Titan Box Corp.Download PDFNational Labor Relations Board - Board DecisionsJan 29, 1974208 N.L.R.B. 787 (N.L.R.B. 1974) Copy Citation TITAN BOX CORP. Titan Box Corporation and Local Union No. 2393-S of the United Brotherhood of Carpenters & Joiners of America, AFL-CIO. Case 3-CA-5308 January 29, 1974 DECISION AND ORDER BY MEMBERS FANNING, KENNEDY, AND PENELLO On October 16, 1973, Administrative Law Judge Thomas A. Ricci issued the attached Decision in this proceeding. Thereafter, the Respondent filed excep- tions 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 authority in thisproceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and brief and has decided to affirm the rulings, findings, and conclusions of the Administrative'Law Judge and to adopt his recommended Order as modified herein.' ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Administrative Law Judge, as modified herein, and )hereby orders that the Respon- dent, Titan Box Corporation, Liverpool, New York, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order, as modified below: Delete paragraph 2(c) of the Administrative Law Judge's recommended Order and reletter the remain- ing paragraphs accordingly. 1 The Respondent excepts , inter alia, to the Administrative Law Judge's recommended Order . We conclude that his extension of the certification year for 12 months from the date the Respondent begins to bargain was not warranted and shall modify the recommended Order accordingly. DECISION STATEMENT OF THE CASE THoMAS A. Ricci, Administrative Law Judge: A hearing in this proceeding was held at Syracuse, New York, on August 16, 1973, on complaint of the General Counsel against Titan Box Corporation, herein called the Respon- dent or the Company. The charge was filed on May 25, 1973, and the complaint issued on July 12, 1973. The issue of the case is whether the Respondent refused to bargain in good faith with the Union in violation of Section 8(aX5) of the statute. Briefs were filed by the General Counsel and the Respondent. Upon the entire record and from my observation of the witness , I make the following: FINDINGS OF FAcr 787 1. THE BUSINESS OF THE RESPONDENT Titan Box Corporation, a New York State corporation, is engaged in the manufacture , sale, and distribution of boxes , crates, pallets, and related products, and maintains its principal office and place of business in the city of Liverpool, New York. During the past year the Respon- dent purchased , transferred , and had delivered to its New York plant wood and other goods and materials valued in excess of $50,000, of which an amount valued in excess of $50,000 was transported to that location directly from out- of-state sources. I find that the Respondent is engaged in commerce within the meaning of the Act. II. THE LABOR ORGANIZATION INVOLVED In its answer to the complaint the Respondent denies any knowledge,as to whether the Union is in fact a labor organization. A Board-conducted election (Case 3-RC-5494), which resulted in the Union's certification, was predicated upon a stipulation of the parties , and which formed the basis for the Regional Director's finding that the Union is a labor organization within the meaning of the Act. The certification which followed, of course, inherently reaffirmed that finding, and the subsequent collective- bargaining sessions were full implementation of the Union's statutory function as bargaining agent for the employees involved. I find that the Union is a labor organization within the meaning of Section 2(5) of the Act. M. THE UNFAIR LABOR PRACTICES A Picture of the Case This is a refusal-to-bargain case. While admitting that an election was held among . its employees, that a majority voted in favor of the Union, that a regular certification of exclusive representative status was issued to the Union, and that it discussed conditions of employment with the Union on that basis thereafter, the Respondent does not concede the appropriateness of the bargaining unit as alleged in the complaint, purely a restatement of the unit in which the election was held . It is a unit which conforms precisely with the first one deemed appropriate in the statute. Accordingly, on the entire record , I find that all production and maintenance employees of the Respon- dent, including shipping and receiving employees, but excluding all office clerical employees, professional .em- ployees, guards, and supervisors as defined in the Act, constitute a unit appropriate for the purpose of collective bargaining within the meaning of Section 9(b) of the Act. I also find that on September 22, 1972, and at all times thereafter, the Union has been and now is the exclusive statutory collective-bargaining representative of all the employees of the Respondent in the above-described unit. In support of the complaint the General &unsel argued, at the hearing, what appear to be (1) a primary and direct violation of Section 8(aX5), and (2) a collateral, or inferential unfair labor practice violation of the same section, but based on the record as a whole. On June 4, 1973, less than 12 months before the end of the certifica- 208 NLRB No. 118 788 DECISIONS OF NATIONAL LABOR RELATIONS BOARD tion year (see Ray Brooks v. N.L.R.B., 348 U.S. 96), the Respondent unilaterally, and completely without prior bargaining with the Union, instituted a wage incentive system, thereby changing the method and amount of compensation payable to the employees for the work they performed. Absent any justification for so clearly bypass- ing and ignoring the statutory exclusive representative of the employees, this was the clearest possible refusal to bargain unfair labor practice in violation of the statute. N.L.R. B. v. Benne Katz, d/b/a Williamsburg Steel Products Co.; 369 U.S. 736 (1962). Before this unilateral action the Respondent met with the union representatives at approximately eight bargaining sessions ; it sent two persons to do the negotiating on its behalf-Mr. Buchanan, the plant manager, and Mr. Robert McMillan, a labor relations specialist and consult- ant. Mr. John Chapman, owner and president of the Company who engaged McMillan for this purpose, instructed him in the bargaining and discussed with him, between the meetings, what progress was made. Through- out, from first to last, he told McMillan, who carried the primary burden of talking, that in no event was he to give any consideration to any demands the Union might make on two major subjects; the first was economics, however the question might arise-wages, more holidays, more vacations, etc. The second was anything that related to union security-whether in the form of union shop or checkoff. McMillan explained at the hearing that the reason for these basic attitudes was that the Respondent could not afford any economic concession at all and that Chapman, as a matter of philosophical conviction, was opposed to any pressure on employees to join unions or to an employer acting as collection agent for a labor organization. Defense against the first argument is twofold. The Company asserts that in the course of the bargaining it did make an economic offer to the Union, a proposal, it contends, that would have increased the earnings of the employees. It says this took the form of a profit-sharing scheme, which the Union rejected. The argument then goes that the wage incentive system later instituted unilaterally brought the employees less-in money-than the profit- sharing proposal would have produced, and that therefore, just as an employer is privileged to grant wage increases after they have been rejected by a union and after there has been an absolute impasse in the bargaining on that very point, it is also privileged to grant wage increases unilaterally so long as the money benefits total less than that rejected by the bargaining agent in some other form. A further defense, still against this first complaint allegation, is based on the fact that Respondent advised the Union, 10 days in advance, of its decision and intention to make the unilateral change in method of pay. It now asks: inasmuch as the Union did not raise any hue and cry over the proposal, did not request that the Company bargain before r From the transcript JUDGr Ricci Would this be a correct statement The Company talked to you on this, "Do some bargaining with us, you're experienced, you're a labor relations man. You . Buchanan will come in with you, he'll keep the notes He'll help you." Then they also told you that this corporate client had asked for your services, but where economics acting as though the Union did not exist, what does it have to complain about? As to the second argument of misconduct advanced by the General Counsel-essentially a theory of pervasive bad faith-the Respondent insists it did bargain on everything, that it made many concessions to union demands, and that it never literally refused to meet on request; all this, according to the Respondent, reflected no more than hard bargaining, which was its right. Unilateral Action Both McMillan and Ruggiano testified about the bargaining sessions that started after the September certification of the Union. Their combined stones indicate there were seven or eight meetings, beginning in November and ending on March 13, 1973. At an early stage the Union presented a printed copy of its standard contract, and there was much discussion of many of the provisions it contained. Speaking very candidly, McMillan made quite clear in his testimony that no union proposal which might cost the Company any money-what he placed in the category of "economic" matters-was given any considera- tion whatever. In December Ruggiano proposed a 20 cents per hour wage increase and some form of union security. McMillan brushed off the raise demand and "I told him very specifically that the authority to grant the Union shop was out." McMillan's reaction to Ruggiano was consistent with Chapman's directions to him, which Chapman recalled as follows: "In respect to wages, maintenance of membership, dues checkoff, any economic situation was in the discussion of inability of this company to absorb more liability." Q. (By Company Counsel) Is it a fair summation that, in your opinion, you felt that on non-economic matters you were on your own? A. Yes. Q. (By the General Counsel) Mr. McMillan, during the course of the negotiating sessions up to your last meeting of March 13th, did the company make any concessions with respect to wages, pay fringes, any economic item? A. No.' Ruggiano last met with McMillan on March 13, when, frustrated in his repeated attempts at meaningful discus- sion about two of his major concerns, he demanded to speak with owner Chapman personally. Chapman did meet with him several times in April and May, sometimes with a state conciliator in attendance. One of these meetings is very revealing; Chapman, who testified after Ruggiano, said the union agent reported it correctly as a witness. Ruggiano asked him three plain questions: "Are you going to move on Union security? . . . How about a checkoff of dues? . . . How about an increase in wages?" To each question Chapman answered a simple no. At another meeting Chapman told Ruggiano he thought it "immoral are concerned, anything about raises, fringe benefits , more overtime or Union security, and those, say. "no. you 're not authorized to make any counteroffers on Union security or money matters." say , "no." Is that what they told you? Tut Wrrt.iss Right. TITAN BOX CORP. to force a man to become a member of a union against his will," and "shat they couldn't afford to give any increases." At one point Ruggiano asked for a 5.5-percent raise, but again Chapman said he could not afford it. Chapman and Ruggiano last met on May 22 . This was the meeting where Ruggiano put his last three questions and received a refrain of nos . By letter dated May 23 Chapman wrote to the Union as follows: We wrote you May 8th regarding our plans for reinstating an incentive plan at Titan Box . The plan is now ready and we will put it into effect Monday, June 4th. Enclosed please find a memorandum describing the plan in detail. Attached to this letter was a copy, of a five-page statement, the first sheet headed: "Memorandum: To all hourly rated employees-subject : Wage Incentive." The statement explained in precise detail the mechanics of the new system and announced it would become operative on June 4 . Although the total document is not ,easily understood by an outsider, it does set out what appear to be standard production requirements for a great number of itemized parts, time schedules for production, and a statement indicating ' that, depending upon the production capacity and personal diligence of individual employees, they could earn 10 percent more than otherwise under the new system. As promised , the wage incentive system was in fact made effective on June 4 . After the unfair labor practice . charge was filed on May 25 , Ruggiano and Chapman met..again with a state conciliator, at. the Union's request, apparently its last attempt to avoid litigation . Ruggiano asked the same old three questions-would the Company change its. position on union security, checkoff, or economic matters? This time Chapman said no, the matter would have to be decided in court . See Equitable Life Insurance Company, 133 NLRB 1675. Chapman had also written a letter to Ruggiano on May 8, as follows: Some months ago Titan Box Company abandoned a method of incentive pay because of its inequities and because it was impossible to administer. We are currently working on a new incentive plan and hope to put it in effect within the next several weeks. Ruggiano received this letter on May 15, and his testimony is that no mention of the subject was made at all by anyone in the later meetings. A wage incentive plan is but one of many methods for paying employees more money than they might earn under some other system . The increase in the employee 's wages might be dependent upon his personal effort , but the in- crease nevertheless, is in no way dependent upon the company's profit or loss statement. As such ,'of course, the method of payment, like any other, is a mandatory subject of collective . bargaining, and may not be fixed or , altered unilaterally by an employer while it is under statutory duty to bargain with the employees ' representative . The cases on 789 the subject are too well established to justify much citation.2 I find that by putting in effect the wage incentive system on June 4, 1973, the Respondent illegally refused to bargain with the Union and thereby violated Section 8(aX5) and ( t) of the Act. As the Supreme Court -,said in Katz, supra: A refusal to negotiate in fact as to any subject which is within f 8(d), and about which the union seeks to negotiate, violates § 8(5) though the employer has every desire to reach agreement with the union upon an over-all collective agreement and earnestly and in all good faith bargains to that end. We hold that an employer's unilateral change in conditions of`eniploy- ment under negotiation is similarly a violation of f 8(a)(5), for it is a circumvention of the'duty to negotiate which frustrates the objectives of § 8(aX5) much as does a flat refusal. There is no evidence to support the assertion , obliquely suggested at the hearing, that the Company tried to sell this incentive plan to the Union but failed to convince it. As a witness Chapman stated that as early as April 12, "I do seem to remember that I suggested to Mr . Wersing [the state conciliator ) fairly casually that we were working on an incentive plan." In its brief the Respondent relies upon this single phrase out of Chapman 's mouth to support a contention that as of April 12 there had been comprehen- sive bargaining to impasse on the very incentive plan put in effect on June 4. The truth of the matter is Chapman then had no idea what the plan would be about at all. "Mr. Novak : . . . You used the words . . . you explained incentive in a . relative casual manner. What do you mean by `relative' and 'casual'? The Witness : When I say 'relative,' and 'casual,' I mean I didn 't have any detailed program as to what it was going to be.... because we were just considering it at that time. Later we gave them more detailed explanation." In fact , still according to Chapman 's own testimony, he had nothing he - could discuss with Ruggiano even .after the May 8 letter . "Judge Ricci: Would this be correct , that you wrote the letter of May 23rd ; . before that date, you didn't have the wage incentive plan worked out in detail ? The Witness: Yes, sir. Judge Ricci : It was shortly before the ' 23rd that the Company finally had it completed in its implementation, how much it would be? The Witness : Yes. It takes time to do these things." Chapman 's testimony not only belies any notion, that the plan was bargained out to impasse before June 4, but it also effectively disposes of the. concomitant and completely inconsistent argument that , if there was no bargaining, about the incentive - plan, it was Ruggiano's fault, because he did not bring , the subject up and insist that it be discussed before the Company went ahead with its announced . intentions . If the unilateral action must be excused because the Union failed to talk about„ it in advance, there was no bargaining. If Chapman himself, and, of course, the Company did not even know what the s N.L.R.B. v. Dothan Eagle, Inc. a subsidiary of Thompson Newspapers, 434 F .2d 93 (C.A. 5, 1970). , 790 DECISIONS OF NATIONAL LABOR RELATIONS BOARD plan would be, if in fact there did not yet exist a plan that could be evaluated and discussed by anyone, how could the union agent demand any talking at all? And besides all this, the defense ignores the basic principle of the entire statute,' the very essence of this complaint , which is that whenever an employer wishes to alter conditions of employment in these circumstances-particularly during the certification year-the law prohibits it from doing so before consulting and bargaining with the exclusive representative. It is hardly a defense to an unfair labor practice by any respondent that the other party to the collective-bargaining relationship failed to take steps necessary to prevent its commission. I also find no merit in the contention that the Union's earlier refusal to agree to a profit -sharing proposal justified the Company's later conduct . Apart from the-fact that both concepts-profit sharing and incentive wage system-sug- gest that employees would receive something more in cash if they worked harder or more productively, this reality alone does not warrant a finding that the two proposals were the same , or even substantially parallel . There are too many intangibles and generalities in a profit-sharing plan to compare it to any precise time-study system of individual production standards . Moreover ; this is exactly what collective bargaining iss all about . If one proposal to resolve a dispute-economic or otherwise-fails of a meeting of the minds , you try another . But the critical element is that you talk about it, you do not change the condition of employment as though the union did not exist. It was the Respondent's failure to propose this exact incentive plan to the Union , and, to discuss it fairly and openly that constitutes the heart of the unfair labor practice found. The Remedy: Further Allegation The remedial order now required to undo the effects of the refusal to bargain as found includes a number of elements . The Respondent must eliminate the present incentive wage systems from its operations, it must bargain with the Union in good faith, and the 1 -year period of validity ordinarily accorded the Union's certification must be restored , to start anew when the Respondent begins to bargain as the statute dictates . And bargaining in good faith means bargaining on all subjects relating to condi- tions of employment , including this one or any other wage incentive system the Company may propose, as well as any other economic or union-security matter , such as union shop or checkoff of dues. The order requiring good-faith bargaining is as broad as the entire spectrum of the statute. The further complaint allegation-that the Respondent also violated Section 8(aX5) in another sense--adds nothing of substance to this particular case . The evidence does indicate that owner Chapman limited his representa- tives' bargaining authority as to some very important matters , anything involving money or union security. In calling this proof of bad faith , and therefore a refusal to bargain in good faith , what the General Counsel is really saying is the Respondent did not accord the Union the representative status to which it was entitled by virtue of its certification. So phrased, this allegation has already been found true, for unilateral action changing the method of pay and the amount of employee compensation is also rejection of the collective-bargaining obligation , refusal to concede to the Union its statutory right to speak for the employees . Whether the unfair labor practice already found be called bad faith, or refusal to accord recognition, or not authorizing Buchanan and McMillan to speak on the Company's behalf, is only a matter of wording, and of little moment. It is substance that counts. In this case, regardless of whether the Respondent 's conduct as a whole be described one way or another , in no event would the remedial order, either in words or import, be changed. At best, questions of the kind raised by the secondary allegation here are tenuous and difficult to decide. As stated, the testimony of McMillan himself, who rejected out of hand each and every proposal relating to money or union security, strongly points to a fixed position by the Respondent to refuse even to consider anything the Union might suggest on these very important mandatory subjects of collective bargaining. Fairness demands , however, that broad allegations of pervasive bad faith be appraised on the basis of every jot and tittle of evidence in the record. The Respondent did yield on a considerable number of contract proposals advanced by the Union, in a number of instances abandoning its past policy . Indeed, the General Counsel conceded on the record that a certain amount of bargaining-substantial bargaining-did take place with respect to a number of items . And the company spokesman did say, on a number of occasions , that rejection of economic or plain money demands resulted from the Respondent's asserted poor economic conditions. The Respondent even offered to permit a proper representative of the Union to examine its books to establish the truth of that final assertion. Assuming, but not deciding, that this record supported the General Counsel's second allegation of wrongdoing, no useful purpose would be served by any such additional finding, which conceivably could then still further delay the day of good-faith bargaining, and further prejudice the rights of the employees. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The conduct of the Respondent set forth in section III, above, occurring in connection with the operations of the Respondent described in section 1, 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 commerce and obstructing commerce and the free flow of commerce. CONCLUSIONS OF LAW 1. All production and maintenance employees, includ- ing shipping and receiving employees, at the Respondent's Liverpool,. New York, location , excluding all office clerical employees, professional employees, guards, and supervi- sors 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. 2. At all times since September 1972, the Union has been and now is the exclusive representative of the TITAN BOX CORP. employees in said unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 3. By unilaterally instituting a wage incentive system on June 4, 1973, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(aX5) and (1) of the Act. 4. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I make the following recommended: ORDERS The Respondent, Titan Box Corporation, Liverpool, New York, its officers, agents , successors , and assigns, shall: 1. Cease and desist from: (a) Unilaterally instituting any incentive system of pay, or unilaterally making any changes in existing conditions of employment , without first bargaining in good faith with any exclusive collective-bargaining agent of its employees. (b) In any like or related manner ' interfering with, restraining , or coercing employees in the exercise of their right to self-organization , to form organizations, to join or assist Local Union #2393-S of the United Brotherhood of Carpenters and Joiners of America, AFL-CIO, or any other labor organization , to bargain collectively through representatives of their own choosing , and to engage in other concerted activities for the purposes of collective bargaining or other mutual aid or protection , or to refrain from any or all such activities , except to the extent that such right may be affected by an agreement requiring membership in a labor organization as a condition of employment , as authorized in Section 8(aX3) of the Act. 2. Take the following affirmative actions necessary to effectuate the policies of the Act: (a) Discontinue its present incentive wage system of payment. (b) Upon request bargain in good faith with the Union as the exclusive representative of all the employees in the appropriate unit. (c) Honor the Union's representative status pursuant to its Board certification for it 12-month period starting with the date when the Respondent begins to bargain as herein required. (d) Post at its place of business in Liverpool, New York, copies of the attached notice marked "Appendix." 4 Copies of said notice, on forms provided by the Regional Director for Region 3, after being duly signed by the Respondent's representative , shall be posted by the Respondent immedi- ately upon receipt thereof, and be maintained for 60 consecutive days thereafter , in conspicuous :places , includ- ing all places where notices to employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered , defaced, or covered by any other material. (e) Notify the Regional Director for Region 3, in writing, within 20 days from the receipt of this Decision, what steps the Respondent has taken to comply herewith. 791 3 In the event no exceptions are filed as provided by Sec. 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings. conclusions, recommendations, and recommended Order herein shall, as provided in Sec. 102A8 of the Rules and Regulations , be adopted by the Board and become its findings, conclusions, and order, and all objections thereto shall be deemed waived for all purposes. ' In the event that the Board's Order is enforced by a judgment of the United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board" APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board having found, after a trial that we violated the Federal law by refusing to bargain in good faith with Local Union # 2393-S of the United Brotherhood of Carpenters and Joiners of America, AFL-CIO: WE WILL NOT refuse to recognize and bargain with the Union as the exclusive representative of the employees in the unit described below. The bargaining unit is: All production and maintenance employees, including shipping and receiving employees, at our Liverpool , New York , location, excluding all office clerical employees , professional employees, guards and supervisors within the meaning of the Act. WE WILL NOT unilaterally , or without bargaining first with the Union, change any conditions of employment for our employees. WE WILL NOT in any like or related manner interfere with, restrain or coerce employees in the exercise of their rights to self-organization , to form labor organiza- tions, to join or assist Local Union # 2393-S of the United Brotherhood of Carpenters and Joiners of America , AFL-CIO, or any other labor organization, to bargain collectively through representatives of their own choosing, or to engage in any other concerted activities for the purposes of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities except to the extent that such right may be affected by an agreement requiring member- ship in a labor organization as a condition of employment, as authorized in Section 8(aX3) of the Act. WE HEREBY DISCONTINUE our existing wage incentive system. WE WILL bargain collectively , upon request, with the above-named Union as the exclusive representative of the employees in the above-described unit with respect to rates of pay, wages, hours of employment , and other conditions of employment and, if an understanding is reached, embody such understanding in a signed agreement. TITAN BOX CORPORATION (Employer) 792 DECISIONS OF NATIONAL . LABOR RELATIONS BOARD Dated By or covered by any other material . Any questions. concern- (Representative) (Title) ing this notice or compliance with its provision. may be directed to the Board's Office, 9th Floor-Federal Build- This is an official notice and must not be defaced by ing, 111 W. Huron Street, Buffalo, New York 14202, anyone . Telephone 716-842-3100. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered , defaced, Copy with citationCopy as parenthetical citation