Western Union Telegraph Co.Download PDFNational Labor Relations Board - Board DecisionsJan 24, 194981 N.L.R.B. 241 (N.L.R.B. 1949) Copy Citation In the Matter Of WESTERN UNION TELEGRAPH COMPANY and AMERICAN COMMUNICATIONS ASSOCIATION, C. I. O. Case No. 2-T-6.-Decided January 24,1949 DECISION AND ORDER On April 19, 1948, Trial Examiner James R. Hemingway issued his Intermediate Report in the above-entitled proceeding, finding that the Respondent, by reducing the compensation of certain employees, had deprived them of rights, privileges, and immunities guaranteed by Section 222 (f), subdivisions (1) and (7), of the Communications Act of 1934, as amended in 1943, hereinafter called the Merger Act, and recommending that it take certain affirmative action, as set forth in the copy of the Intermediate Report attached hereto. Thereafter, the Respondent, the General Counsel, and the Union filed exceptions to the Intermediate Report and supporting briefs.' The Board has reviewed the rulings made by the Trial Examiner at the hearing and finds that no prejudical error was committed. The rulings are hereby affirmed. The Board has considered the Inter- mediate Report, the exceptions and briefs of the parties, and the entire record in the case, and hereby adopts the findings, conclusions, and recommendations of the Trial Examiner. We agree with the Trial Examiner that the filing requirements of Section 9 (f), (g), and (h) of the amended National Labor Relations Act do not apply to cases arising under the Merger Act. The Trial Examiner correctly denied the Respondent's motion to dismiss the complaint on the ground that the union which filed the charges was not in compliance with these requirements. Unlike the National Labor Relations Act, which is designed to encourage collective bargaining and which creates public rights rather than private rights,2 the provisions of the Merger Act here involved 1 The Trial Examiner found that the Respondent did not reduce the compensation of the employees in all respects alleged in the complaint. 2 National Licorice Co. v. N. L. It. B., 309 U. S. 350, 302. 81 N. L. R. B., No. 40. 241 242 DECISIONS OF NATIONAL LABOR RELATIONS BOARD create monetary private rights or causes of action for loss of compensa- tion, analogous to private claims and causes of action for overtime compensation created under the Fair Labor Standards Act. Instead of designating the Federal courts as the forum for the prosecution of these causes of action, however, Congress elected to designate this Board as the forum and to utilize the Board's regular procedures for unfair labor practice cases. Thus, Section 222 (f) (10) of the Merger Act provides : For purposes of enforcement or protection of rights, privileges, and immunities granted or guaranteed under this subsection, the employees of any such consolidated or merged carrier shall be entitled to the same remedies as are provided by the National Labor Relations Act in the case of employees covered by that Act; and the National Labor Relations Board and the courts of the United States (including the courts of the District of Columbia) shall have jurisdiction and power to enforce and protect such rights, privileges, and immunities in the same manner as in the case of enforcement of the provisions of the National Labor Rela- tions Act. [Emphasis supplied.] The "remedies" provided by the National Labor Relations Act and thus borrowed for enforcement of Merger Act claims are, of course, the filing of a charge (by an individual or a labor organization), the issuance of complaint, the holding of a hearing, and an affirmative Board order on a Respondent to pay any sums found to be due, the order being enforceable in the Federal courts as are other Board orders. Sections 9 (f), (g), and (h) impose restrictions, inter alia, on the proceeding of charges filed by a labor organization under Section 10 of the Act. Section 10 (a) empowers the Board to prevent persons from engaging "in any unfair labor practice (listed in Section 8) affecting commerce." (Emphasis supplied.) Section 10 (b) provides for the issuance of complaints and notice of hearing "whenever it is charged that any person has engaged in or is engaging in any such [listed in Section 8] unfair labor practice." (Emphasis sup- plied.) It is thus clear from a reading of Section 9 (f), (g), and (h) and Section 10 of the Act, that the restrictions of the former section on processing charges filed by labor organizations are made applicable only to charges of unfair labor practices "listed in Section 8." We are aware of no principle of statutory construction which would warrant our extension of the filing requirements of Section 9 to cases arising under the Merger Act. On the contrary, it is a well recognized prin- ciple of statutory construction that any exemptions or restrictions on WESTERN UNION TELEGRAPH COMPANY 243 rights conferred in remedial social legislation a must be narrowly and strictly construed.4 Had Congress intended that the rights which it created under the Merger Act in 1943 should be subject to the re- strictions on the enforcement of rights under the National Labor Relations Act laid down in Section 9 (f), (g), and (h) in 1947, Con-, gress would have specifically included Merger Act proceedings among those proceedings subject to restrictions which are carefully and specifically set forth in Section 9 (f), (g), and (h). We can readily see why Congress did not extend the filing requirements to such pro-, ceedings. The rights protected in Section 8 of the National Labor Re- lations Act and the certification proceedings in Section 9 (c) are all in aid of collective bargaining through labor organizations. Bargaining orders under Section 8 (5) as well as certifications are of direct and immediate aid to the benefited labor organization. And orders under other subsections are also of benefit, albeit less direct, to labor organi- zations. Thus an order under Section 8 (3) reinstating an employee who has been discriminated against for activity on behalf of a par- ticular labor organization, necessarily operates to the benefit of that labor organization in its organizational efforts; indeed, the order specifically names the labor organization. Congress plainly sought by Section 9 (f), (g), and (h) to deny to non-complying unions the right to initiate any proceeding with the Board which would redound to their benefit in their organizational or bargaining efforts. But, as has already been pointed out, the rights created under the Merger Act which are involved herein are private monetary rights to recover com- pensation, and have absolutely no relation to labor organizations or to collective bargaining. Our entry in a Merger Act case of what amounts to a money judgment in behalf of employees who have suf- fered a loss of compensation does not redound directly or indirectly to the benefit of a labor organization. No labor organization is named or conceivably could be named in our order. ORDER Upon the entire record in the case, and pursuant to Section 222 (f) of the Communications Act of 1934, as amended, and Section 10 (c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the Respondent, Western Union Telegraph Company, and its officers, agents, successors and assigns, shall : Clearly the Merger Act falls in this category with respect to the rights conferred which are the subject of this proceeding. * Fleming v . Hawkeye Pearl Button Company, 113 F ( 2d) 52, 56 ( C. A. 8) ; Bowie V. Gonzalez, 117 F. (2d) 11, 16 (C. A. 1). 829595-50-vol 81-17 244 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 1. Retroactively change its record as to each of the seven employees named in the complaint, to wit, Albert J. DeStefan, Charles P. Disil- vestro, Joseph A. McNeilly, John B. Pansera, Stanley G. Pfefferkorn, Irving Shure, and Louis Starace, for the pay week ending April 7, 1945, to show the hourly rate of pay which was in effect for each of them at Postal Telegraph Cable Company as of September 27, 1943, and correct its records accordingly from that week to and including September 26, 1947; 2. Pay to each of said seven employees according to such corrected records a sum of money equal to the difference between what he actu- ally received as compensation for his services during said period and what he would have received as his earnings during said period had his hourly rate of compensation not been reduced in violation of Section 222 (f), subdivisions (1) and (7), of the Act, and had he been paid for his time worked in excess of 7 hours per day and 39 hours per week; and 3. Notify the Regional Director for the Second Region in writing, within ten (10) days from the date of this Order, what steps it has taken to comply herewith. CHAIRMAN HERZOG took no part in the consideration of the above Decision and Order. MEMBER GRAY, concurring : I agree with the findings of my colleagues that the Respondent vio- lated Section 222 (f) (1) and (7) of the Merger Act and with the Order based on such findings. The issue concerning the applicability of the filing requirements of Section 9 (f), (g), and (h) of the Labor Management Relations Act, 1947, to cases arising under the Merger Act, presents to my mind a more troublesome problem. The position that there must be compliance with the filing requirements of Sec- tion 9 in this case, is not wholly without merit. However, in view of the special intendment and purpose sought to be achieved, and the rights created, by the Merger Act, as pointed out in detail by my col- leagues, I am persuaded that the present case may be processed irre- spective of the Section 9 compliance status of the charging union. INTERMEDIATE REPORT Mr. George Turitz, for the General Counsel. Mr. William E. Seward, of New York, N. Y., for the Respondent. Messrs. Newburger, Shapiro, Rabinowitz & Boudin, of New York, N. Y., by Mr. Victor Rabinowitz, for the Union. STATEMENT OF THE CASE Upon a fourth amended charge filed on November 18, 1947, by American Com- munications Association, C. I. 0., herein called the Union, the General Counsel of WESTERN UNION TELEGRAPH COMPANY 245 the National Labor Relations Board, herein respectively called the General Counsel and the Board, by the Regional Director for the Second Region (New York, New York), issued his complaint on November 18, 1947, against Western Union Telegraph Company, herein called the Respondent, alleging that the Respondent had deprived eight named employees' of the rights, privileges and immunities granted and guaranteed to said employees under Section 222 ( f), sub- divisions (1) and (7) of the Communications Act of 1934, 48 Stat. 1064, as amended in 1943, 57 Stat. 5, herein called the Act' In substance, the complaint alleged that each of the eight employees named therein was employed by Postal Telegraph Cable Company, herein called Postal, prior to March 1, 1941, and continuously to October 7, 1943, when Postal merged with the Respondent in conformity with the provisions of the Act, that said employees continued after the date of the merger to be employed by the Respond- ent, that the compensation of each was at the rate of less than $5,000 both before and after the date of the merger, and that subsequent to the date of the merger, on stated dates, the Respondent in violation of the Act reduced their compensation without their consent, although it continued to employ them. Copies of the said amended charge and complaint, accompanied by notice of hearing, were served upon the Respondent and the Union. The Respondent's answer, dated December 5, 1947, denied the alleged reduc- tion of compensation and denied any violation of the Act, but admitted the other allegations of the complaint. The answer affirmatively raised certain procedural questions which were again raised by motion at the opening of the hearing and which will be enumerated later herein. Pursuant to notice, a hearing was held at New York, New York, on various days between December 10 and December 22, 1947, before the undersigned Trial Examiner, designated by the Chief Trial Examiner. All parties were repre- sented by counsel. All participated in the hearing and were afforded full oppor- tunity to be heard, to examine and cross-examine witnesses, and to introduce evidence bearing upon the issues. At the opening of the hearing, counsel for the General Counsel, herein called G. C. counsel, moved to dismiss the complaint without prejudice as to John T. Prout, one of the employees named in the complaint. The motion was granted. Two motions filed by the Respondent prior to the hearing were referred to the Trial Examiner. One was a motion for a bill of particulars and the other was a motion to dismiss the complaint on the following grounds: (1) that the juris- diction of the Board under the Act no longer existed; (2) that the Board's funds should not be used to conduct the hearing; (3) that more than 6 months elapsed between the alleged violation of the Act and the filing of the charge; (4) that the Union had not complied with the filing provisions of Section 9 (f), (g), and (h) of the National Labor Relations Act, as amended.' Both motions were denied. At the opening of the hearing the Respondent moved to amend its answer so as to put in issue the allegation of the complaint that the compensation of the employees named herein was at the rate of less than $5,000 per annum. This motion was granted. At the close of the Government's case, the Respondent moved to dismiss the complaint, urging the same grounds, previously stated and, I Albert J. DeStefan , Charles P. DiSilvestro , Joseph A. McNeilly , John B. Pansera, Stanley G . Pfefferkorn , John T. Prout , Irving Shure , and Louis Starace. 2 The amendment , commonly known as the Telegraph Merger Act, added Section 222 to Title II of the original Act 3 These are substantially the same as the affirmative defenses pleaded In the Respondent's answer 246 DECISIONS OF NATIONAL LABOR RELATIONS BOARD in addition, the ground of failure of proof. As to the former, the Trial Examiner stated that he would reconsider his ruling if a brief on those grounds was sub- mitted. As to the latter, the Trial Examiner reserved ruling. At the close of the hearing, counsel for the Respondent and G. C. counsel waived oral argument.4 Upon request, the Trial Examiner fixed the time for filing of briefs. Briefs have been received from the Respondent, the Union, and G. C. counsel. The undersigned has considered carefully, in the light of the briefs, the four grounds heretofore listed for the Respondent's first motion to dismiss the complaint and finds no reason for changing the previous ruling.` The Respondent's motion to dismiss the complaint for failure of proof is, however, granted to the extent indicated herein. Upon the entire record in the case and upon his observation of the witnesses, the undersigned makes the following: FINDINGS OF FACT 1. THE CONSOLIDATED OR MERGED COMPANIES As alleged in the complaint and admitted in the answer, the Respondent is a New York corporation, having its principal office in New York City. It is engaged in the business of receiving and transmitting, by telegraph and cable, intrastate, interstate, and international communications throughout the United States and in foreign countries. It also operates a long distance telephone system throughout the United States. Postal, a New York corporation, until October 7, 1943, maintained its principal office and place of business in the city of New York in that State. Prior to October 7, 1943, Postal also was engaged in the business of receiving and trans- mitting, by telegraph and cable, intrastate, interstate, and international commu- nications throughout the United States and foreign countries. 4 Counsel for the Union was absent. 5 (1) The first ground of the Respondent's motion-that the jurisdiction of the Board no longer existed-is predicated on the assumption that, because the protection afforded to the employees was limited to 4 years from the date of the F. C. C. approval of the merger, September 27, 1943, the remedy under the Act also expired with the lapse of 4 years from such date. No limitation of remedy is expressly contained in the Act and it would be absurd to construe the Act as limiting the prosecution of claims to the period of protection, since claims could arise up to the last day of that period which could not possibly be litigated before the expiration of the 4 years. But if any limitation did exist, it would apply to the commencement of the action and not to the hearing, and, in this case, the charges initiating these proceedings were all filed originally in Apiil 1945, long prior to the end of the 4-year period following approval of the merger. (2) No legal reason has been shown why the Board's funds should not be used to conduct the hearing in this ease and none was given by the Respondent. (3) The third ground in support of the Respondent's motion-lapse of more than 6 months between the alleged violations and the filing of the charge-is apparently based on Section 10 (b) of the Labor ilanage- inent Relations Act, 1947. That section applies to unfair labor practices such as are described in Section 8 of that Act and has no effect upon the provisions of the Commu- nications Act of 1934, as amended. But if it did apply to the latter Act, it would not have a retroactive effect. Matter of Bernard Fisch et al, d/b/a Union Piodacta Company. 75 N L. R B 591 ; N. L R. B v Sandy Hill Ii on & Brass Works, 165 F (2d) 660 (C C. A. 2, 11/5/47), 21 LRRM 2021; N. L. R. B v Bio:en, 166 F (2d) 812 (C C A 2. 2/27/48), 21 LRRM 2430 (4) The provisions of Section 9 (f), (g). and (h) of the Labor Management Relations Act, 1947, have no relation to proceedings arising under the Communications Act as amended. The language of Section 10 (a) and ib) of the Labor Management Relations Act, 1947, clearly ief: is to en+inr la} or p' idle 1 stcd in Section 8 of said Act and hence limits the application of Section 9 (1), (g). and (It) with respect to charges to those of unfair labor practices fall ug iuil.v ti i i. Ii , of tae ,..i Management Relations Act, 1947. WESTERN UNION TELEGRAPH COMPANY 247 On September 27, 1943, the Federal Communications Commission, pursuant to a written agreement between Respondent and Postal and in accordance with the provisions of the Act, entered an order approving a consolidation or merger of the Respondent and Postal, and thereafter, on October 7, 1943, the Respondent acquired the properties, facilities, equipment and holdings of Postal. Since the latter date, the Respondent has operated said properties, facilities, equip- ment, and holdings, together with its own properties, facilities, and equipment, as a consolidated or merged carrier within the meaning of the Act. II. THE. EMPLOYEES INVOLVED AND THEIR POSITIONS Each of the seven employees named in the complaint (as amended by dismissal as to Prout) was at the time of the merger and for many years prior thereto and prior to March 1, 1941, continuously employed by Postal at a rate of less than $5,000 per annum. At the time of, and before, the merger, they occupied sales or supervisory positions in the Metropolitan Division, attached either to the division headquarters or one of the district headquarters: Pfefferkorn, as an assistant to the division general manager, (lid sales and service work on the larger accounts, investigated complaints and claims, and assigned sales calls to district superintendents and their assistants ; Pansera, with an Informal title of Division Representative of National Accounts, did division sales, pro- motional and educational work ; DeStefan was division sales manager ; DiSil- vestro was a district superintendent with supervision over district managers, clerks, operators, and messengers in his district ; Starace, MeNeilly, and Shure were assistants to district superintendents. HI. THE ALLEGED VIOLATIONS OF THE ACT A. Hours and compensation at Postal The dispute here involved springs out of a disagreement as to what the hours of work were and as to what method should be used to compute the pay of the employees involved, whether by hourly rate or by weekly rate. The disagree- ment is not so much as to the facts as it is the conclusion to be drawn from the facts. Such minor differences on facts as appear in the testimony may be ac- counted for by the biased point of view of some of the witnesses, by lack of first- hand knowledge of some of them as to certain matters, and by the diminished sharpness of memories from passage of time. The undersigned has taken all this into account in making his findings. Therefore, testimony inconsistent with these findings may be understood to have been rejected as unreliable. 1. Hours The seven employees here involved were carried on the books of Postal as 39-hour-a-week employees, exempt from the provisions of the Fair Labor Standards Act.6 Their "assigned" 39 hours included the hours of 9 a. in. to 5 p. in. with 1 hour out for lunch Mondays to Fridays and 9 a. in. to 1 p. in. on Saturday. The schedule of hours was followed with about the degree of elas- ticity which might normally be expected for employees in positions of responsi- bility and authority. Their time was not closely watched. Some of them, less methodical than others, were occasionally late in the mornings 7 and occasionally 6 They were not, in their latest positions at Postal, in the unit represented by the Union for the purposes of collective bargaining. 7 McNeilly had a heart ailment and was allowed regularly to arrive 15 or 20 minutes late and to leave about 15 or 20 minutes early to avoid crowds. 248 DECISIONS OF NATIONAL LABOR RELATIONS BOARD took more than an hour for lunch . But generally , if they were out for illness or wanted time off for personal business , their absence was reported to, and approved by, their superior. Some of them on infrequent occasions worked longer than the 7-hour regular day. Others never were obliged to work after 5 p. m. DiSilvestro appears to have had more occasions for extra-time work (i. e., more than 7 hours a day, Monday to Friday, and more than the scheduled Saturday hours) than the others. Pansera testified that he never worked overtime or on Saturdays at Postal. DeStefan testified that he never worked overtime at Postal except voluntarily , but that something might have kept him half or three quarters of an hour late once in a while . Starace testified that as assistant district super- intendent he did not work after 5 p. m. DiSilvestro testified that as district superintendent he was expected to work overtime for the major holidays. Mc- Neilly testified that he had not worked more than 39 hours a week as assistant district superintendent at Postal. Shure testified that as assistant district superintendent at Postal he had worked past 5 p. m. on rare occasions. Pfeffer- korn testified that there were a few occasions when he had worked more than the customary 7-hour day when he had worked on something special. Cecil Hitchen, general manager of the Metropolitan Division until 1942, testified that the employees named in the complaint did not work overtime "too often," that if there was an emergency or some work that had to be gotten out he would ask them to stay, and that "they would work at night sometimes, up to six, seven o'clock, eight o'clock at night , as well as Saturdays." Although they were all carried on a 39-hour week, their Saturday schedules varied. Saturday, as a rule, was a slow day and it was not a good day for calls on executives in sales and promotional work . Robert McLaughlin, the general manager of the division in which these seven men worked at Postal in 1943, had, in 1933, inaugurated a practice of giving certain Saturdays off.` Pfefferkorn and DeStefan were on a rotating schedule to work the 4 hours from 9 a. in. to 1 p. m. on one Saturday in four. Pansera was never required to work on Saturday. As district superintendent, DiSilvestro had permission from the general manager to take alternate Saturdays off from June to Labor Day. Shure, assistant to DiSilvestro, testified that he was "officially" allowed the same privilege of alternate Saturdays off as DiSilvestro but that "unofficially" he con- tinued through the year to take alternate Saturdays off. Starace, an assistant superintendent, was given alternate Saturdays off, but McNeilly, assistant super- intendent under a different superintendent, was on a rotating schedule under which he worked only one Saturday in four. The division general manager caused to be posted a schedule showing the employees in division headquarters who were to be on or off duty each Saturday. He apparently had authority to make any schedule of free Saturdays warranted by business conditions. 2. Compensation The employees here involved were paid by Postal the same amount regardless of whether or not they worked on Saturdays or worked more or less than 7 hours a day or 39 hours per week. When they worked extra time, they were 8 McLaughlin left it up to the district superintendents to work out a plan under which one of their assistants would always be on duty on Saturday . The number of Saturdays required to be worked varied at different periods of time. At the time of the hearing , F. L. S. A. exempt employees in the general manager's office were on a schedule of one out of six Saturdays. WESTERN UNION TELEGRAPH COMPANY 249 allowed "supper money" and sometimes an amount for "expenses," but they received no overtime pay as such. In about 1938 or 1939 Postal began paying all employees on a weekly basis. At about the same time or shortly thereafter, it gave all employees an hourly rate and noted on its pay-roll records both the hourly rate and the regular weekly pay of each employee. The hourly rate for those previously on a weekly rate was determined by dividing their weekly pay by the number of their assigned hours. For employees who were exempt from the Fair Labor Standards Act and who were not paid overtime based on their hourly rate, the hourly rate at Postal was used primarily for statistical and expense-control purposes e B. The effect of the merger on the employees involved In accordance with the provisions of the Act and approval granted by the Federal Communications Commission on September 27, 1943, the Respondent and Postal merged on October 7, 1943. The seven employees here involved at first were carried on the Respondent's pay roll as "unassigned." For a while-for 4 weeks to several months, varying with the individual employee-these men were used to do the manual and routine work incident to closing various Postal offices. At some time in 1944 or 1945 each was given the title of Commercial Representative and thereafter he performed services similar to the selling work previously performed at Postal but of a less important character and with no supervisory functions. No contention is made that these employees were assigned to work which was inconsistent with their past training and experience in the telegraph industry. 1. Their hours and compensation at Respondent With some temporary exceptions, the seven employees were, during the 4 years succeeding the date of approval of the merger, required to work every Saturday morning notwithstanding their custom at Postal to work only periodically on Saturdays. Pansera, upon claiming that he had worked no Saturdays at Postal, was, for a period of about 6 months beginning in November 1944, given Satur- days off, after which time he was again required to work Saturday mornings. McNeilly and Shure continued for a time after the merger to receive the usual Saturdays off, but then they too were required to work Saturday mornings. No additional pay was given them for the extra 4 hours worked in excess of 35 hours per week, which, with the exception of periodic Saturday mornings, had been their customary work week at Postal. Many times, especially in 1945 and 1946, some of them were required to work evenings or Saturday afternoons. DiSilvestro worked scheduled Saturday afternoons every fourth, fifth, or sixth Saturday after the merger. He also did considerable work on unscheduled Sat- urday afternoons during 1945 and 1946 and also night work. McNeilly and Shure likewise were put on a rotating Saturday afternoon schedule. Beginning with the week ending April 7, 1945, the Respondent changed the number of assigned hours of the seven employees from 39 to 48 hours per week. It also assigned a new hourly rate to each of these employees. The new hourly rate was determined by dividing the existing weekly pay of each by 48 instead of by 39. Except when they were called on for Saturday afternoon work or I It was , however, capable of being used to compute deductions for unexcused absences. Unexcused absences were rare, because it was the practice at Postal to approve absences for illness , and approval was given for requested time off for personal business. 250 DECISIONS OF NATIONAL LABOR RELATIONS BOARD overtime work, the seven employees thereafter continued to work 39 hours each week and to receive the same weekly pay as formerly.10 When these employees did not work in excess of 39 hours per week, the additional 9 hours' time per *week was treated as "excused time," just as at Postal the 4 hours on Saturday had been. No difference in pay was ordinarily noticed, then, when they did no work in excess of 7 hours in 1 day or 39 hours in 1 week. But when they did work longer hours per day or week, as some of them were often required 'to do, they would receive no additional pay for the first hour after 7 hours worked per day nor for any work falling within the 48 weekly hours. Thus no additional pay was given for Saturday afternoon work.11 Time in excess of 8 hours per day and in excess of 48 hours per week was paid for at time and a half the new hourly rate assigned them. This change in assigned hours and hourly rate was made without the consent of, and under protest by, the seven employees. C. Contentions It is contended by G. C. counsel that the seven employees here concerned suffered a reduction in compensation, first, by the Respondent's putting them on a regular 39-hour week, thus depriving them of the Saturday schedule of time off which they had enjoyed at Postal ; and, second, by reducing their hourly rate of pay when they were given 48 instead of 39 assigned hours. The Respondent contends that the seven employees were all exempt from the Fair Labor Standards Act, both at Postal and at the Respondent, that they could be required to work more than 39 hours without extra compensation both at Postal and at the Respondent, that the Saturday mornings off at Postal were a matter of grace and not a matter of right, and that a change in hourly rate was not a reduction in compensation in violation of the Act so long as the Respondent paid the employees weekly what they had been receiving at Postal D. Conclusions The language of Section 222 (f) (1) of the Act, insofar as it is applicable here, reads : Each employee of any carrier which is a party to a consolidation or merger pursuant to this section who was employed by such carrier im- mediately preceding the approval of such consolidation or merger, and whose period of employment began on or before March 1, 1941, shall be em- ployed by the carrier resulting from such consolidation or merger for a period of not less than four years from the date of the approval of such consolidation or merger, and during such period no such employee shall, without his consent, have his compensation reduced. .. :' The questions to be determined are (1) whether the imposition of longer work- ing hours by eliminating free Saturday mornings and (2) whether the increase in the number of "assigned hours" and the attendant lowering of the hourly rate of pay, while leaving the weekly rate of pay the same constituted reductions in compensation within the meaning of the Act. 1o Pansera at this time was working 35 hours per week. 11 There were exceptions to this, as where an employee was assigned to work in a depart- ment other than his own. Also, for a time, straight time at the new hourly rate was paid for the eighth hour of regular work in 1 day, but later no extra pay was given for it at all. u Paragraph (7) of Section 222 (f) likewise prohibits reduction in compensation during the said 4-year period. WESTERN UNION TELEGRAPH COMPANY 251 The Act does not deal with the hours of employees not covered by a collective bargaining agreement 18 It does not specifically prohibit either the reduction or increase in the number of hours in the workweek for employees not covered by an existing collective bargaining agreement. Yet implicit in the word "com- pensation" itself is the concept of equivalence. An employee is paid a sum of money that is agreed to be the equal of the work and time agreed to be given. Thus, if an employee and employer agree that the employee receive $1 for an hour's labor, and the employer thereafter says he will still pay the employee $1 but in return for 2 hours' labor, the employee's compensation obviously is re- duced, as he would then be getting 50 cents an hour. The problem here is complicated by the fact that the seven employees involved were not working at Postal under an agreement in which the hours of work were precisely defined. Certainly the absence of a specific agreement as to hours, in an employment contract which fixes the duration and compensation, does not mean that an employer has a right to increase an employee's regular working hours to 24 hours per day and 168 hours per week. In every case of employment, even in the absence of an express agreement as to hours, certain factors enter into the concept of the parties and tend to create a tacit understanding of what amount of work is equivalent to the agreed pay. In the instant case, the factors to be considered are: (1) Postal's bookkeeping practice of carrying 39 hours as the number of "assigned hours," 34 (2) the recognition by the employees as well as Postal that the work to be performed was, for most of them, of a nature that made the performance of the job paramount to fixed hours, (3) the fact that over a period of years at Postal there was, for most of them, seldom call for more than the 7 hours daily or 35 to 39 hours' work weekly to perform the job, (4) the practice, of long standing at Postal, to permit employees in the positions occupied by the seven employees here concerned to be absent on Saturday mornings except those designated by a rotating schedule. Even taking into account the occasions when extra hours were called for, the jobs of most of these employees normally called for only slightly more than an average of 36 hours per week. Yet the employees presumably understood that their time off on Saturday mornings was by permission of the manager, that he could vary the rotating Saturday schedule or even eliminate all excused Saturdays. In other words, 39 hours per week was company time. In summary, then, the agreement of the seven employees with Postal , as inferred from the available facts, was that the employees would normally work from 35 to 39 hours per week depending upon what, in the discretion of the manager, was necessary ; that they would work such other additional hours as they, themselves, deemed necessary for the proper performance of their jobs ; and that they would work additional hours a few times a year if it became necessary because of some emergency. The manager apparently seldom requested extra- time work ; but when and if he did, the employees never demanded overtime pay, whether they would or would not have been entitled to it on a quasi contractual theory. They were apparently satisfied that too much was not being demanded of them. More or less counterbalancing the excess over a day's normal time put 18 Section 222 (f) (9) of the Act preserves hours of employment provided for in an existing collective bargaining agreement. At the time of approval of merger, and for a year and a half thereafter, these men were not in the collective bargaining unit. 14 Starace testified that the job of assistant superintendent was posted ( I. e., announced for applications) giving the hours as 9 to 5 with 4 hours on Saturdays. On the Respondent's "service change authorization " records for each of these employees in both the space for "full time" and "total assigned" hours the figure "39 " was shown. 252 DECISIONS OF NATIONAL LABOR RELATIONS BOARD In by the employees was the grant of reasonable time off during working hours for personal reasons and the payment of supper and expense money 16 Now when the merger took place, the Respondent acquired exactly the same right to the time of these employees as Postal had had. To the extent that the work to be performed, in the discretion of management, required it, the Re- spondent had a right to a full 39 hours' normal time. It is impossible to de- termine whether or not the management of the Respondent arbitrarily or reasonably exercised its prerogative to determine the necessity for Saturday morning work during the 4-year period following approval of the merger. Cer- tainly the integration problems of the merger itself justified 39 hours' work per week. In the absence of more evidence, it must be presumed that, except in the instance where certain of the employees were in fact given Saturday morn- ings off, management deemed the work load sufficient to warrant its requiring the full number of assigned hours If the excused Saturdays at Postal resulted primarily because of the fact that there were fewer duties to be performed that day, as appears to be the case, the situation of these men is comparable to that of employees who have few duties to perform within their scheduled time and who, therefore, might contend that they could not be transferred to a job where there were more duties to be performed even if such duties could be performed within the same number of hours, because they would then be working harder for their money. As viewed by the undersigned, the employer pays his employee for his time and for what he should do within that time, be it somewhat more or somewhat less. If these men had been required to make only 20 calls per week on customers at Postal but had been obliged to make two or three times that number at the Respondent, there would be no violation of the Act so long as their duties all were performed within the same number of hours. Therefore, as long as there was work to be done, the Respondent was entitled to the full number of scheduled hours. However, even if it were decided that the employees had been paid on weekly sum for an average of 35 or 36 hours per week, and that the Respondent was not entitled to 39 hours' work for the same pay, it is doubtful that the employees sufficiently exhibited a dissent to the requirement of working Saturday mornings to prove a reduction in their compensation without their consent. As to some, there is no evidence that they even questioned the Respondent's right to make them work on Saturday mornings. They were told to work Saturday mornings and did as they were directed. Others, upon being told they were to work Saturday mornings, questioned the right of the Respondent to require them to work that day but lodged no formal protest." On all the evidence the undersigned finds that, by requiring these employees to work Saturday mornings, the Respondent did not reduce their compensation without their consent in violation of the Act. As to the reduction in hourly rate, the Respondent argues forcefully that the figure 39 for assigned hours was an arbitrary figure, that actually these em- 11 Pfefferkorn testified that the supper and expense money which he was given when he worked after hours evenings "worked out about" the same as his hourly rate. Actually, this would have been true only for the first hour. After that it would have worked out less. 26 DeStefan, iNho came nearest to protesting, told his superintendent he had worked only one Saturday in four at Postal. The superintendent said that they worked all Saturdays at the Respondent but suggested that DeStefan introduce himself to the general manager and discuss the matter with him. DeStefan went to see the general manager but was unable to see him alone and did not discuss the matter with him. He did, however, press the question with his superintendent, who promised to take it up with the general manager but never told DeStefan if he did. WESTERN UNION TELEGRAPH COMPANY 253 ployees were employed on a schedule that was limited only by the requirements of the job to be done, that this might be more or less than 39 hours, and that the Respondent's only obligation under the Act was to see that the fixed weekly sum paid to the men on the date of approval of merger was not reduced during the 4-year period following such approval. As already stated, the fact that hours are not precisely fixed by contract does not mean that the employer has an unlimited right to an employee's time. It has already been stated that, as nearly as may be determined in a case of this kind, the Respondent was entitled at the date of approval of merger to 39 hours of the time of these employees. If any of the employees exceeded that time in any given week at Postal, the grant of time off amply made up for the excess of time worked. But in April 1945 the Respondent wanted not only the full limit of 39 hours it was entitled to, it wanted now to put Saturday afternoons on the same basis as Saturday morn- ings had been on at Postal, that is, to require work for such time without extra compensation. Yet no longer was there to be any balancing of extra hours by liberal allowances of Saturday mornings and other time off. It has already been found that an increase in the number of hours of work with no proportionate increase in compensation would constitute a reduction of compensation. If the hours of work at the Respondent remained identically the same as before merger and if compensation therefor was made only on a weekly and never on an hourly rate of pay, any change in the hourly rate would be purely a bookkeeping transaction. That the change in hourly rate was not a mere bookkeeping transaction, at least after the first week of April 1945, is evidenced by the fact that the Respondent made use of the hourly rate in com- puting both overtime pay (for hours in excess of 8 a day or 48 a week) and the proportionate earnings of the employees who had unexcused time off during the week. For example, if an employee was absent on Saturday, he was docked 8 hours (not just 4 for the hours of 9 a. in. to 1 p. m.), and, when the employees worked only the first day of the week ending January 12, 1946, the hourly rate was used in computing their pay.17 Other deductions for unexcused absences, or excused-without-pay time, were made on an hourly basis. If the Respondent were at liberty to increase the number of assigned hours from 39 to 48, it would then be in a position, if it desired, to work the employees regularly, rather than just occasionally, for 48 hours a week. If the argument of the Respondent were to be accepted, the Respondent could as well have given the employees 56 "assigned" hours and worked the employees for 48 or 52 hours or 56 hours a week regularly. The Respondent does not have the right piecemeal thus to encroach on the employees' personal time without compensating them for it. The Respondent's premise-that these employees were under an employment contract that required them to work as many hours as their jobs required- does not warrant the conclusion that the Respondent was entitled to unlimited time per week from these employees. As management representatives of Postal, the men would undoubtedly have been judged by their accomplishments. For that reason they would have had to exercise their discretion as to how much extra time might be required for them to show the desired results. Such extra time as they determined to work would consequently have been voluntarily "For the week ending January 12, 1946, these employees worked Monday only because of a strike which began the next day. For that 1 clay the employees were paid only one-sixth of their weekly rate. On a 39-hour-a-week basis they would have received seven thirty- ninths De Stephan, for example, received $11.67 or $1.4583 (his new hourly rate) times 8 ( hours ) instead of $ 12.56 or $ 1,7949 ( his old hourly rate ) times 7 (hours). 254 DECISIONS OF NATIONAL LABOR RELATIONS BOARD given. Exceptional requirements of extra time not voluntarily given were small and may be deemed to have been offset by the occasional grant of time off, supper money, and expense money. But after the merger the Respondent did not give these men supervisory authority with discretion to determine how much time was required of them ; 1° they were given non-supervisory odd jobs and eventually selling jobs of less importance than their former ones and were told that, whether or not they approved, they would have to work up to 48 hours (instead of 39 hours) per week, as management determined, without extra compensation. Without a doubt, under an employment on a week-to-week basis, an employer may, in the absence of a law or a collective bargaining agreement to the contrary, at the end of any week increase the number of daily or weekly hours which his employee will thereafter have to work without increase of pay. This is, in effect, an offer of new terms of employment made at a time when the em- ployer has a right to terminate the employment. This privilege of changing hours or pay without the consent of the employee would not exist when the latter has an unexpired contract of employment, for a definite term, which fixes his hours and pay. The provisions of the Act, insuring to these employees 4 years of employment without reduction of compensation, to all intents fix the right of the employees as they would be fixed under such a contract. This is true regardless of the fact that these employees may not be covered by the provisions of the Fair Labor Standards Act. The Act here involved protects their right even though that Act may not. For the 4-year term, the employees are entitled to receive for their services no less than the equivalent value already fixed by their Postal rate of pay. This equivalence would be upset if either their net weekly compensation or their hourly rate of compensation were reduced. Since the seven employees here concerned were not, as nearly as can be determined, required to work more than an average of 39 hours a week at Postal, even counting their emergency service, the Respondent was entitled to no more for the same compensation. Any increase in the number of working hours without additional pay would pro- portionately reduce their rate of compensation. The Respondent argues in its brief : "If Congress intended that an hourly rate be established and preserved for each employee regardless of the position formes ly held by the employee and regardless of the position to which he was assigned, then it is submitted that Congress could very readily have so stated by saying that the hourly rate attributable to any employee should not be reduced. The fact that Congress did not do so evidences the fact that an hourly rate should not be applied in this case." An examination of the legislative history of this Act leads the undersigned to conclusion that Congress advisedly avoided such language because of the com- plexity and variety of the problems that could arise under the Act. S. 2445, the first bill dealing with conditions to be complied with by merging carriers, in- troduced April 9, 1942, provided that all employees who had been employed by the same carrier for a 5-year period preceding the approval of consolidation or merger should be employed by the consolidated carrier "at a rate of compensa- tion not less than that received at the time of the approval of the consolidation 18 DiSilvestro, for example, put in extra time at Postal because of his responsibilities as district superintendent, a position he no longer held with the Respondent. Most of the others had fewer emergency demands on their time at Postal. WESTERN UNION TELEGRAPH COMPANY 255 and merger.... ' In a hearing of a subcommittee of the Senate Committee on Interstate Commerce, Joseph J. Lenahan, representing Federal Union 22693, A. F. L., objected that this language, "rate of compensation," failed to guarantee the same income to the employees that they had been receiving because it was possible under this language for the consolidated carrier to argue that it could comply with the Act by employing an employee for but 1 hour a day at the same hourly rate, thus giving the employee no minimum guaranty of pay. (Hear- ings before Subcommittee of the Senate Committee on Interstate Commerce, on S. 2245, 77th Cong., 2d Sess, p. 158.) In S. 2598, introduced June 16, 1942, a bill recommended by the Senate Com- mittee in lieu of S. 2445, and passed by the Senate, 77th Congress, 2d Session, the language quoted above appears changed to "at a rate of compensation and at a net weekly compensation not less than that received by such employee... . One of the objections raised to this language at a House subcommittee hearing was that "net weekly compensation" might cover both regular and overtime earnings being paid prior to the merger and that there could be no assurance that the opportunity for earning overtime pay would continue throughout the period for which such pay was guaranteed by the proposed law. (Hearings before a Subcommittee of the House Committee on Interstate and Foreign Commerce, pp. 69-70, testimony of A. N. Williams, President of Western Union.) The House Committee on Interstate and Foreign Commerce, by amendment, recommended a substitute bill, in which the FCC was given the power to require certain terms and conditions as a prerequisite to its approval of a consolidation or merger. The FCC was thereby required to include, in its order of approval, terms and conditions providing that, during the 4 years from the date of such approval, such consolidation or merger would not result in the protected em- ployees' being in a worse position with respect to their compensation or character of employment. The compensation referred to, however, did not include over- time not guaranteed by a collective bargaining agreement. In its report to the House, the Committee stated that the latter provision was included because of the extraordinary amount of overtime employment under the then prevailing emergency conditions. (House Rept. 2664, p. 9.) The Seventy-seventh Congress expired before action was taken by the House and S. 2598 expired. At the next session, S . 158, substantially the same as S. 2598, was passed by the Senate. The House Committee again recommended its substitute provisions by way of amendment (House Rept. 69). The House adopted the amendment but the Senate rejected it. In conference, conferees of the two houses reached agreement in the form of the present Act. The con- ference report to the Senate and to the House ( House Rept. 142, 89 Cong. Rec. 1089) makes no explanation of why the language quoted from S. 2598 above was not used. However, no reason appears for assuming that a compromise in conference would result in legislation which would give the employees less pro- tection than either the House or Senate separately was favoring. The word "compensation" as used in the Act is broad enough to cover hourly rate of compensation as well as weekly compensation , and it is the opinion of the under- signed that Congress intentionally chose to eliminate words qualifying "com- pensation" so that it would be broad enough in meaning to cover all types of situations that might arise. On the facts of this case the undersigned concludes that the hourly rate of the employees was a functional part of the Respondent 's system for computing the 256 DhCISIONS OF NATIONAL LABOR RELATIONS BOARD compensation due to the employees here concerned." The increase in the number of assigned hours and the accompanying reduction in hourly rate noticeably affected the compensation of these employees even apart from the question of overtime pay. Such reduction resulted in less compensation, at times, than they would have received had the rate in effect on the date of approval of the merger not been changed. For some of the seven, their average hours were not actually increased beyond 39 hours. They were, therefore, injured only when they worked less than the full 39 hours in a given week and when, as a con- sequence, their proportionate time was computed at the lower hourly rate. Others were required to work considerably more than an average of 39 hours a week. The latter were injured not only as were the former but also by being required to work for more hours than at Postal for the same weekly pay. By virtue of a Board certification of the Union on March 13, 1945, following the Board's Decision and Direction of Election," the commercial representatives came into the collective bargaining unit for the first time. As a consequence, commercial representatives came to enjoy the benefits of the overtime pay provisions of the collective bargaining agreement. The Respondent in its brief argues that but for that agreement the men named in the complaint would not be entitled to "the additional payments" any more than they had been at Postal and that, therefore, "the Board is being asked to hold that there is more money due these men because it is claimed that they are not being paid at a sufficiently high rate for additional time worked when the contract calls for that additional payment." The Respondent points out that the Board has no jurisdiction to enforce the collective bargaining agreement. The undersigned agrees that it is not the function of the Board to enforce that agreement. But, although the agreement calls for a minimum guaranty of 48 hours' pay per week, nothing in the agreement requires or approves a reduction in the hourly rate of the employees. Since this agreement does not constitute consent on the part of the employees to a reduction in compensation, the agreement may be disregarded. The Act does not prohibit an increase in the number of hours in this case, but it does prohibit a reduction in compensation. As already pointed out, the lengthening of hours from 39 to 48 by the Respondent effected such a reduction. And even if the employees were not all required to work more than 39 hours per week, the change in hourly rate affected them adversely, as when they were absent for part of a week and were paid at the reduced hourly rate. Likewise, when an absence fell on Saturday and the employee was docked 8 hours' pay even though he was usually expected to work only 4 hours that day he lost more than the Postal rate of pay. All this deprives them of compensation they were entitled to without regard to the contract. The undersigned therefore finds that by thus reducing the compensation of the seven employees named in the complaint, the Respondent has violated the provisions of Section 222 (f) (1) and (7) of the Act. TV. THE REMEDY Since it has been found that by reducing the compensation of the seven employees in the complaint , the Respondent has violated the provisions of Section 222 (f ) ( 1) and (7) of the Act, it will be recommended that it take certain " it is immaterial that the hourly rate at Postal may have been nonfunctional , because at either the hourly or weekly rate at the Respondent an employee working longer hours in order to make the same weekly amount he had been paid at Postal suffers a reduction in compensation. Z0 Matter of Western Union Telegraph Co., 58 N. L. R. B. 1297. WESTERN UNION TELEGRAPH COMPANY 257 affirmative action which the undersigned deems necessary to remedy the wrong. It is clear that the violation began with the pay check for the week ending April 7, 1945, and the protest of the increased hours and reduced rate. It will therefore be recommended that the Respondent change its records as of, and from that week for the period extending to and including September 26, 1947, to show an hourly rate figure not less than that representing the hourly rate which each of the seven employees named in the complaint had at Postal. It will further be recommended that the Respondent make said employees whole for any loss they may have suffered as a result of the aforesaid reduction in hourly rate and increase in number of assigned hours by paying each of them a sum of money equal to the difference between what he was actually paid for his services at such reduced rate between April 7, 1945, and September 26, 1947, both inclusive, and the sum he would have received if his hourly rate had not been reduced and if he had been paid on an hourly basis for the time he was required to work. In this proceeding the employees are not entitled to enforce a claim for 48 hours' pay each week whether or not they were required to work. To decide that they are entitled to a guarantee of 48 hours' pay for 39 hours' work would be to enforce the collective bargaining agreement. The undersigned does not so decide. By readjusting the hourly rate of the employees, the Respondent, pur- suant to this decision, will be paying the employees at their Postal rate only for time worked .21 Since the men were exempt from the Fair Labor Standards Act and since there is no intent here to enforce the collective bargaining agreement, the time hereby required to be paid for would be compensable at straight hourly time rather than time and a half in excess of 40 hours per week. Upon the basis of the foregoing findings of fact and upon the entire record in the case, the undersigned makes the following : CONCLUSIONS OF LAW 1. The Respondent, Western Union Telegraph Company, is a ]verged car- rier within the meaning of Section 222 (a) (4) of the Act as the result of its having acquired on October 7, 1943, the properties, facilities, equipment and holdings of Postal Telegraph Cable Company in a merger or consolidation ap- proved on September 27, 1943, by the Federal Communications Commission. 2. The seven employees named in the complaint are employees of the Re- spondent whose rights, privileges and immunities are guaranteed by Section 222 (f) (1) and (7) of the Act. 3. By increasing the number of assigned hours of work and concurrently re- ducing the rate of hourly compensation of the said seven employees on and after April 7, 1945, the Respondent has violated rights, privileges, and immunities guaranteed them by Section 222 (f) (1) and (7) of the Act. 4. The Respondent has not violated the Act by requiring the said seven em- ployees to work Saturdays between 9 a. m. and 1 p. in. during the 4-year period following September 27, 1943. RECOMMENDATIONS Upon the basis of the foregoing findings of fact and conclusions of law and upon the entire record in the case, the undersigned recommends that the Re- 21 Even the 'highest paid of the seven employees would not earn as much as $5,000 if he worked 48 hours every week in the year. Section 222 ( f) (11) of the Act , therefore, is inapplicable. 258 DECISIONS OF NATIONAL LABOR RELATIONS BOARD spondent, Western Union Telegraph Company, its successors and assigns, shall: 1. Retroactively change its records as to each of the seven employees named in the complaint, to wit, Albert J. DeStefan, Charles P. DiSilvestro, Joseph A. McNeilly, John B. Pansera , Stanley G. Pfefferkorn, Irving Shure, and Louis Starace, for the pay week ending April 7, 1945, to show the hourly rate of pay which was in effect for each of them at Postal as of September 27, 1943, the date of the approval of the aforesaid merger or consolidation, and correct its records accordingly from that week to and including September 26, 1947. 2. Pay to each of said seven employees according to such corrected records a sum of money equal to the difference between what he actually received as com- pensation for his services during said period and what he would have received as his earnings during said period had his hourly rate of compensation not been reduced in violation of Section 222 (1) and (7) of the Act, and had he been paid for his time worked in excess of 7 hours per day and 39 hours per week. 3. Notify the Regional Director for the Second Region (New York, New York), in writing within ten (10) days from the date of receipt of this Intermediate Report of what steps it has taken to comply herewith. It is further recommended that, unless on or before ten (10) days from the date of the receipt of this Intermediate Report the Respondent notifies the said Regional Director in writing that it will comply with the foregoing recommenda- tions, the National Labor Relations Board issue an order requiring the Re- spondent to take the action aforesaid. As provided in Section 203.46 of the Rules and Regulations of the National Labor Relations Board, Series 5, effective August 22, 1947, any party may within twenty (20) days from the date of service of the order transferring the case to the Board, pursuant to Section 203.45 of said Rules and Regulations, file with the Board, Rochambeau Building, Washington 25, D. C., an original and six copies of a statement in writing setting forth such exceptions to the Intermediate Report or to any other part of the record or proceeding (including rulings upon all motions or objections) as he relies upon, together with the original and six copies of a brief in support thereof ; and any party may, within the same period, file an original and six copies of a brief in support of the Intermediate Report. Immediately upon the filing of such statement of exceptions and/or briefs, the party filing the same shall serve a copy thereof upon each of the other parties. Proof of service on the other parties of all papers filed with the Board shall be promptly made as required by Section 203 85 As further provided in said Section 203.46, should any party desire permission to argue orally before the Board, re- quest therefor must be made in writing to the Board within ten (10) days from the date of service of the order transferring the case to the Board. In the event no Statement of Exceptions is filed as provided by the aforesaid Rules and Regulations, the findings, conclusions, recommendations and recom- mended order herein contained shall, as provided in Section 203.48 of said Rules and Regulations, be adopted by the Board and become its findings, conclusions and order, and all objections and exceptions thereto shall be deemed waived for all purposes. JAMES R. HEMINGWAY, Trial Examiner. Dated April 19, 1048. Copy with citationCopy as parenthetical citation