Union Bag & Paper Corp.

National Labor Relations Board - Board Decisions

Dec 16, 1954

110 N.L.R.B. 1631 (N.L.R.B. 1954)

UNION BAG & PAPER CORPORATION 1631
It seems obvious at this point that, in their zeal to frame new stand-
ards which will cut the Board's jurisdiction in order to reallocate
Federal authority over labor relations to the States, the majority has
given little consideration to the actual relationship of activity of the
type here involved to commerce, or, indeed, to any consistent approach
to that problem.
For those reasons, therefore, and for the reasons set forth in our
separate opinions in Breeding Transfer Company and Greenwich Gas
Company as well, we must dissent from the $100,000 minima estab-
lished herein.
,UNION BAG & PAPER CORPORATION and LOCAL LODGE #722, INTERNA-
TIONAL ASSOCIATION OF MACHINISTS , AFL, PETITIONER . Case No.
2-RC-6941. December 16,1954
Decision and Direction of Election
Upon a petition duly filed under Section 9 (c) of the National Labor
Relations Act, a hearing' was held before Leonard J. Lurie, hearing
officer. The hearing officer's rulings made at the hearing are free from
prejudicial error and are hereby affirmed.
Upon the entire record in this case, the Board finds :
1. The Employer is engaged in commerce within the meaning of
the Act.
2. The labor organizations involved claim to represent employees
of the Employer.'
3. A question affecting commerce exists concerning the representa-
tion of , employees of the Employer within the meaning of Section 9
(c) (1) andSection2 (6) and (7) of the Act.
The Petitioner seeks to represent a unit of the production and main-
tenance employees at the Employer's machine shop in Hudson Falls,
New York. Since sometime in the late 1930's the Intervenor has rep-
resented the production and maintenance employees of the Employer's
bag factory and paper mill or honeycomb department. In 1946 the
Employer recognized the Intervenor as representative of the machine
shop employees, who were added to the unit of bag factory and honey-
comb department employees. The machine shop manufactures ma-
chinery, 90 percent of which is shipped to various plants of the Em-
ployer in other parts of the country. On July 1, 1954, the Employer
sold the bag factory which employed 250 employees, and now operates
only the honeycomb department which employs 27 employees, and
"International Brotherhood of Pulp, Sulphite & Paper Mill Wor'kers, AFL , hereinafter
referred to as the Intervenor , was permitted to intervene on the basis of its contractual
interest in the employees involved.
110 NLRB No. 243.
1632 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the machine shop which employs 32 employees. The two plants are.
about three-tenths of a mile apart. The Employer employs 6 main--
tenance employees who do all maintenance work for both plants, and
who make their headquarters in the machine shop. The Intervenor-
urges its current contract as a bar to these proceedings.
On June 1, 1951, the Employer and the Intervenor executed a con-
tract to be effective until June 1, 1952, and from year to year there-
after unless terminated by either party by written notice 60 days
prior to the anniversary date. Section 14, which contained the termi-
nation clause, also provided that if a proper termination notice were
given, "all the provisions of this contract shall remain in full force
and effect during the period of negotiation."
Section 6 of the contract provided that the wage rates therein set
forth. were to remain in effect throughout the life of the agreement
"unless changed by mutual consent of the signatory parties at a meet-
ing duly called on sixty (60) days written notice, by either of the
parties...."
The 1951 contract automatically renewed itself in 1952 and 1953.
However, sometime in May 1953 the Intervenor sought a wage in-
crease, but was successful only in obtaining an agreement that the
parties should meet in October 1953 for the purpose of further dis-
cussion of a wage increase, because the Employer was in a straitened
financial condition. At the October meeting the Employer again
pleaded inability to grant a wage increase but promised that it would
review its records, and if the records showed that the Employer had
operated at a profit for 3 consecutive months, it would grant a 5-cent
an hour wage increase to all employees. During all of this period the
Employer was endeavoring to sell all or part of its Hudson Falls
operations.
On March 11, 1954, the Intervenor sent the following letter to the-
Employer :
In accordance with the provisions of the agreement between
the Union Bag and Paper Corporation, Hudson Falls, New York,
plant and the International Brotherhood of Pulp, Sulphite and
Paper Mill Workers and its affiliated Local Union No. 23, I am
serving the required sixty days notice opening the agreement for
a discussion of wages, hours of employment, working conditions
and other matters of mutual interest.
I am suggesting a conference date at some mutually convenient
time during the month of May.
On March 16,1954, the Employer replied as follows :
I wish to acknowledge receipt of your letter of March 11, in
which you serve the required 60 day notice to open the agreement
UNION BAG & PAPER CORPORATION 1633
for a discussion of wages, hours of employment, working condi-
tions and other matters of mutual interest.
It is a little early to suggest a definite meeting date, but I
should think that within the next thirty days we ought to be able
to arrange a date which will be mutually convenient.
Pursuant to this exchange of letters, representatives of the Em-
ployer and the Intervenor met on May 20, 1954. The Employer dis-
closed that its operations had shown a profit for the months February
through April 1954 and that consistent with its oral commitment of
October 1953, it was granting a 5-cent an hour wage increase to all
employees, retroactive to February 1, 1954, effective immediately. At
this meeting the Employer announced to the Intervenor that arrange-
ments for the sale of the bag factory were nearing completion and
introduced the representatives of the prospective purchaser to the
Intervenor's representatives.
On June 1, 1954, the Employer and the Intervenor signed a Mem-
orandum of Agreement as follows :
In accordance with Section Fourteen-Tern of Agreement-
of the Labor Contract dated June 1, 1953, by and between Union
Bag & Paper Corporation and International Brotherhood of
Pulp Sulphite and Paper Mill Workers, AFL, and Local 23, it
is hereby agreed that this agreement shall remain in full force
and effect until a revised agreement is mutually agreed upon by
the parties signatory to this agreement.
It is also agreed that the parties will arrange a conference for
the purposes of negotiating a revised agreement as soon as mu-
tually convenient.
On July 1, 1954, the sale of the bag factory having been consum-
mated,. Local 23, a cosigner of all agreements between the Intervenor
and the Employer ceased to represent any employees of the Employer.
The Intervenor began the establishment of Local 2 to represent the
employees of the Employer. On July 7, 1954, the petition in this case
was filed. On July 19, 1954, Local 2 achieved compliance with the
filing requirements of the Act. On July 28,1954, the Employer orally
agreed to substitute Local 2 for Local 23 in the contract.
The Intervenor contends that its contract is a bar to a present elec-
tion of representatives, as it was automatically renewed by the failure
of either party, to the contract to send a notice of termination before
April 1, 1954. In its view its March 11 letter was merely for the pur-
pose of reopening the contract for the discussion of wages as provided
for in Section 6 of the contract. However, if the Board views the
March 11 letter as a notice of termination as contended by the Peti-
tion, it is the Intervenor's position that the June 1. Memorandum of
335207--13--vo1 110-104
1634 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Agreement is a bar to the petition which was filed after its execution.
As noted above the Petitioner contends that the March 11 letter con-
stituted a notice of termination. In addition it contends that the
June 1 Memorandum of Agreement can not constitute a bar because
it refers to a contract dated June 1, 1953, whereas the last agreement
in effect between the parties was one dated June 1, 1951, and because
Local 23, which signed the contract and the Memorandum of Agree-
ment, no longer represents any employees of the Employer.
We find no merit in the Intervenor's contention that either or both
of the contracts in issue bar a current election of representatives. The
notice given by means of the March 11, letter was given only 3 weeks
prior to the last possible date on which either party could effectively
terminate the contract, and by its terms served notice that the Inter-
venor expected to reopen the entire contract. In response to this notice,
the Employer agreed to reopen the entire contract and negotiate a
new one. The facts thus clearly show that the parties agreed no
longer to be bound by the old contract and to negotiate another in its
place. The terms of the notice and the conduct of the parties demon-
strate beyond doubt that automatic renewal was forestalled and the
prior agreement terminated. The fact that the contract also con-
tained provision for a narrow wage reopening is of no significance in
view of the fact that the parties chose not to resort to the narrow
provision.
This conclusion is supported by the fact that on June 1, 1954, the
expiration date of the prior contract, the Employer and the Intervenor
executed their Memorandum of Agreement, which clearly indicates
that negotiations for a revised agreement were still in progress. We
are unable to conclude that the parties would have taken such a step
if they had intended to reopen the prior contract only as to wages, as
contended by our dissenting colleague, for the parties had already
put into effect a revised wage schedule before they executed the Memo-
randum of Agreement.
As the contract was effectively terminated by the March 11 letter,
it can not operate as a bar to a current election of representatives.
The provision in the contract that upon a proper termination notice
"all the provisions of this contract shall remain in full force and
effect during the period of negotiations" operates at best to transform
the contract into one of indefinite duration which cannot preclude
this proceeding.2 Nor can the Memorandum of Agreement executed
on June 1, 1954, preclude this proceeding, for that agreement is clearly
of a temporary nature to be effective only until the parties agree upon
a revised agreement, and as such is not a bar to this proceeding.'
Worthy Paper Company As8ociation , 80 NLRB 19
Bridgeport Brass Company, Aluminum Division , 110 NLRB 997.
UNION BAG & PAPER CORPORATION 1635
4. The appropriate unit :
Since 1946 all of the Employer's production and maintenance em-
ployees have been represented by the Intervenor in one unit. This
unit embraced the employees in the Employer's bag factory, honey-
comb department and R & E machine shop. Since the sale of the bag
factory on July 1, 1954, the Employer operates only the honeycomb
department and the machine shop. The employees in the machine
shop manufacture machines, 90 percent of which is shipped to other
plants of the Employer. The machine shop also repairs machines on
occasion. The employees in the honeycomb department manufacture
a paper product which because of its appearance is called honeycomb.
The job classifications in the two operations are entirely dissimilar.
Of the approximately 32 employees in the machine shop, 15 are class
A machinists, 7 are class B machinists, 1 is a class C machinist, 1 is a
class E machinist, 3 are machinist helpers, 1 is a welder, 1 is a car-
penter, 1 is a crater, mover and shipper, 1 is a tool crib attendant and
1 is a janitor. The machine shop contains the usual machines found
in machine shops, and the class A machinists perform the usual duties
of skilled machinists, working from blueprints and to close tolerances.
The machine shop contains a complete welding shop and a complete
blacksmith shop. The machine shop is located about a half mile from
the honeycomb department, across the Hudson River. The two opera-
tions are under completely separate supervision and are carried on
separate payrolls.
Since the sale of the bag factory, 6 maintenance men have been
headquartered in the machine shop. They are under the same super-
vision as the machine shop employees. Their function is to repair
and maintain the premises of both the machine shop and the honey-
comb department. One of the maintenance men reports to the honey-
comb department because most of his work is performed. over there.
The maintenance men are carried on their own separate payroll.
The Petitioner seeks to represent the machine shop employees and
the maintenance men in a departmental unit. It is willing to accept
a unit limited to the machine shop.
We find that the machine shop employees exclusive of the main-
tenance employees constitute a functionally distinct and separate de-
partmental group.4 Moreover the Petitioner is a labor organization
which historically and traditionally represents such machine shop
departmental units. Under these circumstances, and contrary to the
Employer and Intervenor, we find that all machine shop employees
may constitute a separate appropriate unit, or may appropriately be
included in the existing plantwide unit.
4 General Textile Mills, Inc., 109 NLRB 263; Westinghouse Electric Corporation, 108
NLRB 556 ; Allison Steel Manufacturing Company, 105 NLRB 723
1636 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Accordingly, we shall direct that an election be held in the following
group of employees of-the.-Employer at- its Hudson Falls, New York,
plant.
All machine shop employees, including machinists, machinists'
helpers, welder, carpenter, tool crib attendant, janitor and the mover,
crater and shipper, excluding all maintenance employees and all em-
ployees employed in the honeycomb department, office clerical em-
ployees, guards, professional employees, and supervisors as defined
in the Act.
If a majority of the employees in the voting group above vote for
the Petitioner they will be taken to have indicated their desire to
constitute a separate appropriate unit, and the Regional Director
conducting the election directed herein is instructed to issue a certifica-
tion of representatives to the Petitioner for such unit, which the
Board, under such circumstances, finds appropriate for purposes of
collective bargaining. In the event a majority vote for the Inter-
venor, the Board finds the existing unit to be appropriate and the
Regional Director will issue a certification of results of election to
such effect.
[Text of Direction of Election omitted from publication.]
MEMBER MURDOCK, dissenting :
I would find that the 1951 contract between the Employer and the
Intervenor which admittedly was renewed in 1952 and 1953, was also
automatically renewed on April 1, 1954, and, therefore bars the peti-
tion which was not filed until July 7,1954.
The simple issue in this case is'whether the Intervenor intended its
letter of March 11 to operate as a termination notice or as merely a
notice to reopen the contract as to wages without terminating the
contract. Admittedly, the March 11 letter was couched in terms
broader than were required by section 6 of the contract to reopen the
contract as to wages. But it is also true that the March 11 letter did
not use the language required by section 14 to terminate the contract.
We must therefore go beyond the terms of the letter in order to ascer-
tain the intention of the noticing party.
Upon a consideration of all the circumstances surrounding the send-
ing of the March 11 letter, I am persuaded that the Intervenor did
not intend to terminate the contract; that the Employer did not con-
sider the Intervenor's letter as indicating an intention to terminate
the contract; and that neither the Intervenor nor the Employer acted
in such a manner as to bring about the termination of the contract.
The March 11 letter (and the Employer's reply thereto), contem-
plated a meeting to be held 60 clays after the date of the first letter as
was required of a notice to reopen the contract with respect to wages.
It made no mention of an intention to terminate the contract, and
UNION BAG & PAPER CORPORATION 1637
though stating a desire to negotiate on matters other than wages, the
negotiations which followed were confined to wages. The negotia-
tion meeting was held on May 20, more than 60 days after the sending
of the letter . Ever since the previous May the Union had been
attempting to obtain a wage increase from the Employer but had been
met with clangs of inability to pay. At a meeting held the previous
October the Employer had promised to give a wage increase when its
books showed a profit for 3 consecutive months. The May 20th
nneetmg resulted in a wage increase which was retroactive to February,
the first of 3 consecutive months in which the Employer's books showed
a profit. 'T'hese factors strongly support a finding that the March 11
letter was a notice reopening the contract in accordance with the pro-
visions of section (i of the contract. Any other finding seems to me to
ignore the great, weight of the evidence and to require the unrealistic
assumptions, that though the contracting parties had terminated their
contract, they voluntarily refrained from negotiating a new agreement
during the 60-day period provided for that purpose, and that the
Employer would institute a wage increase at a time when it believed
itself faced with continuing negotiations as to the remaining pro-
visions of the contract.
Nor does the fact that the June 1 Memorandum of Agreement cites
that it was executed pursuant to the provisions of section 14 negate
the conclusion that the contract had not been terminated . When it
is remembered that the Employer had all but completed negotiations
for the sale of the larger part of its operations , a fact well known
to the employees , the record testimony that the purpose of the agree-
ment was to assure the employees that such event would not leave them
without a contract takes on significance . Though perhaps ineptly
worded, it was nothing more than a memorandum of assurance, that
the forthcoming dislocation in the Employer's operation would not
deprive - the employees of the protection of their contract.
With respect to the Petitioner 's contention that since Local 23, a
cosigner of the contract no longer represents employees of the Em-
ployer, the contract is somehow removed as a bar, it is only necessary
to point out that the Intervenor was a cosigner along with Local 23
of the contract . The Intervenor has established Local 2, which has
achieved compliance with the filing requirements of the Act, and the
Employer has agreed to the substitution for Local 23 as the local
representative of the employees involved herein. In these circum-
stancestthis contention is without merit.
I conclude therefore , that no notice of termination was given by
either party to the contract urged as a bar, and that the contract there-
fore automatically renewed itself, before the filing of the petition.
Accordingly , I would find that the contract constitutes a bar to a
present election of representatives.