Walter Sherman

National Labor Relations Board - Board Decisions

May 9, 1969

175 N.L.R.B. 918 (N.L.R.B. 1969)

918 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Walter Sherman and Physicians Economic Council.
Case 2-CA-11569
May 9, 1969
DECISION AND ORDER
BY MEMBERS FANNING, BROWN, AND JENKINS
On January 16, 1969, Trial Examiner Thomas A.
Ricci issued his Decision in the above-entitled
proceeding, finding that Respondent had not
engaged in the unfair labor practices alleged in the
complaint, and recommending dismissal of the
complaint in its entirety, as set forth in the attached
Trial Examiner's Decision. Thereafter, the General
Counsel filed exceptions to the Trial Examiner's
Decision together with a Memorandum in Support
of Exceptions and the brief which was filed with the
Trial Examiner at the close of hearing. The
Respondent filed an answering memorandum in
support of the Trial Examiner.
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.
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 exceptions and briefs, and
the entire record in this case, and hereby adopts the
Trial Examiner's findings, conclusions, and
recommendations.
ORDER
Pursuant to the provisions of 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, and orders that the complaint herein be,
and it hereby is, dismissed in its entirety.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
THOMAS A. Ricci, Trial Examiner: A hearing in this
proceeding was held before the duly designated Trial
Examiner at New York City, New York, on October 28
and 29, and on November 12 through 19, 1968, on
complaint of the General Counsel against Walter
Sherman, an individual . The charge was filed by
Physicians Economic Council, herein also called the
Union , on May 15, 1968, and the complaint issued on
July 29 . The issues are whether Sherman discharged four
employees because of their union activities , and thereby
violated Section 8(a)(3) of the Act, and whether he refused
to bargain with the Union in violation of Section 8(a)(5).
A brief was filed after the close of the hearing by the
General Counsel.
Upon the entire record, and from my observation of the
witnesses , I make the following:
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
Walter Sherman, who is also licensed to practice
medicine , is a business man. For some years he has
owned, and still operates, a number of offices where his
employees assist the general public achieve personal
weight reduction desires by advising them what to eat and
what not to eat, and by dispensing , at a price , variegated
pills. The union activities came in the fall of 1967, with a
Board-conducted election and resultant certification of a
union in January of 1968. In March and April Sherman
discontinued the operations of several locations and
discharged some employees. For the 12-month period
preceding February 29, 1968, the gross volume of receipts
exceeded $500,000 ; more than $50,000 of this sum came
from two locations in the State of New Jersey. It was also
stipulated , in the course of the representation proceeding
leading to the election (Case 2-RC-14770), that during the
1-year period ending September 29, 1967, Sherman
bought supplies valued between $5,000 and $7,000 directly
from merchants located outside the State of New York.
Jurisdiction is contested . This case falls in the category
of business undertakings which the Board calls " Retail
Enterprises ," for Sherman 's commerce can be likened to
any chain of barber shops, or a string of hot dog stands
specializing in dietetic frankfurters .' The prices being
higher , the Respondent 's gross receipts satisfy the Board
standard of half a million dollars annually . Discharge of a
part of the help, of course, substantially reduced the
overall intake of money . Respondent 's counsel argues it is
not fair to judge Sherman on the basis of the business he
did before the conduct now said to have been unlawful.
He suggests the test of jurisdiction should be a look at the
gross back from July of 1968, when the complaint issued;
during the 12-month period immediately preceding July 29
the overall money receipts were a shade under $500,000.
This is not unlike the employer who discharged employees
because they joined the union and then pleaded there
should be no proceeding against him because the people
were no longer employees . The argument does not merit
an answer . I find that Sherman is engaged in commerce
within the meaning of the Act and that it will effectuate
the policies of the Act to assert jurisdiction herein.
11. THE LABOR ORGANIZATION INVOLVED
I find that Physicians Economic Council is a labor
organization within the meaning of Section 2(5) of the
Act.
III. THE UNFAIR LABOR PRACTICES ALLEGED
In the summer of 1967 Sherman owned nine locations
for his business : Brooklyn, New York , Rockville,
Maplewood , Forest Hills, Manhasset, Bronx, White
Plains , and Newark . In each there were receptionists, or
girls, who did essentially clerical or recordkeeping work.
There were then also nine men, all licensed to practice
medicine , who personally dealt with the people, called
patients , who came to the offices . In general these men
divided their time during the week between two locations,
' Carolina Supplies and Cement Co.. 122 NLRB 88.
175 NLRB No. 153
WALTER SHERMAN
a few days. her and a -few days there. The offices were
open for business for the- most part 4 or _4 1 /2 days each
week. Their concern with the patient was extremely
limited , confined , as Sherman said , to the question of
obesity . A first time caller , was interviewed by the office
girl, who weighed her and filled out a card . In an inside
office, the man then took the patient's history, tested her
pulse and measured her blood pressure . No other physical
or clinical examination was made, and this interview was
followed by a lecture, either by the receptionists or the
man in the office , sometimes delivered to 25 persons as a
group . If a patient spoke of any ailment whatever , she was
told to see -her personal or family physician. These were
Sherman's instructions to all of the men , and this is what
they did. The exact procedure was repeated each time the
patients returned at subsequent calls. The only difference
was that the price was cut in half for all visits after the
first . It was a regular practice for the examining men to
give the patients reducing pills, varying in kind, quality,
and color . In a single day, in a single office, receipts
reached as high as $1,317.2 One of the men, John
Eschwege, testified that if it was a "busy day," he used to
spend "a few minutes , as few as 3 minutes ," with each
patient, and that if he "had time to talk ," it "might have
been as many as ten minutes ." Leo Curtin, another of the
men, said "the average time was approximately 5
minutes. Roger Rock recalled it was "3 to 5 minutes."
In contrast, Herman Garnett , who was still in the
Respondent 's employ at the time of the hearing , testified
the time with each person "varied anywhere between 3
minutes sometimes to 15 or 30 minutes ," and explained
the longer visits were "not frequent . It was just common."
David Hyman , the fourth man discharged, who worked
for 5 years in these places, said he never spent half an
hour with a single patient.,Each of the nine men was paid
a straight $500 per week,
In July of 1967 some of them decided to form a union;
they started by consulting Mr. Glass, a lawyer, who then
quickly wrote . Sherman , advising and demanding
recognition of the Council . With the claim ,letter came a
list of proposed changes . in working conditions , including a
raise in salary to $ 1,000.per week . There was no answer
and the Council filed a representation petition with the
Board . After a hearing in the fall of the year , a Board
election showed seven men in favor and two against the
Council, which was certified on January 29, 1968.
On March 1 Sherman discontinued operations at White
Plains, on March 15 he closed Manhasset , and on April 1
he closed the Bronx, ^ Newark and the Forest Hills offices.
As those locations closed he discharged Leo Curtin, John
Eschwege , David Hyman and Roger Rock . The complaint
alleges that the discharges were motivated by antiunion
animus and. therefore constituted violations of Section 8(a)
(3) of the Act. This question - does the record prove an
unlawful reason in the }discharges - is the issue of
substance in the case . There is a second allegation -
collateral , subordinate , and not clearly distinguished
factually from the main one - chprging an illegal refusal
to bargain . One of the locations was situated in
'Several of the discharged men started the same business in their own
names , in the same building or next door to where Sherman 's offices and
signs were , after they had been dismissed . All this was in direct violation of
their contractual written restrictive covenants which excluded them for 2
years thereafter from a broad geographical area. Rock , one of Sherman's
competitors now, was asked how long the average "patient" came for
treatment . He answered : "That depends upon the individual patient ... .
And how much money they had ..... His,testimony reads like that of a
'49 claim jumper in the, California gold rush.
919
Manhasset, Long Island, in a building, tenanted by a
number of medical offices. Sherman owned the entire
building , either directly or through effective control of
corporate arrangements; he sold it by contract signed
February 5, 1968, explicitly agreeing also to remove his
own business enterprise from the premises. He told none
of his employees of his plan then, nor did he advise Glass,
the sole agent of the Union. As Sherman said at the
hearing. " . . . I didn't think it incumbent upon me to
inform anybody that I was selling a building....." The
General Counsel contends that discontinuance of that one
office was an unlawful act by the employer because taken
at a time when he was obligated to bargain with the
exclusive representative of his employees, but without
affording the Union an opportunity to bargain on the
question of whether or not it should be discontinued.
The Respondent denies the discharges were prompted
by the employees' union activities. As to the failure to
afford the Union an opportunity to discuss the closing of
the Manhasset office, his position is that the matter was
settled with finality before the certification, and, anyhow,
he individually owned only 40 percent of the building -
the remainder belonged to a certain foundation of which
he was president and a stockholder. He also advanced an
affirmative defense, he claims the offices were closed for
economic reasons - business was declining too greatly -
and his health demanded curtailment of "his professional
activities." Careful to reject the suggestion he was a
specialist, he made it a point to describe himself, in these
dispersed locations, as a general medical practitioner.
A. The Discharges
The employees first learned of Sherman's intent to
close some offices and discharge them in February. His
lawyer, Mandelker, wrote to Glass on February 6, saying
" ... due to extreme adverse business conditions , as well
as considerations of his personal health, he [Sherman]
finds it necessary to discontinue the operations of several
of his offices." The letter added that as the action meant
dismissal of "several" men, Mandelker wished to meet
with Glass as representative of the Union to discuss the
matter.
Glass reported back to his clients, and, after some
telephoning between the lawyers, a meeting was arranged.
Glass, with two of the men - Eschwege and Hyman -
met in Mandelker's office with Sherman and his executive
secretary, a Mrs. Macpherson, also present, on March 1.
They talked for an hour, but Sherman did not change his
mind. The record transcript is unduly belabored,
repetitious, and pointless on such details as what each
individual said at the meeting, the details of arguments
back and forth, the logic or fairness of positions taken one
way or the other, precisely on what day or at what
moment the Respondent told his men of his
determination, what communications there were or were
not between Lawyer Glass and his clients. To the question
as it now appears, all these infinitesimal details are of no
substantial relevance. There is no charge that Sherman
bypassed the Union when he did this, or gave insufficient
advance notice to employees, nor that he refused to
discuss his decision with them or their union agent , Glass.
The question is solely whether his entire decision to fire
these four men was motivated, in part if not entirely, by
an intent to combat the self-organizational conduct. The
General Counsel made clear there is no contention of any
refusal to bargain at all before the certification of January
29. More in point, he left no doubt there is no charge of
920 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
refusal to discuss, or bargain about the four dismissals.
Perhaps because Sherman's principal defense is that
declining business demanded the shutdown of offices and
the consequent discharge of employees, there is an element
of uncertainty in the General Counsel's theory of illegality
on this aspect of the case. If it is not true that Sherman's
health or economic adversity required the closings, then
the entire action may appear, in the light of other
indications, as outright retaliation against formation of
the Council. If instead the customers were in fact
shunning the offices in increasing numbers, and something
had to be done about this, it may be that Sherman seized
the opportunity to weed out those of the group of nine
men who offended him most by their pro-council
activities. If either of these possible theories is supported
by the record, the complaint will have been sustained.
More than once during the hearing the General Counsel
seemed to vacillate between the two possible views of the
case, and there is reason for what may appear as
uncertainty in his argument. When defending the sudden
discharges on March 1, Sherman claimed economic
justification; he had no records with him then, and the
employees, who saw the money firsthand where they
worked were skeptical. In the investigation stage of the
proceeding, after the charge had been filed, a Board agent
asked to see Sherman's books, to verify his continuing
economic defense; the Respondent refused to show his
books, or even to talk to the investigator. What with the
timing - announcement, without prior notice, of mass
discharges only days following certification of the Union
-, and the obvious fact that any impairment of
Sherman's capacity, if he personally did exercise it, to
cure sick people as a doctor had virtually nothing to do
with the running of these offices, his secretiveness added
persuasion to the charge of misconduct. Sherman persisted
in refusing to reveal his records, despite proper and valid
subpoena served well before the opening of the hearing; it
took the equivalent of 2 full hearing days - 3 half-day
sessions on October 28 and 29, and I on November 12 -
before he could be persuaded to produce his records. It
was only after the Trial Examiner's ruling that further
refusal to comply with the subpoena duces tecum would
result in total exclusion of any evidence on the subject,
that Sherman's accountant appeared with the books. It is
not surprising, therefore, that the General Counsel, when
asked did he contend there was no need to close offices
for economic reasons, replied: "I don't know. It's not a
question of not making the concession. I do not know for
various reasons, some of which I think have been
abundantly clear to the Trial Examiner. The General
Counsel just does not know."' "It is the selection of the
doctors for layoff that is the key to this case and it is
really the thrust of the General Counsel's theory."
I therefore have appraised the evidence in terms of
alternative theories: (1) there was no need to close any
offices, and the closings and discharges constituted a
single technique for killing off the Union, and (2) if there
was reasonable grounds for reducing the overall
operations, these four men were selected - some out of
seniority - because they were known adherents of the
Council. On either grounds, I must recommend dismissal
of the complaint with respect to the discharges because it
cannot be said that the preponderance of the substantial
evidence on the record in its totality supports the
allegation.
'In his brief the General Counsel conceded that since 1965 Sherman's
business had been declining
It is a matter of weighing the relevant facts one way
and the other, and bearing in mind that suspicion alone
cannot prove an unfair labor practice. The principle fact
urged by the Government is that no indication of an intent
to do anything came from Sherman before the election in
January and the certification of the Council. He and his
witnesses testified that throughout the year 1967 there had
been much adverse publicity, in many popular magazines,
casting serious reflection upon the kind of "treatment" for
obesity which is the totality of his business . Indeed, one
such article, placed in evidence, seems to describe exactly
the sort of thing all these nine men have been doing for
years. The timing was not effectively removed as a
significant element in the case by pointing to one such
article published on January 26, 1968; it was only one of a
long series . The other meaningful fact is Sherman learned,
as of September 1967, while the hearing in the
representation case was in progress, just who had gone to
Lawyer Glass and formed the Council. Only two of his
men - Schwartz and Ludwig - had refrained from
joining in the concerted activity. All four of the men
selected for discharge were among the agitators. For the
rest, what in the usual Board proceeding of this kind is
called evidence of an 8(a)(1) violation, or evidence of
general union animus , there is a paucity of proof. One day
in September 1967, after the employees' original demand
letter had been received, Sherman told Eschwege, later
discharged, he was " . . . very much irked by the fact that
the doctors organized and formed a union, and that if we
had come to him first, things would have worked out
much better. He said now everybody is going to be hurt,
that doctors would be hurt and that he also was being
hurt because he had to hire a lawyer." This is the only
evidence in the record, such as it is, of an intent by
Sherman to take punitive action.
Against the foregoing must be considered the
Respondent's records, reliable because the General
Counsel agreed to their admission into evidence, and
because two documents, as stipulated, are copies of a
portion of his Federal income tax returns for 1966 and
1967. Business was down, both in terms of gross volume
and in terms of gross profits, in 1966 compared to 1965,
and for the year 1967 compared to 1966. The annual gross
intake for successive years was: $753,764 for 1965;
$633,635 for 1966, and $568,447 for 1967. The first 2
months of 1968 compared with prior years as follows:
1968-$67,819; 1967-$81,411; 1966-$109,441; and
1965-$122,176.
There is much testimony, in conclusionary phrases, of
why it was reasonable to expect that business would
continue to drop in consequence of the continuing
campaign of adverse publicity this sort of commercial
enterprise was receiving , and there is evidence of a further
downward trend after April 1, 1968. For the 7-month
period April 1 through October 31, the comparative
figures of 1967 and 1968 show a marked decrease in
receipts for 3 of the 4 offices which remained open after
the discharges. Rounding the numbers to hundreds, it
appears that New York went from $81,000 to $70,600,
Rockville from $51,400 to $43,000, and Brooklyn from
$48,300 to $31,900. The fourth location, Maplewood, New
Jersey, advanced from $17,200 to $20,800. But this office
had been opened in April 1967 for the express purpose of
drawing customers from Newark, 7 miles away, where
civil disturbances had severely affected all activities.
When the Respondent spoke of this matter to Glass, at
the March 1 conference, the union man argued all
businesses have their ups and downs, and that conditions
WALTER SHERMAN
might improve. Sherman answered he was not disposed to
be a "philanthropist." His lawyer likened the operations
to a chain of grocery stores, where business acumen often
dictates closing the weak units, and the employees are
ignored, even if the entire group still shows a profit. The
test of legality here is not, and cannot be whether
Sherman was still earning enough, whether he wanted
more than was his right. In a free economy every
merchant follows the dictates of his own money standards;
another employer, or even some practicing physician
might be satisfied with $62,000 a year.4 Sherman was not.
All that is pertinent here is that his business was not as
lucrative as it had been in the past.
In October 1967 Sherman was taken with a severe
heart ailment; he went to the hospital on October 3 and
stayed 4 days. On the 12th a more severe attack sent him
there again, where he remained until November 2. There
followed a period of convalescence and rest. His doctor
ordered him to curtail his activities. Both when discussing
the proposed discharges with the men in March and again
at the hearing, he gave his physical condition as
cumulative reason for reducing his business operations.
The General Counsel belittles the assertion that personal
attention to the dispersed locations - in a professional
capacity - was one of the activities Sherman's doctor
ordered him to discontinue, and that therefore a reason
for closing -offices was because he could no longer
continue his care of the patients. The fact is Sherman
himself had nothing to do with the day-to-day activities
carried on in the distant offices; he virtually never went
there, and did not even count the money, which moved by
courier directly to the office of his accountant. It was a
gross exaggeration for him to say, either to the
representative of the men or at the hearing, that he had to
be consulted on diagnosis or prescription . Even assuming,
a very questionable hypothesis, that what his employees
did fell in the area of what is generally termed the
practice of medicine, the fact is he did not advise them in
any technical capacity. Whereas in the past he used to
hold two staff meetings annually with the men, there was
no such gathering at all in 1967. And the record as a
whole shows that what visiting he did from office to office
was to look after his business interests. On the rare
occasion when he spent any time in a local office, it was,
as he himself conceded, to pinch hit for a man on vacation
or ill. If anything, Sherman's insistence, in the face of
contrary facts, that his professional talents were a
necessary ingredient of the business he had built up, tends
to discredit his affirmative defense of discharge for cause,
rather than enhance it.
Nevertheless, it cannot. be gainsaid that concern with,
even a strictly commercial interest is an activity that may
be adversely affected by a serious health impediment. The
payroll was still an obligation that fell upon him, and it
was not a small one. If he felt he should minimize his
preoccupation with this responsibility, it is an aspect of
the total facts here that must be weighed in the balance.
Sherman had nine offices and closed five: Newark,
White Plains, Bronx, Manhasset, and Forest Hills. The
four men discharged - Eschwege, Curtin, Rock, and
Hyman - had long worked almost exclusively in these
locations. For 6 years Eschwege had worked in the Bronx
and in Forest Hills all but perhaps 20 days all told.
Hyman, an employee 5 years, had divided all his time
between the Bronx and Newark, except for what he called
'Sherman 's Federal income tax return for the year 1967 reports this
amount as the net profit from his obesity business.
921
"a few times only" throughout the period. Curtin, also 5
years with Sherman, worked Monday and Wednesday in
Manhasset, and Tuesday, Thursday, and Saturday
afternoon in White Plains. Saturdays were discontinued in
White Plains in July 1967, and from then on Curtin
moved to Forest Hills on Saturdays. The last man, Rock,
was working in the spring of 1968, 3 days in Newark
(Tuesday, Thursday, and Saturday) and 2 days in New
York (Monday and Wednesday). He had worked for
several years all week in Newark, and it appears he left
there 2 days weekly in early 1967 to do those days in New
York instead. As a witness, Rock was evasive, insolent
and completely unreliable. I credit the testimony of
Macpherson that Rock was transferred 2 days' weekly
from Newark to New York when, in April 1967, a new
office was opened in Maplewood, New Jersey, 7 or 8
miles from downtown Newark.
With the sole exception of the New York office, all
locations where these four men worked were discontinued.
They worked in no other office; occasional substitutions
elsewhere in the chain, seldom totalling more than a few
days annually, are of little significance. And the
operations of the New York office were contracted, with
elimination of 2 days' weekly - Monday and Wednesday
- at the same time that the five offices were closed
completely. These were the 2 days Rock worked in New
York. Moreover, none of the offices which continued to
function added either additional days to their weekly
schedule, or hours to their daily operations. Of the five
remaining men, one - Allen - resigned on April 1.
None other has been hired since.
It is at this point that the alternative theory of illegality
is to be considered, that Sherman picked these five of the
nine offices for the very reason that they were manned by
persons who had advanced the cause of the Council.
However persuasive this argument might be in isolation -
four people fired, all unioneers - there are countervailing
facts that cannot be ignored. Where seven out of nine
favor the union , a random hand selecting four will
probably come up with at least three of the seven. Right
here the finger of suspicion is reduced to the fact one
more union man was included. Not entirely irrelevant is
the further detail, fairly shown of record, that the
originator of the council concept was Garnett. On
cross-examination Curtin admitted that "the man who
was most active in organizing the Union" was Garnett.
On redirect, after a luncheon recess in the hearing, Curtin
attempted to soften the impact of his admission: "I meant
by that that it was my impression that he was the first to
make the suggestion that we get together for collective
bargaining."'
With this its numerical aspect, the theory of
discriminatory selection necessarily merges with the
concomitant argument that it was the offices which were
deliberately picked in order to reach the persons who
worked there. But Garnett worked primarily in Rockville,
an office which Sherman did not choose to close. Thus the
apparent originator of the Council was not discharged.
And while Schwartz , a nonunion man, did work at Forest
Hills, a closed office, he spent more time in Brooklyn,
which remained open. He was retained.
Nor do the money records support the contention of
hidden motive in the selection of offices to be closed. Of
'In his prehearing affidavit Curtin made the following statement:
"Garnett actually suggested that something be done about the situation
and from this conversation stemmed several meetings and telephone
conversations, result of which was the formation of the physicians council.
922 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the 8 offices which functioned all year in 1967, the three
which remained open in 1968 did the largest volume of
business in 1967. Brooklyn - $74,000; New York -
$126,000; and Rockville - $81,000 . Newark did $80,000,
but this one had suffered the greatest percentage decline
from 1966. In 1967 Bronx grossed $54,000, Manhasset
$31,000, Forest Hills $65,000, and White Plains $26,000.
It may well be that Sherman contracted his business
because he wanted to have nothing to do with any union.
The same unlawful intent might have been in his mind in
terms of a reluctance to cut larger pieces of the pie for the
men now that they were demanding $ 1,000 a week.
Probabilities aside, fair appraisal of the record in its
entirety does not support the complaint allegation of
unlawful discharge as to any of the four men.
B. The Manhasset Office
The record shows that four of the offices closed -
White Plains, Bronx, Forest Hills and Newark - were in
rented locations and that Sherman still maintains the
physical equipment in each of them, although no work is
done there. The fifth office - Manhasset - was located
in a building owned by a corporation called Domeplan
Properties; Sherman owns 40 percent of this corporation
and the Sherman Foundation owns 60 percent.
Technically, Sherman individually was one of the tenants
in this building . He signed a binding contract to sell the
premises on February 5, 1968 ; a clause in the agreement
obligated him to vacate his office no later than 3 months
after the date of closing . When, on his behalf, Mandelker
advised Glass , of the Council, on February 16, that
Sherman planned to close five offices and dismiss four
men, he included Manhasset and the man who worked
there. And when Mandelker discussed this broad program
of closings , first with Glass alone on February 16 and
again on March 1 with the principals and two of the
employees present , their discussion encompassed both the
five offices and the four men as a single problem . Despite
talk of seniority, probability of rotating men about, or
balancing possible losses of some offices with profits of
others, there was no consideration given to any particular
office apart from the other four, nor of one particular
dischargee as distinguished from the other three.
Whether, during these discussions between Sherman
and the Council there was any possibility he might change
his mind in consequence of what bargaining they were
doing, there is, of course , no way of knowing . He did not,
and it may well be that his mind was hermetically sealed
on the subject even before his lawyer first gave any inkling
to the men and their lawyer. It is very clear, however, that
so far as the Manhasset office was concerned , the decision
to shut that one down with finality was beyond anything
the men, or the Council, might say. And this is because
Sherman had by that time already accepted a $7,500
deposit for the entire building , with surrender of the
premises a legal obligation in return.
It is this definitive action by Sherman, binding himself
legally with third parties to discontinue all work at the
Manhasset office, taken unilaterally , without notice to the
Council or an opportunity for it at least to discuss the
matter with the employer , that is called a violation of
Section 8(a)(5) of the Act in the complaint . The General
Counsel made clear there is no charge nor claim of
unlawful refusal to bargain before issuance of the
certification to the Council . The certificate issued on
January 29 . Certainly from then forward Sherman was
obligated to advise the employees ' agent of an intent to
make any such change in his operations as would
materially affect their tenure . He signed the contract of
sale for the Manhasset building on February 5; but the
Council knew nothing about this until later. Ergo,
according to the complaint , it would be farcial to call any
subsequent discussion about the closing of that one office
proper collective bargaining.
Considering the record in its entirety I deem the
evidence insufficient to support the allegation it was an
unfair labor practice for Sherman to have sold the
Manhasset building when he did and without notice to the
Council . There is uncontradicted testimony that efforts to
sell the property started in 1966 . Resnick, a lawyer who
managed the building for Sherman , president of
Domeplan Properties, said that during 1967 he negotiated
with the purchaser who eventually bought it and that the
final deal was agreed upon early in January 1968. He
added the fully written sales contract was mailed to him
at the end of January by the buyer's lawyer and that he
received it on February 2. I have no reason for
discrediting his testimony , for a $191 ,000 transaction -
the price of this building - is not likely to be negotiated
and reduced to writing in a matter of a few days. The
election took place on January 19 and the certificate
issued on the 29th. Glass ' demand letter to Sherman is
dated January 23. The General Counsel conceded there
was no unlawful refusal to bargain before the certificate. I
find that the arrangement to sell the property was
effectively consummated before the statutory duty to
bargain with the Council arose.
In his brief the General Counsel argues that even if it
be assumed the decision to sell was "reached prior to the
advent of the Union ," the decision to close Sherman's
office located there must be considered a thing apart. The
suggestion here is that Sherman first sold the building
with no intention to discontinue his own business and later
decided to leave the premises altogether . The evidence
does not support this assertion . The sales contract is a
single document and in its body provides for Sherman's
departure. Moreover there is testimony that the purchaser
took measurements of the rooms occupied by Sherman
before the deal was made , good indication that it was
always intended Sherman would surrender the entire
premises.
Accordingly, I shall recommend dismissal of the
complaint in its entirety.
RECOMMENDED ORDER
It is hereby recommended that the complaint against
Walter Sherman be, and it hereby is, dismissed.