Swift Adhesives

National Labor Relations Board - Board Decisions

Dec 19, 1995

320 N.L.R.B. 215 (N.L.R.B. 1995)

215
320 NLRB No. 43
SWIFT ADHESIVES
1 The parties agree that calendar days include time not working,
e.g., paid holidays, days off, vacation days, and time on disability.
Thus, an employee accrued vacation benefits if he had been on the
Respondent’s payroll for 28 weeks during a calendar year.
2 The length of the vacation benefit varied according to the em-
ployee’s total length of service with the Respondent.
3 All dates are in 1993 unless otherwise indicated.
4 Working days, according to the Respondent’s testimony, covered
only days actually worked, and excluded days spent on vacation and
paid holidays, as well as time on disability. Thus to accrue vacation
benefits under its final offer, an employee would have to be on the
Respondent’s payroll more than 39 weeks in a calendar year.
5 The Respondent in its exceptions asserts that the judge erred in
finding that 15 strikers had worked 195 working days. On the basis
of the record before us, we have no basis for finding that this num-
ber of strikers had worked that amount of time. The judge’s error,
however, is harmless because all the strikers had accrued vacation
benefits under existing calendar day criteria before the expiration of
the collective-bargaining agreement and the ensuing strike.
6 See also Glover Bottled Gas Corp., 292 NLRB 873 (1989).
7 We find this case distinguishable from Nuclear Fuel Services,
290 NLRB 309 (1988), cited by the judge. In that case, the Board
majority found that the vacation benefits that the employer denied
Continued
Swift Adhesives, Division of Reichhold Chemicals,
Inc. and Ralph Nordstrom. Case 17–CA–17502
December 19, 1995
DECISION AND ORDER
BY CHAIRMAN GOULD AND MEMBERS BROWNING
AND TRUESDALE
On June 9, 1995, Administrative Law Judge Martin
J. Linsky issued the attached decision. The Respondent
filed exceptions and a supporting brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the Respondent’s exceptions and
brief and has decided to affirm the judge’s rulings,
findings, and conclusions and to adopt the rec-
ommended Order.
The judge found that the Respondent violated Sec-
tion 8(a)(3) and (1) of the Act by denying vacation pay
to 15 permanently replaced economic strikers. We
agree for the following reasons.
The relevant facts are undisputed. Under the terms
of the expiring collective-bargaining agreement be-
tween the Respondent and the Union representing the
employees in question, employees who had been em-
ployed 196 calendar days1 during the calendar year
were eligible for vacation benefits.2 The relevant col-
lective-bargaining agreement, which expired on Sep-
tember 30, 1993,3 also provided that employees who
became eligible for vacation days during a calendar
year were to take them the ensuing calendar year ac-
cording to a schedule promulgated by the Respondent.
Under section 11 of that agreement, however, employ-
ees who were terminated for any reason were to be
paid for the vacation days for which they had become
eligible. Prior to the expiration of the collective-bar-
gaining agreement, all 22 employees had worked more
than 196 calendar days and thus under the terms of the
agreement were eligible for vacations the following
calendar year.
The employees struck on October 1 after the parties
had reached impasse in negotiations for a new collec-
tive-bargaining agreement. At the beginning of No-
vember, the Respondent notified the striking employ-
ees that it had hired 9 permanent replacements and
would hire 15 more permanent replacements unless 15
of them returned to work before November 8. None of
the strikers returned. On January 4, 1994, the Union
requested, citing section 11 of the expired contract,
that the Respondent pay the striking employees for the
vacation days they had earned. The Respondent, in re-
sponse, contended that the strikers had not been termi-
nated but nevertheless agreed to award vacation pay to
the seven strikers who had worked at least 196 days
during the previous year. The Respondent asserted it
was entitled to limit vacation pay to those seven strik-
ers because it had implemented its final offer. That
offer changed the eligibility requirements for vacation
benefits from 196 calendar days to 196 working days.4
It is not in dispute that the remaining 15 strikers had
not worked 196 working days.5
In Texaco, Inc., 285 NLRB 241 (1987), the Board
articulated the principles for the application of the test
for finding unlawful discrimination under Section
8(a)(3) set forth in NLRB v. Great Dane Trailers, 388
U.S. 26 (1967).6 In the case of denial of benefits to
strikers, this test requires that the General Counsel
make a prima facie showing of some adverse effect of
the denial of benefits on employee rights. The General
Counsel can meet this burden by showing that (1) the
benefit was accrued and (2) the benefit was withheld
on the apparent basis of a strike. Once the General
Counsel makes a prima facie showing, the burden,
under Great Dane, shifts to the employer to come for-
ward with proof of legitimate and substantial business
justification for its denial of benefits. If the employer
proves such a business justification, the Board will dis-
miss the complaint if the adverse effect of the dis-
criminatory conduct was merely ‘‘comparatively
slight’’ but may nevertheless find a violation if the em-
ployer’s conduct is demonstrated to be ‘‘inherently de-
structive’’ of important employee rights or motivated
by antiunion intent.
Applying these principles here, we find that the
General Counsel established a prima facie case. All 22
of the striking employees had accrued vacation bene-
fits under the eligibility requirements of the collective-
bargaining agreement prior to the agreement’s expira-
tion and prior to the commencement of the strike.7
216 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
were not accrued benefits since the contract did not provide for pay-
ment for vacation pay in lieu of vacation. Here, however, the Re-
spondent did not make such a contention. To the contrary, by paying
vacation pay to seven of the strikers, the Respondent concedes that
strikers could qualify for vacation pay in lieu of vacation.
8 The 15 strikers who were denied their vacation benefits had
worked, according to an exhibit introduced by the Respondent, be-
tween 156 and 195 days prior to the commencement of the strike
on October 1. Thus, even under the Respondent’s unilaterally imple-
mented new rule, which required that employees have actually
worked 196 days in a calendar year to be eligible for vacation bene-
fits, it is apparent that the 15 strikers would have satisfied the new
requirement if they had refrained from exercising their right to strike
and had continued to report to work between October 1 and Decem-
ber 31.
9 In light of this finding, we find it unnecessary to decide whether
the Respondent’s conduct was inherently destructive of employee
rights.
Further, the Respondent’s denial of these accrued ben-
efits to 15 strikers was a direct result of the strike
since, but for their participation in the strike, the Re-
spondent would have deemed these strikers eligible to
receive these benefits.8
We further find that the Respondent has failed to
meet its burden of showing that it denied the benefits
based on a legitimate and substantial business justifica-
tion. Contrary to its contention, the Respondent is not
entitled to rely on the impasse in negotiations for a
successor collective-bargaining agreement as justifica-
tion for its denial of accrued vacation benefits to 15
strikers.
In R. E. Dietz Co., 311 NLRB 1259, 1266 (1993),
the Board found that the term ‘‘wages, hours, and
terms and conditions of employment’’ as used in Sec-
tion 8(d) of the Act refers only to future wages and
conditions, not to past wages and benefits that have al-
ready been accrued and that are owed. The Board fur-
ther reasoned that the employer’s proposal in negotia-
tions for a successor collective-bargaining agreement
to extinguish its liability for accrued wages and bene-
fits under the previous agreement was therefore a non-
mandatory subject of bargaining; and that the employer
could not lawfully insist to impasse on a final offer
which included this proposal. See also Harvstone Mfg.
Corp., 272 NLRB 939 (1984), enf. denied on other
grounds 785 F.2d 570 (7th Cir. 1986).
Thus, under these principles, the Respondent’s pro-
posal to change the eligibility requirement for vacation
benefits which had already accrued under the expired
collective-bargaining agreement and which were owed
the strikers was a nonmandatory subject of bargaining.
The Respondent was not privileged to assert that the
parties were at a lawful impasse and to unilaterally im-
plement the proposal. Accordingly, we find that the
Respondent has not presented a legitimate and substan-
tial business justification for its conduct, and we there-
fore find that the Respondent’s denial of vacation pay
to 15 strikers violated Section 8(a)(3) and (1) of the
Act.9
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Swift Adhesives, Division
of Reichhold Chemicals, Inc., St. Joseph, Missouri, its
officers, agents, successors, and assigns, shall take the
action set forth in the Order.
Lyn R. Buckley, Esq., for the General Counsel.
Michael J. Bobroff, Esq., of St. Louis, Missouri, for the Re-
spondent.
DECISION
STATEMENT OF THE CASE
MARTIN J. LINSKY, Administrative Law Judge. A charge
and first amended charge were filed by Ralph Nordstrom, an
individual, in Case 17–CA–17502 on July 11 and August 31,
1994, respectively, against Swift Adhesives, Division of
Reichhold Chemicals, Inc. (Respondent).
On August 25, 1994, the National Labor Relations Board
by the Regional Director for Region 17 issued a complaint,
which was amended on December 13, 1994, which com-
plaint, as amended, alleges that Respondent violated Section
8(a)(1) and (3) of the Act when on January 14, 1994, it de-
nied 15 permanently replaced economic strikers vacation pay
for 1993.
Respondent filed an answer in which it denied that it vio-
lated the Act in any way and, in any event, with respect to
14 of the 15 alleged aggrieved individuals the charge was
time barred by Section 10(b) of the Act.
A hearing was held before me in Overland Park, Kansas,
on January 12, 1995.
On the entire record in the case, to include posthearing
briefs submitted by the General Counsel and Respondent,
and on my observation of the demeanor of the witnesses, I
make the following
FINDINGS OF FACT
I. JURISDICTION
Swift Adhesives (Respondent) is a corporation with an of-
fice and place of business in St. Joseph, Missouri, where it
is engaged in the manufacture of glues.
Respondent admits, and I find, that Respondent meets the
jurisdictional standards of the Act and is an employer en-
gaged in commerce within the meaning of Section 2(2), (6),
and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
Respondent admits, and I find, that the United Food and
Commercial Workers Union, Local 576 (the Union) is and
has been a labor organization within the meaning of Section
2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
For a number of years the Union or its predecessor rep-
resented a unit of employees of Respondent.
217SWIFT ADHESIVES
The most recent collective-bargaining agreement between
the parties was effective from October 1, 1990, through Sep-
tember 30, 1993.
Prior to the expiration of the most recent collective-bar-
gaining agreement the parties entered into negotiations for a
successor agreement. The parties had not reached agreement
by the expiration date of the 1990–1993 agreement and were
at impasse.
On October 1, 1993, the entire complement of employees
in the unit represented by the Union, i.e., 22 employees,
went on strike. It was an economic strike. All 22 economic
strikers were later permanently replaced. It is conceded by
the parties that an employee who loses his job would be eli-
gible to receive vacation pay for the vacation time he was
otherwise entitled to.
Prior to the strike and under the terms of the 1990–1993
collective-bargaining agreement all 22 employees in the unit
had qualified for vacation pay that ranged from 2 to 4
weeks’ pay depending on the length of time the employees
had worked for Respondent. This was so because all 22 em-
ployees had met the criteria of having worked at least 196
calendar days in 1993.
Prior to the expiration date of the 1990–1993 agreement,
Respondent had proposed changing the rule on eligibility for
vacation from 196 calendar days to 196 working days. That
is, under Respondent’s proposal, an employee to be eligible
for vacation in 1993 would have to have actually worked 196
days in 1993. Working days did not include vacation days,
sick days, holidays, etc. For example, under the old rule an
employee would receive for vacation eligibility purposes 31
days for the month of January 1993 but under the proposed
rule the employee would only receive for vacation eligibility
purposes those number of days the employee actually worked
and since employees worked a 5-day workweek (either Mon-
day through Friday or Tuesday through Saturday) the em-
ployee would, in the absence of overtime, receive credit for
only 20 days. There would be no credit for vacation eligi-
bility purposes for January 1, which was a holiday, or the
2 days per week the employees had off, which would be ei-
ther Saturday and Sunday or Sunday and Monday. No busi-
ness justification was offered for this proposed change other
than Respondent’s desire to have it. At the hearing it was
suggested that Respondent wanted employees to work 75
percent of the year to qualify for vacation but this was an
afterthought and never mentioned during negotiations.
It was only after the employees went on strike and no ear-
lier than November 1, 1993, that Respondent unilaterally im-
plemented its last offer to the Union which included the
change in deciding vacation eligibility. In fact the Union was
not formally told of the implementation until January 14,
1994, when it was advised that only 7 of the 22 striking em-
ployees were entitled to vacation pay. (G.C. Exh. 7.) The
seven were entitled because they worked extra days during
1993 and had actually worked 196 days prior to the strike.
On November 1, 1993, Respondent had notified all 22 strik-
ing employees by letter that it was hiring permanent replace-
ments for the striking employees ‘‘under the wages, benefits
and employment conditions’’ it had proposed to the Union
during the negotiations. (R. Exh. 4.) Respondent argues that
this constituted notice to the Union that Respondent was im-
plementing its last best offer.
It is uncontested that all 22 employees were eligible for
vacation when they went on strike, i.e., all 22 had worked
at least 196 calendar days. After they went on strike Re-
spondent implemented the new rule on vacation eligibility
and only 7 of the 22 employees qualified under the new rule,
i.e., they had actually worked at least 196 days in 1993. Fif-
teen of the employees, believe it or not, had actually worked
195 days during 1993. These 15 striking employees had just
1 day less than they needed to qualify for vacation pay under
the new rule that was implemented after they went on strike.
The practical effect of this was that these employees in
order to retain their right to vacation that they had earned
would have to cease exercising their federally guaranteed
right to strike and return to work for at least 1 more day in
1993.
It is my opinion that what Respondent did in denying va-
cation pay to these 15 employees was inherently destructive
of important employee rights within the meaning of the land-
mark Supreme Court decision in NLRB v. Great Dane Trail-
ers, 388 U.S. 26 (1967). In Great Dane, the Court found that
a company that announces subsequent to July 1, 1963, during
a strike which began prior to July 1, 1963, that only employ-
ees who reported for work on July 1, 1963, would be entitled
to vacation, violated Section 8(a)(1) and (3) of the Act. What
the Company did was inherently destructive of important em-
ployee rights and I conclude that requiring the 15 striking
employees in the instant case to quit the strike and work at
least 1 more day in 1993 to qualify for vacation pay was
similarly inherently destructive of important employee rights.
If what Respondent does is inherently destructive of impor-
tant employee rights no antiunion motivation need be shown.
But even so, to implement the new rule on vacation eligi-
bility as Respondent did in the instant case discriminates
against employees for exercising their right to strike and to
continue their strike. See Texaco, Inc., 285 NLRB 241
(1987), and Nuclear Fuel Services, 290 NLRB 308 (1988).
It is conceded by Respondent that Charging Party Ralph
Nordstrom timely filed his charge claiming that he was un-
lawfully denied vacation pay. Nordstrom filed the charge on
July 11, 1994, which was within 6 months of Respondent ad-
vising the Union in its letter of January 14, 1994, that it was
denying vacation pay to all employees who had not actually
worked 196 days in 1993. On August 31, 1994, Ralph Nord-
strom filed an amended charge claiming that 14 other former
employees of Respondent had been also unlawfully denied
vacation pay.
Respondent alleges that with respect to these 14 additional
discriminatees that the charge is untimely under Section
10(b) of the Act. I disagree and find, relying on Redd-I, Inc.,
290 NLRB 1115 (1988), and Davis Electrical Constructors,
291 NLRB 115 (1988), that the allegation regarding these 14
additional discriminatees is not time barred because it is
closely related to the charge timely filed on July 11, 1994.
This is so because the allegation regarding the 14 additional
discriminatees is precisely the same as the allegation regard-
ing Ralph Nordstrom.
I note that this is an inappropriate case for deferral to the
arbitral process since it doesn’t involve so much as a contract
interpretation but is strictly an unfair labor practice case pur-
sued by former employees and not by their Union.
Respondent violated Section 8(a)(1) and (3) of the Act
when it refused to pay vacation pay to the 15 discriminatees.
218 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
2 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
2. The Union is a labor organization within the meaning
of Section 2(5) of the Act.
3. By refusing to pay vacation pay to 15 permanently re-
placed economic strikers, Respondent violated Section
8(a)(1) and (3) of the Act.
4. The above unfair labor practices affect commerce within
the meaning of the Act.
THE REMEDY
Having found Respondent engaged in an unfair labor prac-
tice, I find it necessary to order it to cease and desist and
to take certain affirmative action designed to effectuate the
policies of the Act.
The Order will require Respondent to pay vacation pay to
the 15 permanently replaced economic strikers.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended1
ORDER
The Respondent, Swift Adhesives, Division of Reichhold
Chemicals, Inc., St. Joseph, Missouri, its officers, agents,
successors, and assigns, shall
1. Cease and desist from
(a) Refusing to pay vacation pay to permanently replaced
economic strikers who are entitled to be paid vacation pay.
(b) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Pay 1993 vacation pay to former employees Ralph
Nordstrom, Howard Gross, Walter Gay, Charles Carriger,
Delmar Wehr, Dave Elliott, Billy Filley, Phillip Martin, Jim
Mason, Ted Ellis, Bob Jones, David Shuman, Franklin Wall,
Dave Carter, and Mike Gasper with interest computed as set
forth in New Horizons for the Retarded, 283 NLRB 1173
(1987).
(b) Post at its facility at St. Joseph, Missouri, copies of the
attached notice marked ‘‘Appendix.’’2 Copies of the notice,
on forms provided by the Regional Director for Region 17,
after being signed by the Respondent’s authorized representa-
tive, shall be posted by the Respondent immediately upon re-
ceipt and maintained for 60 consecutive days in conspicuous
places including all places where notices to employees are
customarily posted. Reasonable steps shall be taken by the
Respondent to ensure that the notices are not altered, de-
faced, or covered by any other material.
(c) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondent has
taken to comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we vio-
lated the National Labor Relations Act and has ordered us
to post and abide by this notice.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representatives of
their own choice
To act together for other mutual aid or protection
To choose not to engage in any of these protected
concerted activities.
WE WILL NOT refuse to pay vacation pay to 15 perma-
nently replaced economic strikers.
WE WILL NOT in any like or related manner interfere with,
restrain, or coerce you in the exercise of the rights guaran-
teed you by Section 7 of the Act.
WE WILL pay 1993 vacation pay, with interest, to perma-
nently replaced economic strikers Ralph Nordstrom, Howard
Gross, Walter Gay, Charles Carriger, Delmar Wehr, Dave El-
liott, Billy Filley, Phillip Martin, Jim Mason, Ted Ellis, Bob
Jones, David Shuman, Franklin Wall, Dave Carter, and Mike
Gasper.
SWIFT ADHESIVES, DIVISION OF REICHHOLD
CHEMICALS, INC.