Creative Engineering, Inc.

National Labor Relations Board - Board Decisions

Mar 4, 1977

228 N.L.R.B. 582 (N.L.R.B. 1977)

582 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Creative Engineering, Inc. and United Steelworkers of
America. Case 25-CA-7421
March 4, 1977
DECISION AND ORDER
BY CHAIRMAN MURPHY AND MEMBERS
FANNING AND JENKINS
On September 29, 1976, Administrative Law Judge
Elbert D. Gadsen issued the attached Decision in
this proceeding. Thereafter, Respondent filed excep-
tions and a supporting brief, and the General
Counsel filed limited exceptions, and a brief in
support of the Administrative Law Judge's Decision.
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
briefs and has decided to affirm the rulings, find-
ings, ' and conclusion2 of the Administrative Law
Judge as modified herein.
The Administrative Law Judge found, and we
agree, that Respondent violated Section 8(a)(5) of the
Act by refusing to bargain with the Union after the
collective-bargaining contract expired on March 1,
1975, and by withdrawing recognition of the Union
in the absence of objective considerations to support
a reasonable doubt of the Union's majority. We
further find that such conduct also violated Section
8(a)(1) of the Act.3 The General Counsel has
excepted to the failure of the Administrative Law
Judge to find that Respondent also violated Section
8(a)(5) of the Act as alleged in the complaint by
bargaining individually with nonunion employees
hired after the contract expired concerning wages
and working conditions and by unilaterally and
without notice to the Union refusing to follow the
established conditions of work regarding supervisors'
performing bargaining unit work. We find merit in
the General Counsel's exceptions.
The record shows that, after Respondent laid off
unit employees covered by the collective-bargaining
contract around February 1975 because of economic
' We do not adopt the Administrative Law Judge's finding, stated in In 2
of his Decision , that Respondent 's attorney, Blankenship, credibly testified
that he offered the Union an opportunity to examine its books . Attorney
Blankenship did not appear as a witness and the sole discussion of the
alleged offer was the following exchange between Blankenship and the
Union's staff representative, Donald Tobin , during cross-examination of the
latter
Q. Did we also at that particular time, Mr. Tobin, offer to let you
look at the Company books
A That part I do not recall - I'm not saying you did and I'm not
saying you didn't
reasons, it thereafter hired new employees in the
spring and summer of 1975 to perform unit work.
The individuals hired were not members of the
Union, and Respondent's president testified that the
wage rates were, in effect, established by bargaining
directly with the individual applicants without regard
to the wage rates and fringe benefits which were paid
under the recently expired collective-bargaining
contract. The wage rates were below the union scale
and certain fringe benefits were eliminated.
In addition, the record shows that Respondent
permitted supervisors to perform bargaining unit
work during the same period. The use of supervisors
for unit work was prohibited under the agreement
with the Union except under certain specified
conditions. Admittedly Respondent did not notify
the Union nor bargain with the Union concerning
the utilization of supervisors.
Accordingly, we find on the basis of the above
conduct that Respondent violated Section 8(a)(5)
and (1) of the Act.
Remedy
In view of our findings above we revise the
recommended remedy of the Administrative Law
Judge to require that Respondent also cease and
desist from individually bargaining with individual
employees and from permitting supervisors to per-
form bargaining unit work in derogation of estab-
lished practices. In addition, we shall require Re-
spondent to make the nonunion employees hired
whole for any loss of pay or other benefits that they
may have suffered by reason of Respondent's refusal
to pay them wages and fringe benefits established
through collective bargaining with the Union, plus 6-
percent interest.
Because the bargaining unit employees who are
members of the Union and were laid off on and
around February 1975 are no longer employed by
Respondent, so far as the record shows, we shall
require that, in addition to posting the attached
notice at Respondent's plant as recommended by the
Administrative Law Judge, Respondent shall be
Also, in the same footnote the Administrative Law Judge inadvertently
indicated that the Union contacted Respondent in October 1975, rather
than by letter dated September 30, 1975, that it wished to resume
bargaining
2 In agreeing with the Administrative Law Judge that Respondent
violated Sec . 8(a)(1) and (3) of the Act by not calling the laid-off unit
employees back to work, we rely on, in addition to the rationale set forth in
his Decision , the admission of Respondent's president , Crandall, that the
laid-off employees were not called back because they were union employees
and that people could be hired off the streets for less money.
3 In adopting the Administrative Law Judge's Conclusion of Law 3, we
additionally conclude that Sec. 8(a)( I) was violated.
228 NLRB No. 67
CREATIVE ENGINEERING 583
required to mail a copy of the notice to the laid-off
union employees.4
Additional Conclusions of Law
Insert the following as conclusions 5 and 6 and
renumber conclusion 5 as 7:
"5. By individually bargaining with individual
applicants for employment on and after April 14,
1975, as to wages and working conditions, Respon-
dent violated Section 8(a)(5) and (1) of the Act.
"6. By allowing supervisors to perform bargain-
ing unit work on and after April 14, 1975, without
notice to and bargaining with the Union and in
derogation of established practices, the Respondent
violated Section 8(a)(5) and (1) of the Act."
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board hereby orders that the Respondent,
Creative Engineering, Inc., Elkhart, Indiana, its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Unilaterally changing terms and conditions of
employment by hiring new nonunion-member em-
ployees at a lower rate of pay.
(b) Unilaterally changing a substantial part of its
production work to engineering work.
(c) Refusing to recall any of its union-member laid-
off employees to perform unit production work.
(d) Withdrawing recognition of the Union in the
absence of reasonable and objective considerations
to support a good-faith doubt that the Union
continued to enjoy majority status.
(e) Discriminating in regard to tenure of employ-
ment of its union-member laid-off employees, there-
by discouraging membership in the Union or other
labor organization.
(f) Bargaining with individual employees as to
wages and working conditions.
(g) Permitting supervisors to perform bargaining
unit work.
(h) In any other manner interfering with, restrain-
ing, or coercing employees in the exercise of their
rights guaranteed in Section 7 of the Act.
2. Take the following affirmative action necessary
to effectuate the policies of the Act:
(a) Upon request, bargain with United Steelwork-
ers of America as the exclusive representative of
Respondent's employees in the unit herein found
appropriate, and embody any understanding reached
in a signed agreement.
(b) Offer to those union-member laid-off employ-
ees whom Respondent would have recalled to
perform the work Respondent hired new nonunion-
member employees to perform reinstatement to their
former positions or, if such positions no longer exist,
to substantially equivalent positions, without preju-
dice to their seniority or other rights previously
enjoyed, and make them whole for any loss of pay
suffered by reason of the discrimination against them
with interest at the rate of 6 percent, in the manner
described in the section entitled "The Remedy."
(c) Make the nonunion employees hired as the
result of individual bargaining in the spring and
summer of 1975 whole for any loss of pay and
benefits in accordance with the established wage
scale and established fringe benefits schedule, with
interest in accord with F. W. Woolworth Company, 90
NLRB 289 (1950), and Plumbing & Heating Co., 138
NLRB 716 (1962).
(d) Preserve and, upon request, make available to
the Board or its agents, for examination and copying,
all payroll records, social security payment records,
timecards, personnel records and reports, and all
other records necessary to analyze the amount of
backpay due under the terms of this Order.
(e) Post at Respondent's plant in Elkhart, Indiana,
copies of the attached notice marked "Appendix." 5
Copies of said notice, on forms provided by the
Regional Director for Region 25, after being duly
signed by Respondent's representative, shall be
posted by Respondent immediately upon receipt
thereof, and be maintained by it for 60 consecutive
days thereafter, in conspicuous places, including all
places where notices to employees are customarily
posted. In addition, copies of the notice, duly signed
by the Respondent's representative, shall be mailed
to all employees who were laid off around February
1975 who were members of the bargaining unit.
Reasonable steps shall be taken by Respondent to
insure that said notices are not altered, defaced, or
covered by any other material.
(f) Notify the Regional Director for Region 25, in
writing, within 20 days from the date of this Order,
what steps Respondent has taken to comply here-
with.
4 Southland Manufacturing Corp, 157 NLRB 1356, 1358 (1966).
5 In the event that this Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by Order
of the National Labor Relations Board" shall read "Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board."
584 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT refuse to recognize and bargain
collectively with United Steelworkers of America
by unilaterally changing terms and conditions of
employment in hiring new nonunion-member
employees instead of recalling our union-member
laid-off employees, by changing a substantial
portion of our production work to engineering, or
by refusing to timely meet with United Steelwork-
ers of America upon its request.
WE WILL NOT bargain individually with appli-
cants for employment as to wages, hours, and
working conditions.
WE WILL NOT allow supervisors to perform
bargaining unit work without notice to and
bargaining with the Union.
WE WILL NOT discourage membership in
United Steelworkers of America, or any other
labor organization, by hiring new nonunion-
member employees instead of recalling our union-
member laid-off employees, or otherwise discrimi-
nating in any manner with respect to their tenure
of employment or any term or condition of
employment.
WE WILL NOT in any other manner interfere
with, restrain, or coerce employees in the exercise
and enjoyment of rights guaranteed to them by
Section 7 of the National Labor Relations Act,
except to the extent that such rights may be
affected by lawful agreements in accord with
Section 8(a)(3) of the Act.
WE WILL offer to those union-member laid-off
employees, whom we would have recalled to
perform the work we hired new nonunion-mem-
ber employees to perform reinstatement to their
former positions or, if such positions no longer
exist, to substantially equivalent positions, with-
out prejudice to their seniority or other rights and
privileges enjoyed by them, and make them whole
for any loss of pay they may have suffered by
reason of our refusal to recall them, with interest
at the rate of 6 percent per annum.
WE WILL make the nonunion-member employ-
ees hired to perform work in the bargaining unit
at rates of pay and other benefits through
individual bargaining whole for any loss of pay or
other benefits that they may have suffered by
reasons of Respondent's refusal to pay them
wages and fringe benefits established through
collective bargaining with the Union, plus 6-
percent interest.
WE WILL, upon request, bargain collectively in
good faith with United Steelworkers of America
as the exclusive bargaining representative of all of
the employees in the bargaining unit herein found
appropriate.
WE WILL mail copies of this notice to all
employees who were members of the bargaining
unit at the time of the February 1975 layoff. The
appropriate bargaining unit is composed of:
All production and maintenance employees
of the Respondent employed at its facility
exclusive of all office clerical employees, all
plant clerical employees, all engineering
employees and all professional employees,
guards and all supervisors as defined in the
Act constitute a unit appropriate for the
purpose of collective bargaining within the
meaning of Section 9(b) of the Act.
All our employees are free to become, remain, or
refuse to become or remain members of said union or
of any other labor organization, except to the extent
that such rights may be affected by lawful agree-
ments in Section 8(a)(3) of the Act.
CREATIVE ENGINEERING,
INC.
DECISION
STATEMENT OF THE CASE
ELBERT D. GADSDEN, Administrative Law Judge: Upon
a charge of unfair labor practices filed on October 10, 1975,
by United Steelworkers of America, hereinafter referred to
as the Union, a complaint was issued by the General
Counsel of the National Labor Relations Board on
January 30, 1976, against Creative Engineering , Inc., herein
called Respondent. The complaint alleged that Respondent
committed certain unfair labor practices by refusing to
recall laid-off employees for engaging in concerted and/or
union activities, thereby discriminating against them; by
bargaining with representatives of its own choosing even
though it knew it was bound to bargain with the duly
designated Union herein; by refusing to recognize and
bargain with said Union in that it unilaterally bargained
individually and directly with employees on mandatory
subjects of bargaining; and by abrogating the seniority and
recall provisions of its collective-bargaining agreement, all
in violation of Sections 8(a)(1), (3), and (5) and 2(6) and (7)
of the National Labor Relations Act, as amended, herein
called the Act.
The hearing in the above matter was held before me in
Goshen, Indiana, on March 29 and 30, 1976. Briefs have
been received from counsel for the General Counsel and
counsel for Respondent, respectively, which have been
carefully considered.
CREATIVE ENGINEERING 585
Upon the entire record in this case and from my
observation of the witnesses , I hereby make the following:
FINDINGS OF FACT
1. JURISDICTION
Respondent Creative Engineering , Inc., is now, and has
been at all times material herein , a corporation duly
organized under and existing by virtue of the laws of the
State of Indiana . Respondent maintains its principal place
of business at Elkhart , Indiana, where it is and has been at
all times material herein , engaged in the manufacture, sale,
and distribution of office furniture and/or engineering
technology . During the past calendar year , a representative
period, Respondent, in the course and conduct of its
business operations , manufactured , sold, and distributed at
its plant products valued in excess of $50,000 which were
shipped from said plant directly to States other than the
State of Indiana . During the same period, Respondent
purchased, transferred, and delivered to its plant goods and
materials valued in excess of $50,000 which were transport-
ed to the plant directly from States other than the State of
Indiana.
The complaint alleges , Respondent admits , and I find
that Respondent is engaged in commerce within the
meaning of Section 2 (6) and (7) of the Act.
U. THE LABOR ORGANIZATION INVOLVED
The complaint alleges, the answer admits, and I find that
the United Steelworkers of America, the Union herein, is a
labor organization within the meaning of Section 2(5) of
the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Background
Approximately 14 years ago Respondent started business
as Contour Art and later became known as Creative
Engineering , Inc., for the purpose of manufacturing
fiberglass bucket chairs with foam, vinyl, nylon, and wool,
such as are found in airport terminals and theaters. The
owners of Respondent are Eugene Crandall , president and
chairman of the board of directors ; Franklin Miles,
executive vice president, treasurer , and director; and
Roland Oberchain , secretary and director; all with owner-
ship interest of 20 percent, 60 percent, and 20 percent,
respectively . Since on or about August 5 , 1967, the
International Union of District 50, since merged with and
now known as the United Steelworkers of America, was
designated or selected the certified representative for
purposes of collective bargaining with Respondent for
employees in the appropriate collective-bargaining unit
described as follows:
All production and maintenance employees of the
Respondent employed at its facility exclusive of all
office clerical employees , all plant clerical employees,
all engineering employees and all professional employ-
ees, guards and all supervisors as defined in the Act
constitute a unit appropriate for the purpose of
collective bargaining within the meaning of Section
9(b) of the Act.
Although Respondent and the Union were parties to
several collective-bargaining agreements , their last such
agreement covered the unit heretofore described from the
effective date of March 1, 1973, until its expiration on
March 1, 1975.1
B. The Binding Obligations of the Parties to
Bargain and the Question of Contractual Obligations
The credible testimony of Donald Tobin, staff represen-
tative for the United Steelworkers of America, herein
called the Union, established that prior to August 9, 1972,
the Union was known as District 50 of the United
Mineworkers until its merger with the United Steelworkers
of America. Prior to the expiration of the last contract (G.
C. Exh. 2) on March 1, 1975, the Union sent Respondent a
letter dated December 17, 1974, in which it advised
Respondent of the upcoming termination of its current
contract on February 19, 1975 (G. C. Exh. 3), and
expressing its desire and request to negotiate terms and
conditions of a new collective-bargaining agreement.
Respondent replied by letter dated December 20, 1974 (G.
C. Exh. 4), pointing out an error in the Union's letter of the
expiration date of its contract as February 19, 1975, instead
of March 1, 1975. Respondent further advised the Union to
contact its representative (Ray Blankenship) to schedule a
time and place for negotiations pursuant to the Union's
request.
Subsequently, the parties' representatives met on Febru-
ary 25, 1975, when both sides expressed their demands and
limitations . The Union suggested the next meeting for
February 27 and 28, but Respondent said it would not be
able to meet at that time . Respondent thereafter suggested
a date in March, but the Union said it could not be present
at that time. However , representatives of the parties met
again on April 8, 1975, when the Union appeared at the
plant at 2 p.m., but Respondent's representative (Blanken-
ship) did not appear until 3 p.m. An argument ensued as to
whether the meeting had been set for 2 or 3 o'clock and the
Union was ordered off Respondent's premises until 3 p.m.
The union representative , Tobin, rejected the 3 p.m. time.
The next bargaining meeting was scheduled for June 10
and when the union representative arrived he was advised
by Blankenship (Respondent) that he could not meet
because his father was critically W. The parties then agreed
and did in fact meet on June 17 , 1975 , when they presented
proposals and counterproposals. An impasse did not
develop on any of the issues.
The Union sent a letter dated September 30, 1975, to
Blankenship advising that it had not as yet selected an
arbitrator and suggested that the next negotiation session
be scheduled for October 13, 1975.
With respect to a request for negotiations, Tobin
admitted on cross-examination that he had received
I The facts set forth above are undisputed and are not in conflict in the
record.
586 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Blankenship's letter dated January 2, 1975 (Resp. Exh. 1)
in which he was advised in part as follows:
I would suggest we begin negotiations as soon as
possible because it would serve no useful purpose to go
in negotiations with an expired contract.
Would you have Mr. Tobin contact me on this
matter as soon as possible.
In a letter dated October 6, 1975, Blankenship (Respon-
dent) acknowledged receipt of the Union's letter of
September 30, 1975, and advised the Union that Respon-
dent had reason to believe that the Union no longer
represented the employees and, therefore, it would no
longer bargain for a collective -bargaining agreement. It
further advised that Respondent took the position that, due
to the hiatus of time in the noted arbitration case , such case
is no longer to be arbitrated.
On cross-examination Tobin said he could not deny that
Respondent (Blankenship) did not contact him first about
scheduling negotiation meetings and he admitted that,
during the June 17 meeting , Respondent insisted on its
supervisors being permitted to perform production work;
that the Company had financial problems; and that, if
Respondent had to pay a 1-cent increase in pay , it would
have to go out of business. When asked did Respondent at
that time also advise the Union that it could look at its
books so that it would be able to determine whether
Respondent was telling the truth, Tobin said he could not
deny that Blankenship said that but that he could not recall
his saying so?
In an effort to show that the Union no longer represent-
ed the unit employees, Respondent introduced a letter
dated August 9, 1974 (Resp. Exh. 3), in which Respondent
was advised by an appointed arbitrator, David Dolnick
that the latter had been appointed arbitrator and asked to
be advised, by return mail, of the date and place the parties
(Respondent and Union) agreed to meet for the arbitration
hearing. Tobin admitted he did not ever contact Dolnick
concerning a date for arbitration and that he could not
recall whether he had received three letters for arbitration
from Dolnick between June and September 30, 1975. He
testified that his reasons for not seeking negotiations
sooner are as follows:
A. Well, due to contract negotiations at one other
plant, two other plants here in Elkhart, and the fact that
our people were already laid off, and not working, we
did have other people who were working and tried to
negotiate a contract for them . I felt that it was useless to
take time that could be spent better for plants that were
in operation, take time away from them, and go to
something where there was no production being run
and nobody being worked.
Tobin said that he did not know as a fact that
Respondent had employed or hired new employees to
replace those employees on layoff. After checking his
notes, he changed his testimony and advised that he had
processed two arbitration grievances in 1975.
C. The Changing Progress of Respondent's Business
and Actions Taken by it in the Interim
In June or July 1974 Respondent employed as many as
20-25 production and maintenance workers , but business
fell off in the fall, and it laid off some employees. The laid-
off employees were subsequently recalled until business
declined again in February 1975, when Respondent laid off
all of its employees, advising them that they would be
recalled when business improved . There is no dispute that
the employees were not fired. In May, June , July, and
August 1975, Respondent concluded it had enough work to
hire some new people to do work (2 or 4 weeks in duration)
which need it characterized as temporary spasmatic help.
None of the new employees were employees who had been
laid off.
At the time of this proceeding Respondent had working
in its plant , two production workers, himself, and the
engineer, plus two part-time workers doing prototype work
for 1 day a week on one customer account . Respondent's
business records showed that some 14 or 15 unit employees
in production worked 40 hours during the week of July 26,
1974; and that one worked 30 hours. All such employees
were union members . Tom Varney, engineer for Respon-
dent for about a year and a half, sometimes acts as
supervisor and he had participated in negotiations with the
Union. Since all production and maintenance employees
were laid off on or before February 1975, none of such
employees have been recalled before or after April 14,
1975, but Respondent acknowledged having hired new
temporary employees at a lesser rate of pay than he had
previously paid his laid-off employees. Respondent did
$182,000 worth of business in 1975. In some instances the
new employees were paid $3 an hour while the laid-off
union employees were paid as much as $4.50 an hour. The
new employees did not receive some of the fringe benefits
the prior laid-off employees had received. When Respon-
dent hired new employees after April 14, 1975, it did not
notify the Union it had such work or that it was not going
to recall its laid-off employees because it concluded it had
no responsibility to the Union.
With respect to supervisors of Respondent performing
production work, Respondent said it allowed supervisors
or anyone else to perform bargaining unit work after April
14, 1975, because it had no contract with the Union; that
the union employees were absent (being on layoff) and its
procedure fell within the exception clause of the contract
for supervisors to do such work . In responding to questions
by counsel for the General Counsel, Respondent (Cran-
dall) said it did not recall its laid-off employees first,
because it had no responsibility to them and, secondly,
because work was so "spasmatic" that such employees
would have gotten only 3 days' work a week. He
acknowledged that all of the employees laid off were union
members.
President Crandall did not remember a letter from Tobin
dated September 30 (G. C . Exh. 5), asking for a bargaining
session but he did remember Respondent's counsel
(Blankenship) writing a reply (G. C. Exh. 6) in which he
2 1 credit Blankenship 's testimony that Respondent did offer the Union contact Blankenship to set the date for the next negotiation session, but he
an opportunity to exarrune its books. Tobin admitted that he agreed to in fact did not contact Blankenship from June 17 to October 1975.
CREATIVE ENGINEERING 587
advised the Union that Respondent had no responsibility
to bargain with the Union. Off and on since the fall of
1975, Respondent has terminated the production part of
his business operation and continued the engineering part
of his business , of which fact Respondent acknowledged it did
not notify the Union and afford it an opportunity to bargain
about the matter. Respondent also admitted that it started
farming out engineering work to Cordell in 1974 when it
had more business at Creative Engineering than it could
handle; that it received a royalty on all work farmed out to
Cordell which because profitable, while the same such
work was not profitable at Creative because he could
collect from the customers.
In 1976 Respondent produced about 500 prototype
chairs (chairs with different technology on helms and back,
which were engineered differently). If the customers liked
the prototype chairs, they would then buy the production
machines and the entire engineering concept. The proto-
tyes were so few in number that they were usually
produced by Crandall and Respondent engineer, Varney.
The change in operation from production to engineering
was discussed by Crandall with the board of directors of
Creative Engineering about 2 years before the change took
effect. Prior to, and including, March 1975, Respondent
produced chairs primarily for the Kruger account which it
lost in 1975.
The credited testimony of President Crandall, his wife
and administrative staff assistant , Mary Crandall, and
Supervisor Juanita Varney , as well as company records,
established that beginning in November or December 1974
and continuing into January and February Respondent
laid off its unit production employees; that in the early fall
of 1974 Respondent was advised by the Krueger Company
that the latter was doing its own side chairs and fabrics and
was phasing out the need and demand for chairs from
Respondent; that, although company records from May 6,
1975, through June 27, 1975, reflect orders for chairs to the
Krueger Company, a close examination of said records
reveals that 20 or more of such orders were what
Respondent characterized as reorders (repairs, rework, or
replacements rather than original orders for new chairs);
that such reorders (or rework) were done under a warranty
or guaranty period clause in the sales contract; that since
1973 supervisors frequently did the same work unit workers
did and company records showed that from August 1,
1975, to March 30, 1976, there were no more than three
people working in the plant on an hourly or salary basis,
while prior to August 1, 1975, there were 15 to 16 hourly or
salaried persons working; and that prior to August 1, 1975,
the highest number of hours worked was 377 hours, while
after August 1, 1975, to the present time, the highest
amount of total hours worked was Ill hours and the least
hours worked was 8 hours. The difference in the number of
employees working and the number of hours worked is due
to the fact, as the records further shows, that there have
been on invoices to the Krueger Company since July 1975.
3 1 credit the testimony of George Pickens not only because I received
the distinct impression that he was making every effort to testify truthfully,
but also because his testimony with respect to changes in the amount of
production employees working, and the kind of product being manufac-
tured , was essentially consistent with the credible testimony of the witnesses
Donald Tobin further testified about a conversation held
on June 3, 1975, which he described as follows:
Q. As best as you recall, would you tell us what
your conversation with Mr. Pickens-what he said,
what you said-in that conversation?
A. George arrived at the Union hall some time
after 12:00 when the meeting had adjourned, came into
my office and wanted to know what was taking place at
Creative Engineering. I told him that I would like to
know also what was taking place. I had heard that he
was working at Creative Engineering and wanted to
know what his job entailed. He explained that he was
doing basically the same job that he had on his previous
employment- term of employment- I asked him if
the rest of the people in the plant were performing the
duties of the people that were during his first tenure
and he said yes, they were and he went on to discuss the
problems and I asked him if he had actually been
informed that he was doing any engineering work or
just what and he said well, he had never been informed
that he was doing any engineering work as far as he
knew he was doing the same job that he had prior to his
quitting the first time. He wanted to know what
happened to the other people that worked there and I
said that the Company had laid them off and had
contended that they were engineering employees and it
looked as though since they were doing the same work,
that I felt the Company was playing games with us and
asked him if he was interested in signing a Union card
to- just in case- he wasn't an engineering employee,
if they were going to bring engineering in, we would try
to organize them.
George Pickens had previously testified to the same effect
on this subject. George Pickens, an employee and union
member, testified that all of the chairs he worked on during
his last employment could have been replacements and he
admitted he had had several arguments with Varney during
his second period of employment with Respondent. He was
reemployed in his last employment at a lower salary and he
said that, when he talked with Tobin at the Union, Tobin
told him the Union was no longer in the plant and that his
salary was as low as it was because the Union was no
longer in the plant and that the contract had run out.
Pickens also stated that he had noted two different
machines and a new glue being used and he had also
noticed that employees would leave the employment of
Respondent, but he did not note any employees being
hired. He admitted that production was different .3
Analysis and Conclusions
As amplified by counsel for the General Counsel's brief,
the crucial issues presented for determination in this
proceeding are:
of Respondent. In other words, while there was in fact a greater emphasis on
developing and selling engineering, there was also still considerable
production work being carried on for which Respondent employed new
nonunion-member employees to perform at a lower salary.
588 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(1) Whether Respondent violated Section 8(aXl) and (3)
of the Act by refusing to recall its laid -off employees
because of their union and/or concerted activities, as
alleged in paragraphs 5 and 6 of the complaint.
(2) Whether Respondent violated Section 8(aX5) and (1)
of the Act by refusing to bargain collectively with the
Union as the exclusive bargaining representative of
Respondent 's production and maintenance employees, as
alleged in paragraph 7 of the complaint.
A determination of the validity of the above -described
allegations with which Respondent is charged , and the
corresponding defenses asserted by it in response thereto,
depends in part upon a determination of the veracity of the
several witnesses whose testimony is almost free from
conflict . Nevertheless, in resolving what issues of credibili-
ty as are presented by the testimony of the witnesses, I
considered the relationship of each witness to the party on
whose behalf he testified , the readily responsive , nonselec-
tive , nonexaggerating , consistent , and straightforward
manner in which he testified , the reasonableness of efforts
made by the parties to bring essential witnesses and
appropriate documentary evidence to the hearing , as well
as how such testimony or other evidence relates to the
logical consistency of all of the evidence of record and the
sequence of events as they transpired.
With respect to the refusal -to-bargain charge , Respon-
dent does not argue that prior to March 1 , 1975, the Union
was not in fact the designated and exclusive representative
of its unit production employees, but, on the contrary,
contends that when its last contract with the Union expired
on March 1, 1975, so did its obligation to bargain with the
Union, thereby justifying its hiring new nonunion -member
employees on and subsequent to April 14, 1975 . Respon-
dent further contends that on and subsequent to October 6,
1975, it was not obligated to bargain with the Union
because the Union no longer represented its employees
since it neglected to process more than two grievances
during the past year and did not request a bargaining or
negotiation session from June 14 through September 29,
1975. In support of its position , counsel for Respondent
cited the Board 's decision in George Braun Packing Co.,
210 NLRB 1028 (1974). It is not clear from the record at
what point Respondent commenced doubting that the
Union continued to represent a majority of its employees,
but it is inconceivable that Respondent held such a view
during the months January through June 1975 , when it met
and negotiated with the Union. At no time during the
negotiation sessions did Respondent ever indicate that it
entertained any question about the Union's representative
capacity with respect to its employees.
However, it is well-established law that a certified or
incumbent union gives rise to a presumption of majority
status in favor of the union . In view of this presumption
Respondent , or an employer , in addition to showing the
Union's claim for continued recognition , must demonstrate
by objective considerations that it has some reasonable
grounds for believing that the Union has lost its majority
status . United States Gypsum Co., 157 NLRB 652 (1966);
and George Braun Packing Co., supra . An examination of
the latter case , cited by counsel for Respondent , reveals
that the Board found that the Administrative Law Judge
therein gave a factual detail of the objective considerations
upon which the employer's good-faith doubt of majority
status was based . The anomaly in the instant proceeding is
that no probative objective considerations appear on the
record that would support a reasonable basis for Respon-
dent's belief that the Union herein might have lost its
majority status.
Under the above-described circumstances, the presumed
majority status of the Union has not been rebutted and
Respondent was, and remains, under a legal obligation to
bargain with the Union. Consequently, Respondent's
withdrawal of recognition of the Union, as well as its
refusal to recall any of its laid-off union-member employ-
ees instead of hiring new nonunion -member employees, all
without notification to or consultation with the Union,
constituted discrimination against its laid-off union-mem-
ber employees in violation of Section 8(a)(5) of the Act.
Respondent 's union-member laid-off employees were still
employees and, therefore, Respondent was still bound to
bargain with the Union even though the contract had
expired March 1, 1975. More specifically, since Respon-
dent was under a legal duty to bargain collectively with its
laid-off employees , its unilateral action in replacing them
with new (part-time or full-time) employees obligated it to
recall the laid-off employees instead of replacing them,
even though its prior bargaining contract had expired a few
months earlier.
Although Respondent contends that it did not recall its
laid-off employees because of a decrease in production
work resulting from a loss of the Krueger contract and a
shift in manufacturing emphasis from production to
engineering, the evidence of record bears out its contention
only in part. More specifically, while it is true that
Respondent's production of its original chairs was substan-
tially curtailed as a result of its loss of the Krueger contract
and its efforts to sell engineering , Respondent nevertheless
continued to produce a considerable number of original
chairs as well as some new prototype chairs. In carrying
out this operation , Respondent elected to hire new
nonunion-member employees at a reduced rate in pay,
instead of recalling a sufficient number of its union-
member laid-off employees as the production demand
required.
Not only did Respondent not recall any of its union
employees but it also neglected to advise them or the
Union that it had any production work, that it was shifting
a part of its operation emphasis from production to
engineering, or that it was hiring new nonunion-member
employees to perform such work at a lower pay rate. Under
sworn testimony, Respondent (Crandall) testified that the
reason it had hired the new nonunion-member employees,
in preference to recalling its union-member laid-off
employees, was because the work did not require a 40-hour
week employment and that Respondent could have such
work performed at a lower pay rate by new nonunion-
member employees. When such an admission by Respon-
dent is considered along with its changes in a substantial
part of the nature and quantity of production without
advising or consulting with the Union with which it
admitted, in part (par. f(i) of the complaint), it was bound
to bargain, the credible evidence of record is more than
CREATIVE ENGINEERING
sufficient to support the conclusion and finding that
Respondent's failure and refusal to recall its laid-off union-
member employees was discriminatory and violative of
Section 8(a)(1) and (3) of the Act.
Jurisdiction
Although Respondent in its answer to the complaint
herein denies that it is an employer engaged in commerce
within the meaning of Section 2(6) and (7) of the Act, it
nevertheless admits in paragraphs 2(c) and (d) of the
complaint the criteria upon which a determination of
jurisdiction is made. Under these circumstances, as well as
upon the credible testimony of record, I conclude and find
that Respondent, for all practical purposes, has admitted it
is an employer engaged in commerce within the meaning of
the Act, and that its denial to the contrary is merely an
academic formality without substance.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
The activities of Respondent set forth in section III,
above, occurring in connection with the operations of
Respondent described in section I, above, have a close,
intimate, and substantial relationship 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 Respondent engaged in unfair labor
practices warranting a remedial order, I shall recommend
that it cease and desist therefrom and that it take certain
affirmative action to effectuate the policies of the Act.
Having found that Respondent has refused to bargain
collectively with the Union, it will be recommended that
Respondent, upon request, bargain with the Union as the
exclusive representative of its employees in the appropriate
unit.
It having been found that Respondent interfered with,
restrained, and coerced its union-member laid-off employ-
ees in the exercise of their Section 7 protected rights, in
violation of Section 8(a)(1) of the Act, by refusing to recall
any of its union-member laid-off employees in violation of
589
Section 8(a)(3) and (1) of the Act , the recommended Order
will provide that Respondent offer to the same number of
its laid-off employees that it would have recalled had it not
hired new nonunion-member employees reinstatement to
their jobs , and make them whole for loss of earnings within
the meaning and in accord with the Board 's decision in
F. W. Woolworth Co., 90 NLRB 289 (1950), and Isis
Plumbing & Heating Co., 138 NLRB 716 (1962), except as
specifically modified by the wording of such recommended
Order.
Because of the character of the unfair labor practices
herein found, the recommended Order will provide that
Respondent cease and desist from in any other manner
interfering with, restraining, and coercing employees in the
exercise of their rights guaranteed by Section 7 of the Act.
N.L.R.B. v. Entwistle Mfg. Co., 120 F.2d 532, 536 (C.A. 4,
1941).
Upon the basis of the above findings of fact and upon
the entire record in this case , I make the following:
CONCLUSIONS OF LAW
1. Creative Engineering, Inc., the Respondent, is an
employer engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.
2. United Steelworkers of America, the Union, is and
has been at all times material herein, a labor organization
within the meaning of Section 2(5) of the Act.
3. By unilaterally changing the terms and conditions of
employment in hiring new nonunion-member employees at
a lower salary, changing some of its production work to
engineering work, failing and refusing to recall any of its
laid-off union-member employees, and withdrawing recog-
nition of the Union, Respondent violated Section 8(a)(5) of
the Act.
4. By discriminatorily refusing to recall any of its
union-member laid-off employees, thereby discouraging
membership in the Union or other labor organization,
Respondent has engaged in unfair labor practices con-
demned by Section 8(aX3) and (1) of the Act.
5. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
[Recommended Order omitted from publication.]