Conval-Ohio, Inc.

National Labor Relations Board - Board Decisions

Mar 2, 1973

202 N.L.R.B. 85 (N.L.R.B. 1973)

CONVAL-OHIO, INC.
Conval-Ohio, Inc. and Local 908, International Broth-
erhood of Boilermakers, Iron Shipbuilders, Black-
smiths, Forgers and Helpers, AFL-CIO. Case
8-CA-6488
March 2, 1973
DECISION AND ORDER
BY MEMBERS FANNING, KENNEDY, AND
PENELLO
On August 31, 1972, Administrative Law Judge
Maurice S. Bush issued the attached Decision in this
proceeding. Thereafter, Respondent filed exceptions
and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and brief
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge and to
adopt his recommended Order,' as modified herein.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge and
hereby orders that the Respondent, Conval-Ohio,
Inc., Akron, Ohio, its officers, agents, successors, and
assigns , shall take the action set forth in the said
Order,2 as modified herein.
Substitute the attached notice for the Administra-
tive Law Judge's notice.
1 In sec . III, par. 10 of the Administrative Law Judge ' s Decision , the date
in the last sentence should read December 31, 1970.
In the fifth paragraph of the section entitled "The Remedy," the
Administrative Law Judge stated that Respondent would be ordered to
cease and desist from "in any other manner" interfering with the employees'
rights . In paragraph 1(d) of his recommended Order, he ordered Respon-
dent to cease and desist from "in any like or related manner" interfering
with such rights . We believe that "in any like or related manner," as
provided in the Order, is appropriate.
Respondent has not excepted to the Administrative Law Judge's
determination with regard to possible deferral to arbitration , and Members
Kennedy and Penello therefore adopt his conclusion on this issue pro forma.
2 In the fifth indented paragraph of the notice to employees, the
Administrative Law Judge awarded 6 percent interest from January 1, 1971,
to employees who were eligible to receive the cash awards. This interest
should be awarded from the date the employees became eligible for the
awards . We therefore have made this correction in the notice.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
85
The National Labor Relations Act gives you as
employees, these rights:
To engage in self-organization, to form,
join, or help unions;
To bargain collectively through a repre-
sentative of your own choosing;
To act together with other employees to
bargain collectively or for other mutual aid
or protection; and, if you wish, not to do any
of these things.
WE WILL NOT do anything that interferes with
any of your rights listed above.
WE WILL NOT discontinue, cancel, abrogate,
suspend, modify, or withhold payment, in full or
in part, of your monetary service award, without
first notifying and giving your Union the opportu-
nity to discuss and bargain about it with us.
WE WILL cancel any changes of benefits or
working conditions of our employees which we
made on January 1, 1971, or later, and which
have resulted in financial or other detriment to
our employees.
WE WILL pay each eligible person in the
following collective-bargaining unit the monetary
service award which he or she would have
received since January 1, 1971, the same as if we
had not unilaterally suspended or withheld
payment thereof. The amounts of such payment
will be calculated in accordance with the previ-
ously established schedule which became effective
March 1, 1968, and applied in the years prior to
January 1, 1971, and shall have added thereto 6
percent interest from the date it was due to the
date of payment.
The collective-bargaining unit referred to herein
consists of:
All production and maintenance employees,
only at Machining and Assembly Wads-
worth, Ohio, but excluding clerical employ-
ees, dispatchers, professional employees,
watchmen, guards and supervisors as de-
fined in the Labor-Management Act of 1947,
as amended; and at the Casting Plant,
Orville, Ohio, but excluding clerical employ-
ees, dispatchers, production planners, pro-
fessional employees, watchmen, guards and
supervisors, as defined in the Labor-Man-
agement Act of 1947, as amended.
WE WILL from now on bargain with Local 908,
202 NLRB No. 16
86 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
International Brotherhood of Boilermakers, Iron
Shipbuilders , Blacksmiths , Forgers and Helpers,
AFL-CIO, concerning any proposed change in
our monetary portion of the employee service
award program , or concerning any other term or
condition of employment.
WE WILL continue the payments of the cash
awards for longevity of service due to employees
as they become eligible therefor under the
established employees ' service award program
until we and the Union have negotiated in good
faith to agreement on any proposed changes in
the said present program or impasse thereon.
CONVAL-OHIO, INC.
(Employer)
Dated By
(Representative) (Title)
This is an official notice and must not be defaced
by anyone.
This notice must remain posted for 60 consecutive
days from the date of posting and must not be
altered, defaced, or covered by any other material.
Any questions concerning this notice or compli-
ance with its provisions may be directed to the
Board's Office, 1695 Federal Building, 1240 E. 9th
Street, Cleveland, Ohio 44199, Telephone 216-
522-3715.
DECISION
STATEMENT OF THE CASE
MAURICE S. BUSH, Administrative Law Judge: In 1969,
Conval-Ohio, Inc., became the successor owner and
operator of two plants in Ohio under union contract which
employ approximately 400 employees. A portion of these
are long term employees on their way to the attainment of
30 or more years of continuous employment at the two
plants. On March 1, 1968, a predecessor company on its
own initiative but with the consent of the Union began to
honor such long term employees with cash awards of $100,
$150, $200, and $300 on the anniversary of their attain-
ment of service records of 30, 35, 40, 45, and 50 years,
respectively. These fringe benefits are not covered by or
included in the formal collective -bargaining agreements
here involved between the Union and Conval-Ohio or its
predecessor , but were part and parcel of the established
terms and conditions of employment at the two plants
when Conval-Ohio took over their operations.
Conval-Ohio became the successor owner of the two
Ohio plants on November 1, 1969. Starting in April 1970,
the Union began protests to the Company over its failure
to make the described longevity cash awards of $ 100 to two
employees who had attained 30 years of service . In August
1970, the Company after several conferences with the
Union on the matter , made retroactive payments of the
$100 cash awards to the two employees . Thereafter,
Respondent made one more cash award in December of
1970 to the only other senior employee who qualified for
such employee service award in the calendar year 1970.
But from and after January 1, 1971, the Company has
refused and still refuses to make any further cash awards to
qualifying senior employees under the established employ-
ee longevity service award program . This led to the filing of
the charge herein by the Union and the issuance of the
complaint.
The issue herein , under the pleadings and the above
skeletonized but undisputed facts, is whether the Respon-
dent unilaterally discontinued an established program of
employee service cash awards based on seniority without
notice or discussion with the Union in violation of Section
8(a)(5) and ( 1) of the National Labor Relations Act.
The Respondent in its brief admits that it unilaterally
discontinued the seniority service cash awards but defends
its action on the ground that the discontinuance was
"discretionary with the Company" and on the further
ground that the Union waived its right to protest the
discontinuance under the "zipper" or waiver clause of the
current collective -bargaining agreement.
At the 2-day trial herein, Respondent did not request or
in any way indicate that it desired deferral to arbitration of
the basic issue of the employees ' continued rights to the
service awards under the grievance and arbitration
provisions of its collective-bargaining agreement with the
Union . In its brief , Respondent for the first time requests
and seeks deferral to arbitration of the issue under the
authority of Collyer Insulated Wire, 192 NLRB No. 150.
Under these circumstances there is a threshold issue here
of whether the Respondent is entitled to raise in its brief for
the first time the issue of whether it is entitled to the right of
deferral or, conversely, whether Respondent 's request for
deferral to arbitration should be denied regardless of merit
because of Respondent 's failure to either plead or raise the
issue during the trial of the case.
The complaint herein was issued on April 18, 1972,
pursuant to a charge filed on June 24 , 1971, and duly
served on the Respondent . Respondent's answer denies the
alleged unfair labor practices.
The case was tried before the Administrative Law Judge
on June I and 2 , 1972, at Akron, Ohio . Briefs filed by
counsel on July 10, 1972, have been carefully reviewed and
considered.
CONVAL-OHIO, INC.
For reasons more fully set forth below, Respondent's
request for deferral to arbitration is dismissed because it is
untimely and the Respondent is found in violation of the
Act substantially as alleged in the complaint.
Upon the entire record in the case and from my
observation of the witness, I make the following:
FINDINGS OF FACT
1. JURISDICTIONAL FINDINGS
Respondent Conval-Ohio, Inc., an Ohio corporation, is
engaged in the manufacture of industrial and commercial
valves, with its principal office and assembly plant located
at Wadsworth, Ohio, and a foundry located at Orrville,
Ohio. The Company, in the course and conduct of its
business operations, annually receives goods, materials,
and supplies, valued in excess of $50,000 at its places of
business in Wadsworth and Orrville, Ohio, directly from
points located outside of the State of Ohio. The Company
is an employer engaged in commerce within the meaning
of Section 2(6) and (7) of the Act.
The above-captioned Union is a labor organization
within the meaning of the Act.
11. THE REQUEST FOR DEFERRAL TO ARBITRATION
As heretofore indicated, the Respondent makes its
request for deferral to arbitration of the issue here
involved, under the grievance and arbitration articles of its
collective-bargaining agreement with the Union, for the
first time in its brief addressed to and filed with the
Administrative Law Judge more than 30 days after the
close of the hearing in the case. The request for such
deferral is not affirmatively pleaded anywhere in Respon-
dent's answer. The issue of deferral was not raised or
litigated during the course of the 2-day hearing. The
opening statement of counsel for the Respondent at the
trial does not contain even a suggestion for deferral to
arbitration. Throughout the trial there was no reference to
the Board's landmark decision in Collyer Insulated Wire,
supra, dealing with and establishing a policy favoring
deferral to arbitration of contract disputes. Although the
collective-bargaining agreement between the Company
i In the event the Board on exceptions disagrees with the above findings
and conclusions and holds that the plea for deferral for arbitration was or is
properly before the Administrative Law Judge for decision despite its
belatedness, the Administrative Law Judge finds on the merits that the
dispute as to whether the Respondent has the right to unilaterally
discontinue the established cash awards for longevity of service is not in any
event subject to the grievance and arbitration provisions of the collective-
bargaining agreement here involved This is because the established
longevity service cash award program is entirely dehors the agreement and
thus not a part of the agreement and because under the agreement itself a
grievance will not lie on a claimed right outside the contract but must be
based on "a claimed violation of the rights of employees as established by
this Agreement "(Emphasis supplied) (Joint Exhs I and 2, art XI) Thus
under the terms of the agreement the Union could not invoke the grievance
and arbitration procedure of the agreement for the Company's failure to
make cash awards to eligible employees under the established employee
longevity service award program This is candidly recognized by Respon-
87
and the Union contains an article providing for "Arbitra-
tion," the agreement was not introduced in evidence for
the purpose of showing that the issue here involved was
subject to arbitration, but was received i' evidence, insofar
as it related to specific articles therein, only for the articles
dealing with management rights and waiver of the parties
to claim rights not found within the terms of the
agreement.
Discussion and Conclusion
As there is no affirmative plea in Respondent's answer
that the Board should defer the issue in the case to
arbitration and as the Respondent did not raise the issue of
deferral at the trial, the Administrative Law Judge finds
and concludes that the issue of deferral is not before him,
that the Respondent's plea for the first time in its brief for
deferral to arbitration is untimely, and that accordingly the
belated plea for deferral should be and is denied,
irrespective of merit or lack of merit. I
iiI. THE UNFAIR LABOR PRACTICES
The two Ohio plants here involved have been in
operation under several corporate owners for decades. The
plants have been operating under collective-bargaining
agreements with the Union from at least February 11,
1968, and probably for many years prior thereto. The
appropriate bargaining unit in the two plants consists of all
production and maintenance employees with the usual
exceptions.2 Approximately 400 bargaining unit employees
have been employed at the 2 plants at all times here
pertinent.
Respondent, Conval-Ohio, Inc., purchased and took over
the two plants from the previous owner, OIC Corporation,
on November I, 1969, which was then under contract with
the Union. (Joint Exh. 1) On October 31, 1969, Conval's
president, Howard Deem, met with the Union's Bargaining
Committee and union officers to advise them of Conval's
proposed takeover of the two plants as of the next day,
asked their cooperation with the new management, and
told them that Conval would adopt and take over their
then current collective-bargaining agreement with the OIC
Corporation, as was subsequently carried out by formal
written agreement. (Joint Exh. 5)
In addition the credited testimony of four of the unit
employees present at the meeting as officials of the Local
shows that Deem also told the entire unit delegation that
dent's able counsel in his brief where he states, "Not being covered by the
specific contractual language , the strict reading of Collyer Insulated Wire
would preclude the application of its deferral doctrine here"
Respondent , however, argues for an expansion of the Board's "deferral to
arbitration" policy to include disputes "concerning the existence or
nonexistence of benefits which are claimed to be due employees through the
operation of past practice" based on the general language in the Collyer
decision favoring arbitration But, as any reading of the Collyer decision
shows that the sine qua non for deferral to arbitration is the existence of
grievance and arbitration machinery for the settlement of disputes, the
requested expansion of the policy favoring deferral to arbitration here
cannot be allowed because the collective-bargaining agreement does not
provide the machinery for the arbitration of disputes not arising under the
term of the agreement
2 The precise definition of the appropriate unit will be set forth in the
Conclusions of Law below
88 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Conval as the new owner would recognize and accept all
other commitments and obligations of OIC to the Local.3
With these pledges, the union people unanimously
promised full cooperation to the new management.
At the time that Deem as president of Conval made his
blanket commitment to the union representatives present
at the meeting not only to adopt the then current
collective-bargaining agreement but also to recognize and
accept all other obligations OIC had to the Local, the
employees in the unit were entitled to certain fringe
benefits under OIC's and predecessor programs of employ-
ee service awards which the employees received under
established practice and not under the terms of collective-
bargaining agreements. Prior to OIC's acquisition of the
two plants, the predecessor firm for many years had
awarded service emblems in the form of pins to employees
for each increment of 5 years of service. The record does
not disclose whether the pins were embellished with jewels.
As of March 1, 1968, OIC at its own suggestion and
without the request of the Local, but after full discussion
with and consent of the Local, modified and greatly
liberalized the then established employees service award
program which as seen, existed apart from the collective-
bargaining agreement. Under the modified program OIC
continued the practice of awarding service pins for each 5-
year increment of service. Whether the practice of adding
precious jewels to the pin emblems was new or not, under
the modified program the pin for 10 years of service had
one ruby, the pin for 15 years of service had two rubies,
and for each additional increment of 5 years of service, the
jewels increased in either number or value or both. Under
the modified program, OIC also continued the practice of
awarding a watch to employees who attained 25 years of
service, but, after discussion with and consent of the
Union, updated the styles of the watches for the award.
But more importantly, as directly related to the issue
herein, OIC under the modified plan began for the first time
a program of making cash awards to employees on their
anniversaries of 30, 35, 40, 45, and 504 years of service in
the amounts of $100, $150, $200, $250, and $300,
respectively. The day before OIC's modified program
became effective, OIC notified its employees of the
liberalized revision by a press release in its house
publication. (Joint Exh. 3) The modified employees service
3 The above finding is based on the composite testimony of Oscar
Ellison, Paul Dobbins, James Waggamon, and Maurice Knecht, president,
vice president, secretary-treasurer, and trustee of Local 908, respectively, all
of whom are also long time unit employees at one or the other of the two
plants Mr Deem did not testify at the trial The only management man
present at Deem's meeting with the Local's representatives, called upon to
testify herein, was Leo Ryan, then manager of Labor Relations for IOC
before Conval took over (He continued in the same capacity for Conval for
a period of time ) Ryan merely testified to the undisputed fact that Deem
informed the Local's representatives that Conval would take over the then
current collective-bargaining agreement that the Local had with OIC. Ryan
did not deny the testimony of the four above-named witnesses that Deem
also told the union people at the meeting that Conval would recognize and
accept all other commitments and obligations OIC had to the Union The only
other person to testify as to what Deem told the union people at the meeting
was Don Meager, then chief steward for OIC but now part of Conval's
management personnel Like Ryan, Meager testified that Deem promised
the union people that Conval would take over their collective- bargaining
agreement with OIC but did not deny the testimony of the aforementioned
four officials of the Local that Deem also told the union people that Conval
award program, as before the modification, is not covered
by any part of the collective-bargaining agreement.
In the spring or early summer of 1970, two of Conval's
unit employees became entitled to cash awards of $100
each upon their anniversaries of 30 years of service under
the modified employees service program established by
OIC as described above. Conval, whether by design or
oversight, did not make the awards to the two employees
on the anniversary dates of their services in the plants then
owned and operated by Conval. Protests were made by the
Union to the Company over its failure to make the two
cash service awards. The matter came to a head on July 13,
1970, tangentally as an offshot of a fourth-step grievance
meeting concerning matters totally unrelated to the service
awards. At that meeting, Conval's then manager of
industrial relations, Bruce Coen, announced that the
Company would make retroactive payments of the cash
awards to the two employees.
The credited testimony of a number of employee union
representatives at that meeting shows that Coen also
informed the union representatives that the Company
would in the futures continue to make the employee cash
service awards on the anniversary service dates of the
employees. In August, in accordance with Coen's an-
nouncement, the Company made retroactive service award
payments of $100 to each of the two mentioned employees.
In late December 1970, it made another cash award of a
$100 to another employee who had attained 30 years of
service. These three employees were the only employees in
the plant who became entitled to longevity service awards
from the time the Conval took over the two plants on
November 1, 1969, through 1970.
On January 1, 1971, Conval, unilaterally and abruptly
without notice to or discussion with Local 908, discontin-
ued the described employee cash service awards as well as
the grants of watches to employees who attain 25 years of
service. As the Union does not challenge the discontin-
uance of the watch award, there is no issue in the case with
respect to the watch award discontinuance. Thus, the only
issue in the case relates to Respondent's unilateral
discontinuance of the cash awards for longevity of service.
By stipulation, it is established that the Company has not
made any employee cash service awards since December
31, 1971.
The collective-bargaining agreement Conval took over
would recognize and accept all other obligations OIC had to the Local If
the testimony of Ryan and Meager can be construed to mean that Deem
made no commitments other than the promise to take over the current
collective-bargaining agreement, the Administrative Law Judge does not
credit such testimony The testimony of Ryan and Meager as a whole show
them to be unreliable witnesses
4 Rather surprisingly, the record indicates that there are some employees
in the unit with or approaching 50 years of continuous service
5 The testimony of Leo Ryan, Conval's then manager of labor relations,
that Mr. Coen told the Local's representatives that the award payments
would be reinstated "for now" is not credited insofar as it implies that the
reinstatements of the awards was to be temporary The testimony of four
union witnesses, Ellison, Knecht, Dobbins, and Waggamon, leaves no
doubt that Coen indicated that the Company would continue the service
awards indefinitely into the future As will be seen below in another
connection, Ryan is found not to be a reliable witness Moreover,
Respondent in its own brief admits (at p 5) that Mr. Coen at the July 13,
1970, meeting told the union people that the Company "would pick up all
back awards and would continue the program " (Emphasis supplied )
CONVAL-OHIO, INC.
from OIC had an expiration date of February 11, 1971.
(Joint Exh. 1.)
On or about December 14, 1970, Conval and the Union
commenced negotiations for a new collective- bargaining
agreement . The negotiations continued until March 26,
1971, when a new 3-year contract was executed, effective
as of February 11, 1971. (Joint Exh. 2.) Both the new and
old contract contain a so-called "zipper clause" in identical
language . In effect the zipper clause states that all
agreements between the Company and the Union are
contained in the collective-bargaining agreement and
further states that ". . . all matters subject to collective
bargaining have been bargained upon, whether or not such
matters are included, and they may not be made the
subject of collective bargaining during the term of this
Agreement."6
Notwithstanding the zipper clause, OIC, predecessor to
Conval, initiated the above-described cash awards pro-
grams for senior employees attaining service records of 30,
35, 40, 45, and 50 years of service, even though there was
no provision for same in its collective-bargaining agree-
ment with the Union.
Similarly, Conval, notwithstanding the same zipper
clause, in the contract it took over from OIC, continued
OIC's established practice of making cash employee
service awards to eligible senior employees from the date
(November 1, 1969), it took over OIC's two plants through
December 31, 1970, after some initial balking as described
above. However, as shown above, the Respondent unilater-
ally discontinued the practice from and after January 1,
1971.
As in the case of the old collective-bargaining agreement,
the new agreement is silent on the subject of the employee
cash service awards established by OIC and recognized by
the Respondent for some 14 months or up until about 6
weeks before the labor contract it took over from OIC
expired. All written proposals submitted by both the Union
and the Respondent during the bargaining negotiations
leading to the new contract are likewise silent on the
6 In Joint Exh . 1, the zipper clause is in par. 216; in Joint Exh . 2, it is in
par. 213.
r The meeting that Leo Ryan, the aforementioned then manager of
Labor Relations for Respondent , claims in his testimony he had with Oscar
Ellison and Coy Sutton, president and chief steward of Local 908,
respectively, in his office on some unremembered date in January 1971 prior
to January 21, 1971, on the subject of the employees' cash service award
program , was not a contract negotiation meeting . This is evident from
Ryan's own description of the alleged meeting with Ellison and Sutton
which he describef̀ as an "informal meeting in my office" of the kind he
had because this position , "practically on a daily basis and sometimes more
than twice a day" Ryan testified that at his claimed meeting with Ellison
and Sutton on the unremembered date in January prior to January 21 he
notified them upon instructions from his superior, Joseph Laterza, director
of industrial relations , that the Company would no longer be making the
employees' cash service awards for longevity of service. Ellison and Sutton
flatly denied Ryan's testimony that there had been such a meeting. Their
denial is fully credited. The record shows that the Union consistently at all
times made it clear to management that it would reject any and all attempts
by the Company to take away from the employees the established cash
service awards. Thus it is a virtual certainty that the Union would have
brought up Ryan's alleged notice of the Company's discontinuance of the
employees ' cash service at a contract negotiation meeting long before the
January 21 meeting, if in fact it had been so notified by Ryan. It was
evident from the demeanor of Ellison and Sutton at the trial during their
testimony that they had never heard of Ryan 's claimed meeting with them
on some day in January before January 21, 1971, until the second day of the
89
subject of the employee cash service awards. Negotiations
for the new contract came to a deadlock over terms and
conditions of employment wholly unrelated to the cash
service awards. (Tr. 140) The deadlock resulted in a strike
which commenced on February 11, 1971, when the old
contract expired, and ended on March 2, 1971, when the
parties apparently reached an oral agreement on the terms
and conditions of employment, later reduced to writing in
the new collective-bargaining agreement , which in turn
became effective as of February 11, 1971, for a period of 3
years.
Between the time the negotiations for a new contract
began in mid-December 1970 and the execution of the
contract on March 26, 1971, the Union and the Company
had more than 20 collective -bargaining negotiation meet-
ings . The only such negotiation meeting at which the
matter of the employees cash service award program was
discussed or mentioned was the meeting held on January
21, 1971.7 At that meeting the Company was represented
by Joseph Laterza, its director of industrial relations, as
spokesman, and his subordinate, Leo Ryan, manager of
labor relations, and other management personnel. At the
same meeting the Union was represented by George
Sepelak , International representative as chief spokesman,
the aforementioned Oscar Ellison as president of the Local,
James Waggamon as a secretary -treasurer of the Local,
and Maurice Knecht, as trustee of the Local, among other
union representatives.
Although the witnesses for both the Company and the
Union are agreed that the subject of the employees cash
service award program came up for discussion at the
bargaining meeting of January 21, 1971, in a sort of
peripheral fashion because it was not on the agenda for
discussion,8 they are not agreed on what Laterza as the
company spokesman said on the subject. The matter came
up in connection with a union proposal that the Company
continue to reimburse employees for safety shoes just as it
was required to do under the then expiring contract. In this
connection Sepelak, because of rumors that the Company
hearing herein some 18 months later . Even after the new contract had been
executed , the Union continued to protest the Company's failure to keep up
the cash service award program as soon as it became aware of such failure
which was not until after the new contract had been executed. The
Company's stock response to these protests through its personnel director,
Meager was, "We are checking on it . Joe [Laterza , Director of Industrial
Relations ] is handling that. We will get back to you ." The fact that the
Respondent from sometime in April 1971 to sometime in June 1971 was still
considering whether to continue or discontinue the employees' cash service
award program is still another indication that the meeting that Ryan
claimed he had with Ellison and Sutton prior to the collective -bargaining
negotiation meeting of January 21. 1971, on the subject of the service
awards, never in fact took place . Laterza 's testimony , seeking to corroborate
Ryan's story of notice to Ellison and Sutton in January prior to January 21,
1971, of the Company 's discontinuance of the employees cash service award
program . is not credited , especially in view of Laterza's own initial positive
testimony that the matter of the service awards came up for discussion with
union officials for the first time on January 21 , 1971. The charge herein by
the Union against the Respondent was not filed until June 24 , 1971. This is
still another indication that Ryan did not some 6 months prior thereto
notify the Union of the Company 's alleged decision to discontinue the
service awards.
8 As heretofore noted, none of the proposed contracts submitted by the
Company and the Union for discussion at the negotiation meetings
contained any provisions pertaining to the employees' cash service award
program. The only items for discussion and bargaining at the negotiation
meetings were the items in the parties ' proposed contracts.
90 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
was going to discontinue such reimbursements, wanted
assurances from the Company that it would not back out
from reimbursement for safety shoes just as it had
"reneged" on the employees cash service awards. It is
evident from the testimony of the witnesses herein for both
the Company and the Union, and so found, that the word
"renege" was a reference to the Company's temporary
discontinuance of the awards in 1970 which it reinstated
later in the year as heretofore shown. (The Company's
unilateral action in discontinuing the cash awards as of
January 1, 1971, was not known to the Union until after
the new contract was executed.) Laterza testified that at
that point in the January 21, 1971, bargaining session he
told the union representatives that the Company intended
to do away with the monetary and watch awards for
longevity of service and to redesign the pin emblems.
Laterza's testimony was based primarily on his memory.
The contemporaneous notes kept by union representatives
Sepelak, Knecht, and Waggamon, and by Laterza (Tr.
174), however, show that Laterza merely informed the
union representatives that there would be changes in the
service awards for longevity of service without spelling out
what these changes would be. The Administrative Law
Judge credits these contemporaneous notes, including
Laterza's, as against Laterza's above-noted testimony.
Thus it is found that Laterza merely told the union people
that there would be changes in the employees' service
awards without telling them what the changes would be.
Sepelak responded that the Union would not stand for any
unilateral changes in the established employees' service
award program and that the Union "will have to have an
understanding with you [Company] before an agreement is
reached." (Tr. 71-72, 112, 118) Laterza responded by
telling Sepelak that, "This is not a negotiable item."
Respondent takes the same position, among other de-
fenses, in its brief.
Summarizing, the record shows, as found above, that the
matter of the employees' service award program came up
for discussion for the first and only time, in the more than
20 contract negotiation meetings leading to the execution
of the new contract, at the meeting of January 21, 1971.
Similarly, the record as found above shows that at the
precontract nonnegotiating meeting of July 23, 1970, the
Respondent agreed to reinstate without condition or
reservation the established employees' cash service awards
which it had previously unilaterally discontinued. As
shown, the matter of the service awards at the January 21
negotiation meeting came up peripherally to another
bargaining item as it was not on the agenda of that meeting
or any other negotiation meeting because the proposed
contracts of both the Company and the Union were
completely silent on the subject of the employees service
awards. The record further shows that at the January 21
9 The following testimony is the basis for the above evidentiary findings
TRIAL ExAMINER- Did the Union at any time say or indicate to you
directly or indirectly that they were waiving this matter of their
entitlement to the cash awards')
WITNESS LATERZA Not directly. We resolved all issues when we
signed the contract [The last remark is a reference to the zipper clause
in the new collective-bargaining agreement I (Tr •176)
a s
MR POWERS (counsel for the General Counsel) But it is clear that
meeting the Company took the position that the matter of
the employees' service awards program was a nonnegotia-
ble item whereas the Union maintained that it was a
negotiable item . The record also shows that while the
Company at the January 21 meeting told the Union that it
contemplated making changes in the service award
program, it' never at any time during the contract
negotiations submitted to the Union for discussion any
proposed changes in the program on the ground that it was
not a negotiable item . The record further shows by
Respondent's own admissions that the Union never at any
time gave the Company any reason to believe that it was
abandoning or waiving the rights of the unit employees to
the cash awards for longevity of service, (Tr. 176, 177) but
on the contrary shows that the Union at all times
vigorously maintained that the Company could not take
away the established monetary awards for longevity of
service by unilateral action .9
The events relating to the employees' service award
program subsequent to the execution of the new contract
on March 26,' 1971, are as follows. In early April 1971, the
Local's president, Ellison, learned for the first time that an
employee, who had attained 30 years of service on January
2, 1971, had not received the $100 cash award under the
established employees' service award program although the
Company had just previously made such a cash award to
another employee in late December 1970. The Company
similarly failed to pay cash awards to five other employees
who had become entitled to awards between January 2 and
21, 1971.
Starting in April after the first complaint of a nonpay-
ment of the cash service award and continuing through
June 22, 1971, various union officials on numerous
occasions took the matter of the nonpayment of the cash
service awards up with Laterza and with Don Meager, now
product manager but then personnel manager. The
credited composite testimony of Union Representatives
Sepelak, Ellison, Dobbins, and Waggamon show that
Laterza seriously entertained their protests about the
discontinuance of the cash service awards and that he
sought the authority of his superiors to restore the cash
award program. Their testimony shows that they pressed
Laterza for an answer before their statutory 6-month
period to file an unfair labor practice charge expired and
that Laterza on June 22 informed them that it was the
Company's final decision that it would not for financial
reasons reinstate the cash awards for longevity of service.io
The Union filed its unfair labor charge with the Board 2
days later, just short of the deadline.
Between the Company's discontinuance of the cash
service awards on January 1, 1971, and February 11, 1971,
the date of the expiration of the extant collective-bar-
gaining agreement, nine employees became eligible for the
the Union did not drop this matter after negotiations . that they
continued to press the Company with regard to the monetary portion of
the service award, isn't that correct
LATERZA Yes (Tr 177)
IS Laterza admits that he took up the Union' s request for the
reinstatement of the cash service awards with his supervisors The
Company's final answer of "No" in June came more than 2 months after the
Union's initial protests in early April Laterza's testimony that the
Company's decision was "No" from the start is not credited
CONVAL-OHIO, INC. 91
awards, some for the $100 award and some for the $150
award. But between January 1, 1971, and the opening of
the trial herein on June 1, 1972, a total of 48 out of the
approximate 400 employees in Respondent's two plants
became eligible for the cash awards for service records of
30, 35, 40, and 45 years of service. Collectively they would
have been entitled to approximately $5,400 if the Respon-
dent had continued making the cash service awards from
January 1, 1971, until the time of trial herein on June 1,
1972, as it had prior to January 1, 1971.11
Discussion and Conclusions
As the record is undisputed that the Respondent on
January 1, 1971, without prior notice to or any discussion
or consultation with the Union and without affording the
Union any opportunity to bargain on the matter, unilater-
ally discontinued the established employees' cash award
program for longevity of service, as established by its
predecessor firm and as recognized, adopted, and main-
tained by Respondent as successor employer for a period
of 14 months prior to its discontinuance of the cash
awards, there can be no doubt that Respondent is in
violation of Section 8(a)(5) and (1) of the Act by such
conduct unless one or more of its asserted defenses lie.
As shown above, this established employees' service cash
award program was put into effect by the predecessor
company in 1968 by practice and usage as a modification
of a longstanding employees' service award program,
dehors and independent of the then existing collective-
bargaining agreement, but existing side by side with the
terms and conditions of employment of the agreement, not
withstanding the agreement's "zipper" clause which states
that the parties to the contract "have set forth their entire
understanding [therein] on all matters which are or may
properly be subjects for collective bargaining."
Respondent's first defense to the dropping of the cash
awards for longevity of service is that the predecessor
employer, OIC, came to the Union on its own initiative
with the proposal for inaugurating the employees' service
cash awards as detailed in the findings above; that the
Union did not request or initiate bargaining for the
program; and that when OIC presented the service cash
award proposal, as well as other modifications of the then
existing and long-established employees service program,
to the Union for its approval, the Union readily and
without quibble consented to the cash longevity service
awards and all other modifications (in pins and watches) of
the existing employees service award program.
From these undisputed factual premises, the Respondent
contends that the employees' cash service awards were
"not negotiated" by the Union and thus, not having been
negotiated, they are in the nature of "discretionary bonuses
or gifts," and that accordingly they may be withdrawn at
11 The motion of counsel for General Counsel at the end of the hearing
to conform the pleadings to proof is hereby granted As there is no proof
that Respondent at the meeting of January 21, 1971, notified the Union, as
alleged in par 8 of the complaint, "of its decision made and implemented
on or about January 1, 1971" to drop the employees service cash award
program, that part of par 8 is dismissed for failure of proof and in lieu
thereof par 8 under the motion is deemed amended to show the facts as
found above
any time by management unilaterally at its own discretion
and without notice to or bargaining with the Union.
The Respondent's contention that the cash service
awards were "not negotiated" simply because they were
proposed by OIC and readily consented to by the Union is
without merit. Respondent seeks to make the term
"negotiation" the equivalent of haggling over the terms of
a proposal, but negotiation can take place without any
haggling or bickering over terms as it frequently does over
the bargaining table where either party may simply say
"Agreed" to numerous noncontroversial items presented
by the other. The mere fact that an item proposed by one
side is accepted by the other side without hesitation or even
with alacrity does not prevent that item from having been a
negotiated item. In the instant case, OIC proposed cash
awards of fixed amounts for longevity service records of
30, 35, 40, 45, and 50 years of service, respectively. The fact
that the Union quickly and gladly accepted the proposed
cash awards program for such longevities of service,
without seeking more than the Company proposed, does
not rob the transaction of its negotiated character.
Respondent has not cited any authority to the contrary.
Respondent's attempt to bolster its contention that the
cash awards for longevity of service are discretionary in
character by reference to what it apparently claims Mr.
Laterza told the union representatives in July 1970, after
agreeing to reinstate the cash service awards under
persistent demands therefor from the Union, is likewise
without support in the record. Respondent's brief seeks to
convey the impression that Laterza at that time told the
Union that although it was reinstating the cash service
awards, it "retain[ed] the right to discontinue the same on
January 1, 1971, which it did." 12 The record leaves no
doubt as found above that in July 1970 when the
Respondent agreed to reinstate the cash service awards
that it did so without any conditions or reservations
whatever.
The Respondent's further attempt to equate the cash
longevity service awards here involved to gratuitous
bonuses is also without merit. The cases cited by
Respondent, Vogt Machine Company, 190 NLRB No. 13,
and N.L.R.B. v. Wonder State Manufacturing Co., 344 F.2d
210, deal with Christmas bonuses. Christmas bonuses are
frequently tied into company profits and these can vary
decidedly from year to year depending upon the Employ-
er's profit experience. But even with respect to such
bonuses the Board has long held "that Christmas bonuses
which are not gratuities and which have been paid with
regularity over extended periods of time are not only an
integral part of the wage structure, but also constitute a
mandatory subject for bargaining." (Emphasis supplied.)
Gravenslund Operating Co., 168 NLRB 513. In the Vogt
Machine Company case, supra, cited by the Respondent, the
Board made an exception to this general rule where "the
12 In its brief under "Summary of Testimony," the Respondent shows
that at a meeting with the Union on July 13, 1970, the Company "reported
to the Union that it would pick up all back awards not made since the time
of acquisition and would continue the program " ( Emphasis supplied)
This is followed by the sentence- "How long the program would be
continued is the subject of disputed testimony " The findings above show,
based on the credited testimony of union witnesses , that the Company did
not indicate any cutoff date for the resumed cash service awards
92 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Christmas bonus payment was intermittent and not
uniform in amount or basis over the years." It held that in
such situations the payment of the bonus becomes a
discretionary matter as to which bargaining is not a custom
or practice. The court in the Wonder State Manufacturing
Co. case, supra, with more explication, held to the same
effect.
Under the cited cases the critical test is whether a bonus
paid by an employer to an employee is a gift. If the bonus
is a gift, its giving is a discretionary matter with the
employer, not subject to mandatory bargaining which the
employer can give or take away at will.
The cash service awards here involved are obviously not
in the same genre as a Christmas bonus as they are not in
any sense gratuties because they are essentially awards or
payments for staying with Company for stated long
periods of time. It is significant that they are not even
called bonuses. They are designated and known as
employees' service awards. They are, in other words,
awards for longevity of service. They are thus definitely
and positively tied into the working service of the employee
and as such are part of an employee's compensation for
continuous service for periods in excess of a quarter of a
century. The cash awards are fixed in amount, depending
only upon the length of service and accordingly do not
vary from time to time; they are in no way tied to the profit
experience by the initial employer when it established the
cash service awards. Having been established by the
predecessor employer, they were paid by the predecessor to
qualifying employees without interruption as long as it
remained the employer. As found above, the Respondent
as successor employer assumed the employees' service
award program as part of its commitment not only to take
over the then extant collective-bargaining agreement but
also all other commitments to the Union. Although the
Respondent at first balked at keeping up the employees
service cash awards despite its commitment to take over all
commitments to the Union, it carved on the program of
the cash awards for longevity of service (after protest from
the Union for nonpayment) for a period of 14 months
which covered the period from the day of its takeover until
January 1, 1971, when it unilaterally and without notice to
the Union or even its knowledge discontinued making the
cash awards.
In summary, the Administrative Law Judge finds and
concludes that the Respondent is in violation of Section
8(a)(5) and (1) of the Act by its unilateral conduct of
January 1, 1971, in discontinuing during the life of its
assumed collective-bargaining agreement the established
employees' cash award program for longevity of service
without notice to or any discussion with the Union and
without affording it the opportunity to bargain on the
matter.
The above conclusion of violation of the Act is confined
for the moment to Respondent's conduct between Novem-
ber 1, 1969, when it took over the extant collective-
bargaining agreement, and February 11, 1971, the date of
the agreement's expiration. During that period, the
Respondent adopted both the extant collective-bargaining
agreement and the historical usage of the established
employees' service award program. During the same
relatively short period, as shown above, nine of Respon-
dent's employees became eligible for the awards in varying
amounts depending upon their length of service.
The status of the employees' service cash award program
from and after February Il, 1972, is on an entirely
different footing.13 This is because the Respondent and the
Union executed a new 3-year contract on March 26, 1971,
effective as of February 11, 1971, and in the negotiations
leading to the new agreement the Respondent had the
opportunity for the first time to bargain, in contrast to its
former adoption of the cash service awards, over the
question of whether the usage of the service cash award
program established by the predecessor firm and honored
by itself for a period of 14 months, should or should not be
continued over into the life of the new collective-bargain-
ing agreement. In this connection, the Respondent con-
tends that the Union has waived and is therefore estopped
from claiming the right of the prior established employees'
service cash awards program for its members by a
combination of three factors. The first of these factors is
that at the one and only negotiation meeting on January
21, 1971, at which the subject of the service cash awards
was discussed, the Union allegedly "unequivocally stated
that unless there was some agreement on the continuation
of the Service Award Program, there would be no
collective-bargaining agreement." The second factor is that
the new collective-bargaining agreement is silent on the
subject of the service award program. The third and final
factor relied upon by Respondent is that the new contract
has the same "zipper" clause as the previous contract and
this clause in combination with the other two factors now
estops the Union from now claiming the service award
program for its members.
The first of these factors requires close analysis. For the
position of the Union on the matter of the cash service
awards at the meeting of January 21, the Respondent relies
on the statement made by Sepelak, the International's
representative and spokesman for the Local, at that
meeting. In its brief under the heading of "Summary of
Testimony," the Respondent sets forth Sepelak's response
to Laterza's announcement at the January 21 meeting that
there would be changes in the service award program, as
follows, "Mr. Sepelak responded that there would have to
be an understanding on the continuation of the Service
Award Program prior to the signing of any agreement." As
will be shown below, the above is not an accurate
statement of Sepelak's response. At best it is an approxima-
tion of Sepelak's remark. In the argument section of its
brief, Respondent changes Sepelak's response as set forth
in its "Summary of Testimony" into meaning, "It is
virtually undisputed that the Union's chief spokesman at
those negotiations stated to the Company that there would
be no agreement at all if there were no agreement on the
Service Award Program." In a still later point in its
argument, the Respondent again even more sweepingly
changed Sepelak's response into meaning that, "the Union
unequivocally stated that unless there was some agreement
13 This difference in footing between the old and new contracts is not
discussed in either General Counsel's or Respondent 's briefs
CONVAL-OHIO, INC. 93
on the contention of the Service Award Program, there
would be no collective-bargaining agreement."
Contrary to the above versions of Sepelak's response, the
record shows, as found above, that Sepelak's reply to
Laterza's announcement that there would be changes in
the service award program, was as follows, ". . . we will
have to have an understanding with you before an
agreement is reached." The above finding was abstracted
from Sepelak's contemporaneous notes of the negotiation
meeting of January 21, 1971. The full text of Sepelak's
notes on the matter 14 places the above quotation in its
proper context and more clearly sets forth the tenor of
Sepelak's response. The full text reads:
We don't feel you have the right to unilaterally change
the service award. You did not propose a change in
these negotiations [for a new contract] and neither did
the Union and I want to refer to paragraph 216 [the
zipper clause]. We feel since you brought it up, we will
have to have an understanding with you before an
agreement is reached. We will have to have an
understanding that the present service award remain as
is for the duration of the new agreement or any other
privilege that we have enjoyed in the past.
The Administrative Law Judge finds that Sepelak's
statement "that we will have to have an understanding with
you [on proposed but unidentified changes in the employ-
ees service award program] before an agreement is
reached" was merely bargaining table hyperbole and not a
statement of "unequivocal" position. The absence of the
alleged unequivocal position (which Respondent contends
Sepelak took on Laterza's proposed but unidentified
changes in the employees service award program) is
reflected by the contemporaneous notes on the meeting
kept by two other union representatives in attendance at
the meeting. Thus the notes of Union Trustee Kneckt
shows that Sepelak only told Laterza that "if he intended
to change anything, we will probably lock horns on this
subject, such as awards or anything that we now enjoy."
(Emphasis supplied.) Similarly, and even more mildly, the
notes of Union Official Waggamon show that Sepelak
merely stated to Laterza that "he wanted to make it clear
that we [the Union ] are not proposing any changes [in the
service award program], nor will we accept any changes."
From these contemporaneous notes, it is found that the
Union put the Respondent on clear and unambiguous
notice that it would not accept any unilateral changes in
the established employees' service award program. More-
over, as found above, the Respondent itself admits that the
Union did not, directly or indirectly, at any time before,
during, or after the negotiations leading to the execution of
the new contract waive the entitlement of its members to
the established employees' service cash awards, except for
Respondent's claim that the Union indirectly waived the
cash awards through the operation of the zipper clause in
the new contract. The latter, however, is a matter for the
Administrative Law Judge, not the Respondent, to decide.
Another basic difficulty with Respondent's claim that
the Union waived the cash service award program at the
January 21 meeting is that the credited testimony of a
number of union witnesses show that Laterza at that
meeting merely announced that there would be changes in
the general service award program without indicating in
any way that the Company not only proposed but actually
had discontinued the cash awards as of January 1, 1971.
Under these circumstances, the Union obviously cannot be
held to have waived the rights of its members to something,
the cash service awards, that had not even been mentioned
by Laterza at the meeting. Even Laterza's own notes on the
January 21 meeting show that he merely announced at the
meeting that there would be changes in the employees'
service award program without spelling out what those
changes would be. The record leaves no doubt that if the
Union had been put on any kind of notice during the
negotiations that the cash award part of the employees'
service award program had been or was to be discontinued
that it would indeed have balked at signing a new contract
without a showdown on the issue of the elimination of the
cash awards.
It was not until after the new contract was executed in
late March 1972, that the Union learned for the first time
that the Company had unilaterally discontinued the cash
awards part of the service award program as of January 1,
1972. It then sprung into immediate action to get the
Company to restore the cash service awards program by
back payments to the nine employees who had become
entitled to such awards between January 1, 1972, and
February 11, 1972 when the` old contract expired. This
vigorous but unsuccessful effort by the Union to get the
cash awards reinstated and the numerous meetings the
Company had with the Union in that connection is
obviously antithetical to Respondent's claim that the
Union had consciously and knowingly waived the employ-
ees' rights to the established cash longevity service awards
simply by the provisions of the zipper clause in the new
contract.
Of all the facts and circumstances negativing Respon-
dent's claim that the Union waived the rights of its
members to the established cash award program for
longevity of service under the zipper clause of the new
contract, perhaps the most telling is the openly admitted
fact that the Company at the meeting of January 21, 1971,
point blank refused to enter into negotiations with the
Union on the item of its proposed but unidentified changes
in the service award program on the ground that such
changes were not negotiable items for bargaining but were
solely within the direction of the Company. (The Company
still maintains this position on brief which the Administra-
tive Law Judge found without merit above.) The Union
through its spokesman at the meeting, as found above,
stoutly denied that contention and steadfastly maintained
that any changes in the service award program was subject
to negotiation.
In view of the Respondent's refusal to even discuss with
the Union the unilateral changes it had in mind to make in
the service award program on the ground of nonnegotiabil-
ity and the Union's admitted open, vigorous, and continu-
ing opposition to any unilateral changes in the established
program, it would not be in accord with reality to find that
14 Sepelak's contemporaneous notes on the January 21, 1971, meeting, the findings above to avoid duplications here
and that of other union representatives shown below, were not set forth in
94 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the Union had waived the right to the cash service awards
simply because the new contract contained the same zipper
clause the old contract had, dunng the term of which the
employees not only received the emoluments for their
services set forth in the old agreement but also the cash
longevity service awards established by independent usage
and practice and dehors the old agreement.
The record further shows that there was a strong element
of deceit on the part of the Respondent during the
negotiations leading to the new contract as the Company
never notified the Union at the contract negotiation
meeting of January 21, 1971, or at any other meeting 15 of
the action the Company had unilaterally taken on January
1, 1971, to discontinue the cash awards for longevity of
service. The Union was completely unaware of this
development until some days after the execution of the new
contract on March 26, 1971, when it learned for the first
time that nine of its members who had become entitled to
the cash longevity service awards between January 1 and
February 11, 1971, when the old contract expired, had not
received the awards. The Administrative Law Judge infers
and finds that the Respondent kept the fact that it had
taken secret unilateral action to cut off the cash awards, as
a sleeper throughout the negotiations leading to the
execution of the new collective-bargaining agreement, in
order to avoid a direct confrontation on the issue with the
Union. The Administrative Law Judge finds and concludes
that this deceptive conduct by the Respondent is sufficient
in itself to relieve the Union of the effects of the zipper
clause in the new contract under the rationale of a recent
court decision as adopted by the Board. N.L.R.B. v.
Southern Materials Company, Inc., 447 F.2d 15 (C.A. 4,
1971); Southern Materials Company, 198 NLRB No. 43.
But in a broader sense the Administrative Law Judge
finds and concludes that the Respondent is also in
violation of Section 8(a)(5) and (1) of the Act in connection
with the negotiations of the new collective-bargaining
agreement 16 under all the circumstances of the case as
manifested by its secret unilateral action of January 1,
1971, in discontinuing the established service cash award
program and by its absolute refusal to bargain with the
Union on any aspect of the employees' service award
program at the only meeting at which that subject came up,
not directly but peripherally,17 during the more than 20
negotiation meetings that led to the execution of the
agreement. During that entire period the Respondent was
under notice from the Union and had admitted knowledge
that the Union opposed any change in the established
employees' service award program without its consent or
agreement. Accordingly, it is found that the Union has not
consciously or knowingly waived the rights of the unit
employees here involved to the established cash service
awards under the zipper clause of the new collective-
15 The Administrative Law Judge in the findings above totally
discredited the testimony of Mr. Ryan, Respondent's then manager of labor
relations, that he had notified Union Representatives Ellison and Sutton on
an unremembered date in January 1971 at a routine noncontract business
meeting poor to the contract negotiation meeting of January 21, 1971, that
the Company had dropped the cash awards for longevity of service
16 For the reasons heretofore stated, the footing of the established service
cash award program dunng the existence of the collective-bargaining
agreement the Respondent took over from the predecessor firm is different
bargaining agreement and that the zipper clause has no
application to the established employees ' service award
program which has always had an independent life apart
from the existing collective-bargaining agreements.
In final summary , the Administrative Law Judge finds
and concludes that the Respondent is in violation of
Section 8(a)(5) and (1) of the Act under both the old and
new contract by its unilateral conduct of January 1, 1971,
in discontinuing the established employees cash award
program for longevity of service without notice to or any
discussion with the Union and by its absolute refusal to
bargain with the Union on the matter.
The Administrative Law Judge further finds and
concludes under all the facts and circumstances of the case
that the Union did not waive the rights of its members to
the established employees ' service cash award program
under the zipper clause of the new collective -bargaining
agreement.
Upon the basis of the foregoing findings of fact and
upon the record as a whole , the Administrative Law Judge
makes the following:
CONCLUSIONS OF LAW
1. Respondent, Conval-Ohio, Inc., is an employer
engaged in commerce within the meaning of Section 2(2),
(6), and (7) of the Act.
2. Local 908, International Brotherhood of Boilermak-
ers, Iron Shipbuilders, Blacksmiths, Forgers and Helpers,
AFL-CIO, is a labor organization within the meaning of
Section 2(5) of the Act.
3. The following constitutes a unit of Respondent's
employees appropriate for the purposes of collective
bargaining within the meaning of Section 9(b) of the Act:
All production and maintenance employees, only at
Machining and Assembly, Wadsworth, Ohio, but
excluding clerical employees, dispatchers, professional
employees, watchmen, guards and supervisors as
defined in the Labor-Management Act of 1947, as
amended, and at the Casting Plant, Orrville, Ohio, but
excluding clerical employees, dispatchers, production
planners, professional employees, watchmen, guards
and supervisors, as defined in the Labor-Management
Act of 1947, as amended.
4. Local 908, International Brotherhood of Boilermak-
ers, Iron Shipbuilders, Blacksmiths, Forgers and Helpers,
AFL-CIO, at all times material herein, has been and is
now the exclusive representative for the employees in the
aforesaid appropriate unit for the purposes of collective
bargaining within the meaning of Section 9(a) of the Act.
5. By its action on or about January 1, 1971, unilateral-
ly and without prior discussion with the Charging Party
(Union) as the duly authorized and exclusive collective-
bargaining representative of Respondent's employees in
from the footing of the same program under the new contract negotiated by
the Respondent under the negotiations of which the Respondent had the
opportunity to open up bargaining on the program but adamantly declined
to do so
17 As heretofore noted the matter of the established employees' service
award program came up peripherally dunng the negotiations of the new
contract because it was never on the agenda of either the Company or the
Union as reflected in their proposed agreements which were the subjects of
negotiations dunng the negotiation sessions
CONVAL-OHIO, INC. 95
the above unit appropriate for collective-bargaining pur-
poses, withdrawing, suspending, eliminating, or discontinu-
ing payment of its established program of employee service
cash awards, Respondent failed and refused to bargain
collectively with said Union, thereby engaging in an unfair
labor practice in violation of Section 8(a)(5) of the Act.
6. By its said action described in Conclusion of Law 5,
supra, and its nonpayment of said service cash awards
under said circumstances, Respondent has interfered with,
restrained, and coerced, and is continuing to interfere with,
restrain , and coerce, its said employees, in violation of
Section 8(a)(1) of the Act.
7. By its failure and refusal to bargain collectively with
said Union at any time on or since January 1, 1971,
concerning its unilateral action described in Conclusion of
Law 6, supra, Respondent has failed and refused and is
continuing to fail and refuse to bargain collectively with
said Union, in violation of Section 8(a)(5) and (1) of the
Act.
8. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
THE REMEDY
It having been found that Respondent engaged in certain
unfair labor practices in violation of Section 8(a)(5) and (1)
of the Act, it will be recommended that it cease and desist
therefrom and take certain affirmative action designed to
effectuate the purpose of the Act.
As the record stands undisputed that the Respondent has
since January 1, 1971, unilaterally discontinued the
established and assumed employees' cash award program
for longevity of service and by such conduct has defaulted
in the payments of hundreds of dollars due to numerous
employees under the program, an order will be issued
directing the Respondent to restore the status quo ante of
all employees who have become entitled to the cash service
awards under the program since January 1, 1971, by
making payments with interest to them in accordance with
the previously established schedule as set forth in the
Findings of Fact above. Leeds & Northrup Co., 162 NLRB
987, 988, enfd., 391 F.2d 874, 879-880 (C.A. 3). As the
Respondent's default on the payments due its employees
under the established employees' service cash award
program is virtually equivalent to a unilateral reduction of
an agreed wage, no less than the indicated order is required
to effectuate the policies of the Act.
As a further aid to the restoration of the status quo ante
of the established employees' service award program, the
Respondent will also be required to cancel any changes in
the monetary portion of the service award program which
have resulted in financial or other detriment to employees,
and to continue the payments of the cash awards for
longevity of service to employees as they become eligible
thereto under the terms of the program until the Respon-
dent and the Union have negotiated in good faith to
agreement on any proposed changes in the present
program or to impasse thereon.
In addition an order will be issued requiring the
18 In the event no exceptions are filed as provided by Sec 102 46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions , and recommended Order herein shall , as provided in Sec
Respondent to bargain concerning future proposed
changes in the employees ' service award program , but, as
the Union is not contesting Respondent's presently
proposed changes in the pin emblems and wrist watch
items in the service award program , no order will be issued
with respect to such heretofore proposed changes.
Finally, because of the character of the unfair labor
practice herein found , in order to effectuate the policies of
the Act, the Respondent will be ordered to cease and desist
from in any other manner interfering with , restraining, and
coercing employees in the exercise of their rights guaran-
teed by Section 7 of the Act.
Upon the foregoing findings of facts , conclusions of law,
and the entire record , and pursuant to Section 10(c) of the
Act, the following is recommended.18
ORDER
Respondent, Conval-Ohio, Inc., its officers, agents,
successors, and assigns, shall:
1. Cease and desist from:
(a) Unilaterally discontinuing, abrogating, canceling,
suspending, modifying, or withholding payment in full or
in part or the monetary portion of the employees' service
award program which has been in effect since 1968,
involving Respondent's employees in the following de-
scribed unit:
All production and maintenance employees, only at
Machining and Assembly, Wadsworth, Ohio, but
excluding clerical employees, dispatchers, professional
employees, watchmen, guards and supervisors as
defined in the Labor-Management Act of 1947, as
amended, and at the Casting Plant, Orrville, Ohio, but
excluding clerical employees, dispatchers, production
planners, professional employees, watchmen, guards
and supervisors, as defined in the Labor-Management
Act of 1947, as amended.
(b) Refusing or failing to bargain collectively in good
faith with Local 908, International Brotherhood of Boiler-
makers, Iron Shipbuilders, Blacksmiths, Forgers and
Helpers, AFL-CIO, as an exclusive collective-bargaining
representative of Respondent's employees in the unit
described in paragraph 1(a) of this Order, with regard to or
concerning the subjects, referred to in said paragraph 1(a)
of this Order.
(c) Taking any other unilateral action on or affecting
said employees service award program or any other term or
condition of employment without prior consultation and
bargaining with said Union.
(d) In any like or related manner interfering with any
effort of said Union to bargain collectively on behalf of
said unit employees; or interfering with, restraining, or
coercing said employees in their rights and efforts to
bargain collectively or to assert and enjoy their rights
guaranteed under Section 7 of the National Labor
Relations Act, as amended.
2. Take the following affirmative action which will
effectuate the policies of the Act:
(a) Make whole each and every person employed since
102.48 of the Rules and Regulations , be adopted by the Board and become
its findings , conclusions , and Order, and all objections thereto shall be
deemed waived for all purposes
96 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
January 1, 1971, in the bargaining unit described in
paragraph 1(a) of this Order for any loss which he or she
may have suffered by reason of Respondent 's unilateral
cancellation , suspension , withholding , or failure to pay the
monetary service award , by payment thereof to each such
person forthwith in accordance with the previously
established schedule in effect since March 1 , 1968, in the
manner set forth in the "Remedy" section of the Decision
in this proceeding , together with interest thereon at the rate
of 6 percent per annum from January 1, 1971, to the date
of payment in accordance with this Order . This order shall
also apply to all eligible employees who have retired since
January 1, 1971.
(b) Upon request , bargain collectively in good faith with
Local 908, International Brotherhood of Boilermakers,
Iron Shipbuilders , Blacksmiths , Forgers and Helpers,
AFL-CIO, as the statutory representative of Respondent's
employees in the above-described unit, concerning any
proposed change in the monetary portion of the service
awards program in effect for said employees since March
1, 1968, and concerning any other term or condition of said
employees ' employment.
(c) Cancel any changes of benefits or working conditions
of its employees in said Union made on January 1, 1971, or
later , which may have resulted in financial or other
detriment to said employees, and continue the payment of
the cash awards for longevity of service to our employees
as they become eligible thereto under the terms of the
program until the Respondent and the Union have
negotiated in good faith to agreement on any proposed
changes in the present program or impasse thereon.
(d) Post in Respondent's plants located at Wadsworth,
and Orrville, Ohio, copies of the attached notice marked
"Appendix." 19 Copies of said notice, on forms provided by
the Board's Regional Director for Region 8, after being
signed by Respondent's authorized representative, shall be
posted by Respondent immediately upon receipt thereof
and maintained by it for a period of 60 days thereafter, in
conspicuous places, including all places where notices to
employees are customarily posted. Reasonable steps shall
be taken by the Respondent to ensure that said notices are
not altered, defaced, or covered by any other material.
(e) Notify the Regional Director, for Region 8, in
wasting, within 20 days from the date of receipt of this
Decision, what steps have been taken to comply there-
with.20
The complaint is dismissed insofar as it alleges that
Respondent engaged in any unfair labor practices other
than those found herein.
19 In the event that the Board's Order is enforced by a Judgment of a 20 In the event that this recommended Order is adopted by the Board
United States Court of Appeals, the words in the notice reading "Posted by after exceptions have been filed, this provision shall be modified to read
Order of the National Labor Relations Board" shall read "Posted pursuant "Notify the Regional Director for Region 8, in writing, within 20 days from
to a Judgment of the United States Court of Appeals enforcing an Order of the date of this Order, what steps the Respondent has taken to comply
the National Labor Relations Board " herewith