United States Gypsum Co.

National Labor Relations Board - Board Decisions

Nov 29, 1965

155 N.L.R.B. 1216 (N.L.R.B. 1965)

1216 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
United States Gypsum Company and International Union of Elec-
trical, Radio , and Machine Workers, AFL-CIO: Case No. 8-
CA-3726. November 29,1965
DECISION AND ORDER
On August 17, 1965, Trial Examiner Harry- R. Hinkes issued his
Decision in the above-entitled case, finding that the Respondent had
engaged in and was engaging in certain unfair labor practices, and
recommending that it cease and desist therefrom and take certain
affirmative action, as set forth in the attached Trial Examiner's Deci-
sion . Thereafter, the Respondent filed exceptions to the Trial Exam-
iner's Decision and a brief in support thereof.
Pursuant to the provisions of Section 3 (b) of the National Labor
Relations Act, as amended, the National Labor Relations Board has
delegated its powers in connection with this case to a three-member
panel [Members Panning, Brown, and Zagoria].
The Board has reviewed the rulings of the Trial Examiner made
at the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Trial
Examiner's Decision, the Respondent's exceptions and brief, and the
entire record in this case, and hereby adopts the findings, conclusions,
and recommendations of the Trial Examiner, as modified hereinafter.
ORDER
Pursuant to Section 10(c) of the National Labor Relations Act,
as amended, the National Labor Relations Board hereby adopts as its
Order the Recommended Order of the Trial Examiner, as herein
modified, and orders that- the Respondent, -United States Gypsum
Company, Warren, Ohio, its officers, agents, successors, and assigns,
shall take the action set forth in the Trial Examiner's Recommended
Order, as so modified:
1. Amend paragraph 1(a) of the Trial Examiner's Recommended
Order by substituting the phrase "by unilaterally changing" for the
phrase therein "or unilaterally changing."
2. Delete paragraph 2 (b) from the Trial Examiner's Recommended
Order and amend the serial identification of the paragraphs follow-
ing thereafter.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
Upon a charge filed on December 21, 1964, and an amended charge filed on
March 4, 1965, by International Union of Electrical , Radio and Machine Workers,
AFL-CIO, herein referred to as the Union , the General Counsel of the National
Labor Relations Board by -the Regional Director for- Region 8 (Cleveland, Ohio)
issued a complaint dated March 10, 1965, against United States Gypsum Company,
155 NLRB No. 118.
UNITED STATES GYPSUM- COMPANY - 1-217
herein referred to as the Respondent or Employer. The complaint alleges that the
Respondent has engaged in and is engaging in unfair labor practices in violation of
Section 8(a)(1), (3), and (5) of the National Labor Relations Act, as amended,
,in that it unilaterally, without notice and/or bargaining with the Union, demoted
certain employees and reduced their hourly rate of pay because their bargaining
unit had designated the Union as its bargaining representative. By answer duly
filed, the Respondent admitted the unilateral demotion and reduction in pay but
denied any violation of law. -
Pursuant to notice, a hearing was held before Trial Examiner Harry R. Hinkes in
Warren, Ohio, on May 3 and 4, 1965. All parties were represented and afforded
full opportunity to participate, examine witnesses, and adduce relevant evidence.
Briefs have been flied by the General Counsel and the Respondent. - On June 18,
1965, Respondent moved for certain corrections to the transcript in this proceeding.
No objection having been received, the transcript is corrected.
Upon the entire record in the case and from my observation of the witnesses
I make the following:
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
Respondent is, and has been at all times material herein, a corporation duly orga-
nized and existing by virtue of the laws of the State of Illinois, with its principal
office and place of business in Chicago, Illinois. The plant involved herein is located
in Warren, Ohio, where the Respondent is engaged in the manufacture and distribu-
tion of metal building materials and industrial products. Respondent, in the course
and conduct of its operations in Warren, Ohio, annually ships finished products
valued in excess of $100,000 directly to points outside the State of Ohio.
The complaint alleges, Respondent's answer admits, and I find that the Respondent
is engaged in commerce within the meaning of Section 2(6) and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
International Union of Electrical, Radio and Machine Workers, AFL-CIO, herein
called the Union, is a labor oigarization within the meaning of Section 2(5) of the
Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
The sole issue in the proceeding is whether the Respondent was guilty of an unfair
labor practice in the demotion and reduction in pay of certain of its employees with-
out having bargained with the Union or given notice to it before making the change.
Respondent readily concedes that reclassifications or demotions are normally com-
pulsory subjects of bargaining and that unilateral action with respect thereto, gener-
ally speaking, are violations of Section 8(a)(5) of the Act. N.L.R.B. v. Bernie
Katz, etc., d/b/a Williamsburg Steel Products Co., 369 U.S. 736. It argues, how-
ever, that under the circumstances of this case, there was no violation of law.
By decision of the Board dated October 12, 1964, and bearing Case No. 8-RC-
5571, all production and maintenance employees of the Respondent at its Warren,
Ohio, plant, including the sample department operator, storekeeper, all shipping
department operators, the packing department operators, and all production depart-
ment operators, but excluding all office clerical employees, guards, professional
employees, the works manager, superintendents, foremen, head machinist, head
mechanic, and all other supervisors as defined. in the Act, constitute a unit appro-
priate for the purposes of collective bargaining within the meaning of Section 9(b)
of the Act.
On or about November 6, 1964, a majority of employees of the Respondent in
the unit described above, by secret ballot conducted under the supervision of the
Regional Director for Region- 8 of the_ National Labor Relations Board, designated
and selected the Union as its representative for purposes of collective bargaining
with the Respondent, and on or about November 16, 1964, said Regional Director
certified the Union as the exclusive collective-bargaining representative of the employ-
ees in said unit.
At all times since November 16,1964, and continuing to date the Union has been
the representative for the purposes of collective bargaining of the employees in the
unit described above and by virtue of Section 9(a) of the Act has been and is now
the exclusive representative of all the employees in said unit for the purposes of
collective bargaining with respect to rates of-pay, wages, hours of employment, and
other terms and conditions of employment.
1218 DECISIONS OF NATIONAL -LABOR RELATIONS BOARD
- Since f958 the Respondent's plant at- Warren, Ohio, has had two operational divi-
sions, industrial and building. In each -of these two divisions there is a shipping
department. So-called department operators- are employed in the shipping- depart-
ments of the two divisions as well as in other departments of those two divisions.
In November 1964 there were 43 department operators in the plant, 2 of whom were
in the shipping department of the building division: and 2 others in the shipping
department'of the industrial division. The two department operators in the building
shipping department were Fortunato Cebeia and Frank Soukenik. The two depart-
ment operators in industrial shipping were Edward Staszko and James Browning.
At a meeting of department operators called by Respondent in mid-November
1964, shotYly after the representation election was held, John Daugherty, Respond-
ent's works manager, told the operators that because of NLRB's decision that depart-
ment operators were not supervisors, there was going to be a reorganization at the
plant.. No further details were given at that time. Cebella, Browning, and Soukenik
also testified that Daugherty blamed the reorganization on the Union's position.
Daugherty, in his testimony, admitted the November meeting with -operators and
did not deny the statements attributed to him by the three operators who testified.
Or. or about December 1, 1964, Cebella antd Soukenik were told by Don Cooper,
superintendent of the building division, that they were being demoted from oper-
ators to checkers with a reduction in hourly rate of pay from $2.83 to $2.60 and
that the action was taken because of NLRB's decision that they were not supervisors
and the Union's position in this regard. Similarly, around the same time Browning
was told by Eshler, superintendent of the industrial division, that he was being
demoted from operator to checker with a 23-cent-per-hour reduction in pay because
of the NLRB decision. The fourth operator, Staszko, was promoted to foreman.
Various responsibilities previously regarded as part of the job duties of the three
operators who were demoted were taken from them at the same time and their work
was more closely supervised as the result of additional manpower assigned to the
respective foremen.
According to Respondent's witnesses, this reorganization had been discussed and
planned for some time Prior to November 1964. Works Manager Daugherty
claimed to be unaware of weaknesses in the supervisory structure of the shipping
departments prior to the representation hearing, although he conferred frequently,
perhaps several times a week, with his division superintendents and had been asked
for more help by the -superintendent of the building division at least 6 months to
a year prior to the representation hearing which occurred in May and June 1964.
Daugherty further testified that the change in the shipping departments was based
upon the testimony-given at the representation hearing by operators in the production
departments. Although the shipping department operators did not testify at the
representation hearing, they were the only operators who were demoted and who
sustained a cut in pay.
Within a day follovi ing the demotion the Union learned of it from the wife of the
Local Union's president. On December 18, 1964, the Union wrote a letter to the
Respondent stating that it had filed a charge with the National Labor Relations Board
with respect to the demotion. About the same time the Union commenced contract
negotiations with the Respondent which ultimately, on April 30; 1965, culminated in
a collective-bargaining agreement which is now in effect. Other than the letter of
December 18, 1964, neither the Union nor the Respondent has discussed the demo-
tions of December 1, 1964.
Although plant practices in effect for some years had provided a grievance proce-
dure and this procedure was called to the attention of union representatives during the
representation hearings, no grievance with respect to the demotion of these operators
was ever filed by anyone. Plant practice, at the time of the demotions here, was for
an aggrieved employee to discuss his grievances with his foreman and other manage-
ment personnel. The collective-bargaining agreement of -April 30, 1965, contains
similar grievance procedures. In both instances, management retains the right to
make transfers and assignments.
Contentions and Conclusions
Respondent contends that the demotions were nondiscriminatory and not unlaw-
fully motivated, arguing that two of the three demoted operators were apparently
antiunion and the third's union attitude was unknown. On the other hand, the pro-
moted operator was known to be active in the Union because his candidacy for-union
steward had been posted on the bulletin board. Assuming the demotions, therefore,
UNITED STATES GYPSUM COMPANY - - 121%
to have been nondiscriminatory, it does- not nevertheless follow that Respondent is.,
absolved from impropriety for its unilateral action. In N.L.R.B. v. Katz, sup; c, 747„
the Supreme Court said:
... the Board may hold ... unilateral action [by an employer without prior dis-
cussion with the union; to be an unfair labor practice in violation of § 8(a) (5)r
without also finding the employer guilty of over-all subjective bad faith.
As the Board held in Town & Country Manufacturing Company, Inc., etc., 136 NLRB-.
1022, 1031: -
In sum, even were we to find-that Respondent terminated its tracking opera-
tions for nondiscriminatory reasons, we would, in the circumstances of this case„
order Respondent to abrogate its subcontract and bargain with the Union over
any future decision to subcontract those operations. In addition, we would direct
reinstatement of its drivers with an appropriate backpay remedy.
I am not convinced, however, that Respondent is not guilty of bad faith and that
the unilateral action was in fact taken for business reasons. Respondent's works
manager admitted knowing- of supervisory difficulties in the- shipping departments.
perhaps 11/2 years beforethe reorganization was made. The building division super--
mtendent testified that he had had discussions with the works manager and his shippmg
foreman regarding such problems in May 1964. It was not until November 1964,.
however, and after the employees had voted in favor of the Union as their bargaining
representative, that the action was taken. Moreover, the credited testimony of the,
workers affected establishes that the reason given by the works manager for the reor-
ganization was NLRB's decision regarding the supervisory status of operators and:.
the Unions position in this respect rather than any longstanding legitimate business.
reason. Althouo the works manager and the superintendent testified that compelling
business necessities caused the reorganization, neither denied the statements which.
the operators attributed to them. The alleged.business justification for the reorganiza-
tion is further impugned by the admission of the works manager that his action was
based upon the testimony of the production department operators and not of the,
shipping department operators. The demotions, however, were directed not to the
production department operators but only the shipping department operators. In
sum, therefore, it cannot be concluded that the reorganization that was announced
in mid-November and put into effect about December 1-when the Union was pre-
sumably taking steps to commence collective-bargaining negotiations was required by
compelling business -necessities. Rather, it is found that the reorganization was
designed to embarrass and disparage the Union by demonstrating to the employees
that the Respondent could change jobs and pay without consulting the certified Union_
The Respondent argues for a dismissal of the complaint upon several grounds. It
contends that this is a de niinimis matter, unworthy of the attention of the Board. It
cites American Oil Co., Case No. 14=CA-3125, 58 LRRM 1640, where the Trial
,Exa_miner dismissed a complaint involving unilateral action. The Trial Examiner's-
dismissal was adopted by the Board in the absence of any exceptions. It-should be
noted, however, that in that case- the action- was found to have "no demonstrable,
adverse, economic effect on the employees - in the unit other than to curtail, to a
limited extent, the amount of overtime work available to them." Scott Lumber Com-
pany, Inc., 117 NLRB 1790, also cited by Respondent, is similar, involving cleanup
work, "a minor rearrangement of duties." Similarly, Central Soya Company, Inc.,
151 NLRB 1619, dismissed a complaint concerning an employer's unilateral action
where the General Counsel failed to establish that the employees "suffered any signifi-
cant impairment of job tenure." General Tube Company, 151 NLRB 850, cited by
the Respondent, states, however, "no unit , employee was laid off or lost his regular
wages." Here, by contrast, there was a permanent change in job classification with
a permanent reduction in pay of almost 10 percent. It is neither minor nor temporary.
Respondent also seeks dismissal of the complaint arguing that the Union's behavior
constitutes waiver. It points to the fact that the Union failed to mention the matter
during 3t/2 months of contract negotiations with the Respondent and that no griev-
ances were ever filed or. the transfers in question. It also points to its offer to discuss
the transfers with the Union if the Union should so request. - The statutory right of a
union to bargain about changes in terms and conditions of employment may, of
course, be waived by the Union.
However, a waiver of a statutory right is not to be lightly inferred but must be
"clear and unmistakable." The Board will not find that contract terms of them-
selves confer on the employer a management right to take unilateral action on
212-809-66--vol. 155-78
1220 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
a mandatory subject of bargaining unless the contract expressly or by necessary
implication confers such a right. New York Mirror, Division of the Hearst
Corporation, 151 NLRB 834.
The grievance procedure in effect at the time of the demotion merely provided an
avenue of listeners for an aggrieved employee seeking redress. The contract reached
on April 30, 1965, provides a similar avenue while recognizing the right of the
Respondent to make personnel transfers. As in the New York Mirror case, at no
point does the Union surrender its right to notification nor can such a surrender be
inferred from the language of the contract. The right of the Union to notification is
entirely consistent with Respondent's right to transfer personnel. Although the
Union might not be able to prevent Respondent from making a contemplated transfer
of personnel, advance notification of the proposed action would give the Union "an
opportunity to present arguments to the employer to dissuade him from effecting the
change, and also an opportunity to propose alternatives or compromises which might
moderate the change so as to accommodate the mterests of the employees as well as of
the employer" (Kinard Trucking Company, Inc., 152 NLRB 449), thus reducing the
likelihood of industrial strife.
Nor can a waiver be inferred from the failure of the Union to bring the matter up
during negotiations. Respondent cites E-Z Mills, Inc., 106 NLRB 1039, where the
employer's unilateral action was excused. The Board held:
The Union did not indicate at any of the bargaining sessions that it wished to
bargain about the matters, or to have the action withdrawn. Indeed, at one of
the meetings, one of the employees specifically brought up the subject of the
cafeteria closing and the credit union withdrawal, but the Union's regional
director, and its principal negotiator, Salerno. indicated that the Uri-ion dad not
wish to discuss the subjects, saying that there were "more important things than
grievances" to discuss.
The action of the Union in this proceeding falls far short of that which justified the
dismissal in E -Z Mills. Moreover, the filing of the charge and the issuance of the
complaint in this proceeding could very well have been construed by all concerned
as the appropriate vehicle for a determination of the dispute rather than resorting
to bargaining where a decision has already been made and implemented. In Town &
Country Manufacturing Co., Inc., supra, 1030, the Board held:
No genuine bargaining over a decision to terminate a phase of operations can
be conducted where that decision has already been made and implemented.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of Respondent set forth above, occurring in connection with the
operations of Respondent described in section I, above, have a close, intimate, and
substantial relation to trade, traffic , and commerce among the several States and tend
to lead to labor disputes burdening and obstructing commerce and the free flow of
commerce.
V. THE REMEDY
Having found that Respondent has engaged in unfair labor practices I shall recom-
mend that it cease and desist therefrom and take certain affirmative action designed
to effectuate the policies of the Act.
As found, Respondent unilaterally demoted three of its shipping department oper-
ators to checkers and reduced their rate of pay without bargaining with, or notice to,
their bargaining representative, the Union . To simply require bargaining on this
action would be insufficient to effectuate the policies of the Act. In Town & Country
Manufacturing Co., Inc., supra , 1030-1031, the Board held:
It would be an exercise in futility to attempt to remedy this type of violation if
an employer's decision to subcontract were to stand . No genuine bargaining
over a decision to terminate a phase of operations can be conducted where that
decision has already been made and implemented.
[Ijt would be equally futile to direct an employer to bargain with the
exclusive bargaining representative of his employees over the termination of
jobs which they no longer hold. Since the loss of employment stemmed directly
from their employer's unlawful action in bypassing their bargaining agent, we
believe that a meaningful bargaining order can be fashioned only by directing
the employer to restore his employees to the positions which- they held prior to
this unlawful action.
The restoration of the demoted employees to their previous jobs and rate of pay is
necessary here as in Town & Country, above, even in the absence of discrimination
underlying the Respondent 's action . Having also found, however , that the motivation
"UNITED STATES GYPSUM COMPANY 1221
,of the Respondent in its unilateral action was the embarrassment and disparagement
,of the Union by acting without consulting the certified union , a natural consequence
of such behavior is the discouragement of employees in the exercise of the rights
guaranteed them in Section 7 of the Act, a violation of Section 8(a)(1) of the Act.
Moreover, the change in job duties as well as the reduction in pay was a change in a
term or condition of employment and, because of the Respondent 's motivation, would
discourage membership in the Union , a violation of Seetion 8(a)(3) of the Act. I
shall , therefore , recommend further that the Respondent cease and desist from such
unfair labor practices and take certain affirmative action in addition.
CONCLUSIONS of LAW
1. Respondent is an employer engaged in commerce within the meaning of the Act.
2. The Union is a labor organization within the meaning of the Act.
3. By its unilateral action demoting several shipping department operators to
checkers and reducing their rate of pay without bargaining with, or giving notice to,
their exclusive bargaining representative, Respondent has engaged in and is engaging
in unfair labor practices within the meaning of Section 8(a)(1), (3), and (5) of
the Act.
4. The aforesaid unfair labor practices are unfair labor practices affecting com-
merce within the meaning of Section 2(6) and (7) of the Act.
RECOMMENDED ORDER
Upon the basis of the foregoing findings of fact and conclusions of law, and pur-
suant to Section 10(c) of the National Labor Relations Act, as amended, it is recom-
mended that Respondent, United States Gypsum Company, its officers, agents, suc-
cessors, and assigns, shall:
1. Cease and desist from:
(a) Refusing to bargain collectively with the Union with respect to rates of pay,
wages, hours, or other terms or conditions of employment, or unilaterally changing
the rates of pay, wages, hours, or other terms or conditions of employment of its
employees in-the appropriate bargaining unit in derogation of the rights of the Union
or any other union which they may select as the exclusive bargaining representative.
(b) Discouraging membership in International Union of Electrical, Radio and
Machine Workers, AFL-CIO, or any other labor organization of its employees by
discriminating in regard to their tenure of employment or any term or condition of
employment.
(c) Conduct like or related to the foregoing which interferes with, restrains, or
coerces employees in the exercise of their rights guaranteed in Section 7 of the Act.
2. Take the following affirmative action in order to effectuate the policies of
the Act:
(a) Offer to Fortunato Cebella, Frank Soukenik, and James Browning immediate
and full reinstatement to their former or substantially equivalent position of shipping
department operator without prejudice to their seniority or other rights and privileges
and make each of them whole for any loss of pay he may have suffered by reason of
the Respondent's unilateral change in duties and compensation on or about Decem-
ber 1, 1964. Backpay shall be computed with interest in the manner prescribed by
the Board in Isis Plumbing & Heating Co., 138 NLRB 716.
(b) Upon request, bargain collectively with the Union as the exclusive representa-
tive of the employees in the bargaining unit described above and embody in a signed
agreement any understanding which may be reached.
(c) Preserve and, upon request, make available to the Board or its agents, for
examination and copying, all payroll records, social security payment records, time-
cards, personnel records and reports, and all other records necessary to analyze and
compute the amounts of backpay due under the terms of this Recommended Order.
(d) Notify any of the three demoted operators named above if presently serving in
the Armed Forces of the United States of his right to full reinstatement upon applica-
tion in accordance with the Selective Service Act and the Universal Military Training
and Service Act of 1948, as amended, after his discharge from the Armed Forces.
(e) Post in conspicuous places at its place of business, including all places where
notices to employees are customarily posted, copies of the attached notice marked
"Appendix." 1 Copies of said notice, to be furnished by the Regional Director for
i In the event that this Recommended Order be adopted by the Board, the words "a
Decision and Order" shall be substituted for the words "the Recommended Order of a
Trial Examiner" in the notice. In the further event that the Board's Order be en orced
by a decree of a United States Court of Appeals, the words "a Decree of the United States
Court of Appeals, Enforcing an Order" shall be substituted for the words "a Decision
and Order."
1222 DECISIONS OF NATIONAL LA33OR RELATIONS BOAR-
Region 8, shall, after being duly signed -by the Respondent 's representative, be posted
by it immediately upon receipt thereof, and be maintained by it for at least 60 consecu-
tive days thereafter . Respondent shall take -reasonable , steps , to insure that said
notices are not altered , defaced , Or-covered by any other material.
(f) Notify the Regional Director for Region 8, in writing, within 20 days from the=
receipt of this Decision, what steps it has taken to comply therewith.
2In the event that this Recommended Order be adopted by the Board , this provision
shall be modified to read: "-Notify said Regional Director , in writing, within 20 days from
the date of this Decision , what steps the Respondent has taken to comply herewith."
APPENDIX
NOTICE To ALL EMPLOYEES- -
Pursuant to the Recommended Order of a Trial Examiner of the National Labor
Relations Board, and in order to effectuate the policies of the National Labor Rela-
tions Act, as amended, we hereby notify our employees that:
PIE WILL offer Fortunato Cebella, Frank Souikenik, and James Browning
immediate and full reinstatement to their former or substantially equivalent posi-
tion of shipping department operator without prejudice to-their seniority or
other rights and privileges and make each of them whole for any loss of pay he
may have suffered by reason of this demotion to checker on or about Decem-
ber 1, 1964.
PIE WILL notify the above-named employees if presently serving in the Armed
Forces of the United States of their right to flail_1 reinstatement upon application in
accordance with the Selective Service Act and the Universal Military Training
and Service Act of 1948, as amended, after discharge from the Armed Forces.
WE WILL NOT refuse to bargain collectively with the Union by unilateral
changes in any term or condition of employment of -any employee in The appro-
- priate bargaining unit in derogation of the rights of the Union.
labor organization.
- WE WILL NOT engage in like or related conduct which interferes with, restrains,.
or coerces you in the exercise of the rights guaranteed to you in Section 7.
UNITED STATES GYPSUM COMPANY,
Employer. -
Dated------------------- By-------------------------------------------
(Representative ) (Title)
This notice must remain posted for 60 consecutive days from the date of posting,,
and must not be altered, defaced, or covered by any other material. -
If employees have any question concerning this notice or compliance with its provi-
sions, they may communicate directly with the Board's Regional Office, 720 Bu-:kley
Building, 1501 Euclid Avenue, Cleveland, Ohio, Telephone No. Main 1-4465.
H. B. Zachry Company and International Brotherhood of Electri--
caI Workers, Local Union No. 278, AFL-CIO. ccese No. a3-CA--
194 . November-9, 1965
DECISION AN ND ORDER
On August 23, 1965, Trial Examiner A. Bruce Hunt issued -his-
Decision in the above-entitled proceeding, finding that the Respondent
had engaged inand Was engaging in certain unfair labor practice-
and recommending that it cease and desist therefrom and take certain-
155 NLRB No. 121.
WE WILL NOT discriminate in regard to hire or tenure of employment or any
term or condition of employment to encourage or discourage membership in any