Terrell Machine Co.

National Labor Relations Board - Board Decisions

Jan 3, 1969

173 N.L.R.B. 1480 (N.L.R.B. 1969)

1480 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Terrell Machine Company and International Associ-
ation of Machinists & Aerospace Workers,
AFL-CIO, Local Lodge No. 1725 . Case 11-CA-
3422
January 3, 1969
DECISION AND ORDER
BY CHAIRMAN MC CULLOCH AND MEMBERS
FANNING AND BROWN
On July 3, 1968, Trial Examiner Max Rosenberg
issued his Decision in the above-entitled proceeding,
finding that the Respondent had engaged in and was
engaging in certain unfair labor practices within the
meaning of the National Labor Relations Act, as
amended, and recommending that it cease and desist
therefrom and take certain affirmative action, as set
forth in the attached Trial Examiner's Decision.
Thereafter, the Respondent filed exceptions and a
supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
powers in connection with this case to a three-
member panel.
The Board has reviewed the rulings of the Trial
Examiner made at the hearing and finds that no
prejudicial error was committed. The rulings are
hereby affirmed. The Board has considered the Trial
Examiner's Decision, the exceptions and brief, and
the entire record in this case, and hereby adopts the
findings, conclusions, and recommendations of the
Trial Examiner, with the following additions and
qualifications.
As more fully set forth in the Trial Examiner's
Decision, the record shows that a continuous
collective-bargaining relationship preceded the rele-
vant events of 1967. In 1945, the Union was certified
as the unit employees' exclusive bargaining represent-
ative, pursuant to a Board election earlier that year.
The Union and the Respondent subsequently exe-
cuted consecutive annual agreements. The last expired
June 26, 1967. That year, negotiations for another
began on May 17. Further sessions were held on June
2, 23, and July 3.
The Respondent admittedly refused to bargain on
July 3. At the meeting that date, it resumed discus-
sion of outstanding substantive proposals; and having
outlined its position, it expressed for the first time a
doubt of the Union's majority representative status.
The Respondent then conditioned its willingness
either to execute any contract or to proceed any
further with negotiations on a showing by the Union
that it still represented a majority of the unit
employees. The Union's representative replied by
refusing to "show proof ... this late in the game";
asserting the Union's right to recognition and bar-
gaining, he pointed to the Board's original
certification.
On July 6, in a letter to its employees, the
Respondent reiterated the announced condition with-
out which it would not resume negotiations:
We said [at the July 3 meeting] we were willing
to renew the contract if the Union would have an
impartial third party ... inspect the membership
records and report simply that they did have a
majority at that time .... The Union has refused
to provide satisfactory evidence of a majority, and
until it does we cannot continue to negotiate with
it.
Thereafter, the Union, decided it could best get
negotiations resumed by acceding to the Respond-
ent's demand. Accordingly, it informed the Respond-
ent, about mid-July, that it was willing to
demonstrate its majority representative status. To this
end, it offered to make documentary evidence avail-
able for inspection. The Respondent, however, now
declared its unwillingness to recognize the Union any
further and refused even to consider the proffered
showing.
On August 7, the Respondent addressed another
letter to its employees. The letter said, in part, "[W] e
are not interested ... at this time," in seeing the
Union's offered evidence of its majority represent-
ative status. The letter also announced that the
Respondent had decided (unilaterally) to grant a wage
increase in the fall. On the same date, the Union sent
the Respondent a written request that negotiations be
resumed. The Respondent received the request
August 9, and answered it August 15. In its reply, the
Respondent unconditionally refused to meet again.
The instant litigation followed.
The complaint alleged among other things that the
Respondent's refusal, beginning July 3, further to
recognize the Union as the exclusive collective-
bargaining representative of the unit employees,
violated Section 8(a)(5) of the Act. That allegation is
amply sustained by the evidence in this record.
It is well settled that a certified union, upon
expiration of the first year following its certification,
enjoys a rebuttable presumption that its majority
representative status continues.' This presumption is
designed to promote stability in collective-bargaining
relationships, without impairing the free choice of
employees.' Accordingly, once the presumption is
shown to be operative, a prima facie case is estab-
lished that an employer is obligated to bargain and
that its refusal to do so would be unlawful. The prima
' Celanese Corporation ofAmerica , 95 NLRB 664 , 671-672. 2 Id.
173 NLRB No. 230
TERRELL MACHINE CO.
facie case may be rebutted if the employer affirma-
tively establishes either (1) that at the time of the
refusal the union in fact no longer enjoyed majority
representative status,3 or (2) that the employer's
refusal was predicated on a good-faith and reasonably
grounded doubt of the union's continued majority
status. As to the second of these, i.e., "good faith
doubt," two prerequisites for sustaining the defense
are that the asserted doubt must be based on
objective considerations 4 and it must not have been
advanced for the purpose of gaining time in which to
undermine the union.5
In applying the above principles to this case, the
Trial Examiner construed the General Counsel's posi-
tion during the hearing to be only that on July 3, the
Union was the majority representative of the em-
ployees based on the number of Union members on
that date, without reliance on the presumption that
the Union continued to enjoy majority representative
status. For that reason, the Trial Examiner looked to
the membership records and the signed designation
cards and concluded that in fact fewer than a
majority of the employees had designated, or were
members of, the Union as of the morning of July 3,
and hence the Respondent was not obligated to
bargain on that date.
As we read the record, the Trial Examiner incor-
rectly interpreted the General Counsel's contentions.
It is clear from the broad allegations of the complaint
and the General Counsel's statements throughout the
hearing that the General Counsel, in fact, sought to
rely on both the presumption of continued majority
representative status and the supplementary evidence
of the Union's membership figures and designations.
Further, contrary to the Trial Examiner, we find, for
the reasons set forth below, that on July 3, the Union
continued to be the majority representative of the
employees in the unit. Thus, on the facts of this case,
the presumption of continued majority status was
operative, and it was incumbent upon the Respondent
to go forward with the evidence to establish actual
loss of such status, if it wished to rebut that
presumption. Of course, if the General Counsel's
evidence refuted his own contention, that would
undoubtedly be sufficient. But that is not the case
here. For, a showing as to employee membership in, or
actual financial support of, an incumbent union is not
the equivalent of establishing the number of em-
ployees who continue to desire representation by that
union.' There is no necessary correlation between
3 "Majority representative status" means that a majority of em-
ployees in the unit wish to have the union as their representative for
collective -bargaining purposes Id.
4 See Laystrom Manufacturing Company, 151 NLRB 1482, 1484,
enforcement denied on other grounds (sufficiency of evidence) 359
F.2d 799 (C.A 7, 1966 ), United Aircraft Corporation , 168 NLRB No.
66 (TXD), N.L R B v. Gulfmont Hotel Company, 362 F 2d 588 (C.A.
1481
membership and the number of union supporters
since no one could know how many employees who
favor union bargaining do not become or remain mem-
bers thereof. Accordingly, the Trial Examiner's finding
here that on July 3, only 41 of the 90 employees in
the unit were dues-paying members does not justify
his conclusion that on that date the Union did not
represent a majority of the Respondent's employees.
Therefore, we find, the presumption of the Union's
representative status on and after July 3 has not been
rebutted.
There remains for consideration, however, the
question whether the Respondent was nevertheless
justified in refusing to bargain because of a good faith
and reasonably grounded doubt of the Union's
continuing majority status.
The Trial Examiner discussed the asserted bases for
the Respondent's claim of doubt and concluded that
the Respondent did not have a reasonable doubt
"when it refused to continue the bargaining collo-
quy." Inasmuch as the refusal first occurred on July
3, but the Trial Examiner found an obligation to
continue bargaining after July 3 1, the time to which
that holding applies is ambiguous. However, it is
apparent from the record that the Respondent at no
time had objective grounds which justified its refusal
to continue negotiations. Rather, the evidence shows
that its claim of doubt was advanced in order to
circumvent its legal obligation to negotiate with the
Union.
As indicated above, there were 90 employees in the
unit on about July 3; during the meeting on June 23,
the Union representative remarked there were be-
tween 65 and 70 in the unit. The Trial Examiner
discussed and correctly rejected the Respondent's
claim that this misstatement, together with a report in
May by the shop superintendent that he had heard
from three employees that they did not feel the
Union was active enough and various rumors con-
cerning the number of members in the Union, raised a
reasonable doubt and justified its refusal to continue
bargaining. In addition, however, the Respondent also
claimed that it relied on (1) an opinion received June
15 from a night-shift supervisor that he did not think
three named Union members would strike; (2) unde-
tailed rumors from unidentified sources that unrest
and dissatisfaction existed with the way the Union
was running things; and (3) the Respondent's con-
clusion (according to the testimony of Vice President
Ferguson) that it was "hard to understand how our
5, 1966 ), enfg. 147 NLRB 997. And cf . United States Gypsum
Company, 157 NLRB 652.
5 C & C Plywood Corporation , 163 NLRB No 136, Bally Case and
Cooler, Inc , 172 NLRB No. 106.
6 United Aircraft Corporation , supra (TXD), N.L.R.B. v Gulfmont
Hotel Company, supra.
1482 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
employees could pay their money into a union which
as far as we could see was doing them no good ... "
It is patent that none of the assertions, either
separately or collectively, support the showing that
the Respondent is required to make. To be of any
significance, the evidence of dissatisfaction with a
validly recognized incumbent Union must come from
the employees themselves, not from the employer on
their behalf.? There is no such evidence in this case.
Under all the circumstances, we conclude that the
reasons asserted by the Respondent were insufficient
to show a reasonable basis for doubting the Union's
continued majority.8 On the contrary, we are per-
suaded that the evidence establishes that the Re-
spondent asserted its doubt in order to avoid
bargaining with the Union. Thus, although the Re-
spondent said that it was refusing to bargain until the
Union agreed to a check of its records and so
informed the employees, it flatly rejected the Union's
offer when made, stating unequivocally that it had no
interest in learning whether the Union represented a
majority and that it was "no longer interested in a
membership check or anything else .... "9 The
Respondent continually acted in this inconsistent
fashion, claiming to desire substantiation of majority
status but rejecting any offer to show such status,
from July 3 through August 7. Moreover, we note
that the Respondent could have filed a petition for an
election, or asked that the Union do so, in order to
resolve its alleged doubt, but it took no such steps.
These facts, viewed in light of the absence of any
objective basis for its claimed doubt," 0 lead to the
inevitable conclusion that the Respondent's assertion
of an interest in what it called a satisfactory showing
of majority status was, in fact, a pretext to conceal its
desire to eliminate the Union. For, although the
Respondent purported to justify its withdrawal of
recognition on the basis of an asserted doubt, it
simultaneously precluded the possibility of that
doubt being resolved-under circumstances wholly
inconsistent with good faith.
In sum, the Respondent had no basis for doubting
the Union's continued majority representative
status-only, perhaps, its membership figures-and
the doubt as to such status was not based on
reasonable grounds and was asserted in bad faith. For
these reasons, the Respondent, in breaking off nego-
tiations on July 3 and thereafter refusing to resume
bargaining with the Union, acted contrary to its
statutory duty and violated Section 8(a)(5) of the
Act.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board hereby adopts as its Order the
Recommended Order of the Trial Examiner, as
modified herein,' 1 and orders that the Respondent,
Terrell Machine Company, Charlotte, North Carolina,
its officers, agents, successors, and assigns, shall take
the action set forth in the Trial Examiner's Recom-
mended Order, as so modified.
1. Delete paragraph 1(b) and substitute the
following-
(b) Unilaterally deciding, without prior consulta-
tion with the union, the award and timing of wage
increases.
2. Substitute the Notice to All Employees at-
tached hereto as Appendix for that recommended by
the Trial Examiner.' 2
7 United Aircraft Corporation, 168 NLRB No 66 (TXD)
8 United Aircraft Corporation, supra , Kentucky News, Incorporated,
165 NLRB No 119
9 The Respondent's refusal to look at the Union 's evidence,
assertedly because of rumors and reports of Union coercion in securing
employee signatures , was supported only by conclusionary testimony of
such reports The Respondent also claims that it believed , based on a
rumor, that a strike was possible , but because it never occurred the
Respondent concluded that the Union had lost majority employee
support even assuming it had existed before. Patently , this type of
evidence affords no support for the Respondent's claim that it was
justified in its adamant position
to Cf The Richard W. Kaase Company, 141 NLRB 245, 247-248.
11 The Trial Examiner found that the Respondent unilaterally
decided to increase wages in the fall of 1967, and to announce on
October 10 how much the increase would be, and when it would be
granted He concluded , and we agree , that these unilateral decisions-as
to whether, in what amount , and when to make this increase-violated
Section 8 (a)(5). Yet, his phrasing of paragraph 1(b) in the Recom-
mended Order inadvertently focuses on unilateral announcements We
accordingly correct paragraph 1(b)in the Order
12 We believe the policies of the National Labor Relations Act will
best be promoted by a Notice which, in readily understandable
language, informs employees of their rights, how these were violated,
and how the violations are being remedied . J P. Stevens & Co., Inc, 167
NLRB No 37 , Genuardi Super Markets , Inc, 172 NLRB No. 121,
Lipsey, Inc, 172 NLRB No 171 , Volkswagen De Puerto Rico, Inc, 172
NLRB No 225, Northwest Oil Equipment Inc , 173 NLRB No. 86
APPENDIX
NOTICE TO ALL EMPLOYEES *
THIS NOTICE IS POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a trial at which all sides had the chance to give
evidence, the National Labor Relations Board found that we,
Terrell Machine Company, violated the National Labor Rela-
tions Act The Board therefore ordered us to post this notice
* This notice is addressed to all employees whose jobs make them
members of the "bargaining unit " which-according to a National Labor
Relations Board ruling -is the "appropriate " bargaining unit The
employees in this bargaining unit are:
All production and maintenance employees , inspectors, and
stockroom employees at our plant in Charlotte , North Carolina.
This bargaining unit excludes-
All office clerical employees , foremen and assistant foremen,
professional employees, guards, and "supervisors" as defined in the
National Labor Relations Act.
TERRELL MACHINE CO. 1483
The Act gives all employees these rights:
To engage in self-organization;
To form, help or join unions,
To bargain collectively through a representative of their
own choosing;
To act together for collective bargaining or other mutual
aid or protection, and
To refrain from any or all of these things.
WE WILL NOT do anything that interferes with these rights.
The National Labor Relations Board found:
1 That the International Association of Machinists and
Aerospace Workers, AFL-CIO, Local Lodge No 1725, is
the Union you have chosen as your collective-bargaining
representative.
2. That we refused to bargain with this Union about
your wages, hours, and other conditions of employment
3 That when we refused to bargain, we were advised
you had chosen it as your collective-bargaining represent-
ative, and had no reason to doubt this was true.
The Board ruled that our refusal to bargain with the Union
under these circumstances violated your legal rights under the
National Labor Relations Act.
Accordingly, we give you these assurances-
WE recognize the International Association of Machin-
ists and Aerospace Workers, AFL-CIO, Local Lodge No
1725, as the exclusive bargaining representative-with re-
spect to wages, hours, and other conditions of
employment-of all employees in the appropriate bargaining
unit
WE WILL NOT refuse, upon request, to bargain col-
lectively with your Union concerning wages, hours, and
other conditions of employment.
WE WILL NOT decide-without first consulting your
Union-whether or not wages will be increased
NOR WILL WE decide-without first consulting your
Union-when to increase wages.
WE WILL, as stated, bargain with your Union upon
request
If, after bargaining, we agree with your Union as to
wages, hours and other conditions of employment, WE WILL
embody the agreement in a signed contract.
TERRELL MACHINE COMPANY
(Employer)
Dated ------------.By----------------
(Representative) (Title)
This notice must remain posted for 60 consecutive days
from the date of posting and must not be altered, defaced, or
covered by any other material
Any questions concerning this notice may be directed to
the Board's Regional Office, 1624 Wachovia Building, 301
North Main Street, Winston-Salem, North Carolina 27101
Telephone 919-723-2392
TRIAL EXAMINER 'S DECISION
STATEMENT OF THE CASE
MAX ROSENBERG, Trial Examiner : With all parties repre-
sented, this case was tried before me in Charlotte, North
Carolina, on April 8 and 9, 1968, on complaint of the General
Counsel of the National Labor Relations Board and answer of
Terrell Machine Company, herein called the Respondent or the
Company i The issues raised by the pleadings are whether
Respondent violated Section 8(a)(5) of the National Labor
Relations Act, as amended, by certain conduct to be detailed
hereinafter. At the conclusion of the hearing, the parties orally
argued their causes. A brief was submitted by Respondent
which has been duly considered.
Upon the entire record made in this proceeding and my
observation of the witnesses, including their demeanor while
testifying on the stand, I hereby make the following
FINDINGS OF FACT AND CONCLUSIONS
I THE RESPONDENT'S BUSINESS
Respondent, a corporation duly organized under the laws of
the State of North Carolina, maintains an office and plant in
Charlotte, North Carolina, where it is engaged in the manu-
facture of machinery for the textile industry During the an-
nual period material to this proceeding, and in the course and
conduct of its business operations, Respondent shipped prod-
ucts valued in excess of $50,000 from its plant in Charlotte
to points located directly outside the State of North Carolina,
and during the same period Respondent purchased directly
from points located outside said State goods valued in excess
of $50,000 The complaint alleges, the answer admits, and I
find that Respondent is engaged in commerce within the
meaning of Section 2(6) and (7) of the Act.
II THE LABOR ORGANIZATION INVOLVED
International Association of Machinists & Aerospace
Workers, AFL-CIO, Local Lodge No. 1725, herein called the
Union, is a labor organization within the meaning of Section
2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
The General Counsel contends that Respondent failed to
bargain in good faith with the Union, the duly designated
majority representative of Respondent's employees, and there-
by violated Section 8(a)(5) of the Act, when it (a) insisted
throughout negotiations which began on May 17, 1967,2 that
it be afforded the prerogative of unilaterally determining the
timing and amount of any future wage increase, (b) promised
employees on June 3 that there would be a pay raise in the
fall, and (c) discontinued negotiations with the Union on July
3 and thereafter refused to recognize the Union as the
exclusive agent of the employees in an appropriate unit.3
Respondent admits that it refused to bargain with
I The complaint, which issued on February 23, 1968 , is based upon
charges filed and served on September 5, 1967.
2 Unless otherwise indicated , all dates fall in 1967.
3 Alternatively, the General Counsel asserts that, even though the
Union might have lost its majority status on and after July 3, this loss
was directly attributable to the Company 's engagement in the unfair
labor practices set forth in (a) and (b) of the text above I have
hereinafter found that Respondent did not engage in those unfair labor
practices. Accordingly , I find no merit in this contention
1484 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the Union on and after July 3. However, it defends its conduct
on the ground that the Union in fact lacked a majority of
employee-designations at all times during which it withheld
recognition from the Union. Additionally, Respondent main-
tains that it harbored a good-faith doubt as to the Union's
majority status on and after July 3, based upon certain
objective considerations which had come to its attention, and
consequently its failure to deal with the Union on an exclusive
basis after that date was legally privileged.
The facts giving rise to this proceeding are not in essential
dispute and I find them to be as follows. Pursuant to a Board
election conducted on April 11, 1945, the Union was certified
on April 19, 1945, as the exclusive representative of all
production and maintenance employees, inspectors, and stock-
room employees at Respondent's plant, excluding office
clerical employees, foremen and assistant foremen, profes-
sional employees, guards, and supervisors as defined in the
Act.4 Thereafter, the parties negotiated and executed a series
of annual labor agreements, the last of which contained a
terminal date of June 26. By letter dated April 22, the Union
notified the Respondent of its intention to terminate the
existing contract and its desire to commence negotiations for a
new one, in consequence of which the date of May 17 was set
for the first bargaining session. On that date, the parties met at
Respondent's offices. Present on behalf of the Union were
George W. Wells, a special representative, Terry Howard, an
employee who occupied the post of financial-secretary and
treasurer , and Marion Pauling, an employee who was a member
of the negotiating committee. Richard Ferguson, vice president
in charge of operations, was the chief spokesman for Respond-
ent, and he was assisted by William House, the personnel
manager, and Ed Kimbirl, the shop superintendent. When the
meeting opened, the Union advanced its contract proposals
which included a 7 percent wage increase, another paid
holiday, additional sick pay, and improvements in vacation
benefits. After considering the Union's demands, Ferguson
requested that, because of the Company's peculiar operational
and financial posture, the Union acquiesce in a 1-year
extension of the existing agreement without substantive
change. Ferguson explained that Respondent's textile machine
sales had fallen off because the slack season had set in, and
that it would not be known until late summer or fall whether
and to what extent new orders would be obtained. Ferguson
further explained that Respondent had enjoyed exceptional
sales in the Schlafhorst line for the current fiscal year and
anticipated a high level of profits from these sales.5 However,
he noted that Respondent was in the process of erecting a new
building in which its equipment was to be moved, and that it
was unclear at the time and would not be known until late in
the year the extent to which the Schlafhorst profits would be
devoured by the new construction. Ferguson concluded by
stating that the Company intended to survey its profit position
in the fall and he expressed the hope that, after this appraisal,
it might be possible to afford all employees increased wages,
cash bonuses and other fringe benefits by the year's end. Wells
advised Ferguson that the Union was unwilling to extend the
contract without any change in its terms, and suggested that
4 The complaint alleges, the answer admits, and I find that this unit
is appropriate for the purposes of collective bargaining within the
meaning of Section 9 (b) of the Act
5 Respondent manufactures and sells textile machinery such as gear
the latter take the matter back to his office and give further
consideration to the Union's proposals. Ferguson agreed to do
so, but expressed the opinion that the Respondent could not
presently alter its stance. Before the discussion terminated, the
parties explored such topics as maintaining a parity of wage
rates when the Federal Minimum Wage was escalated in
February 1968, Pauling raised a question regarding Respond-
ent's ment rating system, and the Union brought up a matter
concerning job descriptions. The meeting terminated with
agreement by the parties to reconvene on a later date, June 2,
to continue negotiations.
On the afternoon of May 17, Ferguson drafted a notice and
a letter to the employees, which were signed by E A Terrell,
Jr., Respondent's executive vice president. These were posted
on the plant bulletin board, in accordance with past practice,
and set forth the Union demands for such items as a wage
increase, and enlarged vacation and sick leave benefits,
together with a statement of Respondent's position that the
existing contract should be extended for another year because
of the uncertainty of business prospects and the possibility
that calculated profits might produce increased benefits for the
employees later in the year.
At the June 2 session, with both sides represented by
substantially the same individuals, Wells asked Ferguson
whether the latter had reconsidered his position and would be
willing to execute an agreement embodying the Union's
proposals. Ferguson restated Respondent's concern about the
cost of construction of the new plant and the removal of
machinery to that installation and mentioned that, although
the Company anticipated a profit for the fiscal year 1967, it
was as yet uncertain as to the amount of proceeds which
would be available for wage increases or other benefits. At this
juncture, Wells complained that the employees deserved a wage
increase because of the rise in the cost of living, and remarked
that the employees should not be asked to forego a wage hike
simply because the Respondent was moving into new facilities.
Ferguson agreed that the employees merited a wage increase
but reiterated that the time was not ripe for such a financial
move. Ferguson added that Respondent hoped to appraise the
situation in October with a design of implementing wage
increases at the end of the year. When Wells pressed Ferguson
to be more specific about the tirrung of the raises, the latter
stated that, if the Company did grant the increases "it would
be some time in the fall, and probably after September 1967."
Wells then inquired whether Ferguson would be amenable to
sign the existing agreement with a wage reopener, to which the
latter replied that the parties had operated under a firm 1-year
contract over the course of the years and that the Union's
proposals would derogate from this practice. The session ended
with Wells commenting that he would conduct a meeting with
his members to ascertain their sentiments with respect to
Respondent's offer.
On June 3, Respondent assembled its employees to explain
to them what had transpired during the negotiations con-
ducted on the previous day. Ferguson recounted that the
Company was unable to determine whether it could currently
offer a definitive wage increase but would have to await an
boxes and labor-saving devices for the textile industry in the United
States As another facet of its business , it acts as a sales representative in
this County for a German textile machinery firm known as the
Schlafhorst Company.
TERRELL MACHINE CO. 1485
audit of its financial statement and an assessment of new
customer orders. Ferguson assured the men, as he had their
representatives, that they might receive a higher wage in the
fall.
Following the June 3 meeting, Wells contacted Robert
Callaway of the Federal Mediation and Conciliation Service to
inform Callaway of the status of negotiations with the
Company thus far. In consequence of this conversation,
another bargaining session was scheduled at the Service's office
for June 23. In the meantime, and on June 22, Ferguson sent a
letter to all employees in which he outlined the topics of
discussion at the June 3 meeting. The letter recited that the
Company had experienced a good year as a result of the
Schlafhorst sales, but cautioned that the prospects for the
following year were uncertain and mentioned that this had
been brought to Wells' attention. The letter further stated that
the Respondent desired a 1-year extension of the existing
agreement and advanced the prospect that a pay raise might be
feasible by the end of the year. After setting forth the profit
figures for prior years, the letter added that the labor
agreement between the parties was about to expire and
informed the employees that Respondent intended to operate
the plant after the contract's termination even if the Union
decided to strike the facility.
The June 23 meeting was conducted as scheduled, with
Callaway present. Also in attendance for the first time was
E.A. Terrell, Jr., Respondent's executive vice president. Before
the session got under way, Wells and Callaway met separately
and Wells stated that the Union was willing to recede from its
original proposals. Under the Union's revised demands, it
indicated a willingness to sign the existing contract provided it
contained a provision for reopening the agreement for a review
of the wage situation in September or October. On November
1, Respondent would award an increase in an amount to be
determined solely by it. In the event that the Union was
dissatisfied with the sum offered, it could terminate the
agreement on 10 days' notice. When the parties met jointly,
Wells' reviewed the topics discussed at the two preceding
meetings. Wells' new proposals were then considered by the
management representatives. After doing so, Terrell testified
that he observed that he was unable to gauge at that time what
the profit margin would be by September or October because
of the uncertainty of future sales and the efficiency factor in
manufacturing industrial sales products, and hence he stated
that he would not agree to a wage-reopener clause or a definite
date for a wage increase. It is undenied and I find that Terrell
then told Wells that the Company would be willing to sit down
with the Union in the fall when all the unknowns had become
certainties, and that he would negotiate with the Union
concerning the amount of any wage increase or other benefits.
A suggestion was made to permit the parties to study the issues
and reconvene at a later date. As the contract was due to
expire on June 26, the possibility of a meeting on that day was
explored but, inasmuch as Wells had other commitments, the
next session was set for July 3 with Wells' assurance that the
Union would not engage in a strike prior to that date.
However, before the meeting broke up, Mediator Callaway
inquired into the numerical size of the appropriate unit, to
which Wells replied that there were "around 60 or 65" men
within the unit.6 According to Wells, the figure was based
upon information which he had received from the Union
committee, and he had not consulted any of the Union's
records before he answered. When Terrell heard this, he
corrected Wells and stated that there were 90 men in the
certified unit. The meeting then terminated.
On June 26, Respondent mailed another letter to its
employees in which it set forth the latest Union proposals and
Respondent's reaction to them. The letter also advised that
another bargaining session was scheduled for July 3, and that
Respondent intended to operate its plant in the usual manner
despite the fact the existing contract was due to expire on
June 26.
After the meeting of July 3 opened at 10 a.m., Terrell
reviewed the Union's revised proposals and remarked that he
did not find them attractive to him. Once more, he requested
that the expired contract be extended for another year, with
the prospect of a wage award when Respondent's financial
position was fully ascertained. At this point, Terrell stated that
there was an important issue which needed resolution before
negotiations could continue. Terrell testified that he informed
Wells of a serious doubt which had arisen in his mind as to the
Union's majority due to Wells' assertion on June 23 that there
were between 60 and 65 employees in the unit when in fact
the number totalled 90. Terrell announced that he would not
proceed further with negotiations unless and until the Union
demonstrated that it did represent a majority of Respondent's
employees. Terrell thereupon gave Wells a list of all the unit
employees and suggested that Wells establish by documentary
proof to be submitted to an impartial observer that the Union
had in fact been designated by a majority of the men. Terrell
added that, unless the Union possessed a majority, it would be
illegal for the Company to continue negotiating with it. Wells
responded that "We very definitely do have a majority;
however, we don't think that it's necessary to show proof of
majority this late in the game, but if and when we decide to
show proof of majority, we will show you in our own way,"
and Wells remarked that the Union would not open its books
to anyone as a matter of principle. Terrell testified that he
asked Wells how many members of the Union were encom-
passed in the unit and offered to renew the old contract
without change if the Union was found to represent a majority
of employees, but that Wells replied he did not know what the
number was. In his testimony, Wells flatly denied that Terrell
inquired as to the number of union members at the July 3
meeting or at any other time.7 Following this colloquy,
Mediator Callaway recommended that Terrell summon Re-
spondent's attorney, William Sturges, to render legal advice in
the matter. After Sturges arrived, he informed the gathering
that, in his opinion, it would be unlawful for Respondent to
enter into an agreement with the Union unless the latter
proved its majority. Wells replied that it was perfectly lawful
for the Company to deal with the Union in view of its original
certification by the Board , and again insisted that the Union
was a majority representative. He finally advised the manage-
6 Wells testified that he placed the figure at 60 to 6S . Ferguson and
Terrell averred that Wells set the number at 65 or 70. As this variance is
not critical to a decision herein , the conflict need not be resolved
7 Howard testified that , at this meeting, Wells assured Terrell that
the Union possessed designations from a majority of the employees, but
no mention of numbers was made. Ferguson, who was also present at
the session, failed to support Terrell's testimony concerning the latter's
inquiry into how many members the Union claimed . I credit Wells'
testimony in this regard.
1486 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ment officials that the Union 's current proposals would remain
viable for the rest of the week, that the Union would not
permit anyone to inspect its records , that an agreement
without a reopener clause was unacceptable , and that, if the
Union decided to engage in a strike at the plant , it would do so
without prior notice . On this note , the meeting ended.
On July 6, Terrell once again mailed a letter to the
employees reporting on the status of negotiations . The letter
repeated the Respondent 's contract proposal , namely, the
extension for one year of the recently expired agreement with
an appraisal of a possible wage increase in the fall. The
document went on to recite that "Because during our
negotiations many evidences of opposition to the Union's
policies have been shown , including a misunderstanding by the
Union of the size of the bargaining unit, we asked the question
... whether the Union really represented a majority of the
employees . We said we were willing to renew the contract if
the Union would have an impartial third party to inspect the
membership records and report simply that they did have a
majority at that time .... The Union has refused to provide
satisfactory evidence of a majority, and until it does we cannot
continue to negotiate with it." The letter concluded with the
statement that a work stoppage , if called by the Union, would
result in financial hardship for the strikers , and with an
announcement that the plant would continue to operate
despite a strike.
Wells testified without contradiction and I find that, around
the middle of July, he telephoned Callaway to relate that
Wells' superiors had decided that the best course to pursue in
order to resume negotiations was to demonstrate its majority
status to the Respondent , and that Wells was prepared to do
so. Callaway told Wells that he would relay this information to
the Company. A few days later, Callaway phoned Wells and
stated that the former had contacted Respondent's officials
and laid before them the Union 's card-check offer, but that
those officials "had said no , that they were no longer
interested in a membership check or anything else, as far as
they were concerned the union was out , and they did not
intend to recognize it further." I/
Terrell's testimony on this score is not at essential variance
with that of Wells. Terrell noted that he received a telephone
call from Callaway on July 31 during which the latter inquired
whether Respondent's officials had given any further thought
to the bargaining stalemate which had been reached, and
whether they had arrived at any new conclusions . Terrell
replied that he and his colleagues had considered the matter
and were convinced that their position regarding the contract
proposals was a proper one and would not be altered . Callaway
commented that, if Respondent would agree to grant a wage
increase in an unspecified amount in January 1968, he believed
that the Union would be willing to produce evidence of its
representational status. Terrell responded that "as far as
making any changes in our position , as far as that was
concerned , we didn't see any at that time, but that we would
do exactly what we said we would, which was to review the
situation in the fall, and to make changes if we could , then."
Terrell inquired whether this proposal came from Callaway or
from the Union , and when Callaway stated that the proposal
was of his own invention , Terrell remarked that he would
consider the proposition . During the first week in August,
Terrell contacted Callaway Terrell informed Callaway that
Respondent had given full and careful consideration to the
proposal which Callaway had proffered and that , because "of
the pressure that had been reported to us, and the activities
reported to us, we did not feel a check of any records at that
time would give an uncoerced, unbiased view of what the
desires of the employees were, and that we were not interested
in any reference to it at that time." When pressed as to the
nature of the "pressure" and "activities" which prompted him
to refuse to test the Union's majority, Terrell avowed that he
had heard "The reports of remarks made by employees as to
pressure they felt under the situation where a strike had been
threatened, [that] was the primary reason." Terrell was
queried as to whether these anxieties had been expressed by
employees who were union members, and initially replied that
"I had it reported to me that employees who were union
members or said they were, expressed concern at the activities
of the Union, and the strike talk, and that they did not wish to
participate in a strike." However, he then conceded that the
"reports" were merely rumors of the possibility of a strike,
that a strike never eventuated, and that none of the rumors
came from the lips of any member of the Union. Moreover,
Terrell allowed as how he never contacted the Union to
demand that it demonstrate its majority, and admitted that he
was not interested after July 3 in ascertaining whether or not
the Union represented a majority of his employees.
At the conclusion of his conversation with Callaway in early
August, Terrell informed Callaway that Respondent had
decided that business conditions were sufficiently promising to
justify the award of a wage increase in the fall. Terrell added
that, by October 10, all of the relevant information concerning
Company profits would be available and that he would make
an announcement on that date to the employees regarding
when and in what amount the increase would be granted. So
far as this record stands, this intelligence was never communi-
cated to the Union and the Union was never given an
opportunity to bargain again over the matter of the award.
On August 7, Terrell addressed still another letter to his
employees. This letter conveyed Callaway's inquiry as to
whether Respondent would be willing to renew the old
contract with a provision for a wage increase in January 1968
in return for the Union's production of evidence of its
representative status Terrell further commented that "It was
clear at the time we made our original request [the July 3
meeting] that the union did not represent a majority, and we
sincerely doubt that an uncoerced majority of our employees
now really wish to be represented by the union. Therefore we
are not interested in any record check at this time, as we do
not believe it would represent the true choice of our
employees." The letter concluded with the information that
Respondent would make known on October 10 the amount of
the wage increase which it had decided to grant in the fall
On the same day, Wells dispatched a letter to Ferguson
which was received by Respondent on August 9 and in which
Wells requested that management officials meet with the
Union as early as possible to continue current contract
negotiations. Ferguson responded on August 15 by stating that
"We do not believe ... that your union represents a majority
of our employees in an appropriate unit. We therefore decline
to meet with you." The refusal by Respondent to continue
negotiations triggered this litigation.
As chronicled heretofore, Respondent claims that it was
lawfully privileged to deny exclusive recognition to the Union
on and after July 3 on dual grounds. First, it asserts that the
Union did not in fact represent a numerical majority of the
employees during that period. Second, Respondent contends
TERRELL MACHINE CO. 1487
that it possessed a good-faith doubt of the Union's majority
based upon various objective facts and considerations which
had come to its attention on and before July 3, and therefore
it was justified in refusing to bargain with the Union for this
reason.
Before turning to a consideration of the Company's initial
claim, certain legal guidelines should be noted. It is now
well-grounded in the law that, where a labor organization has
been certified by the Board and recognized by the employer
over the years, as in this case, a rebuttable presumption arises
that the Union's majority continues to prevail unless it is
shown to have been lawfully dissipated. Under prevailing
precedent, aught that the General Counsel need plead and
prove is that the labor organization involved had obtained a
Board certification which continued in effect, after which the
employer must shoulder the burden of demonstrating that the
union is not entitled to recognition by virtue of a defection
from its ranks 8 For a reason not apparent on this record, the
General Counsel chose not to follow this procedure but,
instead, undertook during his case-in-chief to establish the
Union's numerical majority on and after July 3 by proof of
membership rather than by reliance on its prior certification.
In my opinion, he has nevertheless succeeded in doing so.
The record establishes and I have found that, at the meeting
at 10 a.m., on July 3, Respondent provided the Union with a
list containing the names of the 90 employees in the
appropriate unit. At the hearing, the General Counsel placed in
evidence 41 dues ledger cards and 6 union authorization cards,
purportedly making 47 designations in favor of the Union on
July 3. Because an individual named William Grayder did not
appear on the list submitted to the Union, or on Respondent's
payroll as of July 3, the General Counsel agreed to withdraw
Grayder's designation, reducing the Union's majority to 46. In
addition, the parties stipulated that the designation of em-
ployee Roger Locklear should be disregarded due to the
uncertainty as to when he joined the Union, thus lowering the
Union's membership figure as of July 3 to 45. Finally, the
parties agreed to include employee Terry Howard among the
union members. Hence, the General Counsel maintains that the
Union represented 46 employees on July 3, out of 90 in the
appropriate unit, numerically a majority. However, Respond-
ent asserts that three of the authorization cards do not
constitute valid designations on the critical date, namely, those
of Alfred Pettis, Earnest Lee Kilgo, and Perry Hudson.
Pettis testified that he executed his card on June 30 at the
behest of employee Carl Surber while at work that day, and
returned it to Surber the following morning, Saturday, July 1.
Personnel Manager House testimonially related that Pettis'
timecard shows that the latter did not work on July 1.
Accordingly, Respondent advances the argument that Pettis
could not have turned the card over to Surber on that day, and
that there is thus no probative evidence to establish that Pettis
was a Union member on July 3 when Respondent rejected the
Union's bargaining demand. Respondent misconceives the
thrust of Pettis' testimony. While he stated that he "worked
with" Surber and conveyed the card to Surber on July 1, there
is nothing in Pettis' averments to indicate that the transaction
took place at the plant on this date, nor is there any evidence
to show that Surber was on the job on July 1 9 I therefore am
convinced and find that Pettis was both truthful and accurate
when he testified that he executed the authorization card on
June 30 and returned it to Surber on July 1, and that it
constitutes a valid designation in favor of the Union.
Kilgo testified that he filled out his card on July 3 at the
solicitation of Surber and returned it to the latter on the same
day. Kilgo placed the signing "in the afternoon before" he left
work. The record shows that he paid his Union dues for the
months of July, August, and September. Respondent claims,
and I find, that as the final bargaining session of July 3 was
conducted in the morning, Kilgo's designation did not become
effective until after that meeting had been concluded.
Hudson's authorization card bears a date of July 3. When
asked on direct examination whether he executed the card on
that day, he replied, "I guess so." On cross-examination,
Hudson could not remember whether in fact he signed the card
on July 3, nor could he remember the time of day when he
appended his signature to it. However, it is undenied that he
paid his Union dues for the months of July, August, and
September. Respondent contends that, accepting the assump-
tion that Hudson signed his card on July 3, there is no
demonstrative evidence in this record that his signature was
obtained prior to the meeting between Respondent and the
Union on that date. I concur in this contention and find that
the General Counsel has failed to prove that Hudson's
authorization card was procured by the Union prior to the
bargaining session on July 3 when Respondent rejected the
Union's recognitory demand. I therefore find and conclude
that at 10 a.m. on July 3, when the last negotiating meeting
was held between the parties and Respondent declined to
continue the bargaining colloquy except upon proof of the
Union's exclusive status, the Union possessed only 44 valid
designations from the 90 employees, certainly not a majority.
However, inquiry into the propriety of Respondent's
conduct on and after July 3 does not end with this
happenstance. It is undisputed and I have found that Kilgo
submitted his signed card to the Union following the meeting
on July 3. It is also uncontroverted and I have found that
Hudson paid his union dues for the month of July and,
although it has not been evidentially established with any
degree of certainty on what date during that month he joined
the Union, it seems clear and I find that, by the payment of
dues, Hudson became a union member at some time during the
month of July I therefore find and conclude that the Union
was possessed of a majority of the employees' designations
following the July 3 session and at least on July 31.10
When Respondent broke off negotiations on July 3, the
Union had not abandoned its representional claim. Indeed, it is
undenied and I have found that, around mid-July, Wells
contacted Mediator Callaway to report that the Union was
agreeable to lay open its membership rolls for inspection by an
8 See Celanese Corporation of America, 95 NLRB 664, 672,
Frito-Lay, Inc, 151 NLRB 28, 33. -
9 I would note that neither House nor any other Company official
who was i . alled to testify claimed that Surber was on duty at the
factory on July 1.
10 The addition of Kilgo and Hudson to the Union 's membership
rolls following the July 3 meeting , and the absence of any evidence that
the size of the unit had meanwhile increased , preserved the Union's
majority of 46 out of 90 employees during July However, Respondent
points out that employee Maurice Carter, a Union member who is
included in the figure of 46, left its employ on July 7. Respondent can
draw little solace from Carter's departure for, upon his termination, this
reduced the number in the unit to 89. At this juncture , the Union's
strength totalled 45 of the 89 unit employees, also a majority.
1488 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
impartial observer to determine its majority status if this
action would induce Respondent to resume its place at the
bargaining table. Callaway transmitted this intelligence to
Terrell on July 31 and the former received an inconclusive
response on that date and a negative one on August 7 when
Terrell told Callaway that "we did not feel a check of any
records at this time would give an uncoerced, unbiased view of
what the desires of the employees were, and that we were not
interested in any reference to it at that time " I therefore find
and conclude that the Union continued to press its demand for
recognition after July 3 at a time when it represented 45 of the
89 unit employees, that Respondent was fully apprised of the
Union's desire to perpetuate negotiations, and that Respond-
ent refused to meet and deal with the Union I therefore
conclude that the Union in fact represented a mathematical
majority of the unit employees in the latter part of July, a
period during which Respondent was asked and refused to deal
with the Union concerning the wages, hours, and other terms
and conditions of employment for its employees.
As heretofore found, Wells sent a letter to Ferguson on
August 7 demanding a renewal of negotiations which the latter
declined by reply dated August 15. Respondent argues that
Ferguson's rejection of the Union's demand at this time did
not impose any statutory liability upon it because, as stated in
Respondent's brief filed with me, "There is no evidence to
show who or how many employees comprised the unit on
August 7." In support of this argument, Respondent claims
that the membership of Corum Harris and Bruce Kepley lapsed
in August, and that employees William Helms and Rufus
Combs testified that they did not remit their dues to the
Union after July. Accordingly, Respondent asserts that the
Union's majority during August was suspect and that at most it
represented only 41 of 89 employees in the unit during that
month. The dues ledger card of Harris, which was maintained
by Financial Secretary and Treasurer Howard in the normal
course of business and was introduced into evidence, shows
that Harris was initiated into the Union in June, and that he
thereafter paid his dues for the full months of July and
August. Kepley's record indicates that his initiation took place
in May and he paid his dues for the months of June and July,
but not thereafter. However, Howard testified without contra-
diction and I find that, pursuant to the Union's internal
procedures, a member is permitted to remain in arrears of dues
for a period of 3 months before his membership in that
organization is cancelled. As the record fails to show that
either Harris or Kepley formally resigned from the Union
during that 3-month period, I find that Harris continued to be
a member through November and that Kepley remained on the
Union's rolls until the end of October. With respect to Helms,
he testimonially expressed his belief that he did not pay any
union dues after July. Yet, his dues' ledger card which was
introduced into evidence, demonstrates that he was initiated
into the Union in July and paid his dues for the months of
July and September, but not for August. Combs also testified
that he paid dues for the month of July, but not thereafter.
Here, again, Combs must have been mistaken for his ledger
card establishes that he paid an initiation fee in July, did not
pay any dues for August, but did remit dues for the months of
September and October. In view of the foregoing, I find and
conclude that the Union retained a numerical majority of 45
out of the 89 employees in the unit after it makes its demand
for continued recognition by its letter to Respondent dated
August 7
In sum, I find and conclude that, at all times material to
this proceeding, the Union in fact represented a majority of
Respondent's employees in an appropriate unit.
I turn next to Respondent's defense that, assuming,
arguendo, the Union did have the support of a majority of
Respondent's employees on and after July 3, it was neverthe-
less vested with a good-faith doubt as to that majority because
of certain objective facts and considerations which had come
to its attention both before and during negotiations. In
Laystrom Manufacturing Co.," the Board reiterated the
character of proof which must be adduced to support this
defense. It noted:
After the first year [a Board] certificate still creates a
presumption of majority status, but the presumption is
normally rebuttable by an affirmative showing that the
union no longer commands a majority. [Footnote omit-
ted.] Moreover, where the certificate is a year or more old
an employer may withhold further bargaining without
violating the Act and insist that the union reestablish its
statutory representative status if, but only if, he in good
faith has a reasonable doubt of the union's continuing
majority [Footnote omitted ]
A showing of such doubt, however, requires more than
an employer's mere assertion of it and more than proof of
the employer's subjective frame of mind The assertion
must be supported by objective considerations. The appli-
cable test, as defined in the Celanese case, (95 NLRB 664),
is whether or not the objective facts furnish a "reasonable
basis" for the asserted doubt, or, put another way, whether
or not there are some reasonable grounds for believing the
Union has lost its majority status since its certification.
[Footnote omitted.]
Executive Vice President Terrell, who has been associated
with Respondent since the Union's original certification in
1945, testified that the "first serious doubt" about the latter's
majority status which he entertained arose at the first
bargaining meeting he attended on June 23 when Wells
remarked in response to Mediator Callaway's question that
there were between "65 or 70" employees in the unit.
However, Terrell candidly admitted that he "didn't know why
[Wells] said" that the unit was so limited in scope and Terrell
believed that the figure advanced was a "mistake or misjudg-
ment" on Wells' part due to the fact that the latter had only
been employed by the Union for approximately a year. Terrell
attempted further to support his good-faith doubt as to the
Union's majority by relating that "specific reports" had
reached his ears that the Union's membership ranged from 38
to 40 out of 90 employees in the unit, but then he
acknowledged that these reports were "conflicting" and he
failed to identify either the source of his information or the
basic ingredients of this intelligence. Searching for additional
bases on which to found his doubt, Terrell recounted that his
skepticism over the Union's exclusive status had developed
over the years due to "the apparent lack of interest in union
membership, and the lack of communication with the union.
We never saw any union representatives excepting during
negotiations." He finally conceded that the sole report
1 1 151 NLRB 1482 , 1483-84.
TERRELL MACHINE CO. 1489
concerning the Union's lack of support among his employees
was received in the 1950's
Ferguson was equally vague as to the basis for Respondent's
belief that the Union did not command the adherence of a
majority in the unit when Respondent decided to withhold
recognition on and after July 3. He testified that, prior to the
bargaining session on June 23 when Wells commented there
were between 65 and 70 individuals in the unit, he and
Respondent's officials had a "general feeling" that the Union
lacked a majority and that this feeling crystallized into
certainty when Wells made his comment on June 23. However,
Ferguson admitted that Respondent's doubt was predicated on
contradictory and unsubstantiated rumors. Thus, he reported
that, prior to the commencement of negotiations in May, he
was told by Shop Superintendent Kimbirl that the latter "had
heard" from three employees that they "did not feel like our
union was active enough, they wanted to get another union in
there." Then, on June 6, Ferguson learned from Production
Control Manager Tolbert that the Union had obtained six new
members and that acquisition brought the number of Union
adherents in the unit to 100 percent. On June 15, Ferguson
was informed by a Supervisor Deaton that the Union had
acquired 15 additional members because Respondent had
altered its employees' coffeebreak. On the same day, Kimbirl
notified Ferguson that the Union had admitted 60 employees
into membership. Finally, Ferguson heard on June 16 that
there were between 38 to 40 men in the Union. Despite the
receipt of the foregoing "rumors," as both Ferguson and
Terrell put it, and although Respondent obtained advice of
counsel before it decided to refuse to continue negotiations
with the Union on and after July 3, Respondent concededly
declined to file a representation petition with the Board to test
the Union's majority in a secret election.
After a full review of the evidence which Respondent
introduced on this issue, I find and conclude that Respondent
has failed to sustain its burden of showing by "objective
considerations" that "reasonable grounds" existed concerning
the Union's lack of majority support which would justify its
failure to accord continued recognition to that labor organi-
zation, under the precepts outlined in Laystrom Manufacturing
Co. 12
I have heretofore found, contrary to the General Counsel's
contention, that the Union did not represent a majority of
Respondent's employees when the latter's officials walked out
of the bargaining room on July 3 and refused to recognize the
Union. However, I have also found that employee Kilgo
executed his authorization card on the afternoon of July 3,
following the last negotiating session, and that employee
Hudson became a union member during the month of July,
making the Union's majority designation as of July 31 a figure
of 45 out of 89 in the unit on that date. I have further found
that the Union maintained that majority during the month of
August when the Union requested that Respondent resume
negotiations and when Respondent declined to do so. Accord-
ingly, I conclude that the Union in fact represented a majority
of Respondent's employees in the appropriate unit on July 31
and that Respondent did not harbor a good-faith doubt of the
Union's exclusive status when it refused to continue the
bargaining colloquy. By the foregoing conduct, I conclude that
Respondent thereby violated Section 8(a)(5) of the Act.
The complaint alleges that Respondent further violated
Section 8(a)(5) by insisting "throughout negotiations" that it
be permitted unilaterally to determine the size and timing of
any wage increase and by promising its employees on June 3
that they would be afforded a raise in the fall. As heretofore
found, at the June 23 bargaining meeting Terrell told Wells
that the Company would be willing to sit down with the Union
in the fall when Respondent's financial resources were known
and that Terrell would then negotiate with the Union
concerning the amount of any wage increase or other benefits.
Wells testified that, at the June 2 bargaining session, Ferguson
did not indicate one way or the other whether the amount of
any future increase would be negotiable. Terry Howard, the
Union's financial-secretary and treasurer, testified that, in the
course of negotiations, Respondent stated that there "prob-
ably" would be a wage escalation later in the year, but Howard
did not deny that the Company gave the assurance that it
would bargain over the raise. Marion Pauhng, the only witness
called by the General Counsel to report on the June 3
convocation by Ferguson, proclaimed that Ferguson did not
promise that there would be a wage increase in the fall, and he
added that no such proffer was made at any time during
negotiations. In light of the foregoing testimony, as well as
Wells' testimonial acknowledgment that, at the June 23
meeting, he expressed a willingness to grant license to
Respondent unilaterally to ascertain and award a wage increase
for its employees, and in view of Terrell's undenied testimony
that he promised to negotiate the amount of the increase in
the fall when business conditions stabilized, I find and
conclude that the General Counsel has failed to sustain his
burden of proof that Respondent insisted throughout negoti-
ations which terminated on July 3 that it be permitted
unilaterally to fix the size and time of a pay award, and that
Respondent promised employees on June 3 that they would
receive such an award toward the end of the year.
However, I have also found that at all times material herein
the Union in fact represented a majority of the unit em-
ployees, particularly on August 7 when the Union requested
that Respondent resume negotiations, and that Respondent
did not entertain a good-faith doubt as to the Union's majority
status. As heretofore found, Terrell informed Mediator
Callaway on August 7 that the Company had unilaterally
decided to announce to the employees on October 10 when
and in what amount it would award a wage increase. As the
Union was the exclusive representative of Respondent's
workers on August 7, I find that Respondent was statutorily
bound to consult with and bargain with the union timing and
amount of the raise which it would grant. By failing to do so, I
conclude that Respondent thereby offended the provisions of
Section 8(a)(5).
IV. THE EFFECT OF THE UNFAIR LABOR
PRACTICES UPON COMMERCE
The activities of the Respondent set forth in section III,
above, occurring in connection with the operations of Re-
spondent described in section I, above, have a close, intimate,
and substantial relation to trade, traffic, and commerce among
the several States, and tend to lead to labor disputes burdening
and obstructing commerce and free flow thereof.
12 See fn. 10, supra.
1490 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
V THE REMEDY
Having found that Respondent has engaged in certain unfair
labor practices, I shall recommend that it cease and desist
therefrom and take certain affirmative action designed to
effectuate the policies of the Act.
Having found that the Respondent refused to bargain
collectively with the Union as the exclusive representative of
its employees in the appropriate unit, I will recommend that
the Respondent, upon request, bargain collectively with the
Union as such representative and, if an understanding is
reached, embody said understanding in a signed agreement
Having found that the Respondent unilaterally announced
to its employees the date on which it would determine the
timing and award of a wage increase without prior consultation
with their duly designated bargaining agent, I will recommend
that Respondent bargain with the Union concerning the timing
and award of any future wage increase.
Upon the basis of the foregoing findings of fact and
conclusions and the entire record in the case, I make the
following
CONCLUSIONS OF LAW
1. Respondent is engaged in commerce within the meaning
of Section 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 All production and maintenance employees, inspectors,
and stock room employees at Respondent's plant in Charlotte,
North Carolina, excluding office clerical employees, foremen
and assistant foremen, professional employees, guards, and
supervisors as defined in the Act, constitute a unit appropriate
for the purposes of collective bargaining within the meaning of
Section 9(b) of the Act.
4. At all times material herein, the Union has been the
exclusive bargaining representative of the employees in the
aforesaid unit within the meaning of Section 9(a) of the Act.
5. By refusing to bargain with the Union, upon request,
concerning the wages, hours, and other terms and conditions
of employment for employees in the aforesaid bargaining unit,
and by unilaterally announcing the date on which it would
determine the timing and award of a wage increase without
prior consultation with the Union, Respondent has engaged in
and is engaging in unfair labor practices within the meaning of
Section 8(a)(5) of the Act.
6. The aforesaid unfair labor practices are unfair labor
practices affecting commerce within the meaning of Section
2(6) and (7) of the Act.
13 In the event that this Recommended Order be adopted by the
Board, the words "a Decision and Order" shall be substituted for the
words "the Recommended Order of a Trial Examiner " in the notice. In
the further event that the Board 's Order be enforced by a decree of a
United States Court of Appeals, the words "a Decree of the United
States Court of Appeals, Enforcing an Order" shall be substituted for
the words a Decision and Order "
RECOMMENDED ORDER
Upon the foregoing findings of fact and conclusions of
law and the entire record in this case, and pursuant to Section
10(c) of the National Labor Relations Act, as amended, I
recommend that Respondent, Terrell Machine Company,
Charlotte, North Carolina, its officers, agents successors, and
assigns, shall-
1 Cease and desist from
(a) Upon request, refusing to bargain collectively with the
Union as the exclusive representative of all employees in the
appropriate unit with respect to rates of pay, wages, hours of
employment, or other terms and conditions of employment
(b) Unilaterally announcing the date on which Respondent
would determine the timing and award of wage increases
without prior consultation with the Union.
(c) In any like or related manner interfering with, restrain-
ing or coercing its employees in the exercise of their right to
self-organization, to form labor organizations, to join or assist
the above-named labor organization, or any other labor organ-
ization, 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 protec-
tion, or to refrain from any or all such activities.
2 Take the following affirmative action which I find is
necessary to effectuate the policies of the Act.
(a) Upon request, bargain collectively with the Union as
the exclusive representative of all employees in the following
appropriate unit with respect to rates of pay, wages, hours of
employment and other terms and conditions of employment
and, if any understanding is reached, embody such under-
standing in a signed agreement
All production and maintenance employees, inspectors,
and stock room employees at Respondent's plant in
Charlotte, North Carolina, excluding office clerical em-
ployees, foremen and assistant foremen, professional em-
ployees, guards, and supervisors as defined in the Act.
(b) Post at its plant in Charlotte, North Carolina, copies of
the attached notice marked "Appendix" [omitted from
publication] .i 3 Copies of said notice, to be furnished by the
Regional Director for Region 11, shall, after being duly signed
by a representative of Respondent, be posted by Respondent
immediately upon receipt thereof and maintained by it for a
period of 60 consecutive days thereafter in conspicuous places,
including places where notices to employees are customarily
posted Reasonable steps shall be taken by Respondent to
insure that said notices are not altered, defaced or covered by
any other material.
(c) Notify the Regional Director for Region 11, in writing,
within 20 days from the receipt of this Decision, what steps
the Respondent has taken to comply therewith.14
i4In the event that this Recommended Order be adopted by the
Board, this provision shall be modified to read . " Notify said Regional
Director, in writing , within 10 days from the date of this Order, what
steps the Respondent has taken to comply herewith."