W. A. Krueger Co.

National Labor Relations Board - Board Decisions

Sep 27, 1990

299 N.L.R.B. 914 (N.L.R.B. 1990)

914 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
W. A. Krueger Co. and Local 532, Graphic Arts
International Union, AFL-CIO. Case 26-CA-
10301
September 27, 1990
DECISION AND ORDER
BY MEMBERS CRACRAFT, DEVANEY, AND
OVIATT
Upon a charge filed by the Union July 11, 1983,
the General Counsel of the National Labor Rela-
tions Beard issued a complaint August 18, 1983,
against the Respondent alleging that it has violated
Section 8(a)(5) and (1) of the National Labor Rela-
tions Act On August 29, 1983, the Respondent
filed an answer admitting in part and denying in
part the allegations in the complaint
On September 12, 1983, the General Counsel
filed a Motion for Summary Judgment On Septem-
ber 16, 1983, the Board issued an order transfernng
the proceeding to the Board and a Notice to Show
Cause why the motion should not be granted The
Respondent filed a response
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel
On the entire record, the Board makes the fol-
lowing
FINDINGS OF FACT
I JURISDICTION
The Respondent, a corporation, is engaged in
printing at its facility in Senatobia, Mississippi,
where it annually sells and ships products, goods,
and materials valued over $50,000 directly to
points outside Mississippi and where it annually
purchases and receives products, goods, and mate-
nals valued in excess of $50,000 directly from
points outside Mississippi We find that the Re-
spondent is an employer engaged in commerce
within the meaning of Section 2(2), (6), and (7) of
the Act and that the Union is a labor organization
within the meaning of Section 2(5) of the Act
II ALLEGED UNFAIR LABOR PRACTICES
The Union was certified as the exclusive collec-
tive-bargaining representative of a production and
maintenance unit' at the Respondent's facility on
'The unit consisted of
All production and maintenance employees employed by Respondent
at its Senatobia, Mississippi, facility, including permanent part-time
employees, and janitor-watchmen but excluding all other employees,
including all office clerical (non-exempt salaried) employees, guards
and supervisors as defined in the Act
January 26, 1981 The Respondent and the Union
later entered into a collective-bargaining agreement
effective from April 26, 1981, through April 30,
1983 On February 3, 1983, 2 a decertification peti-
tion was filed and, pursuant to a Stipulation for
Certification upon Consent Election, an election
was conducted on March 9, 1983
The tally of ballots showed the election results
to be 115 votes against the Union and 110 votes for
the Umon with 4 challenged ballots, an insufficient
number to affect the results The Union filed timely
objections to the election On April 25, the Region-
al Director issued his Report on Objections which
recommended that the Union's objections be over-
ruled The Union filed exceptions to the Regional
Director's report which were pending at the time
of the Motion for Summary Judgment and re-
sponse On February 21, 1984, the Board adopted
the Regional Director's recommendation to over-
rule the Umon's objections and decertified the
Union 3
The gravamen of the complaint allegations is
that the Respondent unlawfully made unilateral
changes in employees' wages and terms and condi-
tions of employment after the election but before
the certification of results The Respondent admits
that it refused to contribute to the GAIU Supple-
mental Retirement and Disability Fund after March
9, 1983, a time when the parties' collective-bargain-
ing agreement was still in effect The Respondent
also admits that it extended to its employees cover-
age under the W A Krueger Co Pension Plan co-
incident with its refusal to contribute to the GAIU
plan About May 18, 1983, the Respondent granted
unit employees a 6-percent wage increase retroac-
tive to May 1, increased the amounts payable to
employees under the health plan and short-term
disability plan, and extended coverage under its
long-term disability plan to all unit employees who
were not already covered Finally, on May 31,
1983, the Respondent implemented a new gnev-
ance procedure The Respondent admits that it
made the described changes without prior notice to
or negotiations with the Union
A Contentions of the Parties
The General Counsel alleges that the unilateral
changes made by the Respondent violated Section
8(a)(5) and (1) of the Act The General Counsel
relies on Presbyterian Hospital4 and Dow Chemical
2 All dates are in 1983 unless otherwise indicated
3 W A Krueger Co, Case 26-RD-590 (Feb 21, 1984), not reported in
Board volumes
4 241 NLRB 996 (1979)
299 NLRB No 141
W A KRUEGER CO 915
Co , 5 which held that a union ostensibly losing a
decertification election remains the established bar-
gaining representative of unit employees until the
certification of results issues and any unilateral
changes made before the certification issues violate
Section 8(a)(5)
The Respondent argues that the complaint
should be dismissed It asserts that Dow and Presby-
terian should be overruled and that the rule applied
in Mike O'Connor Chevrolet-Buick-GMC 6 should be
extended to decertification situations Mike O'Con-
nor held that absent compelling economic circum-
stances for doing so, an employer acts at its peril in
making changes in terms and conditions of employ-
ment during the period that objections to an initial
certification election are pending If the union is
later certified, the employer's umlateral changes are
found to have violated Section 8(a)(5) The Re-
spondent relies on the Fifth Circuit's denial of en-
forcement in Dow Chemical The court disapproved
Presbyterian Hospital and applied the Mike O'Con-
nor rule in the decertification context
B The Unilateral Changes Before Contract
Expiration
As noted, the Respondent has admitted that two
of its unilateral changes, i e, its refusal to contrib-
ute to the Union's supplemental retirement and dis-
ability fund and its coincident extension of cover-
age under the company pension plan to unit em-
ployees, were made while the parties' collective-
bargaining agreement was in effect In Sisters of
Mercy Health Corp , 7 -the Board stated, "It is well
established that a union enjoys an irrebuttable pre-
sumption of majority status during the term of a
collective-bargaining agreement" Therefore, we
find that these unilateral actions violated Section
8(a)(5) and (1) of the Act
C The Unilateral Changes After the Contract
Expired
It is well established that election results are not
final until the certification is issued 8 Such a rule
promotes stability and certainty during the transi-
tion period when, due to the existence of objec-
tions or determinative challenges, the employees'
choice of representative is in doubt 9 Mike O'Con-
6 250 NLRB 756 (1980), enf denied 660 F 2d 637 (5th Cir 1981)
8209 NLRB 701 (1974), enf denied on other grounds 512 F 2d 684
(8th Or 1975)
7 277 NLRB 1353 at 1353 (1985)
See Trim Products Corp. 238 NLRB 1306 (1978), Albert Van Luiz &
Co, 234 NLRB 1087 (1978), enfd 597 F 2d 681 (9th Cir 1979)
° At the outset, we must disagree with our dissenting colleague's view
that our professed goal of stability in mdustnal relations is "speculative"
We adhere to the settled view of the Board and courts that Industrial sta-
bility is an important and appropriate goal of Board decisions
nor created a narrow "act at your own peril" ex-
ception to this general rule in the initial certifica-
tion context Allowing an employer to proceed
with impunity until the issuance of a certification
could undermine the union's status as the employ-
ees' representative when the certification issues
The Board noted that to "hold otherwise would
allow an employer to box the union in on future
bargaining positions by implementing changes of
policy and practice during the period when objec-
tions or determinative challenges to the election
are pending "" We note that an employer in an
organizational campaign has no preexisting obliga-
tion to bargain with the Union The status quo for
such an employer is to act unilaterally Thus, to the
extent that an employer is free to act at its peril,
the Mike O'Connor rule allows an employer to
maintain the status quo until a certification issues 1'
For the reasons stated below, we decline to
extend the Mike O'Connor "at risk" rule to decerti-
fication situations Accordingly, we adhere to Pres-
byterian Hospital and find that in the decertification
context the change in the basic relationship be-
tween the parties and in the parties' obligations to
bargain should not be effective until the date the
certification issues This view is consistent with the
status quo approach of Mike O'Connor Thus, any
unilateral changes made before the issuance of the
certification of results violate Section 8(a)(5) and
(1) of the Act
In refusing to enforce Dow Chemical, the Fifth
Circuit stated, inter aim, that it saw no basis in law
or justice for distinguishing between initial repre-
sentation and decertification elections 12 We re-
spectfully disagree and find a substantial basis on
which to draw a distinction between the rules ap-
plied to initial representation elections and those
applied to decertification elections That basis is the
difference in the relationships among the employer,
the employees, and the union at the time the two
types of petitions are filed
Before an initial representation petition is filed,
the employer has no obligation to consult with a
union and is free to take unilateral action with
regard to its employees' terms and conditions of
employment By contrast, after the initial certifica-
tion year an incumbent union is presumed to have
'° Mike O'Connor, supra at 703
" Contrary to our dissenting colleague's view that an election tally is
diapositive of the employer's postelection obligation to bargain, an osten-
sible union victory in an initial certification election does not activate an
employer's duty to bargam with a union An 8(aX5) violation resulting
from an employer's postelection unilateral changes, once the union is cer-
tified, is actually an exception to the rule that election results are final on
certification, an exception used solely to safeguard a union's future bar-
gaining position
12 Dow Chemical Co v NLRB, 660 F 2d at 654
916 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
retained majority status and an employer may not
withdraw from the bargaining relationship unless
the union has actually lost its status as majority
representative or the employer has a reasonable
doubt of the union's continuing majority status 13
Thus, following a union's initial certification year,
there is a presumption, albeit rebuttable, that the
status quo should be maintained As the Board
stated in RCA Del Canbe, Inc 14
[H]aving once achieved the mantle of exclu-
sive bargaining representative, a union ought
not to be deterred from its representative func-
tions even though its majority status is under
challenge
This presumption is not rebutted by an election
that is contested by the filing of objections or by
determinative challenged ballots Accordingly, an
incumbent union is entitled to be treated as the em-
ployees' bargaining representative until a final de-
termination is made that the union is no longer the
employees' representative
Before a decertification petition is filed, an em-
ployer is required to notify the union of proposed
changes in represented employees' terms and con-
ditions of employment and must bargain on request
concerning the changes Because the decertification
petition is filed m the context of an existmg bar-
gammg relationship, the employer in that circum-
stance does not have the freedom to act unilateral-
ly regarding its employees' terms and conditions of
employment Under Board law, the mere filing of a
decertification petition does not relieve the employ-
er of its obligation to bargain with the union 15
Presbyterian Hospital merely holds that an election-
day tally that is subject to determinative challenges
or objections (or may become subject to timely
filed objections) also does not relieve the employer
of its preexisting obligations The crucial change, if
any, in the parties' relationship occurs when the
certification of results issues 16
In denying enforcement in Dow Chemical, the
court stated that the Presbyterian Hospital rule
le See Dresser Industries, 264 NLRB 1088 (1982)
i4262 NLRB 963 at 965 (1982)
le Dresser, supra In Dresser, the Board reaffirmed that the filing of a
decertification petition does not provide a reasonable ground for an em-
ployer to withdraw recognition from an Incumbent union The Board
held that "the mere filing of a decertification petition will no longer re-
quire or permit an employer to withdraw from bargaining or executing a
contract with an incumbent union" 264 NLRB at 1089
le Although the Presbyterian Hospital rule prohibits an employer from
relying on the putative outcome of a Board-conducted election in with-
drawing recognition from an incumbent union, it does not prohibit the
employer from relying on objective evidence that its employees do not
support the union As the Board stated in Atwood & Morrill Co, 289
NLRB 794 (1988), an outstanding question concerning representation
does not prevent an employer from withdrawing recognition based on a
good-faith doubt supported by objective considerations
"depnve[s] former union members of the right to
express their choice in the election from the date of
the election to the date on which the board com-
pleted its review of the election " 660 F 2d at
654 The court further stated that the Mike O'Con-
nor rule immediately honors that choice We do
not agree 17
First, neither the Mike O'Connor rule nor the
Presbyterian Hospital rule affects employee's rights
to express their desire regarding representation
Where a Board-conducted election is involved, the
employees' desire concernmg representation is ex-
pressed in an uncoerced majority of the ballots If
objections to an election are timely filed, whether
the tally of ballots reflects uncoerced employee sen-
timent requires an application of representation
case law If the Board sustains an objection to an
election, that election is set aside and becomes a
nullity As long as an election objection is unre-
solved or one could be timely filed, the tally of bal-
lots cannot be considered reliable evidence of em-
ployee sentiment 18 The Presbyterian Hospital rule
17 We note that, to the extent that the court's language can be read
otherwise, neither the Presbyterian Hospital rule nor the Mike O'Connor
rule has any effect on an employee's nght to be a member or refrain from
being a member of a union Machinists Local 1414 (Neufeld Porsche-Audi),
270 NLRB 1330 (1984), Pattern Makers League v NLRB, 473 U S 95
(1985)
18 In its Dow Chemical decision, the Fifth Circuit stated, "It is difficult
to perceive, however, of a more firm and logical bans for a reasonable
and good faith doubt of a union's majonty status than the fact of its
having lost a fair decertification election" 660 F 2d at 657 While we
agree with the court's assertion generally, we note that the key question
in objections cases is whether, in fact, the election was fair Tlus question
cannot always be answered solely by reviewing the tally of ballots Until
a certification has issued and the parties have had the opportunity to raise
and litigate their objections and determinative challenges, an election
tally that is subject to objections and challenges does not provide a firm
and logical basis to doubt a union's majonty status
Contrary to our dissenting colleague, we do not believe that Presbyte-
nan Hospital is inconsistent with other Board decisions clarifying the cir-
cumstances under which an employer can withdraw recognition See
Dresser Industries, supra (decertification petition supported by a majority
of unit employees will support a reasonable doubt of majority status), and
Atwood d Morrill, supra (employer's withdrawal of recognition based on
a petition signed by a majority of unit employees during the pendency of
a decertification case was lawful) We emphasize that under these latter
cases a petition tainted by unfair labor practices or signed by nonunn em-
ployees does not constitute objective evidence supporting a reasonable
doubt of a union's continuing majority status and will not support a with-
drawal of recognition By analogy, objections and/or determinative chal-
lenges should prevent the tentative election tally from being used as a
defense to an allegation that an employer's unilateral changes are unlaw-
ful
We also do not agree that the Presbyterian Hospital rule discourages
resort to the Board's processes by "realistic employees" Even assuming
that a Board-conducted election is always the preferred route for em-
ployees questioning the majority status of their representative, Board law
provides analytically and practically different routes for employees seek-
ing to end their union representation Each of these alternatives offers
unique advantages Specifically, employees who petition the Board for an
election may achieve a resolution of the union's status on a showing of
Interest of less than a majonty of employees in the unit A Board-con-
ducted election also clarifies beyond question the union's status and re-
sults in a yearlong period dunng which elections are barred On the
other hand, employees who choose to approach thew employer directly
Continued
W A KRUEGER CO 917
merely encourages stability in the parties' relation-
ship while the Board determines whether the appar-
ent employee choice was freely made and discour-
ages the employer from acting prematurely based
on that unreliable tally
Second, contrary to the court's implication, the
Mike O'Connor rule has neither the purpose nor the
uniform or necessary effect of giving early expres-
sion to employee choice in elections As noted
above, the Board's purpose in prohibiting unjusti-
fied unilateral changes in employees' terms and
conditions of employment in the period between an
initial representation election and the certification
of the union as the employees' bargaining repre-
sentative is to discourage employers from "bypass-
ing, undercutting, and undermining the union's
status" as the employees' representative" 209
NLRB at 703 The rule is directed at a narrow
range of employer conduct and has only mcidental
impact on the prompt effectuation of employees'
desires Where an employer refrains from unilateral
changes, the rule does not at all affect when the
employees' desires become reality Where an em-
ployer relies on an ostensible umon loss to make
unilateral changes before results are certified, the
"at risk" rule actually delays the effectuation of em-
ployee choice if the election is set aside and the
union wins a rerun election, for in that situation,
even though the union has been the majority repre-
sentative throughout, the unilateral changes are not
remedied until after the union is 'certified and the
unilateral changes are litigated
In finding that the Mike O'Connor rule meets the
needs of certainty and mdustnal relations stability
that support the Presbyterian Hospital rule, the Fifth
Circuit referred to the requirement that the em-
ployer must bargain retroactively with the union if
it is certified as the employees' representative 19
The court implied that bargaining over unilater-
ally imposed changes after the fact would ade-
quately remedy the effect of the employer's unilat-
eral dealings with employees We do not agree In
our view, bargaining after the fact over changes
made on the assumption that the union no longer
plays a role in setting terms and conditions of em-
ployment would not encourage stability nearly as
effectively as maintaining the bargaining relation-
ship until the union's status is resolved Rather, uni-
lateral changes under an "at risk" rule during this
period would have the same tendency to under-
mine an incumbent union's future effectiveness and
with evidence from a majority of unit employees that they no longer
wish to be represented may well enjoy practical advantages such as those
outlined by our dissenting colleague However, we see no legal or practi-
cal reason these two routes available to employees should be identical to
each other in all respects
le Dow Chemical Co v NLRB, 660 F 2d at 655
status in employees' eyes as bypassing the bargain-
ing representative under other circumstances In
finding direct dealing with employees unlawful, the
Board and the courts have often expressed aware-
ness of the real-world impact of bypassmg the
union on its effectiveness as a bargaining agent
"Such tactics are inherently divisive they sub-
vert the cooperation necessary to sustain a respon-
sible and meaningful union leadership " 20 In the
initial organizational context, by contrast, the em-
ployees have not yet developed expectations of the
union's ability to represent them Thus, the fact
that the union was unable to prevent the employer
from making unilateral changes is not likely to
have as lasting an effect on the employees' view of
the effectiveness of their as yet uncertified bargain-
ing representative
We recognize that our decision to adhere to
Presbyterian Hospital may be an imperfect solution
to a difficult problem Our dissenting colleague
relies on statistics showing that a small percentage
of cases m which a union loses a decertification
election and files objections results in ultimate
union victories He finds these few instances a poor
basis for a presumption of a union's continuing ma-
jority status during the objections period We dis-
agree We willingly grant that our decisions cannot
ignore what happens in the workplaces in which
our policies are played out, but we base our recog-
nition of workplace realities on a wider and firmer
ground than a survey of election outcomes for a
limited period Our ultimate objective in fashioning
any policy in representation cases is to ensure the
freedom of choice of employees To that end, we
recognize that when a union files meritorious ob-
jections—signifymg that employees have been
denied the opportunity for uncoerced choice—its
chances of prevailing in a rerun election are dimin-
ished, possibly beyond repair, if the employer insti-
tutes unilateral changes To permit the legality of
such self-serving changes to hinge on the outcome
of that second election would, in our view, have
real-world consequences—it would weaken the ob-
jections procedure in the decertification context
and thus impair employee access to uncoerced
elections Thus, we strongly believe that our pri-
mary mission is best effectuated by mamtammg the
presumption of majority status until election results
issue, and that this policy is preferable regardless of
the numbers of cases resulting in union victory or
defeat Further, we believe as a policy matter that
the stability resulting from our adherence to the
Presbyterian Hospital rule outweighs its disadvan-
20 NLRB v General Electric Co, 418 F 2d 736, 755 (2d Or 1969), cert
denied 397 U S 965 (1970)
918 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
tages Presbyterian Hospital does not impose any
new obligation or burden on the parties involved
The employees have only to continue the relation-
ship with the union that they earlier chose and the
employer need only continue to recognize the
union until the union's status is resolved 21 We be-
lieve this is not a heavy burden and is a small price
to pay for stability in labor relations
For the foregoing reasons, we find that the um-
lateral changes made by the Respondent before the
issuance of the certification of results violated Sec-
tion 8(a)(5) and (1) of the Act Accordingly, we
grant the General Counsel's Motion for Summary
Judgment
CONCLUSION OF LAW
By making unilateral changes in employees'
terms and conditions of employment on March 9,
1983, while the parties' contract was in effect, and
on May 18 and 31, 1983, before the certification of
results m Case 26-RD-590 was issued, without
prior notice to or negotiations with the Union, the
Respondent has engaged in unfair labor practices
affecting commerce within the meaning of Section
8(a)(5) and (1) and Section 2(6) and (7) of the Act
REMEDY
Having found that the Respondent has violated
Section 8(a)(5) and (1) of the Act, we shall order it
to cease and desist and to take certain affirmative
action designed to effectuate the policies of the
Act
We shall order the Respondent to make whole
the unit employees by making all GAIU Supple-
mental Retirement and Disability Fund contribu-
tions, as provided for in the collective-bargaining
agreement effective from April 26, 1981, to April
30, 1983, which have not been paid 22 and by reim-
bursing unit employees for any expenses ensuing
from the Respondent's failure to make such re-
quired payments as set forth in Kraft Plumbing &
Heating, 252 NLRB 891 fn 2 (1980), enfd mem
661 F 2d 940 (9th Cir 1981) Nothmg here, howev-
21 Contrary to our dissenting colleague, the Presbyterian Hospital rule
does not require an employer to bargain with a "minority" union under
any analysis Until the Board resolves the objections, the Incumbent is
not a "mmonty" union Further, the logical outcome of our colleague's
reasoning would result in the Issuance of 8(aX2) complaints against an
employer that continued to consult with a union while awaiting the
Board's official clanficabon of the union's status The Mae O'Connor rule
would countenance no such result Ironically, by refernng to the confu-
sion that can exist over a union's status and an employer's corresponding
obligations, our colleague has inadvertently highlighted a compelling
reason for establishing a date certain for a losing union's change in status
22 We leave to the compliance stage the question whether the Re-
spondent must pay any additional amounts into the benefit funds in order
to satisfy our "make whole" remedy Menyweather Optical Co , 240
NLRB 1213 (1979)
er, shall be interpreted as requiring the Respondent
to reduce any benefit or wage
ORDER
The National Labor Relations Board orders that
the Respondent, W A Krueger Co, Senatobia,
Mississippi, its officers, agents, successors, and as-
signs, shall
1 Cease and desist from
(a) Unilaterally changing the terms and condi-
tions of employment of unit employees by refusmg
to contribute to the GAIU Supplemental Retire-
ment and Disability Fund or extending coverage to
unit employees under the W A Krueger Co Pen-
sion Plan while a collective-bargaining agreement
with the Union representing the unit employees is
in effect
(b) Unilaterally granting unit employees a wage
increase, increasing the amounts payable to em-
ployees under the health plan and short-term dis-
ability plan, or extending coverage under its long-
term disability plan to employees who were not al-
ready covered, or implementing a new grievance
procedure prior to the final resolution of a question
concerning the continuing representation of Local
532, Graphic Arts International Union, AFL-CIO
The appropriate unit is
All production and maintenance employees
employed by Respondent at its Senatobia, Mis-
sissippi, facility, including permanent part-time
employees, and janitor-watchmen but exclud-
ing all other employees, including- all office
clerical (non-exempt salaried) employees,
guards and supervisors as defined in the Act
(c) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
ercise of the rights guaranteed in Section 7 of the
Act
2 Take the following affirmative action neces-
sary to effectuate the policies of the Act
(a) Make whole unit employees by paying all
contributions to the GAIU Supplemental Retire-
ment and Disability Fund as required by the April
26, 1981, to April 30, 1983 collective-bargaining
agreement, which have not been paid and by reim-
bursing them for any expenses ensuing from the
Respondent's unlawful refusal to make such contri-
butions, in the manner set forth in the remedy sec-
tion of this decision
(b) Preserve and, on request, make available to
the Board or its agents for examination and copy-
ing, all payroll records, social security payment
records, timecards, personnel records and reports,
and all other records necessary to analyze the
W A KRUEGER CO 919
amount of backpay due under the terms of this
Order
(c) Post at its Senatobia, Mississippi plant copies
of the attached notice marked "Appendix "23
Copies of the notice, on forms provided by the Re-
gional Director for Region 26, after being signed
by the Respondent's authorized representative,
shall be posted by the Respondent immediately
upon receipt and maintained for 60 consecutive
days in conspicuous places mcludmg all places
where notices to employees are customarily posted
Reasonable steps shall be taken by the Respondent
to ensure that the notices are not altered, defaced,
or covered by any other material
(d) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondent has taken to comply
MEMBER OviATr, concurring in part and dissent-
ing in part
I concur in my colleague's decision to find that
the Respondent violated Section 8(a)(5) and (1) of
the Act by refusing during the term of the collec-
tive-bargaining agreement to contribute to the
GAIU Supplemental Retirement and Disability
Fund while at the same time umlaterally extending
its coverage under the the W A Krueger Co Pen-
sion Plan 1 I disagree, however, that the Respond-
ent violated Section 8(a)(5) by making unilateral
changes in the terms and conditions of employment
after the contract expired and the Union had lost a
decertification election
The precise legal issue is whether an employer
may rely on the results of a decertification election
as an objective basis for withdrawing recognition
while nonmentonous objections to the election are
pending The broader, pragmatic issue is whether
employees must suffer continued representation by
a union they do not want as the price of stabilizing
collective-bargaining relationships The price is
real, the goal speculative I find the price too dear
The collective-bargaining agreement between the
parties expired on April 30, 1983 On March 9,
1983, the Union had lost a decertification election
On April 25, 1983, the Regional Director recom-
mended overruling the Umon's objections to the
election, and the Union filed exceptions After the
Regional Director recommended overruling the
objections, but while the Union's exceptions were
pendmg, the Respondent, on May 18, unilaterally
,
23 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading "Posted by Order of the Nation-
al Labor Relations Board" shall read "Posted Pursuant to a Judgment of
the United States Court of Appeals Enforcing an Order of the National
Labor Relations Board"
1 Under Sec 8(d)(2) of the Act, an employer cannot unilaterally
change the terms of its current collective-bargaining agreement
granted unit employees a wage increase and ex-
panded disability coverage, 2 and, on May 31, im-
plemented a new grievance procedure Nearly a
year after the decertification election, on February
21, 1984, the Board affirmed the Regional Director
and certified the results
No one disputes that, had there been no collec-
tive-bargaining relationship, the Respondent lawful-
ly could have made unilateral changes in the terms
and conditions of employment while the Union's
objections to an election were pending Once the
Union's objections were rejected, the election tally
would have been an accurate indicator of the em-
ployees' choice and the Respondent would have
had no duty to bargain This result would have
been permitted under the Board's longstanding rule
permitting an employer to act at its peril in that
circumstance, reaffirmed in Mike O'Connor Chevro-
let-Buick-GMC, 209 NLRB 701, 703 (1974) See
Staub Cleaners, 148 NLRB 278, 296 (1964), set
aside on other grounds 357 F 2d 1 (2d Cir 1966),
Louisville Chair Cc, 161 NLRB 358, 376 (1966),
enfd 385 F 2d 922 (6th Or 1967), cert denied 390
U S 1013 (1968) The touchstone in these cases for
determmmg the union's majority status and the em-
ployer's concomitant duty under Section 8(a)(5) is
the election tally If it is the result of the employ-
ees' free choice, the Board's vote count is disposi-
tive of the employer's postelection obligation to
bargain, even during the pendency of objections
Decertification elections are quite another matter
according to the majority Relying on the Board's
decision in Presbyterian Hospital, 241 NLRB 996,
997-998 (1979), the majority finds that valid decer-
tification election results showing that the employ-
ees had rejected the Union cannot justify a post-
election good faith doubt of the Union's majority
status In the name of "certainty and stability" (id
at 998), Presbyterian Hospital requires that an em-
ployer await completion of the Board's review of
the union's objections to a decertification election
that it has lost, however frivolous those objections
may be—no matter that the objections ultimately
may be found to be without merit and the results
certified If, prior to final resolution of the objec-
tions, the employer unilaterally changes the terms
and conditions of employment, without antiunion
animus and in aid of its own economic (and per-
haps the employees') interests, it violates Section
8(a)(5) of the Act under Presbyterian Hospital
2 In its response to the General Counsel's summary judgment motion,
the Respondent explains that its regional competitors had recently made
upward adjustments in their wage/benefit packages The Respondent
argues that It could not have nsked waiting until the Board ruled on the
Union's exceptions given the Respondent's commitment to retaining
qualified personnel
920 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
The two circuit courts that have had an opportu-
nity to review the Presbyterian Hospital rule have
refused to follow it Particularly critical was the
Fifth Circuit Court of Appeals, in Dow Chemical
Co v NLRB, 660 F 2d 637, 653-657 (5th Or
1981) Viewing the Act as requiring "an even-
handed application of the same rules of the game
to all elections and to both sides" (id at 654), the
Fifth Circuit found Presbyterian Hospital "clearly
out of line with the statutory design" (id at 655 fn
14) The court made the following points, among
others (1) the Presbyterian Hospital rule ignores the
employees' uncoerced vote to reject the union and
thus disregards the employees' Section 7 rights (id
at 656), (2) Presbyterian Hospital conflicts with the
longstandmg general rule that an employer having
a good-faith doubt of a union's majority status is
under no obligation to bargain (id at 657), (3) Pres-
byterian Hospital reaches an impractical result be-
cause the Board's Order that the employer cease
unilaterally changing the terms and conditions of
employment is at odds with the Board's decertifica-
tion of the union (id at 654), and (4) applying the
Mike O'Connor rule where the union loses a decer-
tification election does not reward the employer
for its unfair labor practices because the employer's
freedom to make unilateral changes while objec-
tions are pending is conditional, and is subject to a
bargaining order (id at 656) 3
I agree with the Fifth Circuit, and offer the fol-
lowing additionalreasons for not relying on Presby-
terian Hospital in this case
I Presbyterian Hospital is at odds with precedent
permitting an employer to withdraw recognition if
presented with a majority petition indicating that
the employees no longer want the union to repre-
sent them, and actually discourages resort to the
Board's election procedures
It is settled that, in the absence of circumstances
that would bar an election, an employer presented
with a valid petition from a majority of its employ-
ees, stating that the employees no longer desire to
be represented by the incumbent union, has a suffi-
cient objective basis to withdraw recognition of the
union Carolina American Textiles, 219 NLRB 457,
463 (1975), Wilshire Foam Products, 282 NLRB
1137, 1138, 1149 (1987), Bil-Mar Foods, 286 NLRB
786, 795-796 (1987), Hotel & Restaurant Employees
Local 19 v NLRB, 785 F 2d 796 (9th Cir 1986),
enforcing sub nom Burger Pits, Inc , 273 NLRB
1001 (1984) Relying on the employees' petition, an
3 The Seventh Circuit also appears to have followed a Mike O'Connor
approach to an employer's bargaining obligation after a decertification
election that the union lost See Weather Shield Mfg v NLRB, 890 F 2d
52, 60 fn 5 (7th Cif 1989), decision on remand 299 NLRB No 3, slip op
at 2 fn 5 (July 13, 1990)
employer may withdraw recognition even while a
decertification petition is pending before the Board
Atwood & Morrill Co, 289 NLRB 794 (1988)
Where the employer already has objective evi-
dence of the union's loss of majority support, it can
conduct and rely on its own noncoercive poll of
employee sentiment as the basis for withdrawing
recognition White Castle System, 224 NLRB 1089,
1090 (1976), Boaz Carpet Yarns, 280 NLRB 40, 44-
45 (1986), see also NLRB v A W Thompson, Inc ,
651 F 2d 1141, 1145 (5th Cir 1981), Forbidden City
Restaurant v NLRB, 736 F 2d 1295 (9th Cir
1984) 4 Thus, the employer need not wait for the
final results of a Board-conducted election to with-
draw recognition of an incumbent union The
good-faith employer may do so immediately on the
basis of objective considerations
Most importantly for our case, where an employ-
er withdraws recognition based on objective con-
siderations during the pendency of an unfair labor
practice complaint alleging that those "objective
considerations" are tainted by unlawful employer
conduct, the employer does not violate Section
8(a)(5) if the unfair labor practice complaint is ulti-
mately dismissed See, e g, Wilshire Foam Products,
supra, Carolina American Textiles, supra, American
Express Reservations, 209 NLRB 1105, 1120 (1974)
Mark you, an employer relying on objective con-
siderations as a basis for withdrawing recognition
does so at its peril if there are unresolved unfair
labor practice allegations If the Board finds that
the unfair labor practices tainted the "objective"
factors relied on by the employer, then the with-
drawal of recognition violates Section 8(a)(5) See,
e g, Guerdon Industries, 218 NLRB 658, 660-662
(1975) This, in essence, is the Mike O'Connor ap-
proach
Contrast the use of the Mike O'Connor approach
when an employer is presented with an uncoerced
petition from a majority of its employees with Pres-
byterian Hospital's rejection of that same approach
of reliance on a decertification tally that is equally
uncoerced 5 I find this distinction inexplicable, for,
4 The Board's requirement that the employer must first have objective
evidence of the union's loss of majority status before conducting its own
poll has been seriously questioned Johns-ManwIle Sales Corp v NLRB,
906 F 2d 1428, 1431 (10th Or 1990) I need not, and do not, comment on
that Issue here
5 The majority contends that Presbyterian Hospital is not at all mcon-
=tent with those Board decisions permitting an employer to withdraw
recognition and engage in unilateral conduct based on an uncoerced em-
ployee petition The majority reasons that, because, if the petition is taint-
ed by unfair labor practices It will not support withdrawal of recognition,
by "analogy, objections should prevent the tentative election tally
from being used as a defense to an allegation that an employer's unilateral
changes are unlawful" This "analogy" is beside the point The question
is not what the employer is precluded from doing dunng the pendency of
objections when the objections (like the unfair labor practices that tainted
Continued
W A KRUEGER CO 921
as the Fifth Circuit stated in Dow Chemical Co "It
is difficult to perceive a more firm and logical
basis for a reasonable and good faith doubt of a
union's majority status than the fact of its having
lost a fair decertification election" 660 F 2d at 657
I agree A Board election tally is at least as reli-
able as are employee petitions and letters In the
election situation, the union and employer know
that the union's representative status is in question
and are alert to interference with employee free
choice In contrast, where an employer is presented
with an employee petition and withdraws recogni-
tion, neither the union nor the employer has neces-
sarily had occasion to be watchful for obstacles to
free choice The election, typically, also is a more
reliable indicator of employee wishes because em-
ployees have time to consider their options, to as-
certain critical facts, and to hear and discuss their
own and sides will not necessarily be available to
an employee confronted with a request to sign a
petition rejecting the union No one disputes that a
Board-conducted election is much less subject to
tampering than are petitions and letters
The anomaly created by Presbyterian Hospital,
and its rigid requirement that good-faith business
judgment and necessity along with realization of
employee wishes must stand hostage to the final
disposition of mentless objections, is not just illogi-
cal—it is also inimical to the policy favoring secret-
ballot elections that is embedded in the Act
Secret-ballot elections "are generally the most sat-
isfactory—indeed the preferred—method of ascer-
taining whether a union has majonty support"
NLRB v Gissel Packing Go, 395 U S 575, 602
(1969) (footnote omitted) Employees who no
longer want the Incumbent union to represent them
have a choice they can file a decertification peti-
tion with the Board and get the "preferred" Board-
conducted election or they can present their em-
ployer with objective evidence of their dissatisfac-
tion 6 Realistic employees will be discouraged from
taking the Board election route if, even after a ma-
jority vote of "no union," the employer must con-
tinue to recognize the union and to bargain about
changes in their conditions of employment while
nonmentonous utuon objections are under what is
the petition) have merit The issue is what an employer may do when the
objections do not have merit The correct analogy, therefore, is to
changes made during the pendency of an unfair labor practice complaint
that ultimately is dismissed In that situation, under current Board law, as
discussed above, the employer does not violate Sec 8(aX5) In the case of
a decertification election under the Presbyterian Hospital rule, however,
the employer violates the Act if it makes unilateral changes while there
are pending objections, even if the objections are without merit In my
view, these contradictory results have no sound basis in law or policy
6 The employer cannot withdraw recognition of the Incumbent union
solely on the basis of the filing of a decertification petition with the
Board RCA Del Canbe Inc , 262 NLRB 963 (1982), Dresser Industries,
264 NLRB 1088 (1982)
sometimes lengthy review That stands in stark
contrast to the results from a valid petition present-
ed to their employer Their employer can with-
draw recognition Immediately and may well do so
Its alternative is to file its own petition with the
Board that will require an election whose final re-
sults may not be known for many months That is
the unfortunate result of Presbyterian Hospital
II Countervailing policy considerations derived
from Sections 7 and 8(a)(2) of the Act and the re-
alities of the workplace more than offset whatever
benefits arguably flow from Presbyterian Hospital's
presumption of continuing majority status
The majority relies on a presumption of the
union's continuing majority status as encouraging
stability in collective-bargaining relationships I
agree that the presumption should not be disregard-
ed, but,-m my view, both policy and practical con-
siderations strongly militate against continuing to
apply the presumption in these circumstances
First, there is the "overriding policy [embodied in
Section 7] that employees be free to choose
whether to engage in concerted activities," Pattern
Makers League v NLRB, 724 F 2d 57, 60 (7th Cir
1983), affd 473 U S 95 (1985), and the "majority
rule principle of the Act" Chemical Workers Local
1 v Pittsburgh Plate Glass Co, 404 U S 157, 176
(1971) The only situation that actually divides us is
that involving a losing union's mentless objections
Applying Presbyterian Hospital delays employee
choice, perhaps for a substantial period In this
case, for example, if the Respondent had followed
Presbyterian Hospital, effectuation of the employees'
choice would have been delayed for almost a
year—from the date of the election, March 9, 1983,
until February 21, 1984, when the Board certified
the results Like justice, choice delayed is choice
denied
Second, Presbyterian Hospital thwarts the policy
undergirdmg Section 8(a)(2) by requiring an em-
ployer to continue to recognize and to bargain
with a union its employees undeniably do not
want—a minority union See Ladies Garment Work-
ers v NLRB, 366 US 731, 738-739 (1961) A mi-
nority union violates the Act by bargaining with
the employer, even if that union believes in good
faith that it has majority status (ibid ) Yet, Presby-
terian Hospital confers majority status on a union
that has lost a valid decertification election, and re-
quires the employer to bargain with it simply be-
cause that union objects to having lost Thus, Pres-
byterian Hospital places in the hands of the losing
union, the entity that has the most to gain by
delay, "the power [by filing mentless objections] to
completely frustrate employee realization of the
premise of the Act—that its prohibitions will go far
922 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
to assure freedom of choice and majority rule in
employee selection of representatives" Ladies Gar-
ment Workers, supra at 738-739 (footnote omitted)
Third, whether Presbyterian Hospital encourages
stability in the parties' bargaining relationship, I
doubt that application of Presbyterian Hospital re-
sults in a stable labor relations environment in the
broad sense Employees who have voted out the
incumbent union only to find that their employer is
continuing to recognize and bargain with it, per-
haps for months, will likely become disaffected, not
only with the union, but also with the election
process Morale in the workplace, a significant
factor in stable labor relations, is likely to suffer
Unable to act on the fact that the union is no
longer wanted by the majonty, an employer may
simply postpone decisions that would otherwise de-
serve immediate action, possibly to the direct detn-
ment of its employees and almost certainly to that
of the business and, thus, indirectly to the employ-
ees These might include, for example, matching its
competitors' wage increases, as the Employer did
in this case
III Presbyterian Hospital does not comport with
what really happens after a union loses a decertifi-
cation election
Critical to the Presbyterian Hospital rule is the
presumption that the union's majonty status contin-
ues even after a majonty of the employees have
voted m a secret-ballot election to decertify it, so
long as there is the possibility that the election
could be set aside and the union ultimately could
be selected in a second election In my view, when
making policy choices the Board should give con-
siderable weight to what is likely to happen in the
real world, not to what is unlikely to take place
Were I convinced that, in the majority of cases
where objections were filed, the initial decertifica-
tion results did not accurately reflect an employee
decision to reject the union, I would be more dis-
posed to follow Presbyterian Hospital
Our statistics show, however, that Presbyterian
Hospital's presumption of the union's continuing
majority status after it loses a decertification elec-
tion is a legal fiction As described in the Board's
last three Annual Reports, the Board overruled ob-
jections to decertification elections between 77 per-
cent and 81 percent of the time 7 In the 19 percent
to 23 percent of the cases where the objections
were sustained and a second election held, the em-
ployees chose the union only between 21 percent
7 53 NLRB Annual Report 216 (1988), 52 NLRB Annual Report 218
(1987), Si NLRB Annual Report 240 (1986) A solid majonty of the ob-
jections—between 67 percent and 71 percent—were filed by unions
and 33 percent of the time 8 Thus, when the union
loses a decertification election and files objections,
the likelihood that the election results ultimately
will be overturned is poor indeed 9 The very few
cases where the union ultimately wins a second
election, perhaps 1 in 20, hardly can be a sound
basis for a presumption of the union's continuing
majonty status Particularly is this so where that
presumption runs afoul of two countervailing poli-
cies—the employees' nght to reject a union and to
have that choice promptly recognized,' ° and the
Act's directive that the employer not recognize
and bargain with a minority union For, when the
union loses a decertification election and files ob-
jections, an employer following the Presbyterian
Hospital rule most likely will be recognizing and
bargaining with a minority union
For the foregoing reasons, I would not follow
Presbyterian Hospital I would permit an employer
to rely on (and its employees to enjoy) the results
of a Board-conducted decertification election that
the union has lost and to which it has objected In
my opinion, the election tally is an objective basis
for withdrawmg recognition from the union In this
case, I would dismiss that part of the complaint al-
leging that the Respondent violated Section 8(a)(5)
by refusing to bargain with the Union after the
contract's expiration
53 NLRB Annual Report 217 (1988), 52 NLRB Annual Report 219
(1987), 51 NLRB Annual Report 241 (1986)
9 In those few cases where the union wins a rerun election, the Board's
usual remedial order is sufficient to ensure the viability of the bargaining
relationship
i ° The majority contends that a Mike O'Connor "at nslc" rule delays
the effectuation of the employees' free choice if the first decertification
election is set aside and the union wins the rerun election Presumably
this argument concedes the converse if the union loses the first election
and its objections are ultimately overruled, an "at risk" rule effectuates
the employees' free choice in the election by permitting the employer to
withdraw recognition immediately on the basis of the first decertification
tally, without awaiting resolution of the objections Because the situation
where the union's objections are overruled is common and the situation
where the objections are sustained is a relatively rare happening, apply-
ing a Mike O'Connor rule after a decertification election on balance effec-
tuates the employees' choice Conversely, applying a Presbyterian Hospital
rule, which requires the employer to wait until after the objections are
finally decided, on balance operates to delay the employees' free choice
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations board has found that
we violated the National Labor Relations Act and
has ordered us to post and abide by this notice
W A KRUEGER CO 923
WE WILL NOT unilaterally change the terms and
conditions of employment of unit employees by re-
fusing to contribute to the GAIU Supplemental
Retirement and Disability Fund or extending cov-
erage to unit employees under the W A Krueger
Co Pension Plan while a collective-bargaining
agreement with Local 532, Graphic Arts Interna-
tional Union, AFL-CIO representing the unit em-
ployees is in effect
WE WILL NOT unilaterally grant unit employees
a retroactive wage increase, increase the amounts
payable to employees under the health plan and
short-term disability plan, or extend coverage
under our long-term disability plan to employees
who were not already covered, or implement a
new grievance procedure pnor to the final resolu-
tion of a question concerning the continuing repre-
sentation of Local 532, Graphic Arts International
Union, AFL-CIO The appropriate unit is
All production and maintenance employees
employed by us at our Senatobia, Mississippi
facility, including permanent part-time employ-
ees, and janitor-watchmen but excluding all
other employees, including all office clerical
(non-exempt salaried) employees, guards and
supervisors as defined in the Act
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employees in
the exercise of their rights guaranteed by Section 7
of the Act
WE WILL make whole unit employees by paying
all GAIU Supplemental Retirement and Disability
fund contributions required dunng the term of the
April 26, 1981, to April 30, 1983 collective-bargain-
mg agreement with Local 532, Graphic Arts Inter-
national Union, AFL-CIO, which have not been
paid, and WE WILL make our employees whole for
any loss for benefits resulting from our failure to
honor the collective-bargammg agreement, plus in-
terest
W A KRUEGER CO