Wright Aeronautical Corp.

National Labor Relations Board - Board Decisions

Oct 9, 1942

44 N.L.R.B. 959 (N.L.R.B. 1942)

In the Matter Of WRIGHT AERONAUTICAL CORPORATION and INTERNA-
TIONAL UNION, UNITED AUTOMOBILE, AIRCRAFT AND AGRICULTURAL,
IMPLEMENT WORKERS OF AMERICA, C. I. O.
Case No. C-2.346.-Decided October 9, 1942
Jurisdiction : aircraft manufacturing industry.
Unfair Labor Practices.
'Company-Dominated Union: employee representation plan developed out of com'
pany-sponsored group insurance organization prior to effective date of Act;
continued thereafter with employer's financial assistance and other support
Remedial Orders : employer ordered to disestablish dominated organization; con-
tract with dominated organization abrogated.
Mr. Martin I. Rose, for the Board.
Messrs. Spance, Windels, Walser, Hotchkiss di Angell, by Andre
Maximov and Soia Mentschilco ff, of New York City, for the respondent.
Mr. Maurice Sugar, of Detroit, Mich., and Messrs. Leider, Witt 'di
•Camrner, by D. W. Leider, of New York City, for the Union.
Messrs. Arthur M. Wechsler and Aaron E. Schneyer, of New York
City, for the Association. -
Mr. Eugene R. Thorrens, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon an amended charge duly filed on August 27, 1942, by Inter-
national Union, United Automobile, Aircraft and Agricultural Imple-
ment Workers of America, C. I. 0., herein called the Union, the Na-
tional Labor Relations Board, herein called the Board, by the Regional
Director for the Second Region (New York City), issued its complaint
dated August, 28, 1942, against Wright Aeronautical Corporation,
Paterson, New Jersey, herein called the respondent, alleging that the
respondent had engaged in and was engaging in unfair labor practices
affecting commerce, within the meaning of Section 8 (1) and (2) and
Section 2 (6) and (7) of the National Labor Relations Act, 49 Stat.
449, herein'-called the Act. Copies of the complaint, accompanied by
notice of hearing thereon, were duly served upon the respondent, the
Union, and Wright Aeronautical Employees' Association, herein
44 N. L. R B., No. 185. ; .
959,
'960 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
called the Association, a labor organization alleged in the complaint
to be dominated by the respondent.
With respect to the unfair labor practices, the complaint alleged
in substance (1) that on or about 'August 23, 1934, and thereafter,
-the respondent dominated and interfered with the formation and
administration of the Association and contributed support thereto;
(2) that from on or about July 5, 1935, to the date of the complaint,
for the purpose of discouraging membership in outside labor organi-
zations and encouraging membership in the Association, the respondent
(a) vilified, disparaged, and expressed disapproval of outside labor
organizations; (b) interrogated its employees concerning their union
affiliation; (c) urged, persuaded, threatened, and warned its employees
to refrain from assisting, becoming members of, or remaining members
of any outside labor organization; and (d) urged, persuaded, threat-
ened, and warned its, employees to assist and to become' members of,
or remain members of, the Association; and (3) that by the foregoing
acts the respondent interfered with, restrained, and coerced its
employees in the exercise of the rights guaranteed in Section 7 of the
Act.
In its answer, filed September 16, 1942, the respondent admitted,
among other things, the allegations of the complaint with respect to
the nature of its business and denied the 'commission of the unfair
labor practices.
Pursuant to notice, a hearing was held at New York City, on Septem-
ber 22, 1942, before Thomas S. Wilson, the Trial Examiner duly desig-
nated by the Chief Trial Examiner. At the.opening of the'hearing
the Association moved to intervene in the proceeding. The Trial
Examiner granted, without objection, the Association's petition for
intervention and permitted the Association to file an answer. In its
answer, filed at the hearing, the Association, in substance, denied the
allegations of the complaint with respect to the unfair labor practices.
The Board, the respondent, the Union, and the Association were repre-
sented by counsel and participated in the hearing. All parties were
afforded full opportunity to be heard, to examine and cross-examine
witnesses, and to introduce evidence bearing on the issues.
At the conclusion of the hearing counsel for the Board moved to
conform the pleadings to the proof with respect to names, dates, and
other similar matters. There was no objection and the Trial Exam-
iner granted the motion. During the course of the hearing the Trial
Examiner ruled on other motions and on objections to the admission
of evidence. The Board has reviewed the rulings of the Trial Exam-
iner made at the hearing and finds that no prejudicial errors were
-committed. The rulings are hereby affirmed. At the close of the hear-
ing the respondent, the Union, and the Association agreed to waive the
issuance of an Intermediate Report by the Trial Examiner, the making
WRIGHT AERONAUTICAL CORPORATION 961,
of proposed findings of fact, proposed conclusions of law, and proposed
order by the Board, and the privilege of filing briefs and presenting
oral argument, and stipulated that the case may be transferred to the
Board for disposition upon the record as made at the hearing.
On September, 25, 1942, the Board, acting pursuant to Article II,
Section '36 (a), of National Labor Relations Board Rules and Regu-
lations-Series 2, as amended, transferred the case to itself and, ordered
that no Intermediate Report be issued by the Trial Examiner.
Upon the entire record in the case, the Board makes the following:
FINDINGS OF FACT
I. THE BUSINESS OF THE RESPONDENT
The respondent, a subsidiary of Curtiss-Wright Corporation, is a
New York corporation with its principal place of business'in New
York City. The respondent operates a plant at Lockland, Ohio, and
five plants in the area of Paterson, New Jersey, where it is engaged
in the manufacture of airplane and tank engines. Only the New
-Jersey plants are involved in this proceeding. The respondent pur-
chases, monthly, raw materials valued in excess of $5,000,000, and sells,
during a like period, engines valued in excess of $10,000,000. Substan-
tially all raw materials used in the New Jersey plants are purchased
by the respondent outside the State of New Jersey and shipped to the
New Jersey plants from outside the State of New Jersey. The re-
spondent ships substantially all its engines manufactured in its New
Jersey plants from such plants to points outside the State of New
Jersey. The respondent admits that it is engaged in commerce, within
the meaning of the Act, with respect to its operations at its New Jersey
plants.
H. TIIE LABOR ORGANIZATIONS INVOLVED
International Union, United Automobile, Aircraft and Agricultural
Implement Workers of America, affiliated with the Congress of In-'
dustrial Organizations, is a labor organization admitting to member-
ship employees of the respondent.
Wright Aeronautical Employees' Association is an unaffiliated labor
organization admitting to membership employees of the respondent.
III. 'THE UNFAIR LABOR PRACTICES 1
A. Domination and support of the Association
The Association grew out of a group insurance plan sponsored by
the respondent for its employees under circumstances hereinafter set
1 The evidence in the case is entirely documentary : the record includes a stipulation of
facts entered into het `%een counsel for the Board and the respondent with respect to the'
487498-42-vol. 44-61
962 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
forth. Under date of July 11, 1934, the respondent circulated to its
employees a printed notice directing them. to select representatives to
attend a meeting with W. Van C.,Auser, the respondent's personnel
director, for the purpose of discussing a group insurance plan .2 At
the meeting, attended by employee and management representatives
on, company property during working hours on July 13, 1934, there
was formed the Wright Aeronautical Employees Mutual Benefit Asso-
ciation, herein called the Benefit Association, ostensibly for° the, pui ,
pose of providing group insurance.
At a subsequent meeting of the Benefit Association, held on com-
pany property during working hours on August 23, 1934, an employee
representative, John Giebitz, objected to discussion concerning plans
for a picnic, on the ground that the purpose of the organization was
limited to insurance .3 As a result, a motion was made 4 and carried
to the effect that "thisrepresentative body shall be a permanent institu-
tion" to operate under "Section 7A of the . . . Industrial Recovery
Act"; it was decided tentatively to change the name of the Benefit
Association to "The Wright Aeronautical Employees' Welfare Asso-
ciation," herein called the Welfare Association,5 and officers were
nominated and elected.
Giebitz declined nomination to office and stated, as disclosed by the
Association's minutes, that "it was necessary for him to leave the group
entirely after the meeting," inasmuch as there had been a "change in
his employment status which did not make him eligible to member-
ship." 6 However, Giebitz instructed a committee selected for the pur-
pose of drafting governing rules for the proposed organization "to
get in touch with him inasmuch as-he had much information in regard
to formulating constitutions of this type." The minutes of the August
23, meeting were mimeographed on company equipment and dis-
I
formation and administration of the Association. In the stipulation the respondent
agreed, among other things, that it would not contest findings of fact and conclusions of
law made by the Board in accordance with the stipulation of facts in the event that the
Board petitioned a court for the enforcement of an order predicated thereon. As indi-
cated, no witnesses testified at the hearing, and neither the respondent nor the Associa-
tion, although represented by counsel at the hearing, offered any evidence. In addition,
counsel for the Board offered no evidence with respect to the allegations, aside from
those relating to the Association, that the respondent engaged in unfair labor practices
within the meaning of Section 8 (1) of the Act. We therefore do not find that the respond-
ent engaged in unfair labor practices within the meaning of Section 8 (1), except as the
unfair labor practices hereinafter found relate to the Association
,a The notice instructed the representatives so selected "not' [to] ring your cards out,"
and advised them that they would be paid "for the time spent in this meeting and in all
succeeding meetings
' The record does not disclose whether management representatives, as such, attended
this or subsequent meetings of the Benefit Association or of its successor, the Association.
6 By whom does not appear
o As hereinafter appeals, the welfare Association subsequently changed its name and
became the Association ; they are one and the same organization. Hereinafter they are
both referred to as the Association.
Subsequently, nevertheless, on February 26, 1935, Giebitz was reelected an Associa-,
tion representative, and on March 12 or 14, 1935, was named a member of the Association's
Investigating Committee and a member of its Safety & Sanitation Committee.
WRIGHT AERONAUTICAL CORPORATION 963
tributed to employees on company property and time with the knowl-
edge of the respondent.
On or about August 29, 1934, the Association circulated, during
working hours and on company property with the knowledge of the
respondent, 'a printed statement which, notified the employees that
the representatives whom they had selected to serve in connection with
th Benefit Association had tentatively decided to establish the Associa-
tion to function under Section 7A of the National Industrial Recovery
Act, among other things, for the purposes of collective bargaining.
The printed statement. also contained a questionnaire which requested
the employees to cast ballots in their departments with respect to
whether they were in favor of the "new Association," and, if so,
whether they desired their "present insurance representatives" to rep-
resent them in the Association or whether they wanted an opportunity
to vote for new representatives. The questionnaire, which had a place
for the employee's signature, was mimeographed on company equip-
ment and distributed on company time and property with the knowl-
edge of the respondent.7 Of 1,010 questionnaires returned, 982 were
in favor of the formation -of the Association and 28 opposed. Since
145 employees voted in opposition to continuing the Benefit Associa-
tion representatives in office, the promoters of the Association decided
to hold an election for representatives after a set of governing rules
had been adopted. As hereinafter appears, such an election was con-
ducted on February 26, 1935.
In November 1934, the Association distributed to the employees,
on company time and property with the knowledge of the respondent,
a draft of "Bylaws" and application cards for membership in the
Association." The "Bylaws" were prepared on company time and
property, and both the "Bylaws" and the cards were mimeographed on
company equipment.
The "Bylaws" established, in effect, an employee representation plan
to be known as the "Wright Aeronautical Employees' Association."
In substance, the plan contemplated the subdivision of the plant into
geographical voting, districts, with the basis of representation'depend-
ent upon a ratio to be determined by a "Representatives' Council."
It further provided that employees in each electoral division should
nominate and elect employee representatives, and that employees so
elected would serve as representatives for 1 year, or, until their suc-
cessors were elected, except that an employee representative should
automatically vacate office upon termination of his employment or
The ea, hest pay roll appearing in the record is that of December 31 , 1934. As of that
date , the respondent had 1 ,915 employees.
8 Under date of October 22, 1934, the Association had transmitted ' the "Bylaws" to
officials of the respondent for "approval ' ; and under date of November 9, 1934, G. W.
Vaughan, the respondent 's general manager , had advised the Association that the respond-
ent was forbidden by law to express approval or disapproval of the "Bylaws."
964 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
upon' transfer "from one operating group to another." unless an "In-
vestigation Committee" approves "his continuing as a Representative."
After each election the representatives selected were to meet as a
`-Representatives' Council" for the purpose of electing officers and
committees, and were to hold regular monthly meetings to consider
and make recommendations to management with respect to shop and
social matters. Concerning the method of dealing with management,
the "Bylaws" established a procedure for adjustment 'of grievances,
including arbitration, and provided that all "motions and resolutions
adopted by the Representatives' Council shall be deemed to be recom-
mendations of the Council to the Company's General Manager."
Finally, the "Bylaws" could be amended by action of the Representa-
tives' Council and only by a two-thirds' vote of all its members.
The employee representatives elected pursuant to the respondent's
notice of July 11, 1934, above referred to, together with representa-
tives subsequently elected to represent salaried employees, functioned
as Association representatives until on or about February 26, 1935.
On or about February 26, 1935, there was conducted, on company
time and property with the knowledge of the respondent, an election
at which members of the Association elected representatives. On or
about March 12, 1935, the representatives selected at the election
elected officers and committees of the Association at a- meeting held
on company time and property.
By letter dated March 20, 1935, the Association advised the re-
spondent, among other things, that more than 1,400 employees had
signed applications for membership in the Association and requested
the respondent to appoint a management committee "to discuss the
recognition of the Association and the attached By-laws at your
convenience." s
By letter dated April 6, 1935, Vaughan, then president of the re-
spondent, acknowledged receipt of the Association's letter and of a
set of its governing rules, and advised it that he had designated a
committee of three, including the respondent's personnel director,
Auser; "to meet with your special committee to discuss your Associa-
tion." Thereafter, deliberations ensued between committees repre-
e The record discloses the following with respect to the respondent 's pay roll at its New
Jersey plants :
As of-
Number of
employees
Dec. 31 , 1934---------- - = - - - ----------------- 1, 915
Dec. 31 , 1935-------------------------------------------- 1,944
Dec. 31, 1936-------------------------------------------- 2,909
Dec. 31, 1937-------------------------------------------- 3,403
Dec. 31, 1938-------------------------------------------- 4,343
Dec. 31, 1939------------------------- - --------- ------- 6,650
Dec. 31, 1940-------------------------------------------- 15,120
Dec 31, 1941-------------------------------------------- 21,351
June 1942----------------------------------------------- 25,523
WRIGHT AERONAUTICAL, CORPORATION 965k
senting the Association and management. By letter dated April 12,
1935, the Association transmitted to the management committee a
"Statement of the Successive Steps In The Formation of The Wright
Aeronautical Employees' Association" and other exhibits, including
the "Bylaws," for use in the "deliberations of the Committees."
Thereafter, under date of April 29, 1935, W. B. Gordon, the respond-
ent's vice president and general manager, advised the Association that
the respondent "recognizes your Association" 10 and that the manage-
ment committee referred to above had been made a "permanent com-
mittee to represent the management in all discussions and negotia-.
tions" with the Association."
In March 1937, they Association circulated, on company time and
property, authorization cards for. the purpose of designating the As-
sociation as 'collective bargaining representative. Thereafter the re-
spondent' and the Association entered into a written contract, dated
April 21, 1937,12 in which, among other things, the respondent recog-
nized the Association "as the exclusive collective bargaining agency
for those employees of the Company who are members" of the As-
sociation,13 and a procedure for adjustment of grievances, including
arbitration, was established. The contract made no provision for a
wage scale or conditions of work. Thereafter, from time to time, the
written contract was supplemented by informal agreements. The
respondent and the Association entered into a new 1-year written
contract, dated December 9, 1940, in which the respondent recognized
the Association as the exclusive representative of all non-supervisory
employees. The contract contained pi ovisions with respect to sen-
iority, lay-offs,'promotions, hours, wage increases, use of company bul-
letin boards, vacations, strikes, and a grievance procedure. However,
the contract, as did the Association's "Bylaws," provided for an em-
ployee representation plan involving the selection of employee repre-
sentatives in electoral divisions of the plant established by the As-
sociation, and restricted participation in the plan as representatives to"
employees. The respondent and the Association entered into a third
contract, dated July 20, 1942, which, in general, is patterned on the
second contract.14
Since the formation of the Association, and until about April 1937,
the respondent furnished the Association, free of charge, an office on
11 The extent of such recognition was not mentioned.
11 In the letter Gordon also stated that the "Bylaws" did not require "recognition" by
the respondent , since they pertained solely to the "internal workings of your Association."
12 The contract was of indefinite duration and provided that either party could terminate
it upon 60 days' notice given on or after April 21, 1938
18 The stipulation of facts, referred to above, recites, however, that the respondent rec-,
ognized the Association "as exclusive bargaining agent of the employees ... on the basis
of [the 1937] cards " The record does not disclose the number of 1937, authorization cards
signed by the employees , or the number of Association members as of April 21, 1937.
14 The 1942 contract is to run for 1 year, and from year to year thereafter, with a
30-day cancelation clause.
966 DECISIONS "OF. NATIONAL LABOR RELATIONS BOARD
'Company premises, clerical assistance, stationery, furniture, equip-
ment, and the use of mimeographing facilities. During the same
period,'the respondent permitted the Association to distribute Associ-
ation notices to employees on company time and property, and-paid
Association representatives "for part of the time spent by" Associa-
tion representatives on Association business, "including council and
committee meetings .. . held on company property." During the
same period, and until the end of 1939, the respondent permitted the
Association to conduct its elections on company time and property.
The Association did not collect any dues until about June 1937.15
In each of 3 years, 1935, 1936, and 1937, the respondent closed its plant
to enable employees to attend Association social events and, to defray
the cost of chartering a boat, contributed the sum of at least $1,000
for each social event, the net proceeds of which accrued to the Associa-
tion.16 Since August '20, 1935, and until June 1939, the, respondent
permitted the Association to install in the plant and operate candy
-vending machines, the profits from which netted the Association more
than $1,000 annually.
B. Conclusions
On the basis of the evidence hereinabove reviewed, it is plain that,
by management participation and company support, the respondent
dominated and interfered with the formation and administration of
the Association prior to the effective date of the Act. 17 Thereafter the
respondent,did not disassociate itself from the Association. On the
contrary, the respondent has .since July 5, 1935, continued to recog-
nize the Association for the purposes of collective bargaining, has
entered'into contractual relations with the Association, and in addi-
tion has rendered potent assistance to it by financial and other support.
Although the respondent, discontinued substantial forms' of support
in 1937 and 1939, the employees were not thereby freed from the effect
of the respondent's previous domination and support. A labor organ-
' ization formed and operating under the circumstances disclosed here
could not function independently of the respondent and is incapable
of acting as a bona fide bargaining agency for the employees. ,
We find,,that the respondent dominated and interfered with the
administration of the Association and contributed financial and other
support thereto, and thereby interfered with, restrained, and coerced
its employees in the exercise of the rights guaranteed in Section 7 of
11 Its "Amended Bylaws," as adopted in January 1941, prescribe annual dues of $4.
10 The 1035 picnic was held on or about August 24.
34 We have considered the events occurring prior to July 5, 1935, the effective date of
,the Act, in order to evaluate the respondent's conduct since that date and not as the basis
for any findings of unfair labor practices See National Labor Relations Board v. Penn-
sylvania Greyhound Lanes, Inc., 303 U. S. 261, rev'g 91 F. (2d) 172 (C. A. A. 3), enf'g,
as mod. 1 N. L. R. B. 1.
WRIGHT AERONAUTICAL CORPORATION 967
the' Act-"' We further find that the agreements entered into between
the respondent and the Association, and the contractual relationship
existing thereunder, have been and are a means of utilizing an em-
ployer-dominated organization to frustrate the exercise by the respond-
ent's employees of the rights guaranteed in Section 7 of the Act.
IV. THE EFFECT OF THE'UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the respondent set forth in Section III above,
occurring in connection with the operations of the respondent described
in Section 1 above, have a close, intimate, and substantial relation to
trade, traffic, and commerce among the several States, and tend to lead
to labor -disputes burdening and obstructing commerce and the free
flow of commerce.
V. THE REMEDY
Having found that the respondent has engaged in unfair labor prac-
tices, we shall order it to cease and desist therefrom and to take certain
affirmative action designed,to effectuate the policies of the Act.
We have found that the respondent has dominated and interfered
with the administration of the Association, and has contributed sup-
port thereto. The effects and consequences of the respondent's domi-
nation, interference with, and support of the Association, as well as
the continued recognition of the Association as the bargaining repre-
sentative for its employees, constitute a continuing obstacle to the free
exercise by its employees of their right to self-organization and to
bargain collectively through representatives of their own choosing.
Because of the respondent's illegal conduct with regard'to the Asso-
ciation, it is incapable of serving the respondent's employees as a
genuine collective bargaining agency. Moreover, the continued recog-
nition of the Association would be obstructive of the free exercise by-
the employees of the rights guaranteed to them by the Act. Accord-
ingly we shall , order that the respondent disestablish and withdraw
all, recognition from the Association as representative of any of its
employees for the purposes of dealing with it concerning grievances,
labor disputes, wages, rates of pay, hours of employment, or other con-
18 See, for example , National Labor Relations Board v. Newport News Shri,pbuildrng 4
Dry Dock Co., 308 U S 241 , reversing 101 F. ( 2d) 841 (C C. A. 4), enf as mod.
8 N. L. R . B. 866; National Labor Relations Board v. Link -Belt Co, 311 U. S. 584, revers-
ing 110 F. ( 2d) 506 (C. C. A 7), enf. as mod . 12 N. L R B 854 ; Westinghouse Electric
e Mfg Co. v . - National Labor Relations Board, 312 U. S. 660, aff'g, per curtain, 112 F.
(2d) 657 (C. C. A. 2), enf. as mod. 18 N. L. R. B. 100, Swift ci Co. v. National Labor
Relations Board, 106 F (2d) 87 ( C. C. A. 10 ) enf. as mod . 7 N. L. R. B. 269 ; Continental
Oil Co. V. National Labor Relations Board, 113 F. (2d) 473 ( C. C. A. 10 ), enf. as mod.
12 N L. R. B. 789 ; The Texas Co. v. National Labor Relations Board, 119 F. (2d) 23
'