Cumberland Wood and Chair Corp.

National Labor Relations Board - Board Decisions

Jun 10, 1974

211 N.L.R.B. 312 (N.L.R.B. 1974)

312 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Cumberland Wood and Chair Corp . and Teamsters
Local Union 651 , affiliated with International
Brotherhood of Teamsters , Chauffeurs, Ware-
housemen and Helpers of America, Petitioner.
Case 9-RC-10208
June 10, 1974
DECISION AND CERTIFICATION OF
REPRESENTATIVE
BY MEMBERS FANNING, JENKINS, AND
KENNEDY
Pursuant to a Stipulation for Certification Upon
Consent Election executed by the parties, and
approved by the Acting Regional Director for
Region 9 of the National Labor Relations Board on
July 27, 1973, an election by secret ballot was
conducted in the above-entitled proceeding on
August 24, 1973, under the direction and supervision
of said Acting Regional Director.
Upon the conclusion of the election, a tally of
ballots was furnished the parties which shows that
there were approximately 180 eligible voters and that
179 ballots were cast, of which 89 were for the
Petitioner, 87 were against the Petitioner, 2 were
challenged, and I was void. The challenged ballots
are sufficient in number to affect the results of the
election.
On August 31, 1973, the Employer filed timely
objections to conduct affecting the results of the
election. The Acting Regional Director conducted an
investigation of the issues raised by the challenged
ballots and objections and, on November 7, 1973,
issued and duly served on the parties his Report on
Election. In his report, the Acting Regional Director
recommended, in accordance with the stipulation of
the parties, that the challenge to the ballot of Gary
Lynn be sustained, and that no disposition be made
of the challenge to the ballot of Harold Lovins as it
could not affect the results of the election. He also
recommended that the Employer's objections be
overruled and the Petitioner certified. Thereafter, the
Employer filed timely exceptions to the Acting
Regional Director's findings and recommendations
with respect to Objections 1 through 6, inclusive, and
8, and a brief in support of its exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
I The Employer's exceptions , in our opinion , raise no material or
substantial issues of fact or law which warrant reversal of the Acting
Regional Director 's findings or recommendations, or which require a
hearing. In the absence of exceptions, we adopt pro forma the Acting
Regional Director's recommendations with respect to the challenged ballots
and his recommendation that the Employer's Objections 7 and 9 be
overruled.
We conclude , contrary to our dissenting colleague, that the Petitioner has
not engaged in a material misrepresentation with respect to the Employer's
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
Upon the entire record in this case, the Board
finds:
1. The Employer is engaged in commerce within
the meaning of the Act, and it will effectuate the
purposes of the Act to assert jurisdiction herein.
2. The Petitioner is a labor organization claiming
to represent certain employees of the Employer.
3. A question affecting commerce exists concern-
ing the representation of employees of the Employer
within the meaning of Section 9(c)(1) and Section
2(6) and (7) of the Act.
4. The parties stipulated, and we find, that the
following employees constitute a unit appropriate for
the purposes of collective bargaining within the
meaning of Section 9(b) of the Act:
All production and maintenance employees
and truck drivers at Plants Nos. 1 and 2 located
on North Highway 27, Somerset, Kentucky, but
excluding all office clerical employees, technical
employees, professional employees, guards and
supervisors as defined in the Act.
5. The Board has considered the Acting Regional
Director's report and the Employer's exceptions
thereto, and hereby adopts the Acting Regional
Director's findings and recommendations.'
Accordingly, as the tally shows that the Petitioner
has received a majority of the valid votes cast, we
shall certify the Petitioner as the collective-bargain-
ing representative of the employees in the appropri-
ate unit.
CERTIFICATION OF REPRESENTATIVE
It is hereby certified that a majority of the valid
votes has been cast for Teamsters Local Union 651,
affiliated with International Brotherhood of Team-
sters, Chauffeurs, Warehousemen and Helpers of
America, and that said labor organization is the
exclusive representative of the employees in the unit
found appropriate, within the meaning of Section
9(a) of the National Labor Relations Act, as
amended.
MEMBER KENNEDY, dissenting:
My colleagues conclude that Petitioner's election
eve misrepresentation overstating the Employer's
profits. To constitute a "misrepresentation," a statement must refer to a
matter concerning which the person making the statement has, or can
reasonably be perceived to have , knowledge . The Petitioner here clearly had
no knowledge of the Employer's profits nor did it imply such knowledge.
Rather, it simply gave its estimate of the profits on the basis of a formula or
assumptions which it set forth, and which the employees could evaluate for
themselves if they chose. In our opinion , the mere fact that the formula or
assumptions proved to be erroneous does not make the estimate based
thereon a "misrepresentation."
211 NLRB No. 55
CUMBERLAND WOOD & CHAIR CORP. 313
profits by 557 percent does not constitute a substan-
tial misrepresentation within the meaning of the
Board's Hollywood Ceramics rule.2 I cannot agree.
Accordingly, I would sot the election aside.3
The election herein vas conducted on August 24,
1973. Petitioner acquired a two-vote majority-89 to
87. Nine days before the election, questions pertain-
ing to the Employer's profitability and profit-sharing
contributions were raised at a union meeting.
Petitioner's business agent, Ken Silvers, assured the
employees that he would examine "Standard &
Poor's" and "Moody's" financial references in order
to ascertain the Company's economic position.
Thereafter, by letter dated August 22, 1973-2 days
before the election-Silvers told the employees that
their wages were "poor," their fringe benefits
"terrible," they did not have any job security, and the
Company feared unionization because unionized
employees would "find out about the profits and
demand their share for their work." Silvers then
wrote:
If a Company has a profit sharing plan base [sic]
on 10% going into it and if they put $48,000 into
the plan in a year, this means that they made
$480,000 profit, almost 1/2 million dollars.
Silvers repeated these figures the day before the
election during a union meeting when he stated:
Anyone making half a million dollars is not your
friend . . . . Cumberland Wood and Chair has a
profit plan and they put 10 per cent of its profit
into it. Last year $48,000 went into the plan, and
that is 10 per cent of $480,000-their profit.
The Acting Regional Director determined that "the
utterances were incorrect." Indeed they were. During
fiscal year 1972, the Employer's corporate net profits
were not $480,000-but $73,000-and contributions
to the profit-sharing plan constituted not 10 percent
of its net profits-but 71 percent.4
In my view, the election cannot stand in the face of
such eleventh-hour distortions. Silver's misrepresen-
tations obviously constituted a substantial departure
from the truth. The Employer's assertion that it was
precluded from making an effective reply because it
was completely unaware of the misrepresentations
prior to the election is not disputed. Finally, a
company's profitability and the extent to which
2 Hollywood Ceramics Company, Inc., 140 NLRB 221, 224.
3 See also my dissenting opinion in LaCrescent Constant Care Nursing
Center, Inc., 208 NLRB No. 9.
4 Nor were these misrepresentations isolated apparently . The Employer
has supported its other objections by sworn employee affidavits , alleging,
inter alia, that Petitioner ( I) at one point stated that the Employer's profits
were $800,000, (2) claimed to have negotiated contracts at two neighboring
plants providing for average wage rates in excess of $3 per hour when in
actuality the averages were $2 and $2.25, and (3) claimed to have finalized a
third agreement which , when implemented , would provide employees with
employees share in that profitability are obviously
matters of great significance to the employees. Thus,
any misrepresentation with regard to these matters
may reasonably be expected to have a significant
impact on the election.5 Accordingly, it is evident
that all of the factors set forth by the Board in
Hollywood Ceramics, supra, for determining when
campaign misrepresentations justify setting the elec-
tion aside are present and operative here.
In finding Silver' s remarks not objectionable, my
colleagues apparently rely upon the Acting Regional
Director's conclusions that they (1) were mere
conjecture, (2) were based upon employee-supplied
statistics, and (3) were capable of evaluation by the
employees. I cannot accept these conclusions.
While the word "if" does precede the otherwise
declaratory statements regarding the Employer's
profitability and profit-sharing contributions appear-
ing in the August 22 letter, this hardly renders the
statements mere conjecture as far as the employees
are concerned. Petitioner's reference was to this
Employer-indeed, the entire letter was devoted to
allegations that the employees were being "short-
changed," and the Employer opposed unionization
for fear that it would be compelled to disclose its
profits. Furthermore, when Silvers repeated the
remarks during the union meeting on the day before
the election, they were not couched in hypothetical
terms.
Nor does the fact that Petitioner may have relied in
:part upon information initially supplied by certain
employees during an August 15 union meeting make
the remarks any less objectionable. As mentioned
earlier , Silvers noted the statistics given by the
employees and stated that he would personally
examine certain leading financial services in order to
ascertain the Employer's true financial position.
Silvers then utilized the same statistics a week later in
his letter and speech, which served to verify their
original authenticity in the minds of the employees.
'Moreover, I question the wisdom of any policy which
would permit a party to avoid responsibility for the!
accuracy of its campaign propaganda merely by
asserting that it was relying upon the representations
of others.
It is farfetched to believe that the truckdrivers and
production and maintenance employees in the unit
were sufficiently sophisticated with regard to corpo-
raises in excess of $ 1 per hour, when the initial raises were actually limited
to 35 cents per hour. Since these affidavits constitute evidence which, prima
facie, would warrant setting aside the election , the Employer's objections
raise substantial and material factual issues which the Board must resolve
through a hearing. E.g., N.L. R.B. v. Overland Hauling, Inc., 461 F.2d 944,
946-947 (C.A. 5, 1972).
5 N.L.R.B. v. G. K. Turner Associates, 457 F.2d 484, 488 (C.A. 9, 1972).
The court refused to find an 8(a)(5) violation because a union agent
allegedly told an employee that the employer had made $500,000 the
previous year, information which he said came from stock market reports.
314 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
rate procedures, accounting practices, etc., to be able
to effectively weigh and evaluate Petitioner's statis-
tics.6 Add to this the fact that the statistics were
presented in the form of a mathematical formula by
a union official who had earlier promised to research
the Employer's finances, and one can only conclude
that Silver's remarks assumed a high degree of
authenticity upon which the employees could reason-
ably be expected to rely. The test to be applied is not
"whether the speaker in fact had special knowledge,
but whether listeners would believe that he had." 7
In my judgment, this case fits squarely within the
Hollywood Ceramics rule. There was clearly a serious
misrepresentation at a time when there was no
opportunity for rebuttal. I would set the election
aside.
9 See The Halsey W Taylor Company, 147 NLRB 16, 19.
1 N. L. R. B. v. A. G. Pollard Co., 393 F.2d 239 (C A. 1, 1968).