential tie rests for its existence,
however, upon the bare assertions of the respondent's witnesses with-
out an adequate showing of the nature of the information to which
the office employees may have had access, or the extent to which such
confidential tie would preclude the organization of the office em-
ployees for the purposes of collective bargaining. In.any event the
Act vests in employees the right to determine for themselves the feasi-
bility of joining, forming, or assisting in the establishment of a labor
organization. Nor does it withhold the exercise of such right from
confidential employees as a class.
At the hearing the respondent's supervisory employees, while ad-
mitting that they expressed opposition to a labor organization of office
employees claimed that they also reminded the employees of their
freedom to establish a union if they so desired. In our opinion, how-
s Cf National Labor Relations Board v American Potash and Chemical Corporation,
08 Fed (2nd) 488 (1938), cert den., 306 U S 643; Matter of Jackson Daily News, Inc.
and Jackson Prsnt?nq Pressmen and Assistants Union No. 215, 9 N L. R B. 120; Matter
of Hercules-Campbell Body Co, Inc. and United Automobile Worke,s of America, Local
# 118, 7 N. L. R B. 431.
SOUTHERN COLORADO POWER COMPANY 711
ever, such statements, especially when accompanied by threats of
reprisals, do not nullify the coercive effect of the respondent's activi-
ties. Moreover, in the normal relationship between employer and
employee, almost any expression of opinion by the employer indicat-
in_g to those who depend upon his continued good will for their live-
lihood an unequivocal disapproval of their forming or joining a labor
organization characteristically carries home to employees an im-
plied threat of unlawful discrimination for noncompliance with the
employer's desires.'
Ave find that, by expressing opposition to the proposed formation of
a labor organization of its office employees, by urging and persuading
its employees not to join or form a labor union, by threatening to
install labor-saving machines to replace its office workers if they per-
sisted in efforts to organize a labor union, bythreatening to discharge
or lai_.off ewu»lo)_eesif they went on strike, and by nncreasmg their sal--
cries to discourage its employees from joining or establishing a labor
organization, the respondent has interfered with, restrained, and co-
erced its employees in the exercise of the right to self-organization, to
form. join, and assist labor organizations, to bargain collectively
through representatives of their own choosing, and to engage in con-
certed activities for the purpose of collective bargaining and other
mutual aid and protection.
B. The discharges
The respondent's threat to replace its office employees by the instal-
lation of labor-saving devices materialized on November 30, 1937,
with the discharge of H. H. Stewart and I. L. Watkins, both em-
ployees with long service records. On that day Benning told Stewart
and Watkins that they had been selected for discharge because the
respondent planned to install accounting machines to lessen its oper-
ating expense. When Stewart charged that he was being dismissed
for his attempt to organize a union, Benning refused to discuss the
matter.
It appears from the evidence that governmental agencies, such as
the Federal Power Commission and the Social Security Board, had
required the respondent to furnish a large variety of statistical data
concerning the operation of its business during a period of several
years immediately preceding the discharges. In the past the respond-
ent had hired additional employees in order to furnish the information
required by these agencies. According to Benning and Clark, the
respondent first considered the installation of accounting machines to
handle this burden in the spring of 1937. The respondent began
neggtiations for the acquisition of the machines about October 1 and
° See National Labor Relations Board V The Falk Corporation, 102 Fed (2d) 383
(1939)
712 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
its Board of Directors approved their proposed installation and the
discharges of Stewart and Watkins on November 22. We do not find
that the respondent installed the accounting machinery in order to
separate Stewart and Watkins from its pay roll. The question re-
mains, however, whether in selecting employees in connection with the
reduction in force incident to the machinery installation, the respond-
ent discriminated against Stewart and Watkins because of their union
activities. We will now consider that issue as to each of the two
individuals.
Stewart
Benning claims that he reviewed the standing of all office employees
with the department heads, Miller and Hendricks, before he reached
the decision to release Stewart and Watkins. On the basis of Mil-
ler's recommendation, Stewart appeared to be the outstanding can-
didate for discharge, allegedly by reason of certain conduct and be-
cause he exerted a harmful influence upon the other employees in his
department.
Miller accused Stewart of loafing during working hours. At the
hearing Stewart explained that the office employees worked at high
speed during a portion of each month in order to prepare and issue
necessary statistical and other reports; that ordinarily after the issu-
ance of the reports a lull period ensued during which the employees
customarily engaged in conversation when they had no work to per-
form. During the lull period Stewart conducted himself generally
in the same manner as other employees. Miller failed to deny
Stewart's testimony that Miller often spent as much as an hour at a
time with Stewart at his desk in conversation concerning matters
which bore no connection with their work.
Miller also cited an incident which occurred on Armistice Day, 1936,
as a basis for the selection of Stewart for elimination from employ-
ment. It appears that the general accounting department employees
were ordered by Benning to remain on duty beyond 11 o'clock that
morning while employees in other departments were excused in defer-
ence to the day. Miller observed Stewart, who was a war veteran,
advise a small group of his coworkers, World War veterans, to re-
main at their posts in protest against the delay if they were granted
leave at a later hour. At 11: 20 a. m., when Miller informed those
who had been detained, that Benning had granted permission for
them to leave, Stewart stated that "the significance of the day was
lost" and Miller might "tell that pro-German (Benning) to go to
hell, I am staying." Roach and Sheets, another employee, remained
on duty with Stewart. Later, however. Miller approached Stewart
at his desk and apologized in behalf of Benning, saying that he had
forgotten that it was Armistice Day.
SOUTHERN COLORADO POWER COMPANY 7 1 3
In addition, Benning charged at the hearing that Stewart physi-
cally assaulted one of the respondent's officials in 1921 or 1922. This
Stewart denied. In any event, Benning admitted in his testimony
that the alleged assault had been forgotten at the time he decided to
discharge Stewart. Obviously, therefore, the alleged occurrence
could not have been a motivating factor in Benning's decision to
end Stew art's employment.
Stewart admitted at the hearing, as Miller testified, that he left
the office without permission on one occasion in 1936 or 1937 for an
unstated period when Miller, over Stewart's protest, insisted that
Stewart surrender certain reports to a stenographer in the office for
copy purposes.
In the consideration of the alleged acts of misconduct upon which
the respondent's officers claim that they relied in selecting Stewart
for discharge, it is significant to note that neither Benning, Miller,
nor any other member of the respondent's supervisory staff ever
disciplined Stewart for the above-mentioned or any other alleged
shortcomings; that they never apprised him of the accusations
against him, never warned Stewart against the recurrence of these
incidents or requested him to repair his alleged faults on any oc-
casion 8 Although Miller testified that Stewart's claimed deficiencies
continued down to the time of his discharge, the respondent increased
his salary as late as September 1936 and again in August 1937. It
is difficult to believe that the respondent would have granted these
pay increases if it had in reality considered his conduct so deficient
as to warrant Stewart's release in November, less than 31/2 months
after, his last salary advance. Moreover, there is no evidence that
Stewart's fellow workers complained to the management that he
interfered with their work, nor does the record contain any convinc-
ing proof that Stewart's conduct adversely affected the morale of the
office workers.
On the other hand, in his testimony, Miller characterized Stewart
as a "thoroughly competent and capable" worker. Of 15 employees
in Stewart's department at the time of his discharge, only 1 employee
had seniority ° over him. Stewart began his employment with the
respondent in the spring of 1916 and remained continuously in the
respondent's employ for approximately 20 years until he was dis-
charged, except for a period of 22 months' army service during the
World War. Of four accountants in his department, Stewart had
most seniority. Stewart ranked as the third highest paid employee
in the entire department and the second highest paid accountant.
8 we do not credit Miller's testimony concerning a remark he made to all his subordinates
requesting them to cease loafing on an alleged occasion so distant as to be beyond his
recollection
9 At the hearing Clark testified that the respondent recognized seniority as a factor in
its personnel problems.
714 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
During his service with the respondent Stewart was variously em-
ployed as cashier, traveling auditor, bill clerk, utility clerk, invoice
clerk, and accountant and received eight individual salary increases,
one general increase , and one general decrease in pay which was
later restored.
Miller admitted that Stewart possessed ability to do the work of
V. L. Mock, the valuation engineer , of Roach, the invoice clerk, of
Ray A. Talbot, Jr., the pay-roll record clerk, and of W. J. Tiday,
the traveling auditor.'° Miller also conceded that in his opinion
Stewart could have adapted himself, if he would, to the machine
system and perform the work that Roy A. Payton, Jr ., a machine
operator , was doing at the time of the hearing . In addition, it ap-
pears that Stewart performed work which other accountants in his
department did not do ; that only the detail or routine aspects of
Stewart's work could be performed with the use of accounting
machines; and that, at the time of the hearing, even that type of
work, which Stewart formerly did, was not being handled by the
machine system.
Only three employees in Stewart 's department , Roach, Talbot,
and Charlotte Burns , besides Stewart and Sheets , attended the
August 9 meeting at the Labor Temple. Of these only Roach was
active in the movement for union organization , but even his efforts
appear to have been limited to the making of requests to Benning
and Miller for a general pay increase, and not to have extended to
organizational work among the employees . The record makes clear
that Stewart ranked as the outstanding protagonist of the union
movement among the office employees . Moreover , as noted above in
subsection A, the respondent 's supervisory officials made clear to
Stewart that they opposed his efforts to organize these employees.
Watkins
Watkins, whose outside position as a collector enabled him to
communicate with employees in various departments, served as
Stewart's most active union associate. The employees in the local
accounting department, generally, recognized Watkins as their de-
partmental leader. At the close of the Labor Temple meeting on
August 9, Watkins introduced a resolution urging the employees
present to bring a coworker with them to the next meeting.
Watkins worked as a collector in the respondent's local accounting
department at the time of his discharge. He began his employment
with the respondent on May 26, 1919, as a street-car conductor. Dur-
ing his employment with the respondent, in addition to being a
i° The record indicates that the respondent 's district managers at its branch offices
objected to Stewart as a traveling auditor, but the basis of their objection does not appear.
SOUTHERN COLORADO POWER COMPANY 715
street-car conductor , Watkins worked as a cashier , bookkeeper, ac-
countant , salesman, and collector . Of 20 employees in the local ac-
counting department , Watkins ranked sixth in seniority , and of 2
collectors in that department , Watkins had departmental seniority.71
He was the fourth highest paid employee in his department. How-
ever, the respondent paid Watkins less than Pahl , the other collector.
When Watkins received a $15 monthly increase from the respondent
in August 1937, he protested to Bening , pointing out that Pahl
received more pay although he had less departmental seniority than
Watkins. As a result , the respondent granted Watkins an addi-
tional $10 a month increase.
No objection was ever made to Watkins' work . At the hearing
Benning characterized Watkins as "perfectly capable." Benning
testified that after he considered all office employees , the final choice
for discharge lay between Watkins and Sheets, who worked as an
accountant in the general accounting department , and that the re-
spondent decided to release Watkins and shift Sheets from the gen-
eral accounting department to Watkins ' post as collector because
Sheets had an invalid wife and appeared to be in greater financial
need than Watkins. Watkins , however, also was married, and in
addition , had one child to support . Although Benning asserted that
he regarded Sheets, who had prior experience as a collector with
the respondent , as the better man for the position and that the re-
spondent 's public relations department had placed its stamp of
approval upon Sheets and withheld it from Watkins , the record dis-
closes that Watkins had served as collector for the respondent since
1931 , and that during the course of his long service he presented
no personnel difficulties of any sort , while the respondent was com-
pelled to remove Sheets from service on a street -car line in a section
of the city inhabited largely by colored persons after residents of
the district complained of Sheets ' conduct to the respondent.
Moreover , during his employment with the respondent , Watkins
received nine individual pay increases , one general increase, one
general decrease which was later restored to him , and one individual
decrease when his classification was changed from accountant to
salesman in 1930. On the other hand, Sheets received five individual
pay increases during his service with the respondent . While the
number of pay increases granted Watkins and Sheets, respectively,
afford no fair basis for comparison in view of Sheets' shorter em-
ployment record with the respondent ,12 it is significant that the re-
spondent saw fit not to restore a 10 per cent cut in Sheets ' pay, which
it had made in 1932 as a part of a general pay-reduction plan, until
11 The record does not disclose whether the respondent followed a system of depart-
mental or employer seniority
12 Sheets entered the respondent 's employ on December 26, 1923
716 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
August, 1937, almost a year after the respondent had restored the pay
decrease to the employees generally. Moreover, Sheets received no
pay increase over and above the pay-cut restoration in August 1937
when the employees generally, including Watkins, were so favored.
Another factor tends to indicate that the respondent discriminated
against Watkins because of his activities in connection with the con-
templated labor organization. Sheets took a conspicuously active
part at the Labor Temple meeting on August 9. During the ques-
tion period following one of the talks, Sheets inquired whether the
Act applied to the respondent and upon receiving an opinion in the
affirmative, launched into a long and technical argument to the con-
trary and warned the employees that they owed their jobs to their
employer. In the course of the meeting Sheets interrupted speakers
to ask the same question and persisted in repeating it, although the
speakers apparently answered the question to the satisfaction of all
others present. Nevertheless, Sheets insisted that other employees
express an opinion upon the advisability of forming a union. On
three occasions during the evening, Sheets called on Roach to address
the meeting, saying that Roach knew Clark's attitude on the matter.
Although reluctant, Roach yielded to Sheets' goading, took the floor,
and announced to the assembled employees that he had been informed
by Clark that he was "absolutely against the office unionizing."
We are impressed with the fact that Benning chose Sheets, whose
efforts to forestall the union movement have been mentioned above
and whose opposition to the formation of a labor organization of
the office employees was known to Benning,'8 to replace Watkins
whom Benning recognized as an active promoter of the planned labor
organization.
Conclusions with, respect to the discharges
We are satisfied from the foregoing facts that the respondent
selected Stewart and Watkins for discharge in order to deprive the
office employees of the leadership which they provided and thus to
destroy the movement for union organization among the office em-
ployees. Both Stewart and Watkins were admittedly qualified
employees and both possessed long service records with the respond-
ent. We do not believe, under the circumstances, that Stewart, after
20 years of service with the respondent, was selected for discharge
because of the trivial reasons advanced, nor do we believe that his
services had become unsatisfactory to the respondent. Similarly
in view of Watkins' employment record with the respondent as com-
'- Miller , whose source of information is not expressly disclosed in the record , reported
to Benning what took place at the Labor Temple meeting on August 9, and Benning
testified that he was familiar with Sheets ' position with respect to the question of organiza-
tion of the office employees
SOUTHERN COLORADO POWER COMPANY 717
pared with the record of other employees in his department, and
especially with that of Sheets, we are of the opinion that his dis-
charge was not based on the reasons assigned by the respondent.
The-respondent was unalterably opposed to the union organization
of its office employees. It had knowledge that both Stewart and
Watkins were the most militant leaders in the movement to establish
such an organization. It is significant that they were the first two
employees chosen for release when the accounting machines were
installed . We conclude from all the evidence that the respondent
utilized the installation of labor-saving devices to rid itself of the
two- employees whose activities directed toward the self-organization
of the office employees had proved undesirable to it. Our conclusion
is supported by our finding made in subsection A, supra, that the
respondent had threatened to install labor-saving machinery if the
office employees organized. While we do not find that such machin-
ery was installed to discourage organization activity, it is apparent
that the respondent utilized such installation to discipline the leaders
in the organization movement.
We find that by the discharge of H. H. Stewart and I. L. Watkins,
the respondent has discriminated in regard to their hire and tenure
of employment, thereby discouraging membership in a labor organ-
ization and interfering with, restraining, and coercing its employees
in the exercise of the rights guaranteed in Section 7 of the Act.
Stewart received a monthly salary of $190 from the respondent at
the time of his discharge. Since then to the date of the hearing,
he had no gainful employment. At the time of the, hearing Watkins
was employed part time doing collection work. Since his discharge
he has earned a total of. $98.77. When the respondent discharged
him, Watkins was earning $170 a month. Both Stewart and Wat-
kins received 2 months' severance pay from the respondent at the
time of their dismissal. Both testified that they desired reinstate-
ment to their former positions.
III. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
We find that the activities of the respondent set forth in Section
II 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 among the several States,
and tend to lead to labor disputes burdening and obstructing com-
merce and the free flow of commerce.
THE REMEDY
Since we have found that the respondent discriminated in regard
to the tenure of employment of H. H. Stewart and I. L. Watkins, we
718 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
will require the respondent to offer each of said persons full rein-
statement to his former or substantially equivalent position, without
prejudice to their seniority and other rights and privileges.
We shall order the respondent to make whole each of them for
any loss of pay he suffered by reason of his discharge by payment
to each of them of a sum of money equal to the amount which he nor-
mally would have earned as wages from the date of his discharge to
the date of offer of reinstatement, less his net earnings,14 during said
period. The respondent is entitled to deduct from such sum the
amount of severance pay which it paid Stewart and Watkins. We
will further order the respondent to cease and desist from its unfair
labor practices.
Upon the foregoing findings of fact and upon the entire record in
the case, the Board makes the following :
CONCLUSIONS OF LAW
1. By discriminating in regard to the tenure of employment of
H. H. Stewart and I. L. Watkins, and thereby discouraging mem-
bership in a labor organization, the respondent has engaged in and
is engaged in unfair labor practices, within the meaning of Section
8 (3) of the Act.
2. By interfering with, restraining, and coercing its employees
in the exercise of the rights guaranteed by Section 7 of the Act, the
respondent has engaged in unfair labor practices, within the mean-
ing of Section 8 (1) of the Act.
3. The aforesaid unfair labor practices are unfair labor practices
affecting commerce, within the meaning of Section 2 (6) and (7)
of the Act.
ORDER
Upon the basis of the above findings of fact and conclusions of
law, and pursuant to Section 10 (c) of the National Labor Relations
Act, the National Labor Relations Board hereby orders that the
respondent, Southern Colorado Power Co., and its officers, agents,
successors, and assigns shall:
14 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
discharge and the consequent necessity of his seeking employment elsewhere . See Matter
of Crossett Lumber Company and United Brotherhood of Carpenters and Joiners of
America, Lumber and Sawmill Workers Union, Local 2590, 8 N L. R B 440 . Monies
received for work performed upon Federal, State, county, municipal, or other work-relief
projects are not considered as earnings, but as provided below in the Order , shall be de-
ducted from the sum due the employee , and the amount thereof shall be paid over to
the appropriate fiscal agency of the Federal , State, county , municipal or other govern-
ment or governments which supplied the funds for said work -relief projects.
SOUTHERN COLORADO POWER COMPANY 719
-1. Cease and desist from :
(a) Discouraging membership in any labor organization of its
employees , by discharging, or threatening to discharge 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 their
employment ;
(b) 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
representatives of their own choosing and to engage in concerted
activities for the purpose of collective bargaining or other mutual
aid or protection, as guaranteed in Section 7 of the Act.
2. Take the following affirmative action, which the Board finds
will effectuate the policies of the Act :
(a) Offer to H. H. Stewart and I. L. Watkins immediate and full
reinstatement to their former positions, without prejudice to their
seniority and other rights and privileges;
(b) Make whole H. H. Stewart and I. L. Watkins for any loss
which they have suffered by reason of their discharges by payment to
each of them of a sum of money equal to that which he normally
would have earned as wages during the period from the date of his
discharge to the date of the offer of reinstatement , less his net earn-
ings15 during said period; provided, however, that there be deducted
from the amount otherwise due to each of the said employees , monies
received by said employee during said period for work performed
upon Federal, State, county , municipal , or other work-relief projects,
and pay over the amount, so deducted, to the appropriate fiscal
agency of the Federal, State, county, municipal , or other government
or governments which supplied the funds for said work-relief
projects;
(c) Post immediately , in conspicuous places throughout its various
plants and places of business , notices stating that the respondent will
cease and desist in the manner set forth in Section 1 (a) and (b),
and that it will take the affirmative action in Section 2 (a) and (b) of
this Order, and maintain such notices for a period of at least sixty
(60) days from the date of posting;
(d) Notify the Regional Director for the Twenty-second Region in
writing within ten (10) days from the date of this Order what steps
the respondent has taken to comply herewith.
Mn. WILLIAM M . LFISERSON took no part in the consideration of the
above Decision and Order.
15 See footnote 14, supra.