Synalloy Corp.

National Labor Relations Board - Board Decisions

Mar 24, 1975

217 N.L.R.B. 38 (N.L.R.B. 1975)

38 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Blackman -Uhler Chemical Division -Synalloy Corpo-
ration andInternational Molders & Allied Workers
Union, AFL-CIO, CLC. Cases 11-CA-5800 and
11-RC-3936
March 24, 1975
ORDER DIRECTING HEARING
BY MEMBERS FANNING, JENKINS, AND KENNEDY
Pursuant to a Stipulation for Certification Upon
Consent Election executed by the parties and approved
by the Regional Director for Region 11 of the National
Labor Relations Board, an election by secret ballot was
conducted in the above-entitled proceeding on Septem-
ber 12, 1974, under the direction and supervision of the
Regional Director. Upon the conclusion of the election
a tally of ballots was furnished the parties in accord-
ance with the Board's Rules and Regulations.
The tally of the ballots shows that there were approx-
imately 120 eligible voters and that 113 ballots were
cast, of which 53 were cast for and 49 were cast against
the Petitioner, and 11 were challenged. The challenged
ballots are sufficient in number to affect the results of
the election. On September 18, 1974, the Employer
filed timely objections to conduct affecting the results
of the election. The Regional Director caused an inves-
tigation of the challenges and objections to be made and
thereafter, on November 7, 1974, issued and served on
the parties his Report on Challenges and Objections,
Direction and Order Consolidating Cases.' In his re-
port the Regional Director recommended that the Em-
ployer's objections be overruled and concluded that the
issues relating to the challenged ballots could best be
resolved by record testimony. He therefore directed
that a hearing before an Administrative Law Judge be
held to resolve the issues raised by the 11 challenges.
The Employer filed timely exceptions to the Regional
Director's report and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has duly considered the matter and is of
the opinion that the exceptions raise no material or
substantial issue warranting reversal of the Regional
Director.'
We have no quarrel with our dissenting colleague's
t Five of the employees whose ballots were challenged, Ann Holcomb,
Brenda Taylor, Cynthia Dodkin, Carolyn Pugh, and Vivian Coggins, are
alleged as discriminatory dischargees in Case 11-CA-5800 which was con-
sohdated with Case 1 1-RC-3936 by the Regional Director's report, direc-
tion, and order of November 7, 1974
2 In the absence of specific exceptions thereto, the Board adopts, pro
forma, the Regional Director's recommendation that allegations raised by
Objections 2 and 3'be overruled
statement that a union's material misrepresentation of
an employer's profit may, in certain circumstances,
constitute grounds for setting, a representation election
aside. However, unlike our dissenting colleague, we are
of the opinion that in the case at bar no material misre-
presentation concerning the- Employer's profits oc-
curred.
Page 1 of the leaflet circulated to employees before
the election herein contains a facsimile of an unaudited
"Statement of Consolidated Earnings" for the Synalloy
Corporation and notes that the "Company" ex-
perienced record earnings for the period reported. Su-
perimposed upon the Company's statement of earning
is a notation "EARNINGS UP 250%." The source of
the Company's statement of earnings is clearly identi-
fied on the leaflet as the Synalloy Corporation's 6-
month report to stockholders. The notation "more"
with an arrow invites the reader to continue to the
second page of the leaflet. There the leaflet asks,
"Where's your share of the Blackman-Uhler profit
bonanza?" and "what was your wage increase in the
same year that Blackman-Uhler hit the profit jackpot?"
Page 2 of the leaflet also invites the reader to "Compare
the raise you received . . . to the over 250% increase
in Company profits." (Emphasis supplied.)
As noted, unlike our dissenting colleague, we find
that the leaflet in question contains no material misre-
presentation concerning Blackman-Uhler profits.
Thus, the 250-percent figure identified on the second
page as "Company" -profit is the same as the 250-per-
cent profit attributed on the first page of the leaflet to
Synalloy, the parent company of Blackman-Uhler.
Concerning the profits of Blackman-Uhler referred to
on page 2 of the leaflet, we note that the Petitioner used
no specific figures nor any other specific information to
show or to imply a knowledge on its, part of Blackman-
Uhler's profits. The Petitioner merely mentioned a
Blackman-Uhler profit "bonanza" or "jackpot," terms
which we believe could easily be distinguished from the
specific figures provided for Synalloy and in the context
of the organizational campaign could also be evaluated
by the employees through exercise of their common-
sense and good judgment.
ORDER
Pursuant to Section 102.69(f) of the National Labor
Relations Board 's Rules and Regulations and State-
ments of Procedure , Series 8, as amended, it is hereby
ordered that a hearing be held for the purpose of receiv-
ing evidence to resolve the issues raised by the chal-
lenges to the ballots of Ann Holcomb, Brenda Taylor,
Cynthia Dodkin, Carolyn Pugh, Vivian Coggins, Alex-
ander Nichols, Jerry Crocker, Robert Walker, Floyd
Morton, Raymond Roberts, and Debby Peeler and that
217 NLRB No. 7
BLACKMAN-UHLER CHEMICAL DIVISION-SYNALLOY
such hearing may be consolidated with any hearing in
Case 11-CA-5800 to be held before an Administrative
Law Judge designated by the Chief, Division of Judges.
In the event the -unfair labor practice proceeding is
disposed of prior to the hearing, a Hearing Officer will
be duly designated to hear the representation matter.
IT IS FURTHER ORDERED that the Administrative Law
Judge or the Hearing Officer designated for the pur-
poses of conducting such hearing shall prepare and
cause to be served on the parties a report containing
resolutions of the credibility of witnesses, findings of
fact, and recommendations to the Board as to the dis-
position of such challenges. Within the time prescribed
by the Board's Rules and Regulations either party may
file with the Board in Washington, D.C., eight copies
of exceptions thereto. Immediately upon the filing of
such exceptions the party filing the same shall serve a
copy thereof on the other party and shall file a copy
with the Regional Director. If no exceptions are filed
thereto, the Board will adopt the recommendations of
the Administrative Law Judge or the Hearing Officer.
IT IS FURTHER ORDERED that the above-entitled matter
be, and it hereby is, remanded to the Regional Director
for Region 11 for the purposes of arranging such hear-
ing and that the said Regional Director be, and he
hereby is, authorized to issue notice thereof.
MEMBER KENNEDY, dissenting:
Contrary to my colleagues, I believe that the Peti-
tioner did make a material misrepresentation regarding
the Employer's earnings. I therefore dissent from the
overruling of Employer's Objection 1.
On the morning of the election the Petitioner cir-
culated a leaflet which had printing on both sides. The
leaflet is attached hereto and marked "Appendix." On
one side of the leaflet there appeared in very large black
letters, "WHERE IS YOUR SHARE OF THE
BLACKMAN-UHLER PROFIT BONANZA?" The
leaflet continues in small type, "What was your wage
increase in the same year that Blackman-Uhler hit the
profit jackpot? Compare the raise you received (IF
YOU EVEN GOT ONE!) to the over 250% increase
in Company profits."
Any reasonable person reading the above would un-
derstand the message to indicate that Blackman-
Uhler's profits increased 250 percent. However, there
was no such profit bonanza for Blackman-Uhler and,
quite to the contrary, there was a 52-percent decrease
in profits for Blackman-Uhler during the relevant re-
porting period. There can be no doubt, based on the
foregoing information, that there has been a false and
material misrepresentation of Blackman-Uhler's true
profit picture.
The majority adopts the conclusion of the Regional
Director that there was no misrepresentation and rea-
sons that the other side of the leaflet clarifies the matter
39
by indicating at the bottom that the source of the infor-
mation was the "Synalloy Corporation Six-Month Re-
port to Stockholders."3 (Blackman-Uhler is a division
of Synalloy. Blackman-Uhler is the Employer in the
instant matter-not Synalloy. Synalloy controls some
16 installations or entities. During the relevant period
Synalloy's profits went up 250 percent, but Blackman-
Uhler's profits went down 52 percent.)
The other side of the leaflet identifies the source of
the information as Synalloy Corporation, but it does
not identify the actual profit figures listed on the other
page as those of Synalloy. Thus, the consolidated earn-
ings statement does not dispel the erroneous notion
conveyed by the Petitioner that Blackman-Uhler had a
profit bananza of 250 percent.
There can be no doubt that misrepresentation of an
employer's profits is a misrepresentation of a material
issue. As stated by the Second Circuit in Henderson
Trumbull Supply Corporation, 501 F.2d 1224, 1230
(1974), "a person apparently in a position to know the
facts had misrepresented a material fact [profits] (i.e.,
the amount of money available for increase in em-
ployees' wages and benefits) . . . ." Also, the Ninth
Circuit has recognized the salient nature of company
profits to an election campaign stating, "Misrepresen-
tations about company profitability can be material,
since the extent to which employees share equitably in
the products of their labor may be of great interest to
them." N. L.. R.B. v. G. K. Turner Associates, 457 F. 2d
484 (C.A. 9, 1972). I have stated in my dissent in
Cumberland Wood and Chair Corp., 211 NLRB 312
(1974), "a company's profitability and the extent to
which employees share in the profitability are obvi-
ously matters of great significance to the employees."
Other Board and court decisions have recognized the
materiality of company profits as an issue during an
election. See, e.g., Tyler Pipe & Foundry Co. v.
N..L.R.B., 406 F.2d 1272 (C.A. 5, 1969); The Halsey W
Taylor Co., 147 NLRB 16 (1964). See also the Eighth
Circuit's decision in LaCrescent Constant Care Center,
Inc. v. N.L.R.B., 510 F.2d 1319 (C.A. 8, 1975), in
which the court denied enforcement of the Board's
decision reported at 211 NLRB 671 (1974). The court
rejected the Board's conclusion that the employees
could evaluate the union's misrepresentation as to the
employer's profits. The court quoted a portion of my
dissent in footnote 20 of its opinion. The quoted com-
ments are equally applicable to the instant case.
Since there has been a material misrepresentation on
the morning of the election day, which was too late for
any effective reply by the Employer, and a lack of
3 The majority chose to label this side of the leaflet "page 1." As pointed
out above, the leaflet was simply one sheet of paper with printing on each
side The leaflet bears no markings as "page 1" or "page 2," and there is no
indication as to which side was handed to employees to read first
40 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
individual knowledge by the production and mainte-
nance employees as a basis for proper evaluation, I
would find merit in the Employer's abjection 1. Holly-
wood Ceramics Co., 140 NLRB 221 (1962).
After the determinative challenged ballots have been
resolved, I would set aside -the election on the basis of
Objection 1 if the revised tally of ballots reveals that the
Union received a majority of the valid votes cast. If the
revised tally of ballots discloses that the Union failed to
achieve a majority, then I would certify the results of
the election.
April 22, 1975
ORDER AMENDING ORDER
On March 24, 1975, an Order was issued by the
Board in the instant case which, inter alia, directed that
a hearing-be held for the purpose of receiving evidence
to resolve the issues raised, by the challenges to the
ballots of certain employees named in the said
Order.' The Order was in conformance with the
recommendation of the Regional Director Region" 11,
who concluded that the issues relating to the chal-
lenged ballots could best be resolved by record tes-
1 217 NLRB No. 7
2 This Order in no way affects the majority or minority opinion in the
Order of March 24, 1975, as to the issue relating to Employer's Objec-
tion 1.
timony. No exceptions were filed to such recommenda-
tion. Before the Order issued and because no exceptions
had been filed as to the Regional Director's recommen-
dation-as to the challenged ballots, a hearing concern-
ing such challenged ballots was held before Adminis-
trative Law Judge Frank H. Itkin on November 25, 26,
and 27, 1974. Because of the fact that a hearing has
already been held before a duly designated Administra-
tive Law Judge to resolve issues relating to the said
challenged ballots, the Board finds that the portion of
its Order of March 24, 1975, which directs a hearing
to resolve such issues, is moot. Accordingly, it is hereby
amended to delete that portion of the Order which
provides that the case be remanded to the Regional
Director for Region 11 for the purpose of arranging a
hearing to resolve issues relating to the said challenged
ballots.2
ORDER
It is hereby ordered that the Board's Order Directing
Hearing in this case dated March 24, 1975, be, and it
hereby is, amended to delete that portion of the Order
directing a hearing to be held for the purpose of receiv-
ing evidence to resolve the issues raised by the chal-
lenges to the ballots of those employees named in the
Order.
By direction of the Board, George A. Leet, Associate
Executive Secretary.