Tower Records

National Labor Relations Board - Board Decisions

May 11, 1970

182 N.L.R.B. 382 (N.L.R.B. 1970)

:382 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Tower Enterprises , Inc., d/b/a Tower Records and Depart-
ment Store Employees Union , Local 1100 , Retail Clerks
International Association , AFL-CIO. Case 20-CA-5615
May 11, 1970
DECISION AND ORDER
BY CHAIRMAN MCCULLOCH AND MEMBERS BROWN AND
JENKINS
On January 29, 1970, Trial Examiner Louis S. Penfield
issued his Decision in the above-entitled proceeding,
finding that the Respondent had engaged in and was
engaging in unfair labor practices within the meaning
of the National Labor Relations Act, as amended, and
recommending that it cease and desist therefrom and
take certain affirmative action, as set forth in the attached
Trial Examiner's Decision. Thereafter, the Respondent
filed exceptions to the Trial Examiner's Decision and
a supporting brief and the General Counsel filed an
answering brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the National
Labor Relations Board has delegated its powers in con-
nection with this case to a three-member panel.
The Board has reviewed the rulings of the Trial Exam-
iner made at the hearing and finds that no prejudicial
error was committed. The rulings are hereby affirmed.
The Board has considered'the Trial Examiner's Decision,
the Respondent's exceptions, the briefs, and the entire
record in the case, and hereby adopts the findings,'
conclusions2 and recommendations of the Trial Examin-
er.
ORDER
Pursuant to Section 10(c) of the National Labor Rela-
tions Act, as amended, the National, Labor Relations
Board hereby adopts as its Order the Recommended
Order of the Trial Examiner, and hereby orders that
the Respondent, Tower Enterprises, Inc., d/b/a Tower
Records, Sacramento and -San Francisco, California,
its officers, agents, successors, and assigns, shall take
the action set forth in the Trial Examiner's Recommend-
ed Order.
' In Section III, A, of his Decision, the Trial Examiner inadvertently
referred to Store Manager Shaw as having acknowledged that, on
May 21 after the receipt of the Union's demand for recognition, he
talked to a number of employees The record shows that it was General
Manager Schairer who on that occasion spoke with the employees
We hereby correct this madvertance
4 We agree with the Trial Examiner's conclusion that the Respondent's
granting of wage `increases to all of its hourly employees in violation
of Sec 8(a)(1) requires a bargaining order See our decision in C
& G Electric, Inc , 180 NLRB No 52
TRIAL EXAMINER ' S DECISION
STATEMENT OF THE CASE
Louis S. PENFIELD, Trial Examiner: This proceeding,
with all parties represented, was heard before me in
San Francisco, California, on October 7, 1969, upon
a complaint of the General Counsel of the National
Labor Relations Board, herein called the Board, and
answer of Tower Enterprises, Inc., d/b/a Tower Records,
herein called Respondent.' The issues litigated were
whether Respondent violated Section 8(a)(1) and (5)
of the National Labor Relations Act, as amended, herein
called the Act.
Upon the entire record, including consideration of
briefs filed by the parties, and upon my observation
of the witnesses, I hereby make the following:
FINDINGS OF FACT
t'
1. THE BUSINESS OF RESPONDENT
Tower Enterprises, Inc., is a California corporation
with its principal place of business located in Sacramen-
to, California. Under the name Tower Records, Respond-
ent is engaged in the retail sale of phonograph records
and audio tapes at a location in San Francisco, California.
During the past year, Respondent, in the course and
conduct of the San Francisco business had gross sales
in excess of $500,000. During the past year, Respondent
purchased and received goods for use at its San Francisco
operation valued in excess of $50,000. Such goods were
purchased from suppliers located in the State of Califor-
nia, but obtained by such suppliers directly from sources
located outside the State of California. On the basis
of the foregoing, I find that, at all times material herein,
Respondent was engaged in a business affecting com-
merce within the meaning of Section 2(6) and (7) of
the' Act, and assertion of jurisdiction over its business
to be appropriate.
II.' THE LABOR ORGANIZATION INVOLVED
Department Store Employees Union, Local 1100,
Retail Clerks International Association , AFL-CIO, here-
in called the Union, is a labor organization within the
meaning of Section 2(5) of the Act.
III. THE UNFAIR LABOR PRACTICES
The General Counsel alleges that at all times since
May 21, 1969, the Union has been the statutory represent-
ative of Respondent's employees at the San Francisco
store, and that following the Union's request to bargain
as such representative, Respondent not only refused
to accord the Union recognition, but engaged in a course
of unlawful conduct which should be remedied by direct-
' The complaint issued on July 30, 1969, and is based upon a charge
and amended charge filed on June 2 and July 23, 1969, respectively
Copies of the complaint, the charge, and the amended charge were
duly served upon Respondent
182 NLRB No. 56
TOWER RECORDS
ing a bargaining order. Respondent denies that at any
time it became obligated to bargain with the Union
as the statutory representative of its employees or that
at any time it engaged in unlawful interference with
its employees' statutory rights.
At times material to this proceeding, Respondent
employed some 19 persons at its retail store in San
Francisco. The general manager of the corporation, John
Schairer, had his headquarters in Sacramento, California,
but normally visited the San Francisco operation once
a week. Charles Shaw was the store manager and Herb
Hoyt the assistant store manager in San Francisco who
directly supervised the day-to-day store operation. It
is conceded that Schairer, Shaw, and Hoyt were each
supervisors within the meaning of the Act. Bob Morrison
was the head clerk. The General Counsel claimed Morri-
son likewise to be a supervisor properly excluded from
the unit. At the hearing Respondent disputed this claim.
Testimony concerning the duties of Morrison, however,
disclosed that on occasions Morrison had full charge
of the store, and that he had authority to suspend
employees who engaged in misconduct. In its brief,
Respondent withdrew its objection to Morrison's exclu-
sion from the unit. I find Morrison to be a supervisor
within the meaning of the Act properly excluded from
the unit. A dispute exists as to the inclusion or exclusion
of two additional employees. This issue will be discussed
below.
A. The Union's Organizational Efforts, the Request To
Bargain, and the Wage Increase
Commencing about May 15, Daniel Solomon, an
employee of Respondent, began soliciting his fellow
employees at Respondent's San Francisco store for mem-
bership in the Union. He gave many of them union
application cards together with addressed postage paid
envelopes directed to the Union. Some cards were signed
and returned to Solomon who thereupon forwarded them
to the Union. Others were mailed directly to the Union
by the employees themselves. By the morning of May
21, 1969, nine cards had been signed by Respondent's
employees. Eight signed cards had been received at
the union office by that time. The cards, in substance,
set forth that the signer was applying for membership
in the Union, and that he authorized the Union "to
represent [him] for purposes of collective bargaining
and handling of grievances. . . ." The eight cards in
possession of the Union were each dated between May
15 and 17, 1969. Respondent,does not contest the validity
of the signatures on any cards. It is conceded that
each employee signing a card was on Respondent's
payroll as of May 21, 1969.2
Steven Palampres. signed an application card dated
May 20, 1969. Such card was not received at the union
office, however, until May 22. An additional employee,
R These eight cards were signed by the following employees Terry
Rich, Richard Street, Michael T Grenshaw, Ed Hale, Maurice G
Sandy, Mike J Edwards, Daniel J Solomon, and William H Davis,
Jr
383
Michael D. Waggoner, signed a'chrd dated May 22,
1969. This was received at the union office 'on May
23. The dates on each appears to have been put on
by the signer, and no evidence was adduced to support
that these, or any other cards submitted, had not actually
been signed on the dates appearing thereon.
At approximately 3 p.m. on the afternoon of May
21, 1969, Union President Richard Williams visited
Respondent's store and spoke with Store Manager
Charles Shaw. After introducing himself, Williams
advised Shaw that a majority of Respondent's employees
had signed with the Union, and he handed Shaw what
he describes as "the demand letter." This letter was
dated May 21, 1969, was addressed to Shaw as manager
of the San Francisco store, and was signed by Walter
L. Johnson, secretary-treasurer of the Union. In sub-
stance, the letter recited that the Union was thereby
notifying Respondent that a majority of its employees
in a unit comprised of "all selling and nonselling employ-
ees," excluding supervisors and warehousemen, had
designated the Union as their exclusive bargaining repre-
sentative, and that the Union was therefore demanding
"recognition for purposes of collective bargaining as
the exclusive representative of such employees." The
letter further represented that should Respondent doubt
the majority representation, the Union would agree to
an independent card check to prove its majority, and
that the Union desired to meet with Respondent for
the purpose of negotiating a collective-bargaining agree-
ment at Respondent's "earliest convenience." It was
requested that Respondent call the Union by telephone
to arrange for a mutually agreeable date for such a
meeting. The letter concluded by calling Respondent's
attention to the fact that federal law protected the rights
of the employees, and by stating that "discrimination
against any of your employees, or a refusal to bargain
with [the Union] will be brought to the attention of
the proper authorities."
Williams had the eight application cards above-noted
with him when he visited the store. Shaw, however,
did not ask to see them. After reading the letter, Shaw
advised Williams that "he was only the store manager
and that he would pass it on to higher headquarters
or to Sacramento." Neither Williams nor any other
union representative made any subsequent effort to com-
municate by letter, telephone, or visit with anyone con-
nected with management either in San Francisco or
Sacramento. No representatives of, Respondent replied
in any manner to the Union's so-called demand for
recognition following Williams' visit to the store.
John Schairer, Respondent's general manager, was
in San Francisco on May 21. He was not present in
the store, however, at the time that Williams came
in with the demand letter. Upon Schairer's return to
the store about 4 p.m. that same afternoon, Shaw showed
Schairer the letter that Williams had delivered. Shaw
acknowledged that thereafter he talked with a number
of employees, and that in the course of such conversa-
tions he apprised them that he had earlier been aware
that there had been some union activity, but that until
the Union had requested recognition he had not fully
384 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
known of its extent. There is no other evidence of
oral threats or unlawful conduct, except what is related
below, by Schairer or any other management representa-
tive directed at the employees at this or any other
time.
Early in the evening of May 21, Schairer telephoned
Russell Solomon, Respondent's president, in Sacramen-
to, and read him the demand letter. During the course
of this conversation, Solomon and Schairer agreed that
the minimum wage for clerks in the San Francisco
store should be raised from $1.75 to $2 per hour at
once. According to Schairer at that time, there were
14 hourly rated employees who were receiving the $1.75
minimum rate . Schairer announced the increase to the
few clerks who were working that evening , and the
others were notified the following day. The increase
first appeared in the paychecks that the clerks received
on May 30.
Respondent contends that a wage increase had been
planned prior to the advent of the Union. In this connec-
tion, Schairer testified that about May 1 he had become
aware that there was discontent among Respondent's
employees occasioned by a variety of things, including
the low wage scale. Schairer states that he discussed
the problem with Respondent's officers in Sacramento
and it had been decided that some wage adjustments
were in order. This decision was not announced to
the employees, however. According to Schairer prior
to May 21 he did no more than apprise the employees
that he and the other company officers "were looking
into the problems and hoped [they] would have some
solution shortly." Schairer also concedes that prior to
May 21, Respondent had reached no decision concerning
specific raises to be accorded any individual employee.
On the contrary, Schairer testified that it had been
Respondent's intent to evaluate the ability of each
employee before deciding on the amount of any increase.
Schairer acknowledges that such individual evaluations
had not been made by May 21.
B. The Appropriate Unit, the Majority, and the Refusal
To Bargain
As set forth above, the Union seeks a bargaining
unit comprised of the selling and nonselling employees
at Respondent's San Francisco store. Respondent has
no basic dispute with this unit claim. As noted above,
Respondent concedes that the store manager, the assist-
ant store manager, and the head clerk are each supervi-
sors properly excluded from the scope of such unit.
The General Counsel and the Charging Party, however,
would exclude, and Respondent would include, Melinda
Mitchell, classified as bookkeeper clerk and buyer, and
William Doughty, classified as a warehouseman.
Testimony shows that Mrs. Mitchell worked principal-
ly on the selling floor with the other employees, that
occasionally she made sales and took in money at the
cash register, that she kept certain of Respondent's
records, and that she was responsible for observing
Respondent's stock of single records ' in the so-called
"top forty," and for sending in purchase orders for
"top forty" records as replacements were needed.
Doughty worked principally as a shipping clerk receiving
and unpacking records and other items in the back
of the store, and moving these items to the front to
replace diminished stock. Occasionally, Doughty would
engage in selling. Both Mitchell and Doughty were paid
salaries, rather than the hourly wage accorded the clerks.
The reason for this is not explained. Neither received
a wage increase on May 22.
While it is apparently true that Doughty spent relative-
ly little of his time selling and mostly functioned as
a shipping, and receiving clerk, his work brought him
in frequent contact with the selling clerks, and he appears
to share much in common with them. Respondent's
store is relatively a small one with no truly separate
warehouse area. Under the circumstances, there seems
no sufficient reason to exclude him from a unit comprised
of the other employees with whom he works closely,
and which is defined as including both "selling and
nonselling employees."
While Melinda Mitchell did a certain amount of book
work and made out reports, she had no separate office
and took no dictation She too occasionally did some
selling; and also worked in close contact with the clerks
at all times. The General Counsel argues her exclusion
as a part of management because she used her own
judgment and discretion in making orders for the needed
"top forty" records, a function which it is claimed
gave her the managerial power of pledging the employer's
credit. General Counsel cites certain cases in which
the Board has excluded persons with powers to pledge
the employer's credit.3 These cases arise in the situa-
tions where the authority was far more extensive than
that which Mrs. Mitchell possessed. Mrs. Mitchell's
purchase authority was applicable to only a small fraction
of Respondent's business and appears so limited that
it scarcely suggests any real exercise of a managerial
function. Rather, her work, like that of Doughty, is
for the most part related to and done in close association
with the clerks, and like Doughty it would seem
appropriate to include her in a unit comprised of selling
and nonselling employees.
I find a unit comprised of all Respondent' s selling
and nonselling employees, including the bookkeeper and
the warehousemen, but excluding supervisors as defined
by the Act to be appropriate for the purposes of collective
bargaining within the meaning of Section 9(b) of the
Act. As of May 21, 1969, such unit was comprised
of 16 persons.4
As heretofore noted, on May 21, when Williams deliv-
ered the demand letter to Respondent, he had with
him application cards signed by eight of Respondent's
employees.5
3 Weaver Motors Inc , 123 NLRB 209, Western Gear Corp , 160
NLRB 272, Grocers Supply Company, Inc , 160 NLRB 485
' These include Louis Rhode, Mike Waggoner, Larry Mendellson,
Daniel Solomon, Mike Crenshaw, Steve Palamores, Gordon Sandy,
Terry Rich, Bill Davis, Richard Street, Ed Hale, Ernie Koeph, Stan
Alperin, Mike Edwards, Melinda Mitchell, and William Doughty
5 See In 2, supra
TOWER RECORDS
As we have seen, the card of Steve Palamores was
dated on May 20, 1969, but was not received in the
union office till May 22, 1969. Respondent takes the
position that this card should not be counted in determin-
ing the majority as of May 21, because at that time
it was not yet in the possession of the Union. I disagree.
The function of an application or authorization card
when used for majority determination is to signify that
the signer had thereby designated a particular labor
organization as his statutory representative at a particular
time. Palamores' card appears to be in his own handwrit-
ing, and it purports to recite that Palamores so designated
the Union on May 20, 1969. Absent any conflicting
evidence which would suggest a different date, it is
reasonable to conclude the card was signed on the
date which appears on its face. I deem it of no signi-
ficance that thereafter the card did not reach the union
office until May 22. It is Palamores' choice of a bargaining
representative that concerns us, not the date his card
arrived at the union office. Accordingly, I find the card
of Steven Palamores to have been signed on May 20,
1969.
Eight others had designated the Union as their repre-
sentative prior to May 21. Adding the card of Palamores
to these, I find that 9 of Respondent's 16 employees
had in fact designated the Union as their representative
on May 21.
The card of Mike Waggoner indicates on its face
that it was not signed until May 22, 1969, following
the Union's initial demand for recognition. On May
22, Respondent had not expressly declined to accord
the Union recognition, and the Union's demand delivered
on May 21 is reasonably to be construed as a continuing
one. The Board has held that cards obtained during
a period where a demand for recognition is still outstand-
ing may be used to compute the majority., Accordingly,
I find that the card of Mike Waggoner may also be
counted in computing the Union's majority at all times
subsequent to May 22, 1969.
Thus, when the Union first made its request for
recognition, it had been designated as the bargaining
representative by 9 of Respondent's 16 employees in
the appropriate unit, and I so find. At all times after
May 22 with the demand still outstanding, the Union
represented 10 of Respondent's 16 employees in the
appropriate unit and I so find. Accordingly, I find that
at all times material after May 21, 1969, the Union
had been designated by a majority of Respondent's
employees in a unit appropriate for collective-bargaining
purposes.'
" Colonial Wax Products Division of Victrylite Candle Compam,
171 NLRB, Henry Colder Company, 163 NLRB 105
' Respondent notes that on the face of the union application cards
the following legend appears We, the Local Union Executive Board
report affirmatively on this applicant whose application date is ___ "
Following'this is a signature line for a local union executive officer
It does not appear that the Executive Board ever considered or reported
on any of the applicants, nor were any cards signed by an executive
officer According to Respondent, this ommission should be viewed
as a fatal defect invalidating all the cards ' I disagree The card on
its face is an unequivocal authorization for the Union to represent
the signer, as well as an application for membership The approval
385
Respondent concedes that at no time did it affirmative-
ly reply to the Union's request to bargain, or in any
other manner suggest a means whereby the Union could
prove its majority through Board or independent sources.
Respondent would excuse its failure to respond to the
Union's demand by contending that the Union had a
duty to follow up its May 21 letter by submitting proof
of majority or in some other manner press its bargaining
demands. I disagree. Not only does the letter itself
constitute an unequivocal demand for recognition, it
specifically asks for a reply from Respondent. Manager
Shaw told Union Representative Williams that he intend-
ed to pass the letter on to higher management. The
letter was in fact given that same day to Respondent's
general manager, and it was reasonable for the Union
to assume that a reply of some sort would be forthcoming
in the relatively near future without its taking further
steps. Although Schairer now contends that Respondent
doubted the Union's majority from the outset, it never
so notified the Union. Absent a reply of any sort,
Respondent's conduct may be viewed as a refusal on
its part to bargain with the Union whether or not it
was in fact the statutory representative of the employees,
and I so find.
Respondent, however, had a qualified right to refuse
to bargain with the Union until the Union could establish
its majority in some manner other than its mere assertion
in a demand letter. This right, however, was not an
absolute one, and could be forfeited should it be estab-
lished that following the demand Respondent acted in
a manner calculated to undermine the Union's claimed
majority. Thus, we must next consider whether Respond-
ent's refusal to bargain here took place in a fully lawful
context, or whether in conjunction therewith Respondent
engaged in unlawful conduct of a nature which resulted
in a forfeiture of its right to have the majority determined
by the Board or an independent source. Should the
latter be the case it may become appropriate to direct
a bargaining order This issue will be discussed below.
C. Discussion and Conclusions
The propriety of a bargaining order involves an appli-
cation of the principle established by the United States
Supreme Court in N.L.R.B. v. Gissel Packing Co.,
395 U.S. 575, 614. Briefly stated the principle as recited
by the Court, and followed by the Board, is that a
bargaining order may be directed where the majority
is established by authorization cards rather than by
the election process in a situation where an evaluation
of the quantity and quality of the unlawful conduct
of the employer shows it to be of a character likely
to interfere with employee free choice should an election
later be conducted. It is reasoned that where such con-
duct is sufficiently extensive and sufficiently directed
at the employees' right of free choice, the card designa-
lines relate to final steps in perfecting membership and do not purport
to qualify the authorizations It is conceivable that membership might
not be perfected until after representative status had been achieved The
authorization, however, stands as unconditional, and serves to express
the representation choice of the employees at the time of signing
386 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
tions become a more reliable expression of employee
choice than do votes in an election. In Gissel, the
Supreme Court stated the following:
The only effect of our holding here is to approve
the Board's use of the bargaining order in less
extraordinary cases marked by less pervasive prac-
tices which nonetheless still have the tendency
to undermine majority strength and impede the
election processes. The Board's authority to issue
such an order on a lesser showing of employer
misconduct is appropriate, we should reemphasize,
where there is also a showing that at one point
the union had a majority, in such a case, of course,
effectuating ascertainable employee free choice
becomes as important a goal as determining employ-
er misbehavior. In fashioning a remedy in the exer-
cise of its discretion, then, the Board can properly
take into consideration the extensiveness of an
employer's unfair practices in terms of their past
effect on election conditions and the likelihood
of their recurrence in the future. If the Board
finds that the possibility of erasing the effects of
past practices and of ensuring a fair election (or
a fair rerun) by the use of traditional remedies,
though present, is slight and that the employees
sentiment once expressed through cards would,
on balance, be better protected by a bargaining
order, then such an order should issue.
With such rationale in mind, we must examine the
extensiveness, the timing, and the character of the
alleged unfair labor practices here to determine if "the
possibility of erasing the effects" of such conduct and
insuring a fair election by a cease-and-desist order is
so slight "that the employee sentiment once expressed
through cards would on balance be better protected
by a bargaining order. . . ."
The sole unlawful conduct charged in the instant
case is the wage increase accorded the employees on
May 21 under circumstances which are set forth above.
The General Counsel claims that the amount of such
increases and the timing make it apparent that they
were both designed and calculated to undermine the
Union's majority. It is urged that the granting of the
increases constituted not only a manifest interference
with employee right of free choice, but that the conduct
took place in circumstances which call for not only
a cease-and-desist order but also will support a bargaining
order based on the Gissel rationale.
Respondent contends that the wage increases had
been earlier planned, and that their announcement and
implementation within 24 hours of the union demand
amounted to no more than a coincidence. Primarily,
Respondent would claim that it engaged in no unlawful
conduct whatsoever which would support any remedial
order. Secondarily, Respondent would assert that even
if the wage increases be viewed as unlawful interference,
it was not a sufficient interference with employee free
choice to warrant the imposition of the bargaining order
remedy.
Respondent's primary contention must be rejected.
I do not question that on or about May 1, Respondent
was apprised that problems existed among its employees
at the San Francisco store, or that the most significant
problem centered on the low wage scale. Without doubt,
Schairer represented to the employees early in May
that sometime in the near future he would undertake
steps to alleviate all existing problems. Schairer acknow-
ledges, however, that he made no promise of specific
wage increases at this time, or that even within the
management hierarchy prior to May 21 there had been
agreement as to what increases were to be accorded
or to whom they were to go. On the contrary, as
we have seen, Schairer testified that management had
concluded that wage increases should only be granted
on an individual basis after a thorough review of the
work performance of each individual employee. While
intervening circumstances, not related to union organiza-
tion, may have been time consuming, and may serve
to explain why such individual review had not taken
place, it is not contended that any determination had
been reached prior to May 21. On this day, the Union
delivered its demand letter. We note Schairer first talking
to employees concerning union organization, and then
taking up the question of the Union's demands with
Respondent's president. While there is no evidence that
in any of his conversations with the employees, Schairer
voiced threats of reprisal or promises of benefits tied
to union affiliation, his discussions made evident his
concern with the union claim. Schairer's telephone con-
versation with Respondent's president centered exclu-
sively on the Union's demand received that very day.
It was immediately after reading the demand letter that
Schairer and President Solomon agreed that the 14
employees then making $1.75 should have their hourly
wage increased to $2 per hour. This was a substantial
across-the-board increase accorded to a substantial
majority of the unit employees without regard to their
individual work capacities. The decision was immediately
announced to those employees who were still working
on the evening of May 21, with the remaining employees
being apprised of it on the following day. The inference
is all but inescapable that this substantial across-the-
board increase made in a manner contrary to plan at
this time was triggered by the demand of the Union.
Absent a credible explanation for a departure from
the original planned review of individual work capacities,
the most reasonable conclusion is that Respondent by
granting and announcing the increases was seeking to
undermine the Union's claimed majority and to diminish
its capacity to establish such majority in an independent
manner at a later date.
The actual results which followed lend support to
the accuracy of such a conclusion. As recited above,
the likely effects soon appeared as a reality. On May
26, nine of Respondent's employees undertook to with-
draw their union membership applications, signifying
that they now felt that their problems could best be
met by forming their own organization. The employees
followed this by forming an employee group calling
itself "Tower Power." This group endeavored to deal
directly with Respondent. Whereas Respondent had no
response whatsoever to the Union's request to bargain,
TOWER RECORDS
and only at a much later date had voiced doubts as
to its majority; in marked contrast responded to the
"Tower Power" demand, by meeting and discussing
matters immediately without checking on majority status
at all. Moreover, Respondent continued dealings with
"Tower Power" until advised by counsel to cease.
Under the circumstances, I find that Respondent by
granting the 25-cent-an-hour wage increase on May 21
and 22 sought to undermine the Union's majority by
meeting a substantial element of the earlier expressed
discontent of the employees, thereby interfering with
the basic employee rights guaranteed by Section 7 of
the Act in violation of Section 8(a)(1) of the Act.
Although Respondent's sole unfair labor practice was
to grant the wage increase, the circumstances and the
timing of such conduct make it necessary to reject
Respondent's secondary claim as well. Respondent cor-
rectly asserts that the election process is ordinarily
regarded as the most reliable means of determining
a majority bargaining representative. Respondent argues
that circumstances here, even if deemed sufficient to
support a cease-and-desist order, do not suffice to support
a bargaining order absent a majority determination by
the election process.
It is well established there where an employer's unfair
labor practices are relatively inconsequential, or not
sufficiently aimed at interfering with the free choice
of a bargaining representative, a cease-and desist order
may be adequate to remedy the unlawful conduct and
insofar as a majority issue may also exist it is to be
resolved by the Board's representation procedures or
some other independent means.8 The Gissel doctrine
and the bargaining order remedy, however, become
appropriate in situations where in fact a union's majority
can be established by cards and the nature and "exten-
siveness of the employer's unfair labor practices" appear
to make subsequent free choice by the employees proble-
matical. In any given case, therefore, we must consider
whether what has occurred is likely to preclude the
exercise of free choice by the election process.
In the instant case, the wage increase and its timing
presents a reasonably clear-cut situation. It is a fair
assumption that in most instances where employees
designate a union as their representative, a major consid-
eration centers on the hope that such representative
may be successful in negotiating wage increases. Certain-
ly this appears to have been an important consideration
in the instant case. A unilateral award of a wage increase
by an employer following a union's demand for recogni-
ton results in giving the employees a significant element
of what they were seeking through union representation:
It is difficult to conceive of conduct more likely to
convince employees that with an important part of what
they were seeking in hand union representation might
no longer be needed. An employer may have the right
to persuade the employees that representation is not
in their best interests, but it does not have the right
to threaten them or confer benefits on them which
are designed to influence the employees against choosing
E Aaron Brothers Co of California, 158 NLRB 1077
387
a representative. When, as here, an employer does so,
free choice in a subsequent election becomes a matter
of speculation, so long as the effects of the interference
remain unremedied. Where, as here, the majority had
signed cards prior to Respondent's acts of interference
without knowledge of what, if any, benefits the Union
designated might negotiate, the Gissel principle comes
into play and the cards now appear as a more reliable
guage of employer choice than an election. Accordingly,
the wage increase in the instant case brings it within
the Gissel doctrine and inasmuch as we have found
a card majority, the direction of a bargaining order
becomes appropriate.
Respondent also resists entry of a bargaining order
by claiming that at all times it had a good-faith doubt
as to the Union's majority, and that a demonstrable
turnover shows that any majority which the Union may
have been able to claim on May 21 or 22 was subsequent-
ly dissipated by turnover. Respondent's contention in
this regard misconceives the rationale of Gissel. While
prior to Gissel, the Board frequently spoke of the pres-
ence or absence of good-faith doubts as to majority
by an employer, after Gissel the primary reliance is
placed upon evaluation of the unfair labor practices
committed. As found above, the Union represented a
majority of Respondent's employees at the time of its
demand on May 21. Had Respondent refrained from
unlawful conduct following the demand, subsequent turn-
over might have become an appropriate consideration.
However, on the very day of May 21, Respondent
embarked upon an unlawful course of conduct which
we have found above was designed and calculated to
undermine the Union's majority and interfere with the
employee's right of free choice. Respondent thus by
its own unlawful conduct forefeited the right to challenge
the Union's majority at a subsequent date, and subse-
quent turnover became irrelevant in resolving the majori-
ty issue. Respondent by granting the wage increases
for the unlawful object of undermining the employees'
interest in the Union can no longer question any seeming
loss of majority since it may well have resulted from
its own unlawful conduct.
I find that Respondent by granting the wage increases
under the circumstances described above, and declining
to accord recognition to the Union which represented
a majority of its employees in an appropriate unit,
engaged in conduct violative of both Section 8(a)(1)
and (5) of the Act, and such conduct to be appropriately
remedied by both a cease-and desist order, and an
order to bargain.
IV. THE EFFECTS OF THE UNFAIR LABOR PRACTICES UPON
COMMERCE
The activities of Respondent set forth in section III,
above, occurring in connection with the operations of
Respondent set forth 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.
388 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
VI THE REMEDY
Having found that Respondent engaged in certain
unfair labor practices, I shall recommend that it cease
and desist therefrom, and take certain affirmative action
designed to effectuate the policies of the Act
Having found that Respondent unlawfully refused
to bargain with the Union as the exclusive representative
of its employees in an appropriate unit, I will recommend
that Respondent, upon request, bargain collectively with
the Union and, in the event an understanding is reached,
embody such understanding in a signed agreement
Upon the basis of the foregoing findings of fact and
upon the entire record in the case, I make the following
CONCLUSIONS OF LAW
I Respondent is engaged in commerce within the
meaning of Section 2(6) and (7) of the Act
2 The Union is a labor organization within the mean-
ing of Section 2(5) of the Act
3 By interfering with, restraining, and coercing its
employees in the exercise of the rights guaranteed by
Section 7 of the Act, as found above, Respondent has
engaged in unfair labor practices within the meaning
of Section 8(a)(1) of the Act
4 By refusing, upon request, to bargain in good
faith with the Union as the representative of its employ-
ees in the unit found above to be appropriate, Respondent
has engaged in unfair labor practices within the meaning
of Section 8(a)(5) and (1) of the Act
5 The aforesaid unfair labor practices affect interstate
commerce within the meaning of Section 2(6) and (7)
of the Act
ORDER
Upon the basis of the foregoing findings of fact and
conclusions of law and upon the entire record in this
proceeding, I recommend that Tower Enterprises Inc
d/b/a Tower Records, its officers, agents, successors
and assigns, shall
I Cease and desist from
(a) Refusing to bargain collectively with the Union
as the exclusive representative of employees in the
appropriate unit described above
(b) Granting wage increases to its employees for the
purpose of influencing their selection of a labor organiza
tion as their bargaining representative
(c) In any like or related manner interfering with
or coercing its employees in the rights guaranteed them
by Section 7 of the Act
2 Take the following affirmative action which I find
will effectuate the policies of the Act
(a) Upon request, bargain collectively with the Union
as the exclusive representative of the employees in
the appropriate unit, and embody in a signed agreement
any understanding reached
(b) Post at its San Francisco, California, place of
business copies of the attached notice marked "Appen
dix "9 Copies of said notice to be furnished by the
Regional Director for Region 20, after being duly served
upon Respondent's representative, shall be posted by
Respondent immediately upon receipt thereof, and main-
tained by it for at least 60 consecutive days thereafter,
in conspicuous places, including all places where notices
to employees are customarily posted Reasonable steps
shall be taken by Respondent to insure that said notices
are not altered, defaced, or covered by any other mate-
rial
(c) Notify the Regional Director for Region 20 in
writing, within 20 days from the receipt of this Decision
what steps Respondent has taken to comply herewith 10
, In the event that no exceptions are filed as provided by Section
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 Section 102 48 of the Rules and
Regulations be adopted by the Board and become its findings conclu
sions 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 be changed to read Posted Pursuant to a Judgment
of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board
10
In the event that this Recommended Order be adopted by the
Board this provision shall be modified to read Notify the Regional
Director for Region 20 in writing within 10 days from the date of
this Order what steps it has taken to comply herewith
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT grant our employees wage increas-
es for the purpose of influencing their choice of
a labor organization as their bargaining representa
tive
WE WILL NOT refuse to bargain collectively with
Department Store Employee's, Local 1100, Retail
Clerks International Association, AFL-CIO, as the
exclusive representative of employees in the
appropriate bargaining unit The appropriate unit
is
All selling and nonselling employees employed
at the San Francisco store, including the book-
keeper and the warehouseman, but excluding
supervisors as defined by the Act
WE WILL bargain upon request with the above
named Union as the exclusive representative of
all employees in the unit described above with
respect to wages, hours, and other terms and condi-
tions of employment and, if an understanding is
reached, embody such understanding in a signed
statement
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employees
in the exercise of the rights guaranteed them by
Section 7 of the Act
TOWER RECORDS 389
All our employees are free to become or remain This is an official notice and must not be defaced
or refrain from becoming or remaining members of by anyone.
the above-named or any other labor organization.
This notice must remain posted for 60 consecutive
TOWER ENTERPRISES, days from the date of posting and must not be altered,
INC., D/B/A TOWER defaced, or covered by any other material.
RECORDS
(Employer)
Any questions concerning this notice or compliance
with its provisions, may be directed to the Board's
Dated By Office , 450 Golden Gate Avenue , Box 36047 , San Francis-
(Representative ) (Title ) co, California 94102, Telephone 556-3197.