The Wallace Corp.

National Labor Relations Board - Board Decisions

Feb 27, 1943

47 N.L.R.B. 1169 (N.L.R.B. 1943)

In the Matter of TIIE WALLACE CORPORATION and B. E. THOMPSoN and
LOCAL UNION No. 129, UNITED CONSTRUCTION' WORKERS ORGANIZING
COMMITTEE
Case No. C-2321.Decided February 27,1.943
Jurisdiction : clothespin and tray manufacturing industry.
Unfair Labor Practices
Interference, Restraint, and Coercion: threatening to close plant to discourage
union membership; directing employees to attend union meeting and to oppose
proposed labor organizatipn of employees ; threatening union employees with
loss of jobs unless such employees desisted from soliciting members on behalf
of union; interrogating employee with respect to union membership and union
activity; threatening to withhold union recognition even if union successfully
organized the employees ; promising to reward employees for refraining from
joining union'; characterizing union president as "agitator."
Cqn ny-Donzan.ated Union: participation by supervisory employee in forma-
tion ; organizational adviser suggested by employee closely allied with man-
,agement, activity of minor supervisors in formation and administration of
affairs ; organizational participation in employer's back-to-work movement
during strike called by affiliated union; support : by discharging under closed-
shop contract, union employees excluded from membership.
Discrinxiiiation: discharge of employees for non-membership in dominated union
pursuant to closed-shop'contract.
Remedial Orders : company-dominated union disestablished; contract abrogated;
discharged employees reinstated with back pay.
Definitions : individual not acting in the interest of the corporation and having
no official connection with or financial interest in it, no voice in the conduct
of its business or in the formation of its labor policies except as adviser to
company-dominated labor organization, held not an employer of corporation's
employees within,meaning of the Act.
Practice and Procedure : complaint'dismissed as to individual found, not to be an
employer within the meaning of the Act.
Mr. Thomas E. Shroyer, for the Board.
Lewis, Rice,.Tucker, Allen c Chubb, by Mr. R. Walston Chubb, of
St. Louis, Mo., and Wolverton cC Callaghan, by Mr. Brooks B. Calla-
ghan, of Richwood, W. Va., for the respondent.
Mr. Yelverton Cowherd, of Washington, D. C., for the Union.
Ritchie, Hill cf? Thomas, by Mr. Charles Ritchie, of Charleston,
W. Va., for the Independent and for B. E. Thompson.
Mr. Eugene R. Thorrens, of counsel to the Board.
47 N. L . R. B., No. 143.
0 1169
513024-43=voI 47- 7 4
1170 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon a second amended charge duly filed on June 25, 1942, by
Local Union No. 129, United Construction Workers Organizing Com-
mittee, herein called the Union, the National Labor Relations Board,
herein called the Board, by the Regional Director for the Ninth Region
(Cincinnati, Ohio), issued its complaint dated June 25, 1942, against
The Wallace Corporation and B. E. Thompson, Richwood, West Vir-
ginia, herein jointly called the respondents, and severally, the respond-
ent Wallace and the respondent Thompson, alleging that the respond-
ents had engaged in and were engaging in unfair labor practices
affecting commerce, within the meaning of Section 8 (1), (2), and (3)
and Section 2 (6) and (7) of the National Labor Relations Act, 49
Stat. 449, herein called the Act. Copies of the complaint and notice
of hearing thereon were duly served upon the respondents, the Union,,
and Richwood Clothespin & Dishworkers' Union, herein called the
Independent, a labor organization alleged in the complaint to be
company-dominated.
With respect to the unfair labor practices, the complaint as amended.
at the outset of the hearing alleged in substance : (1) that since on or
about July 1, 1941, the respondents interfered with and discouraged
employees at the Richwood plant -of the respondent Wallace with
respect to their membership and activities in the Union while en-
couraging membership in the Independent (a) by urging, persuading,
and warning said employees to join the Independent and/or to re-
frain from aiding, becoming, or remaining members of the Union; (b)
by making disparaging and derogatory' remarks about the Union and
its leaders; (c)' by stating that the respondent Wallace would not
recognize the Union and would cease operating its plant if the Union
succeeded in organizing the employees; (d) by keeping under sur-
veillance the, activities and meeting places of the Union; (e) by at-
tempting to induce members of the Union to resign and- to 'refrain
from concerted activities; (f) by seizing union identification, badges
from the persons of•union members; (g)-by bribing employees to vote
for the Independent and against the Union in an election conducted
by, the Board on January 30, 1942; and (h) by posting and distribut-
ing written material, calculated to influence the employees to vote for'
the Independent and against the Union in said election,, alid ,other-
wise interfering with the free choice of the employees in the election;
(2) that on or about October 2, 1941, the respondents initiated, formed,
and sponsored the Independent, and have since dominated and inter-
THE` WALLACE: CORPORATION 1171-
fared with its adlninistration,-and contributed to its support; (3) that
on' or about March'18, 1942, the respondent Wallace, purporting to act
liursuant•to an alleged agreement between itself and the Independent,
discharged and thereafter refused to reinstate 43 named' employees 1
because they were members .f the Union and because they-were not-
members of the Independent; (4) that said contract, if it existed, was
illegal and void since it was made with a labor organization assisted by
unfair labor practices and not the representative of the employees
pursuant to Section 9 (a) of the Act; and (5) that by the foregoing,
acts, the respondents interfered with, restrained, and coerced em-
ployees in the exercise of the rights guaranteed in Section 7 of the Act.
On June 24, 1942, the respondents filed separate answers to the
complaint and separate motions to dismiss the proceeding,2 which in
substance denied the alleged unfair labor practices and set forth
affirmative matters hereinafter discussed. Among 'other things, the
respondents avefred in substance that the Independent was the lawful
bargaining agent of the employees as the result of an election conducted
by the Board pursuant to certain settlement agreements and _ that the
43 employees were discharged pursuant to the terms of a contract
with the Independent.. ' --
Pursuant to notice, a hearing was held-at Surnmersville, West Vir-
ginia, from July 9 through JulyN15, 1942, before William E: Spencer,
the Trial Examiner duly designated by the Chief Trial Examiner.
At the opening of the hearing the'lndependent filed a petition to inter-
ve!le in the proceeding, which the Trial Examiner granted insofar
as the interests of the Independent. were affected by the proceeding, and.
the Independent filed an answer to,the complaint and a motion to dis
miss the'case. . In its.answer and motion to dismiss, the Independent
denied the alleged unfair labor practices relating to it and set forth
affirmative matter substantially similar to that asserted by. the re-
spondents. The Board,. the respondents, the Union,-and the Inde-,
pendent were represented by counsel and participated in the hearing.,
Full opportunity to-be-heard, to examine and cross-examine witnesses,
and to' introduce -evidence bearing upon the issues was afforded all
parties. At the opening of the 'hearing -the Trial Examiner denied
the motions to- dismiss filed by the respondents and, the Independent
without prejudice to their renewal, and denied a motion of -the re-.
spondent, Wallace 'for. a bill, of particulars, without' prejudice, to a;
request for a' continuance in the event of surprise. No request for a
i They are listed in ,Appendix' A.' -
2 Theretofore the, Board had issued a previous complaint to which the above-mentioned
pleadings were directed At the opening of the hearing the Board amended .the com-,
plaint by substituting `the present complaint containing in its caption the name of B. E.
Thompson and alleging that he is ' an'employer ' within ' the meaning of the Act. By appro-.
priate 'orders, ' the respondent Wallace's answer and' motion to' dismiss theretofore filed
were allowed to' stand as pleadings to the complaint in issue in this proceeding -and the
respondent ''Thompson was permitted ' to amend his answer to 'deny 'the- new allegation.
11,72 ' DECISIONS OF, NATIONAL' LABOR ' RELATIONS BOARD
continuance was made. A motion by counsel for the Board to strike
certain portions of the answers of the respondent Thompson and of,
the Independent, respectively, which alleged in substance that because-
of acts of misconduct engaged in by union officers; agents, and,mem-
bers, ' the Union was not 'a • "labor organization". authorized to file a
charge under the Act, was, granted. This ruling is hereby affirmed.-,
At the close of the Board's case, the respondents and-the Independent
moved to strike all testimony of ' the Board's witnesses relating to
matters antedating the settlement agreements hereinabove referred to
and to dismiss the complaint because of failure of proof. The•moti'ons
were denied. At the close of the hearing the-motions to dismiss and to
strike the testimony of the Board's witnesses were renewed, and ruling
thereon was reserved. In his Intermediate Report, the Trial Ex-
aminer granted the motion'to dismiss as to the respondent Thompson,'
and denied the remaining motions upon which ruling had been re-
served. 'At the conclusion of the hearing, a motion by counsel for the
Board to conform the pleadings to the proof was granted without
objection. During the course of the hearing the Trial Examiner
made rulings on other motions and on objections to the admission of,
evidence. The Board has reviewed the Trial Examiner's rulings and
finds that no prejudicial errors' were committed. The rulings are
hereby affirmed. After the hearing the respondent submitted a brief
to the Trial Examiner.
Thereafter, the Trial Examiner issued his Intermediate Report
dated September 2, 1942, copies of which were duly, served upon allhthe
parties, finding that the respondent had engaged in and was engaging
in unfair labor practices affecting commerce, within the meaning of
Section 8 (1), (2), and (3) and Section 2 (6) and (7) of the Act. He
recommended, among other things, that the respondent cease and desist
from engaging in the unfair labor, practices, disestablish the Inde-
pendent as the bargaining representative'of its employees, and rein-
state, with back pay•from a date 10 days after the issuance of the.,In-
termediate Report to the date of offer of reinstatement, 43 employees
found by him to have been discriminated against. On October 3 and
5, 1942, respectively, the Independent and the respondent filed excep-•
tions-to the Intermediate Report and briefs in support thereof. Pur-
3 In N. L R B. v Indiana & Michigan Electric Company - U. S. -, decided January 18,
1943 , the Supreme Court stated : "we cannot agree with the view of the Circuit Court of
Appeals that the evidence [ of misconduct ] might disqualify Local B-9 from making the
charge of violation against the Company or deprive the charge of force and effect, and
thereby defeat the Board 's jurisdiction to hear the case." Furthermore , we do not regard
such allegations of misconduct , even if proved , as sufficient reason to discontinue the
proceeding..
* We agree with the Trial Examiner 's conclusion that the evidence does not sustain the
allegation ttiat ' B. E1`;Thompson is an employer of the employees involved herein within
the meaning of the Act. The Union did not file exceptions.' Under the circumstances we
shall dismiss ' that allegation. of the complaint in accordance with the Trial Examiner's
recommendation . Hereinafter references to the respondent are to The Wallace Corporation'.
THE.-WALLACE : CORPORATION ' 1173
scant to notice,a-hearing for the purpose of presenting oral-argument
was held before the Board in Washington, D. C., on November 17, 1942.
The respondent and the Union were .represented by counsel and par-
ticipated in the argument.
The Board'has considered the exceptions and briefs and, insofar as
the exceptions are inconsistent with the findings of fact, conclusions of
law, and order below, finds them to be without merit.
Upon the entire record in the case, the Board makes the following :
FINDINGS OF FACT
I. THE BUSINESS OF THE RESPONDENT
The respondent, a Missouri corporation with its principal office at
St. Louis, Missouri, is engaged in the manufacture, sale, and distribu-
tion of clothespins and wood' and paper food trays. It maintains a
'plant in Richwood, West Virginia, which is the--only plant involved
in this. proceeding. At the Richwood plant the principal raw material
used is wood, nearly all of which originates in the State of West Vir-
ginia. During the year immediately preceding the hearing, the re-
spondent purchased raw materials in excess of $100,000 in value, which
were used in the manufacturing process at the Richwood plant. Dur-
ing the same period, the respondent's gross sales of products finished
at the Richwood plant exceeded $200,000. Of this amount, over 75
percent in value were shipped from the Richwood plant to points out-
side the State of West Virginia. The respondent admits that it is
engaged in commerce within the meaning of the Act.
II. THE 011GANIZATIONS INVOLVED
Local Union No. 129, United Construction Workers Organizing
Committee is a labor organization, affiliated with the Congress of
Industrial Organizations, admitting to membership employees of the
respondent.
Richwood Clothespin & Dishworkers' Union is an unaffiliated labor
,organization admitting to membership employees of the respondent.
III. THE UNFAIR LABOR PRACTICES
A. Events prior to the settlement agreements
The Union began organizing the respondent's employees late in
July 1941, when it held an open meeting, on the grounds 'of the high
school in Richwood. The meeting was attended, among other em-
ployees, by Irene Weese Groves,' the respoliderit's paymaster and
5 To avoid confusion with another female employee , having the ' same surname, herein-
after we will refer to Irene weese Groves as Weese.
•1174 DECISIONS OF NATIONAL -IIABOR REI:ATIONS BOARD
confidential secretary to A. F. Davis, the respondent's plant manager,
and by Harry White, the millrbom, foreman, at the respondent's
plant.' ' , - -
During the period from late July to September 25, 1941, when .a
strike occurred at the respondeht's-_planti, according to , partial:ky
undenied testimony credited by the Trial Examiner; management
representatives made statements to employees calculated to dis=
,courage union membership. Harvey Dodrill, an employee, who
actively solicited union memberships among fellow workers and be-
came an 'officer in the Union, testified that he heard Wilbur Mcllwee,
a foreman, telling a group of employees that M. B. Wallace, Jr., the
respondent's president, had stated that he would close the Richwood
plant and "move it away" rather than recognize the C. I. 0., and
-directing them to attend a scheduled union meeting and to oppose
proposed organization of the employees in the Union. He further
testified that on another occasion he was warned by Mcllwee that
union employees would lose their jobs if Dodrill did not "quit
agitating union and getting signers." Mcllwee did not testify and
-no explanation was given for his failure to appear as a witness. - We
credit Dodrill's testimony, as did the Trial Examiner, and find-that
Mcllwee made the statements attributed to him by Dodrill.
Dodrill further testified that in July 1941, about a week after he
started organizing, Foreman 'Sisco Gibson interrogated Dodrill with
.respect to his union membership and asked him whether he had
enrolled other employees for membership in the Union. According
to Dodrill, when he answered in, the affirmative, Gibson further
stated, among other things, that Wallace had warned that he "would
never ... recognize the C. I. 0." Dodri;ll also testified that he
was questioned by Foreman Harry White with respect to organizing
activities in which Dodrill engaged' and was warned by ' White that
continuance of union activities would result in loss of employment.
According- to Dodrill,-,Whi.te• stated-•that if Dodrill. "did go ahead
and organize . . . Wallace would not recognize the Union-that
we would all be out of a job, he would shut the plant down and move
it' away, that they wasn't making any money." According to
Harvey's wife, Roxie Dodrill, also an employee of the respondent,
she was told just before the outbreak of the strike by Alva Sleeth,
a foreman, that Plant Manager Davis had instructed Sleeth, shortly
after Davis brad returned from an out of town conference with
President Wallace, to tell the employees that "the ones that did not
sign up with the C. I. 0. didn't have anything to worry about, . .
that the company-wdiild-seeathat they were,taken-care'of."
At the meeting, when questioned by an employee as to wether she planned to join the
"Union, Weese replied : "No, It would not be a good policy."
THE WALLACE -CORPORATION 1175
• Another employee, William, D. Griffie, who signed an application
for union membership at the Union's first organizational meeting,
testified that on the following morning he was approached in'the
plant by Foreman Harry White who felt about Griffie's chest and
'inquired as to the whereabouts of his "badge"; that Griffie stated
that he had not received a badge but that he bad a union card which
was available for White's inspection; that White stated that he knew
of the card but did not wish to see it; and, that White further stated
that the card would "never do [Griffie] no good there .. . The C. 1. 0.
would never operate in that plant." In addition, shortly after Sep-
tember 1, 1941, whew the Union first requested company recognition,
according to Griffie, he had a conversation with White in the plant
in which White disclosed that he had just attended "a meeting at the
office," and stated that "Mr. Davis had just come in from St. Louis,
and that Mr. Wallace told them, if he told them one time he told'them
twenty times, they would never operate under the C. I. 0." Except
as noted below,' at the hearing, White, Sleeth, and Sisco Gibson denied
making the statements above ascribed to them -by employees- who
appeared as witnesses on behalf of the Board. Under they circum-
stances, we credit, as did the Trial Examiner, the testimony of the
'Board witnesses set forth above, and find that White, Sleeth, and
Sisco Gibson made substantially the statements testified to, and that
their statements are attributable to the respondent., I
Sometime in September, prior to the outbreak of the strike, Davis
'had discussed the respondent's labor relations policy with Wallace at
his summer home in Michigan. When Davis returned to the plant,
he reported, Wallace's instructions to the foremen. According to the
testimony of Wallace and Davis, Wallace told Davis only that the
respondent was-opposed to a closed shop.° Davis denied making
any statement to the foremen other than transmitting Wallace's
asserted expression of company policy with respect to o-a closed shop,
and°Davis and''foremen testified that'the foremen'were instructed by
Davis not to interfere with union organization. We find no merit
in a contention of the respondent that it should not be held respon-
sible for statements of its foremen in contravention of instructions
given them.10
° White admitted in his testimony that he had discussed the Union 'with Dodrill and
Grife and that he [White] "might have" asked Dodrill how he was getting along with
his union •
8 The respondent admits thtit Foremen, White, 'Mellwee, Sleeth, and Sisco Gibson occupied
supervisory positions
O At the hearing Wallace stated that be had no objection toy a "union shop" since
,such,an,arrangement did' not restrict,an employer's right ,to, hire,employees . , As indicated
hereinafter, however, subsequently the respondent, with knowledge that the Independent
planned to exclude employees from membership, entered into a contract with the Independent
requiring membership therein as a condition of employment and thereafter discharged
employees denied membership in the Independent ^3
10 See, for example, H. J. Heinz Co v. N. L. R B., 311 U S. 514, 519-521.
J176 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
In the -first part of September 1941, the Union requested company
recognition as exclusive bargaining representative. When the re-
spondent challenged the Union' s claim to be majority representative,
the Union proposed that its status be determined by a check of union
membership applications and the company pay roll. The respond-
ent refused to agree to this method unless it was permitted in con-
nection therewith to interrogate such applicants as to whether they
desired the Union to represent them in collective bargaining negotia-
tions. The Union rejected the respondent's counterproposal. The
respondent also proposed, that the question of representation be
resolved by a Board election, but the Union refused to consent to an
election unless the respondent reinstated Harvey Dodrill, president of
the Union, who had been discharged in August." Following a union
ultimatum embodying its proposals set forth above, which the re-
spondent rejected, the Union called a strike on September 25, 1941,
and established a picket line; and the plant was shut down.
The Independent, came into existence during the first week of Oc-
tober 1941. According to uncontradicted testimony, a meeting of
a group of the respondent's employees was scheduled' to be held -on
the night of October 2 at the home of Clark Gibson, a foreman at
the respondent's plant, who lived on the main street-of Richwood;
that night Gibson met the employees on a street corner and adjourned
the meeting to the home of Mrs. Lundy Groves, an employee,12 who
lived in a more secluded section of Richwood, because Clark Gibson's
house was "filled up" and "there [were] too many C. I. O. members
[about]." 13 When the employees assembled at the Groves' home,
Mrs. Groves telephoned Weese, the respondent's paymaster and con-
fidential secretary to Plant Manager Davis,14 for assistance in or-
ganizing the group as the nucleus of a labor organization.15
According to a Board witness' version of a conversation with Mrs.
,Lundy Groves on the morning of October 3, which we credit, as did
the Trial Examiner, Mrs. Lundy Groves invited Weese to attend
the meeting for the purpose of assisting in the formation of a labor
organization for the respondent's employees, but that Weese declined
stating that she was unable to attend and, instead, recommended
31 Dod,ill, a member of the Union ' s bargaining comimittee , testified without contradiction,
and we find , that in the course of negotiations Davis stated that he would not reinstate
Dodrill because "he was too much of a union agitator ." As hereinafter appears, Dodrill
was reinstated pursuant to the terms of a settlement subsequently made in January-1942,
and his discharge in August is not in issue in this proceeding
12 We hereinafter find that her husband, Lundy Groves , who acted as foreman in Clark
Gibson's absence from the plant, is identified with management. -
ii Neither Clark Gibson nor the ILundy - Gi oyes appeared as witnesses and not explanation
was 'given for their ' failure to testify except that counsel for the' Independent stated at
the hearing that lie felt it unnecessary to call any witnesses. .
14 Weese and Mrs' Lundy Groves are related through their husbands
15 At the time Weese , City Recorder of Richwood , was in attendance at a meeting\of,the
City Council. -
THE WALLACE CORPORATION 1177
B. E. Thompson, a local newspaper editor and a respondent in this
proceeding as a man experienced in union affairs.ls Thompson at-
tended the meeting on the night of October 2 at the Groves' home
and the Independent was organized at the meeting with Lundy
Groves as a member. of its Board of Directors.!' - Thereafter Thomp-
son became business manager of the Independent and published a-
series of editorials, in opposition to the Union 'and in favor of the
respondent and the Independent.
Prior to October 14, 1941, conferences took place between' the In--
dependent and the respondent. Under date of October 14, the
Independent formally requested company recognition as "a collective
bargaining agency for your employees." By October 10, however, the
Union had'filed charges with the Board, and the respondent did not
act upon the Independent's request."' On October 31, the Independ-
ent filed with the Board a petition for investigation' and certification
of representatives pursuant to Section 9 (c) of the Act 19 During the
"At the hearing Weese admitted having the telephone conversation with Mrs Lundy
Groves but testified that she did not recall mentioning Thompson's name and that she
referred Mrs. Lundy Groves to The Greater Richwood Federation , an organization of
business men. Thompson testified that he attended the meeting as a result of a telephone
call from Mrs Lundy Groves , whom he did not know prior to the meeting, and that he had
no conversation with Weese with respect to the meeting prior to his visit to the Groves'
home. We find, as did the Trial Examiner , that Weese recommended Thompson to Mrs.
Lundy Groves and that she invited Thompson to attend the meeting as a result of Weese's
recommendation.
11 Thereafter Carm Reese acted as president of the Independent and Reese , Ancil Smith,
and Lundy Groves served as members of its bargaining committee The names of the three
appeared on the eligibility list in connection with the election hereinafter discussed and
they were permitted to vote in the election At the outbreak of the strike , Reese worked
as an oiler in the millroom under Foreman White who , in his absence , left the department
in Reese's charge After the end of the strike , the respondent placed Reese in charge -
of a night shift. Groves and Smith worked in different departments as machine set-up
men. Their main duties consisted in maintaining and repairing machinery . However,
in the absence of their foremen , Gioves and Smith acted in their place, giving orders to
machine operators with respect to the manner and method- of production . Groves, par-
ticularly , acted as foreman often and for extensive periods due to frequent illnesses of
Clark Gibson his immediate superior . Next to the foremen , who received a salary,,the
machine set-up men were the highest hourly paid employees in their respective depart-
ments ' Although they had no authority with respect to the hiring or discharge of em-
ployees, the machine operators regarded them as assistant bosses or assistant foremen
A union leader , Mike Goheen, was also employed as a machine set-up man but, so far as
appears, he did not act as a temporary foreman. Other employees who belonged to the
Union acted as,temporary foremen but , so far as appears, they were only rank and file union
members. Under the circumstances , we find that Lundy Groves, Ancil Smith, and Carm
Reese are identified with management and that their conduct in connection with the forma-
tion and administration of the Independent is attributable
I
to the respondent . See, for
example, International Association of Machimsts v. N. L. R. B., 311 U. S. 72 ; Matter of,
Decatur Iron & Steel -Company and Steel Workers Organizing Committee, 29 N. L. R. B.
3044; Matter of Ford Motor Companjj and United Automobile Workers of America, Local'
No 235, 23 N. L R B. 342. -
18 William D Grifiie, a union shop steward and member of the Union 's negotiating com-
mittee who was active in the solicitation of union members , testified without contradic-
tion that the Union had 165 members . a clear majority , within a week after the ,beginning
of its organizational drive According to the undenied testimony of a' Board ,witness
quoting Mrs Lundy Groves , which we credit , as did the Trial Examiner, in response to an
inquiry by Thompson at the meeting of October 2 ieferred to above, Lundy Groves stated
that the Union undoubtedly commanded a majority.
19 The case involving the Independent 's petition was closed on February 4, 1942, on the
basis of a consent election hereinafter discussed.
1178 DECISIONS OF -NATIONAL LABOR RELATIONS BOARD
period between November 1, 1941, and January 12, 1942,: a; series of
conferences took place, in which Board agents and interested parties
participated, to .settle the pending charge of unfair labor Pi adtices
and to resolve the question of recognition, but without avail. During
this period the respondent mailed post cards and sent foremen to the
homes of individual employees soliciting their return to work. In at
least one instance, ' according to undenied testimony which we credit,
,Foreman Clark Gibson notified a subordinate female employee, Frances
Logar, that,'.wet had, a meeting this- morning and I got orders to go
round and ask all the girls to go back to work . . . the plant is going
to reopen at 2 o'clock and if you don't come back you are off the pay
roll." 20 According to the testimony of another employee, Minnie
Givens, with respect to such solicitation, which was denied, Foreman
White stated that "they will never run under the C. I. 0." We find,
as did the Trial Examilier, that White made the statement attributed
to him by Givens. In connection with its organizational drive, the
Independent also urged employees to return to work. 'Furthermore,
Griffie'testified without contradiction, and we-'find as did'the Trial
Examiner, that, when he was solicited during the strike to join the
Independent, Lundy 'Groves- stated "that. was the only way we was'
ever a-going to get back to work up there, if we ever got this thing
settled we would have to settle it in that way."
On December 30, 1941, by telegram the Union proposed to the re-
spondent that an election be conducted permitting the employees1a
choice between the Union and the Independent as their representative
provided that the respondent agree,to enter into a closed-shop con
tract with the Union in the event that it won the election. So far as
appears, the Union received no direct,reply to, its telegram , from- the
respondent. The respondent's response, published on the front page
of Thompson's newspaper on January 1, 1942, rejected the Union's
proposal at least until "law and order have been restored in ` Rich-
wood," the union picket line and-other unnamed "coercive" elements:
removed, the employees allowed to, return to work, and the consent.
of the Independent- to such an election' obtained.
On January 12, 1942, President Wallace and William T.. Christmas,'
vice president and treasurer of the respondent,-who maintain offices at
St. Louis, Missouri, arrived in Richwood for the avowed purpose of de
tiding either to reopen the plant or to close it permanently.21 After'
discussing the matter with Richwood inhabitants and Independent ad-
herents who desired to return to work, Wallace decided to 'resume plant
20 Clark Gibson, concededly 'a supervisor , did not testify, and no explanation ,as given
for'his failure to appear as a witness.
21 At ' the time the respondent had inaetive plants in Wisconsin and Michigan ' The'
inactivity of these plants had no connection with the strike at'the Richwood plant..
THE WALLACE CORPORATION , 1179
^operatlons'the next day.22 'Subsequent to the announcement, of Wal-
lace's decision, representatives of the Union and of the Independent
had. a meetii igi at avliich they discussed the holding of., an election.
The Union proposed a "yes or no" vote with only the Union as a candi'-
date on the ballot, but the Independent would not agree.23 That night
the respondent met with representatives -of both unions. The meet-
ing culminated in al settlement agreement, dated January 13,' 1942,
calling for immediate cessation of the strike; and the plant resumed
operations that day.
B. The ,settlement agreements
The agi-eement of January 13, signed by the respondent, the Union
and the Independent provided, among other things, for the immediate
resumption of plant operations and for the conduct of an election by the
Board to determine the question of representation. In the agreement
the respondent undertook to enter into a contract with the union suc-
-cessful in the election requiring membership in that organization as a
condition of emp'loyment.24. 11
Thereafter, the respondent and the Union entered into a written
agreement, dated January 19, 1942, and approved by the Board's Re-
gional Director, which provided, among other things, for the settle-
ment and withdrawal of the pending 'charges,25 and the respondent i
and both unions entered into a separate consent-election agreement,
dated January 19, 1942, and approved by the Board's Regional Di-
rector, which designated both unions as candidates for representatives
in.an,election to be held on January 30, 1942. • -
C. Events subsequent to ,the f-settlement -agrees e-rits
At the in of Thompson, President Wallace sent a telegram,
dated January 23, 1942, to Thompson-which in substance stated that
22 Wallace, announced that the plant would reopen at a meeting of The Greater Rich-
wood Federation on January 12. Repiesentatilves of the Union were not invited and did
not attend the meeting '
23 After' leaving the meeting, Independent repiesentatives went to the home of Plant
Manager Davis and there conferied with Wallace The Independent representatives
asked Wallace to confirm or deny statements of union representatives to the effect that
management 'had agreed to a "yes or no CIO ballot," and Wallace denied having assented
to such an election
zn The language of the undei taking is as follows :
"The Company further , agrees that if, eitherUnion is proven to, represent a majority
of its employees by said vote, it will recognize- a Union Shop; providing-that the,Company
shall at all times retain the right to suspend, hire, or discharge any employee for proper
and just cause "
26 In the settlement arrangement , the respondent agreed in substance , inter alia, that it
would not dominate or interfere with the administration of the Independent or engage in
any conduct which impeded the' exercise by its employees of the' rights guaranteed in
Section 7 of the Act : Pursuant to the settlement , the respondent instructed its foremen
to observe neutrali ty and posted a neutrality notice in the plant . The case involving the
settled charges was closed , upon the basis of the adjustment of January 19; 1942.
1180 DECISIONS OF NATIONAL LABOR' RELATIONS B-OAR.D
the respondent had the means .to transfer its Richwood,operations to
other States.26 The ' telegram was publicly displayed in the office
window of The Nicholas Republican, the, newspaper edited by Thomp-
son. A copy' of the telegram was posted near the time clock in the
plant ,2' and reprints were widely circulated at the instance of Thomp'-\
son "by some boys" at the plant gates during the week immediately
preceding'=the election. A rumor became widespread among the em-
ployees that the Richwood plant would' be shut down if -the Union
won the election. Although the respondent had knowledge of the,
existence of the rumor, it initiated no action to repudiate Wallace's
-telegram. However, when the Regional Director complained, at his
instance Wallace sent Thompson another telegram, dated January 25,
in which Wallace-asserted that he had not intended to influence the
employees in voting in the election and requested Thompson to 'give
publicity to the second telegram.28 Thompson did not comply with
Wallace's request. After the 'Regional Director called Thompson's
inaction to,Wallace's attention, on or about the night of January 28,
Davis went to Thompson's office; secured Wallace's second telegram,
and accompanied by Thompson, returned to the plant 'and posted the
telegram after working hours. ' Thereafter, Davis made no effort to
keep the second telegram posted until the election although in the
interim reports reached-him that it had been removed?9
During the week immediately preceding the election, a rumor pre-
vailed amon4 'the employees to the effect that the respondent's log
supply would be discontinued in- the event that the Union won the
election. The respondent's chief supplier of logs was The Cherry
26 The telegram read : "Answering your inquiry concerning the statement recently made
by me in Cincinnati about having a source of logs available , it is true that I do have
sources available ' in both Wisconsin and Michigan where we own an inactive clothes pin
and dish manutacturing plant which could be economically started up within a reasonable
time with machinery already there and by tarnsferring (sic) some of the equipment in
our Richwood plant." Wallace testified at the hearing that he had no idea at the time
as to what Thompson intended to do with the information embodied in the telegram'
although he (Wallace ) knew of Thompson ' s association with the Independent . At the oral
argument before' the Board , counsel for the 'respondent stated that Wallace dispatched
the telegram without first seeking advice, of counsel and characterized his action as a
"bad" and "silly thing to do "
27 Griffie testified without contradiction , and we find , as did the Trial Examiner, that
on January 26 Griflie 's attention was called to Wallace 's telegram by Foreman White
who stated that the respondent 's office boy was posting it at the time clock and invited
Griffie to "go down and take 'a look at it ", " Except for' a short interval , the notice
remained posted thereafter and was still-posted on the day of the election
28 The second telegram read : "Regret that some impressions seem to have been formed
by my telegram answering your inquiry concerning our source of logs and production.
It was not may intention that telegram should in anyway affect the outcome of or influence
the voters in the election next Friday . We have always insisted that all employees be
given equal Qpportunity to express themselves on questions presented by the Labor -Board
free from threats or 'coercion of any kind : ' We. trust you agree and will give this message
publicity."
^ 2e As herein appears , the election was held on January 30
THE WALLACE CORPORATION - - - 1181
River Boom & Lumber Company, a Richwood firm,30 who delivered
its logs in cars on its spur track at a "dock" alongside the respondent's
pond. About 2 or, 3 days before the election, according to, the testi-
mony of Roxie Dodrill, Foreman Sleeth told a group of employees
in the plant that "the logs was all-taken off the dock and that if the
CIO won- the election that there would-be no more logs if, our union
was recognized." At the hearing Sleeth denied making such a state-
ment but admitted, that he circulated a- rumor to the same effect
without vouching.for its truth. According to the testimony of Griffie,
on the day before` the election, he was called to a window in the re-
spondent's plant by Foreman White who pointed to the absence of cars
on the spur track and stated : "There is the result of your CIO . . . if
the CIO wins the election. tomorrow, you can figure that you will
not get no more logs." In his testimony White denied making, the
statement attributed to him. We find as did the Trial Examiner, the
testimony of-Rorie Dodrill and Griffie set forth above, to be substan-
tially accurate.
At the election, conducted on-January 30, 1942, the Independent
received a majority of the votes cast 31 No objections to the conduct
of the election having been filed,,on-February 4, the Regional Director
certifiea-the-Independent as the,exclusive bargaining representative of
the respondent's employees.
Thereafter, the respondent and the, Independent entered into bar-
gaining negotiations. Under date of February 28, 1942; in a letter to
Vice-President Christmas, Thompson demanded that the. respondent
enter into a closed shop contract with the Independent' in order to
permit elimination from the respondent's pay roll of employees un-
favorable to the 'Independent and thereby perpetuate the Independent
as the exclusive bargaining representative in the plant.32 Thereafter,
the respondent and the Independent entered into a 2-year contract,33
dated March 7, 1942, which provided, among other-things, for member-
ship in the Independent as a condition of employment and stipulated
that^all present and future employees eligible to membership "shall
30 On September 22, 1942, in another proceeding initiated by charges filed by the Union,
the Board ordered The Cherry River Boom & Lumber Company to cease and desist from
engaging in unfair labor practices within the meaning of Section 8 ( 1) of the Act.
31 Of 207 eligible voters in the election, 186 ballots were cast and counted . The Inde-
pendent received 98 votes, the Union 83, and 5 votes were cast for neither.
321n part , the letter read : "The closed shop will , therefore , give us some control in
preventing the hiring of additional employees who ale unfavorable to our interests and who
would further jeapordize (sic) our majority. It would also piovide us with a legal
means of disposing of any present employees , including Harvey Dodrill , whom our mem-
bers have declared by unanamous (sic), ballots that they will not work withr_whose
presence in the plant is unfavorable to our interests because those who are so unfavorable
will not be permitted to become members of our organization and without such member-
ship they would not be permitted to work in the plant under a closed shop contract which
we respectfully insist we MUST have." - -
3, The contract ' is to run for 2 years and froin year to year thereafter, subject to can-
celation upon 30 days' , notice given prior to the expiration of the 2 -year period or any
subsequent yearly period.
1182 DECISIONS OF NATIONAL LABOR -RELATIONS BOARD
-become members" of the Independent within 10 days from date or from
date of hiring as the"case,niay-be. - On March•7, the-respondent posted,
a copy of the contract in the plant. • Thereafter, supervisors urged
employees to join the Independent. On ,March 16, the respondent
posted in the plant a notice to the effect that, pursuant to the contract,
only members-in good standing in the Independent would be permitted
to continue in the respondent's employ on and after March 18, 1942.
On March' 18, 1942, the respondent excluded from its. plant and
dismissed 43 employees named in Appendix A,34 when they failed to
produce satisfactory proof of'membership in the Independent. Sub-
sequently, negotiations looking toward the reinstatement of the 43 em-
ployees ensued between the Regional- Director and the. respondent:
The respondent asserted that it could not reinstate them without
the consent of the Independent, and the Independent refused to assent
to their reinstatement. Thereupon, the Union filed the charges which
give rise to this proceeding.
D. Conclusio,^-t$.
The foregoing facts hake evident that, at the very outset of the
Union's attempts at employee organization', the respondent declared
and demonstrated to the employees its opposition, to the.Unlon and
forthwith adopted measures designed to frustrate self-organization.
We have found above that management representatives sent employees
to the Union's first organizational meeting with instructions to oppose
association, of the respondent's employees with a national affiliated
labor organization. In statements, to employees foremen let it be
known that President Wallace opposed recognition of the Union and
that the respondent preferred to remove its plant operations from
Richwood rather than deal with the,Union., Foremen questioned
employees, concerning their union membership and activities and
warned them against loss of employment in the event that they con-
tinued efforts to organize the Union. A foreman ivarned an employee,
who was active in soliciting membership on behalf of the Union, that
union members would lose their jobs if he did not "quit'agitating union
and getting signers.' - The same employee was warned by. another
foreman that union organization would be futile since; President
Wallace would close the plant and remove its operations rather than
recognize the Union. A third- foreman disclosed that the respondent
would make suitable provision for those employees who did ,not join
the Union. During negotiations with the Union in September 1941;
Plant Manager Davis characterized a member of the union committee
14 Of the 43 employees, 12 had not applied for membeiship in the Independent within
the-prescribed time limit The remaining 31 employees had'made timel y application for
membership In the Independent but the' Independent had' rejected their membership
applications -
I
THE WALLACE CORPORATION - 1183'
as an "agitator" and proposed, among other things, that management
respresentatives interrogate employees concerning their desires with
respect to representation by the Union for the purposes of collective
'bargaining. In this atmosphere a strike occurred.
Within' about a week after the outbreak of the strike, the Independ-
ent' appeared on the scene. At the outset, a foreman, Clark Gibson;
associated himself with the group of employees who participated in
the formation of the Independent. Apparently, to divert attention
from himself, Clark Gibson delegated the task of providing a meeting
place for those interested in organizing a labor organization limited
to the respondent's employees to his assistant, Lundy Groves, and' his
wife: The first organizational meeting of the Independent was held at
the home of Lundy Groves. , In addition to Lundy Groves, other
supervisory employees, including Carm Reese and Ailcel Smith, played
prominent roles in the formation and administration of the Inde-'
pendent's affairs. The Independent was organized under the guid-
ance of B. E. Thompson who furnished his services as a, result of a
suggestion of Weese,' a person identified with management . There-
after, Thompson became business manager of the Independent and
published a series of anti-union editorials which espoused the respond-
ent's cause. Furthermore, the Independent lent itself to the respond-
ent as an aid in the' back-to-work movement in opposition to the
Union.
The respondent and the Independent contend that the settlement
agreements and the consent election preclude a consideration of the
events occurring prior to the making of'the settlement. In support of
their contentions, the' respondent and the Independent cite; among
others, the decisions of the Board in Matter of Wickwire Brothers 35
and Matter of Hope Webbing Company.3e But these cases are not
apposite since in neither case was there, as here, acontinuation of the
practices which preceded the settlement, or the consent election agree-
ment; or. both, as the case may be.37 Here, after the making of the
settlement agreements, contrary to its undertaking therein', the re-
spondent engaged in further unfair labor practices. In the opinion
of Chairman Millis, Wallace's telegram to Thompson, dated January
23, contained an implied threat that the respondent might close its
Richwood plant if the Union won the election, and the employees- so
understood the telegram.--' Iii addition, during the week immediately
Matte; of Wiekwiie Bi others and Amalgamated Ass'n of Don. Steel it T1n Workers
of North America, Lodge #1,985, through S W 0 C, affiliated with the C I 0, 16 N L- R. 13:
316.
36Matter of,Hope Webbing Company and Textile Woikerc Organizing Committee of the
C I O. Local No 14. 14 N L R B 55
.
37 See , for example, N L R B v Haick it Buck Co. Inc. 120 F ( 2d) 903 (C C A 5),
enf'g 25 N L R B 837 , Matter of Sun Shipbuilding and Dry Dock Co and Industrial Uiiion
of Marine and Shipbuilding Workers of America. 38 N.'L R B 234, and cases cited therein.
88 Since Wallace's' second telegram to Thompson , dated Sanuary 25, did not retract
the statements in the first telegram and did not receive equal publicity, the Chairman
1184 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
preceding.the election,•employees were warned by-Foremen White and
Sleeth that the respondent's log supply would be discontinued in the
event that the Union won the election. In the opinion of the Chair-
man, by the telegram and the statements of foremen set forth above,
the respondent interfered with, restrained, and coerced its employees
in the,exercise of the rights guaranteed in Section 7 of the Act. How-
ever, Mr. Reilly would place no reliance upon these matters in vitiat-
ing.the settlement agreement, as appears from his separate concurring
opinion herein. Both the Chairman and Mr. Reilly, agree that by
entering into the closed-shop contract with the. Independent with
knowledge that the Independent intended to' exclude employees from
membership and by discharging employees denied membership in the
Independent, the respondent gave further potent assistance to the
Independent.3" Under the circumstances disclosed here, neither the
Regional Director's certification of the Independent nor the respond-
ent's undertaking of January 13, 1942, justify the respondent in recog-
nizing the Independent and discharging employees pursuant to the
closed=shop contract.. As we have found that unfair labor practices
were committed by the, respondent after as well as before..both The
settlement agreements, .nd,.the..,election, it .,is clear, -that, the Board',s
consideration of the events preceding the settlement agreements is
consistent with the principles enunciated in the cases cited above.
We find that, by all the foregoing, then respondent dominated and
interfered with the formation and administration of, and contributed
supl.ort to, the Independent, and interfered with, restrained, and
coerced its employees in the exercise of the rights guaranteed in Sec-
tion 7 of the Act. In view thereof, the respondent's contract with the
Independent, dated March 7, 1942, contrary to their contention, affords
no protection to the discharge of employees pursuant to its provisions.
We further find that, by discharging the 43 employees named in Appen-
dix A, because of,their membership in and activities on behalf of the
Union andibecause•they•did not,belong to the Independent;°tlie`respond-
ent discriminated with respect to their hire and tenure of employment
and conditions of employment, and thereby encouraged membership
in the Independent and discouraged membership in the Union.
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 the respondent described
believes that the second telegram did not operate to dissipate the coercive effects of the
first telegram . ,The Regional Director 's action in proceeding with the election despite
the presence of such coercive effects, contrary to a contention of the respondent and
the Independent ,. does not estop the Boaid from - taking steps deemed necessary to effectu=
ute,the ' policies of the Act.
a"Cf. Matter of Monssenr Henri Wines, Ltd, et al and Distillery, Rectifying & Wine
Workers International Union of Ame,lea, Local #1 , 44 N L R B 1310.
THE WALLACE CORPORATION 1185
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 the free .
flow of -commerce.
V. THE REMEDY
Having found that the respondent has engaged in unfair labor prac-
tices, we shall order it to cease and desist therefrom and to take certain
affirmative action designed to effectuate the policies of the Act.
We have found that the respondent has dominated and interfered
with the formation and administration of the Independent and has
contributed support - thereto. The effects and consequences of the
respondent's domination, interference with, and support of the Inde-
pendent, as well as the.-continued recognition of the Independent as
the bargaining representative for its employees, constitute a continu-
ing obstacle to the free exercise by its employees of their right to
self-organization and to bargain collectively through representatives
of their own choosing. Because of the respondent's illegal conduct
with regard to the Independent, it is incapable of serving the respond-
ent's employees as a genuine collective bargaining agency. Moreover,
the, continued recognition of the Independent would be obstructive
of the free exercise by the employees of the rights guaranteed to them
by the Act. Accordingly we shall order that the respondent dis-
establish and withdraw all recognition from the Independent as repre-
sentative of any of its employees for the purposes of, dealing with it
concerning grievances, labor disputes, wages, rates of pay, hours of
.employment, or other conditions of employment.40 The contract en-
tered into between the 'respondent and the Independent and the con-
tractual relationship existing thereunder have been the means whereby
the respondent has utilized an employer-dominated labor organization
to frustrate self-organization and defeat genuine collective bargaining
by its employees. Under these circumstances, any continuation,
renewal, or modification of the existing contract would perpetuate the
conditions which have deprived employees of the rights guaranteed
to them by the Act and would render ineffectual the other portions
of our remedial order. We shall therefore order the respondent to
cease giving effect to any contract between it and the Independent, or
to any modification or extension thereof. Nothing in,this decision or
in our order should be taken, however, to require the respondent to
vary those wage, hour, and other substantive features of its relations
with the employees themselves, if any, which the respondent estab-
'0 See, foi example, N L R B v Link-Belt Co, 311 U S 584 , H J Heinz Co v N L.
R. B, 311 U S 514, aff'g 110 F (2d) 843 (C C A 6) enCg 10 N L R B 963; N L R B
v veupoit Ncws Shtipbutldurry cf Dry Dock Co, supra, N L R B V The Falk Corporation,
308 U S 453 , rev'g 106 F (2d) 454, mod 102 F . ( 2d) 383 (C C A. 7 ), enf'g 6 N L R B.
654
513 024-4 3-v o l 4 7-7 55
1186 DECISIONS OF NATIONAL LABOR RELATIONS ROAR,D
lished in performance of the contract as extended, renewed, modified,-
supplemented, or superseded.41
We have also found that the respondent discharged 43 employees
named in Appendix A because of'their union activities. We shall,
order, therefore, that the respondent offer the aforesaid 43 employees
immediate and full reinstatement to their former or substantially
equivalent positions, without prejudice to their' seniority or other
rights and privileges, and to make them whole for any loss of pay
they may have suffered by reason of the discrimination against them
by payment to each of them of a sum of money equal to the amount
which he normally would have earned as wages from the date of such
discrimination to the date of the offer of reinstatement, less his net
earnings 42 during said period.
Upon the basis of the foregoing findings of fact and upon the entire
record in the case, the Board makes the following :
CONCLUSIONS OF LAW
1. Local Union No. 129, United Construction Workers Organizing
Committee, affiliated with the Congress of Industrial Organizations,
and Richwood Clothespin and Dishworkers' Union are labor-organiza-
tions, within the meaning of Section 2 (5) of the Act.
2. By dominating and interfering with the formation and adminis-
tration of the Independent, and by contributing support to it, the
respondent has engaged in and is engaging in unfair labor practices,
within the meaning of Section 8 (2) of the Act.
3. By discriminating in regard to the hire and, tenure of the 43,
employees named in Appendix A, and thereby encouraging member-
ship in the Richwood Clothespin and Dishworkers' Union, and dis-
couraging menibership in Local Union No. 129, UnitedI Construction
Workers Organizing Committee, the respondent has engaged in and is
engaging in unfair labor practices, within the meaning of Section 8
(3) of the Act.
4. By interfering with, restraining, and coercing its employees in
the exercise of -the rights guaranteed in Section 7 of the Act, the
4r National Licorice Co v N L R B. 309 U 5 350 , aff'g as mod 104 F (2d) 655
(C C A 2 ), enf as mod 7 N L R B . 537; N L R B v J Creenebaum Tanning Co, 110
F (2d) 984 (C C A 7), enf as mad 11 N L R B 300 , cert denied 311 U S 662
42 By "net earnings" is meant earnings less expenses , such as for transportation, room,
and board , incurred by an employee in connection with obtaining work and working else-
where than for the respondent . which would not have been incurred but for his unlawful
dischaige and the consequent necessity of his seeking employment elsewhere See
Matte, of Crossett Lumber Company and Gaited B>otberhood of Carjienters and Joiners
of America, Lumber and Sawmill Workers Union , Local 2 590, 8 N L R B 440 Monies-
receivoil for work performed upon Federal , State, county , municipal ; of other work-relief
projects shall be considered as earnings See Republic Steel Corporation v. N L R B, 311
U S 7
,THE, WALLACE. CORPORATION 1187
respondent has engaged in and is engaging in unfair labor practices,
within the meaning of Section 8 (1) of the Act.,
5. The aforesaid unfair labor practices are unfair labor practices
,affecting commerce, within the meaning of Section 2 (6) and' (7) of
the Act.
6. The respondent, B. E. Thompson, is not an employer within the
meaning of Section 2 (2) of the Act.
ORDER
Upon the basis of the foregoing findings of fact and conclusions
of law, and pursuant to Section 10 (c) of the National Labor Rela-.
Lions Act, the National Labor Relations Board hereby orders that the
respondent , The Wallace Corporation , Richwood, West Virginia, and
its officers , agents, successors , and assigns , shall :
1. Cease and desist from :
(a) Dominating or interfering with the administration of, or con-
tributing financial or other support to Richwood Clothespin and Dish-
workers' Union , or to any other labor organization of its employees ;
(b)' Recognizing Richwood Clothespin and Dishworkers' Union
as a representative of any of its employees for the purpose of dealing
with the respondent concerning grievances , labor disputes , wages,
rates of pay, hours of employment , or other conditions of employment;
(c) Giving effect to its contract , dated March 7, 1942 , with Rich-
wood Clothespin and Dishworkers ' Union, or to any extension, re-
newal , or modification thereof, or to any other contract or agreement
between the respondent and the said labor organization which may
now be in force;
(d) Encouraging membership in Richwood Clothespin and,Dish-
workers' Union , or any other labor organization of its employees, and
discouraging membership in Local Union No. 129, United Construc-
tion Workers Organizing Committee, affiliated with the Congress of
Industrial Organizations , or any other labor organization of its-em-
ployees, by discharging any of its employees or in any other manner
discriminating in regard to their hire or tenure 'of employment or
any term or condition of employment;
(e) In any other manner interfering with, restraining , or coercing
its employees in the exercise of the right to self -organization , to form,
join, or assist labor organizations , to bargain collectively .through
representatives of their own choosing , and to engage in concerted
activities for the purpose of collective bargaining , or other mutual aid
or protection , as guaranteed in Section 7 of the Act. _
2. Take the following affirmative action, which the Board finds will
effectuate the policies of the Act :
1188 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(a) Withdraw all recognition from, and completely disestablish,
Richwood Clothespin and Dishworkers' Union as a representative of
any of its employees for the purpose of dealing with the respondent
concerning grievances, labor disputes, wages, rates of pay, hours of
employment, or other conditions of employment;
- (b) Offer the 43 employees named in Appendix A immediate and
full reinstatement to their former or substantially equivalent positions,
without prejudice to their seniority and other rights and privileges;
(c) Make whole the 43 employees named in Appendix A for any loss
of pay they may have suffered by reason of the respondent's discrim-
ination against them, by payment to each of them of- a sum of money
equal to the amount which he normally would have earned as wages
from the date of the discrimination to the date of the respondent's
offer of reinstatement, less his net earnings during said period;
(d) Post immediately in conspicuous places throughout its plant
in Richwood, West Virginia, and maintain for a period of at least
sixty (60) consecutive days from the date of posting, notices to its
employees stating: (1) that the respondent will not engage in the
conduct from which it is ordered to cease and desist in paragraphs 1
(a), (b), (c), (d), and (e) of this Order;, (2) that it will take the
affirmative action set forth in paragraphs 2 (a), (b), and (c) of this
Order; and (3) that the respondent's employees are free to become
or remain members of Local Union No. 129, United Construction
Workers Organizing Committee, affiliated with the Congress of In-
riustrial Organizations, and that the respondent will not discriminate
against any employee because of membership in or activity in behalf
of that organization;
(e) Notify the Regional Director for the Ninth Region in writing
within ten (10) days from the date of this Order what steps the re-
spondent has taken to comply herewith.
AND IT IS FURTHER ORDERED that the complaint be, and it hereby is,
dismissed as to B. E. Thompson.
MR. Wm. M. LEISERSON took no part in the consideration of the above
Decision and Order.
APPENDIX A
Myrtle Bennett Nellie Curnes Mary Facemeyer
Ida Berry Claudie Dean Garnett Frame
Red Brashaw Ellen Dean Cicero Godfrey
Ella Brown Harvey Dodrill Carrie Griffie
Loy Coffman Ora Dodrill W. D. Griffie
Juanita Cogar Roxie Dodrill Glenna Hannah
Kenneth Cruse Dalla Dotson Jimmie Harris
THE WALLACE CORPORATION 1189
Harold Harris Gay McClure Ida Ruley
Mabel Hinkle Kelse Meadows Pearl Stewart
Janie Hopkins Lilly Mollhan Grace Trimble
Gillie Lewis Eugene Moore Ray Tulver
Cecil-Little Dorothy Nutter Carl Williams
Ada Lockhart Jack Prescott Hazel Williams
Fannie Logar Mildred Ross Bill Willison
Millie Logar
MR. GERARD D. REILLY, concurring specially :
I concur in the Decision and Order, but believe that an expression
of my own views may tend to clarify the real issue.
It is a well settled policy of this Board to give effect to settlement
agreements culminating in consent elections. This policy holds even
where the union entering into such an agreement with the employer
waives its right to charge a competing union with the taint of com-
pany domination or assistance. An exception to this rule arises with
the subsequent commission of unfair labor practices by an employer-
the theory being that a breach of the condition of the agreement by
any of the parties thereby relieves the others from their bargain. The
Trial Examiner found such a breach in certain remarks of supervisory
officials between the date of the settlement agreement and the date of
the election. I am not persuaded that these amounted to unfair labor
practices. These occurrences were known to the Regional Director in
advance of the date-of the election. He, nevertheless, found the elec-
tion to be a fair one and certified the Independent, the organization
which received a majority of the votes cast. The losing union, the
complainant in these proceedings, likewise had knowledge of these
alleged unfair labor practices, but filed no objections to the election
or to the Regional Director's certification. For these reasons, I think
the interference, if any, was too trivial to justify setting aside the
settlement.
The real controversy in this case revolves about the discharge of 43
employees on March 18, 1942. Since the record makes it clear that
they were discharged because of their former adherence to the charg-
ing union which resulted in the Independent refusing to admit them
to membership, a prima facie; case of violation of Section 8 (3) has
been made out. We are. urged, however, to regard these discharges
as proper, since made pursuant to-- a closed-shop contract with the
Independent. Respondent further contends that it was bound to enter
into such a contract by the terms of the election agreement between
the respondent, the Union, and the Independent.
The election agreement of January 13 between the respondent, the
Union, and the Independent contained a clause, inserted at the in-
sistence of the Union, which obligated the respondent to enter into a
1190 DECISIONS -OF NATIONAL LABOR REiLATIONS BOARD
union-shop contract with whichever' organization was chosen by a
majority'of the employees in the election. The clause reads as follows :
The company' further agrees that if either union is proven to
represent a majority of its employees by said vote it will recognize
a union shop, providing that the company shall at all times retain
the right to-suspend, hire, or discharge any employee for proper
and just cause.
On February 28, Thompson, representing the Independent, wrote
to the respondent demanding that the-respondent enter into a closed-
.shop contract pursuant to the election agreement. The Independent's
purpose in making this request was clearly stated in this letter :
The, closed shop will, therefore, give us some control in pre-
venting the hiring of additional employees who are unfavorable
to our interests and who would further jeapordize (sic) our
majority. It would also provide us with a legal means-of dis-
posing of any present employees, including Harvey Dodrill, whom
our members have declared by unanamous (sic) ballots that they
will not work with, whose presence in the plant is unfavorable
to our interests because those who are so unfavorable will not
be permitted to become members of our organization and without
such membership they would not be permitted to work in the
plant under a closed-shop contract which we respectfully insist
we MUST have.
On March 7, the respondent, in compliance with this request,
entered into a 2-year contract with the Independent which provided
among other things 1that membership in the Independent was to be-
a condition of employment and that all present and future employees
eligible to membership "shall become members" of the Independent
within 10 days from-date, or from date of hiring, as the case may
be. On March 16, the respondent posted in the plant a notice to,
the effect that pursuant to the contract only members in good stand-
ing in the Independent would be permitted to continue in the re-
spondent's employ on and after March 18, 1942. Before March 18,
31 employees, all of whom had been adherents of the Union before
the election, applied for membership in the Independent, but were
refused membership in accordance with the plan outlined by Thomp-
son in his letter, of February 28, 1942. These 31 employees, plus 12
who had not applied for membership in the Independent within the
prescribed time, limit, were dismissed by the respondent on March 18
for non-membership in the Independent.
The precise question before us is whether an employer may enter
into a closed-shop contract which to his knowledge is designed to
operate as an instrument for effecting discrimination against his
employees solely because of their prior union activities.
THE WALLACE CORPORATION 1191
The proviso in Section 8 (3) permits an employer to enter into an
agreement with the duly designated representative of his employees,
that membership in that organization shall be a condition' of em-
ployment. We concede that under the terms of the election ,agree-
,ment the respondent: was bound to execute a closed-shop, contract
with the victorious union. It by no means follows, however,, that
the employer was also bound by the election agreement to acquiesce
in a scheme to penalize those employees whose choice' vas not that
,of the majority; nor can the proviso in Section 8 (3) be thought to
countenance such a result.
As we have recently said "the proviso relating to the closed shop is
,not a severable and separate portion of the Act. -It .must be con-
strued in the light of the - statutory statements of policy and the
general provisions of the Act . . . The express purpose of the Act
is to insure employees of their right of self organization and a free
choice of representatives."
In the recent Rutland Co arts case 43 we held that a closed-shop
contract does not justify an employer in discharging employees whom
he knows the contracting union has expelled from membership
'simply because they sought to exercise their statutory right desig-
nating' a new representative for future bargaining. Under an
analogous situation, we held in the Henri Wines case" that an em-
ployer with advance knowledge that a union does not propose to
admit his employees to membership may not execute a valid closed-
shop agreement, since it would' be a device for depriving of their
jobs certain employees whose union activity had offended him.,
The closed-shop contract in the instant case was not, intended
merely to require employees to seek membership in the Independent
as a condition of employment. The facts in the case make it ap-
parent that the respondent was put on notice that its real purpose
,was to bar from future employment with the respondent those
persons who had adhered to the charging Union in the election
campaign. So viewed, the doctrine of the Henri Wines case is ap-
plicable. Under these circumstances, the closed-shop agreement
cannot be deemed a defence, but a discriminatory device "for de-
priving employees of their statutory right to select bargaining repre-
sentatives." 4' Accordingly, it is necessary to find that Section 8
.(3) of the Act was violated and these employees are entitled to
reinstatement with back pay. , It further follows that, by dis-
criminatorily discharging adherents of the Union, the respondent
rendered potent assistance to the Independent, thus breaching the
settlement. I therefore concur in finding that the respondent
violated Section 8 (2).
Rutland Court Owners, Inc, 46 N. L. R B 1040.
Monsieur Henri Wines, Ltd., 44 N. L. R B, 1310.
9u See footnote 43.