Florida-Texas Freight, Inc.

National Labor Relations Board - Board Decisions

May 9, 1973

203 N.L.R.B. 509 (N.L.R.B. 1973)

FLORIDA-TEXAS FREIGHT, INC. 509
Florida-Texas Freight, Inc. and Truck Drivers, Chauf-
feurs and Helpers Local Union No. 100, an affiliate
of, the International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of Ameri-
ca. Case 9-CA-6737
May 9, 1973
DECISION AND ORDER
On August 25, 1972, Administrative Law Judge
Sidney Sherman issued the attached, Decision in this
proceeding. Thereafter, the General Counsel and the
Charging Party filed exceptions. Respondent Em-
ployer filed an answering brief.
The Board has considered the record and the at-
tached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge to the
extent consistent with our decision herein.
The Administrative Law Judge found, and we
agree, that Respondent reacted to the Union's de-
mand for recognition by unlawfully interrogating and
promising benefits to employees, and that Respon-
dent thereby interfered with, restrained, and coerced
its employees in the exercise of rights guaranteed
them by Section 7 of the Act in violation of Section
8(a)(l)'
The Administrative Law Judge further found that
Respondent did not terminate its employees and sub-
contract their work in violation of Section 8(a)(3) and
(5). We disagree with this dismissal of the 8(a)(5) for
the reasons set forth below.2
Until February 1971, Respondent's freight-han-
dling work was performed by employees of an inde-
pendent contractor. At that time, Respondent
terminated that arrangement and hired its own em-
ployees to perform this dock work. The Union's re-
quest for recognition followed, and Respondent then
engaged in the 8(a)(1) conduct found herein. Finally,
on December 2, 1971, the Union was certified to rep-
resent the Respondent's dock workers.
The first bargaining session between Respondent
and the Union took place on December 16, during
which certain noneconomic issues were discussed, in-
cluding a proposal by the Union that subcontracting
be prohibited by contract. Respondent, already nego-
tiating with McMullen and close to agreement with
him on a subcontract to take over the work for which
the Union had just been certified,3 a fact not disclosed
Respondent did not except to the 8 (a)(1) findings.
2 In view of our 8(a)(5) findings , and the remedy we are utilizing therefore,
we need not decide whether Respondent's conduct was also violative of
8(aX3) as alleged in the complaint.
3 Respondent's manager testified that the decision to subcontract to Mc-
to the Union, rejected this proposal. According to
Respondent's negotiator, Smith, whose testimony was
credited in this connection, he told the Union that
Respondent was "contemplating subcontracting
again" and that Respondent "had previously subcon-
tracted, that is, referring to Florida-Texas Freight,
and that was the policy of the company in its other
terminals, and that it would want the right to again
subcontract if it found it necessary to do so." When
the Union asked what would happen to the employees
in a subcontracting situation, Respondent replied that
that would be up to the subcontractor. The Union
insisted upon a contractual prohibition against sub-
contracting, and the meeting was adjourned to anoth-
er date.
Between December 16 and January 14, 1972, Re-
spondent made efforts to contact the Union, and the
Union, also without success, sought to arrange for
further bargaining. On January 14, the parties ar-
ranged a meeting for January 17, but they were un-
able to get together for that date.
On January 14, the same day on which the parties
had agreed to a January 17 meeting, the Respondent
unconditionally terminated its four dock employees
and on January 17 it subcontracted their work to
McMullen, who employed his own employees in their
stead. On January 19, a clause was added to the con-
tract with McMullen, whereby McMullen agreed to
waive the 60-day notice required for cancellation in
the event Respondent succeeded in negotiating a con-
tract with the Union.
The parties met twice more-on February 22 and
25. The Union sought immediate reinstatement of the
employees who had been terminated on January 14.
Respondent countered with contract proposals which
included an offer to reinstate the dischargees on a
probationary status for 90 days conditioned upon
their achieving a level of productivity at a cost of 25
cents per hundredweight which, upon rejection by the
Union, was changed to a proposal for a probationary
period of 6 months and 27 cents per hundredweight,
and changed employment conditions. But actual rein-
statement of the dischargees in place of the
subcontractor's employees was conditioned upon
agreement on contract terms. These meetings pro-
duced no agreement, and no more were held.
The Administrative Law Judge concluded that Re-
spondent gave sufficient notice on December 16 of its
intent to subcontract and that, in any event, any de-
fect in such notice was cured by the bargaining in
February. He further found that the Union was also
afforded an opportunity at the February meetings to
bargain about the impact of the subcontracting ac-
tion. As already indicated, we find that Respondent
Mullen was made about the end of December
203 NLRB No. 74
510 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
did not satisfy its bargaining obligation under the Act.
It can scarcely be found, as the Administrative Law
Judge has, that, at the first meeting held to negotiate
a contract, Respondent gave the Union adequate no-
tice and an opportunity to be heard with respect to the
action it took in January in terminating all the unit
employees and subcontracting their work to McMul-
len. In response to the Union's proposal for a contrac-
tual prohibition against subcontracting, Respondent
advised the Union of a general intention to continue
the use of subcontractors as deemed necessary. But it
never put the newly certified Union on notice at this
meeting that subcontracting of unit work was immi-
nent and that the employees whom it represented
were already on the verge of losing their jobs. The
need for bargaining about this immediate prospect
was simply not indicated. This single meeting ended
without resolution of the subcontracting issue which,
like the other unresolved issues, was left on the table
for further discussion. Yet, before the parties met
again, and in circumstances which do not show any
compelling necessity for such action at the moment,
Respondent subcontracted to McMullen and elimi-
nated all unit jobs. Contrary to the view of the Admin-
istrative Law Judge and the dissent's apparent
agreement therewith, these facts clearly demonstrate
to us that Respondent acted in a unilateral fashion,
without adequate notice to and consultation with the
Union.
By the time the parties next met in February, all the
employees in the unit had been terminated and a
subcontractor's employees were doing their work. The
Union repeatedly sought the immediate and uncondi-
tional reinstatement of the terminated employees.
Respondent's position was that these employees
would be reinstated only if agreement was reached on
a contract. But its contract terms, upon whose accep-
tance the reinstatement of the dischargees even on a
probationary basis depended, were unacceptable to
the Union.4 Negotiations were never resumed and, no
contract having been concluded, the terminated em-
ployees have not been reinstated.
On this record, a finding is not warranted that Re-
spondent provided the Union with a bargaining op-
portunity which effectively "cured" the statutory
violation inherent in its elimination of unit work with-
out prior consultation. The Union was presented with
a fail accompli which could not be remedied, even as
to the reinstatement of the dischargees on a proba-
tionary basis, unless it agreed to contract terms ac-
ceptable to Respondent, which it refused to do. We do
The parties were then divided over both economic and noneconomic
issues . In the latter connection , for example, Respondent 's representative
advised the Union at the February bargaining session that Respondent pro-
posed to have a contract without a union -shop clause.
not believe that meaningful discussion of the issues
posed by Respondent's unilateral conduct was possi-
ble so long as any reinstatement of the unlawfully
terminated employees who were the Union's concern
was used as bargaining bait by Respondent to force
acceptance of its terms. This could serve only to ag-
gravate, rather than cure, Respondent's delinquent
bargaining status.
We reject our dissenting colleagues' reliance on
Hartmann Luggage Company, 145 NLRB 1572, 1579
-80, as being "on all fours" with this case. The Trial
Examiner found no violation in the unilateral subcon-
tracting of unit work there because:
In view of the somewhat executory nature of
the contract with North Bay, and in view of the
full opportunity to bargain which the Company
afforded the Union on February 26, I am of the
view that the Company effectively cured the sta-
tutory violation inherent in its unilateral action.
... Stated otherwise, the Union's failure to ask
that the . . . contract be rescinded or not effectu-
ated, and the Union's concentration on other as-
pects of the situation, amounted to an
acquiescence in the Company's determination,
and removed the unilateral character with which
that determination had been tainted. The execu-
tory nature of the . . . contract serves to distin-
guish this case from Adams Dairy, Inc.... where
the Board held that the employer could not "ret-
roactively remedy its default by pointing out that
in its meeting with the employees . . . when the
subcontracting operation and the consequent
discharge of the driver-salesmen was already a
fait accompli, neither the Union nor the employ-
ees sought to bargain concerning that action."
In the case before us, although faced with the sub-
contracting as a fait accompli, the Union never ac-
quiesced in this unilateral action by Respondent.
Unlike the union in Hartmann Luggage, the Union
herein did not concentrate its demands on matters
concerning the effects of the subcontracting. Indeed,
it made no proposals which were based on acceptance
of the subcontracting as an irreversible fact. Instead,
at all times, its efforts were concentrated on rescind-
ing that action and securing the reinstatement of the
terminated employees by the Respondent and its con-
tinued representation of them under its certification.
But any return of these locked-out employees was
barred by Respondent except upon conclusion of a
contract with economic and noneconomic provisions
acceptable to it. Manifestly, this is not bargaining
such as in Hartmann Luggage which might, under the
Trial Examiner's rationale therein, support a finding
that the unlawful unilateral action had been "cured."
Moreover, although the Board agreed with the Trial
FLORIDA-TEXAS FREIGHT, INC. 511
Examiner's ultimate conclusion in Hartmann Lug-
gage, it did not subscribe to the Trial Examiner's ra-
tionale as suggested by the dissent. In a case where the
parties had enjoyed a long bargaining relationship
and on a record which, as the Trial Examiner found,
"is devoid of any suggestion of conduct indepen-
dently violative of Section 8(a)(1)," the Board rested
its decision "upon our evaluation of the Respondent's
overall conduct, both prior and subsequent to the
execution of the subcontracting agreement." We have
similarly evaluated Respondent's overall conduct in
arriving at our decision herein.
REMEDY
Having found that the Respondent has engaged in
and is engaging in certain unfair labor practices we
shall order them to cease and desist therefrom and
take certain affirmative action designed to effectuate
the policies of the Act.
To remedy Respondent's violation of Section
8(a)(5) by its unilateral subcontracting of unit work,
we shall order that the Respondent cease and desist
from unilaterally subcontracting unit work or other-
wise making unilateral changes in its employees'
terms and conditions of employment without consult-
ing with their designated representative. We shall also
order the Respondent to restore the status quo ante by
restoring its freight-handling operation and reinstat-
ing its employees to the positions which they held
prior to their unlawful termination, and we shall
award backpay to these employees based on the earn-
ing which they normally would have received between
the date of discharge and the date of reinstatement, in
the manner set forth in F. W. Woolworth Company,5
together with 6-percent interest thereon in accordance
with Isis Plumbing & Heating Co.6
ORDER
Upon the entire record in this case, and pursuant to
Section 10(c) of the National Labor Relations Act, as
amended, the National Labor Relations Board hereby
orders that the Respondent, Florida-Texas Freight,
Inc., at its operation in Cincinnati, Ohio, its officers,
agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Interrogating employees about their union ac-
tivities and sentiments or those of other employees
and offering them inducements to refrain from union
activity.
5 90 NLRB 289, 291-293.
6 138 NLRB 716.
(b) Refusing to bargain collectively with Truck
Drivers, Chauffeurs and Helpers Local Union No.
100, an affiliate of the International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers
of America, as the exclusive bargaining representative
of the Respondent's employees in the appropriate
freight-handling unit with respect to wages, hours,
and other terms and conditions of employment; and
from unilaterally subcontracting unit work or other-
wise unilaterally changing the wages, hours, and other
terms and conditions of employment of unit employ-
ees without prior bargaining with the above-named
Union or any other union they select as their exclusive
bargaining representative.
(c) In any like or related manner interfering with,
restraining, or coercing employees in the exercise of
rights under Section 7 of the Act.
2. Take the following affirmative action which the
Board finds will effectuate the policies of the Act:
(a) Reinstate the freight-handling operation previ-
ously performed by its employees represented by
Truck Drivers, Chauffeurs and Helpers Local No.
100, an affiliate of the International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers
of America, and offer to those employees immediate
and full reinstatement to their former positions or, if
those positions no longer exist, to substantially equiv-
alent positions, without prejudice to their seniority or
other rights and privileges, and make them whole for
any loss of pay suffered by them in the manner set
forth in the section above entitled "Remedy."
(b) Bargain collectively with Truck Drivers,
Chauffeurs and Helpers Local Union No. 100, an
affiliate of the International Brotherhood of Team-
sters, Chauffeurs, Warehousemen and Helpers of
America, as the exclusive bargaining representative of
the Respondent's employees in the , appropriate
freight-handling unit with respect to wages, hours,
and other terms and conditions of employment.
(c) 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 oth-
er records necessary to analyze the amount of back-
pay due and the rights of reinstatement under the
terms of this Order.
(d) Post at its plant in Cincinnati, Ohio, copies of
the attached notice marked "Appendix.,' 7 Copies of
said notice, on forms provided by the Regional Direc-
tor for Region 9, after being duly signed by the
7 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."
512 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Respondent's representative, shall be posted by Re-
spondent 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. Reasonable
steps shall be taken by Respondent to insure that said
notices are not altered, defaced, or covered by any
other material.
(e) Notify the Regional Director for Region 9, in
writing, within 20 days from the date of this Order,
what steps the Respondent has taken to comply here-
with.
CHAIRMAN MILLER AND MEMBER KENNEDY , dissenting
in part:
We believe that the Administrative Law Judge
reached a commonsense, realistic conclusion, which
was also in accord with the precedent of the Hartmann
Luggage case,8 in dismissing the 8(a)(5) allegation of
the complaint. Accordingly, we dissent from so much
of the majority's decision as reverses the Administra-
tive Law Judge and finds a violation of Section
8(a)(5).
Respondent, a freight forwarder, operates a num-
ber of freight terminals throughout the United States,
including the terminal at Cincinnati, Ohio, alone in-
volved in this proceeding. For the most part, Respon-
dent subcontracts the handling of freight at its various
docks. Until February 1971, Respondent similarly
subcontracted the freight handling at the Cincinnati
terminal to an independent contractor, Cummins
Cartage Company. Thereafter, Respondent under-
took the freight-handling work with its own employ-
ees. However, it found this arrangement more costly
than when the work was subcontracted. Beginning in
March or April 1971, long before the advent of the
Union, Respondent began looking for a new subcon-
tractor to take over the freight-handling work. It was
unsuccessful in these efforts until December 1971,
when it received what it regarded as an acceptable
offer from one McMullen. Meanwhile, the Union had
begun its organizational activities among
Respondent's freight handlers in August 1971. A rep-
resentation election was held on November 23, and
resulted in a union victory and a certification on De-
cember 2.
The two parties met in their first collective-bargain-
ing session on December 16. At this meeting, the
Union proposed a contract clause prohibiting the sub-
contracting of unit work. Respondent rejected the
proposal and stated that it was considering subcon-
tracting the freight-handling work. No further negoti-
ating sessions were held until February 22, although,
8 Hartmann Luggage Company, supra
as found by the Administrative Law Judge, Respon-
dent "made diligent, but unsuccessful, efforts to con-
tact the Union for the purpose of resuming
negotiations and delayed consummating any deal
with McMullen because of the pendency of such ef-
forts." On January 14, 1972, Respondent finally
signed a contract with McMullen for the performance
of the dockwork and simultaneously discharged its
own employees performing such work. However, the
contract with McMullen contained a provision giving
Respondent the right to cancel the arrangement in the
event Respondent reached an agreement with the
Union.
Despite the McMullen contract, Respondent re-
sumed negotiations with the Union at meetings held
on February 22 and 25. At these sessions, the Union
proposed immediate reinstatement of the discharged
employees. Respondent countered with a proposal
that the employees be reinstated provided that they
demonstrated for a period of 90 days that they were
capable of achieving a level of production which
would bring Respondent's freight-handling costs in
line with those charged by McMullen. When the
Union rejected this offer, Respondent made an
amended and liberalized offer. The Union also reject-
ed the amended offer. No further bargaining sessions
were held.
The Administrative Law Judge found that
Respondent's motive in subcontracting the freight-
handling work was economic and not discriminatory.
Our colleagues in the majority have not disturbed this
finding. The Administrative Law Judge also found
that on December 16 Respondent gave the Union
sufficient advance notice of its intent to subcontract
to comply with its bargaining obligation. At this meet-
ing, Respondent not only told the Union that it was
considering subcontracting the dockwork, but, when
asked by the Union whether the subcontractor would
retain the incumbent employees, Respondent an-
swered that it was up to the subcontractor. The Union
made no further efforts at negotiating the subcon-
tracting issue. Although Respondent had received
what it considered a satisfactory offer from McMul-
len in December 1971, it did not sign a contract with
him for the performance of such work until January
14, 1972. It delayed signing such an agreement in
order to pegotiate further with the Union. When its
efforts at arranging additional meetings with the
Union in the interval, were unsuccessful, Respondent
signed a contract with McMullen because it felt that
it was not feasible to require McMullen to wait any
longer for the subcontract. However, as stated, Re-
spondent included in the contract a provision giving
to the Respondent the right of cancellation if an
FLORIDA-TEXAS FREIGHT, INC.
agreement on work standards could be reached with
the Union. Thus, the subcontract did not bar Respon-
dent from negotiating or consummating a collective-
bargaining agreement with the Union which would
involve the restoration of the discharged employees to
their jobs. The Union and the Respondent did con-
duct further negotiations but reached an impasse on
economic issues . It is not contended that
Respondent's contract proposals as to productivity
were made in bad faith or that they were unlawful.
The Union was thus not prejudiced by the subcon-
tract to McMullen in view of the cancellation clause.
As the Administrative Law Judge found, if there
was any defect in Respondent's notice of its intention
to subcontract, the defect was cured by the actual
negotiations at the February negotiating sessions. It
was not the subcontract to McMullen which caused
the inability of the Union and the Respondent to
agree on terms of a collective-bargaining agreement,
but a dispute as to those terms.
The facts in this case, in our view, are on all fours
with those in the Hartmann Luggage case relied on by
the Administrative Law Judge. In that case the re-
spondent company signed a subcontract for the per-
formance of unit work without first notifying and
consulting with the union representative. However, at
subsequent meetings with the union, the company did
discuss all aspects of the subcontract which at that
stage was executory only; i.e., the company could
have unilaterally canceled the subcontract without
penalty. The Board upheld the Trial Examiner's con-
clusion that any violation of Section 8(a)(5) in the
company's signing of the subcontract without prior
bargaining with the union was "cured" by the subse-
quent negotiations . In one respect the present case is
stronger than Hartmann Luggage for finding that
there was no violation of Section 8(a)(5). Here, unlike
the situation in Hartmann Luggage, Respondent actu-
ally told the Union that it was considering subcon-
tracting before it signed a contract with McMullen
and also gave the Union an opportunity to bargain
about the matter. The fact that the subcontract in
Hartmann Luggage was executory whereas here the
subcontract became effective immediately is without
significance with McMullen. In both cases there was
no legal obstacle to canceling the subcontract and
resuming work with employees if agreement could be
reached.
Accordingly, we would sustain the Administrative
Law Judge 's dismissal of the 8 (a)(5) allegation.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
513
WE WILL NOT promise employees raises or other
benefits to keep them from supporting Truck
Drivers, Chauffeurs and Helpers Local Union
No. 100, an affiliate of the International Brother-
hood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America, or any other Union.
WE WILL NOT ask employees how they feel
about unions or what they know about other em-
ployees' union activity.
WE WILL NOT refuse to bargain collectively with
Truck Drivers, Chauffeurs and Helpers Local
Union No. 100, an affiliate of the International
Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America, as the exclu-
sive representative of our freight-handling
employees in the appropriate unit.
WE WILL NOT unilaterally subcontract unit
work or otherwise unilaterally make changes in
the wages, hours, and other terms and conditions
of employment for the employees in the appro-
priate unit without prior bargaining with Truck
Drivers, Chauffeurs and Helpers Local Union
No. 100, an affiliate of the International Brother-
hood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America, or any other union
which they may select as their exclusive bargain-
ing representative.
WE WILL NOT in any like or related manner in-
terfere with, restrain, or coerce our employees in
the exercise of their rights under the National
Labor Relations Act.
WE WILL reinstitute our freight-handling opera-
tion previously performed by our employees rep-
resented by Truck Drivers, Chauffeurs, and
Helpers Local Union No. 100, an affiliate of the
International Brotherhood of Teamsters, Chauf-
feurs , Warehousemen and Helpers of America.
WE WILL bargain collectively with Truck Driv-
ers, Chauffeurs and Helpers Local Union No.
100, an affiliate of the International Brotherhood
of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, as the exclusive bargaining
representative of our employees in the appropri-
514 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ate freight-handling unit with respect to wages,
hours, and other terms and conditions of employ-
ment.
WE WILL offer to those employees discharged
as a result of the subcontracting of the freight-
handling operation immediate and full reinstate-
ment to their former positions or, if those posi-
tions no longer exist, to substantially equivalent
positions, without prejudice to their seniority or
other rights and privileges, and make them whole
for any loss of pay suffered by them as a result
of our bypassing the above-named exclusive bar-
gaining representative and unilaterally subcon-
tracting our freight-handling operation.
FLORIDA-TEXAS FREIGHT,
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 Office Building, 1240
East Ninth Street, Cleveland, Ohio 44199, Telephone
216-522-3715.
DECISION
SIDNEY SHERMAN , Administrative Law Judge: The original
charge herein was served upon Respondent on January 19,
1972, the complaint issued on March 16, and the case was
heard on May 9 and 10. After the hearing briefs were filed
by Respondent and the General Counsel. The issues litigat-
ed involved alleged violations of Section 8(a)(1), (3),and (5)
of the Act.
Upon the entire record,I including the witnesses ' demean-
or, the following findings and recommendations are made:
I RESPONDENTS BUSINESS
Florida-Texas Freight, Inc., herein called Respondent, is
a Florida corporation engaged in the business of soliciting
and forwarding freight by rail carrier from terminals in
various states , including one located at Cincinnati, Ohio,
which is the only one involved herein . Respondent annually
recieves more than $50,000 for its service . Respondent is
engaged in commerce under the Act.
1 For corrections of the transcript and various evidentiary rulings , see the
orders of June 28 , July 25 , and August 7, 1972.
fI THE UNION
Truck Drivers , Chauffeurs and Helpers Local Union No.
100, an affiliate of the International Brotherhood of Team-
sters , Chauffeurs , Warehousemen and Helpers of America,
herein called the Union , is a labor organization under the
Act.
III THE MERITS
The pleadings raise the following issues:
1. Whether Respondent violated Section 8(a)(1) of the
Act by interrogation, promises of benefit, and threats of
reprisal?
2. Whether Respondent discriminatorily discharged its
unit employees?
3. Whether Respondent violated Section 8(a)(5) and (1)
by subcontracting unit work without prior consultation with
the Union and subcontracting on its employees?
A. Sequence of Events
Respondent operates a number of terminals or docks
throughout the United States, where it receives freight for
delivery to carriers or consignees. For the most part Re-
spondent uses no direct labor but subcontracts all its opera-
tions, including the handling of freight at its docks. The case
at bar involves Respondent's terminal or dock in Cincin-
nati, which began operations in January 1970. Until Febru-
ary 1971,2 the freight handling work at that terminal was
done by an independent contractor, Cummins Cartage
Company. When that arrangement ended, Respondent be-
gan to hire direct employees for the dock work, and in
August, when the union campaign began, Respondent had
four such employees. Three of these had signed cards by
August 30, when the Union made a demand for recognition.
An election, held on November 23, was won by the Union,
which was certified on December 2, as the bargaining agent
of the dockworkers. On December 16, at the first bargaining
session a number of noneconomic issues were discussed,
including the Union's proposal that subcontracting be pro-
hibited. This was rejected by Respondent, which was at that
time negotiating with one, McMullen, to take over the dock
work on a subcontract basis. On January 14, the terms of
such a subcontract were reduced to writing by Respondent's
counsel and forwarded to the parties for signature 3 but
Respondent expressly reserved the right to cancel the sub-
contract, should it reach agreement with the Union. Also,
on January 14, Respondent terminated its dock employees,
who were replaced by McMullen and men hired by him.
Respondent, nevertheless, continued to meet with the
Union, a second bargaining session being held on February
22, 1972, and at this meeting and a final one, on February
25, Respondent offered to reinstate the instant employees,
reserving the right to terminate them again, if for a specified
period their productivity did not compare favorably with
that being achieved under the existing subcontract. This
proposal was rejected by the Union and, although Respon-
dent attempted to resume negotiations , there were no fur-
ther meetings.
2 All dates hereinafter are in 1971, unless otherwise indicated.
3 The signed document was returned to counsel on January 17.
FLORIDA-TEXAS FREIGHT, INC. 515
B. Discussion
1. The 8(a)(1) issues
As already related, on August 30, Respondent received
the Union's wire claiming to represent the dockworkers and
demanding recognition. The next day, Hummel, one of the
dockhands, was summoned to the office, where Operations
Manager Cory admittedly asked him whether it was true
that the men had joined the Union, and, when Hummel
answered in the affirmative, admittedly inquired as to the
reason therefor and the identity of the instigator of the
union activity on the dock. According to Hummel, he was
also taxed by Cory with "stabbing him in the back." As
Cory acknowledged that he might have made such a re-
mark, Hummel's testimony to that effect is credited. Hum-
mel added that on the same occasion Terminal Manager
Alvin asked him who was behind the Union. On the basis
of demeanor, Hummel is credited notwithstanding Alvin's
denial.
Ryane, who was Respondent's dock foreman until some
time in September, testified about various conversations
with Cory between August 30 and the election in the course
of which Cory asked who was "behind the union move-
ment" and why the men wanted a union , instructing the
witness to see what he could learn from the other men about
these matters and tentatively promising to raise Ryane's pay
to $5 an hour and that of the other men to $4 an hour.
Ryane added that at a preelection meeting with the men in
November Cory warned that he would fight the Union all
the way. Cory acknowledged that on August 30, he asked
Ryane why the men had joined the Union and he did not
unequivocally deny the rest of the interrogation ascribed to
him by Ryane. Cory admitted, also that at the November
meeting he warned that he would fight the Union all the
way. As for the promise of a raise , Cory's version was that
at the November meeting he promised all the dockhands
that there would be wage increases but without specifying
the amount thereof, and that on an earlier occasion he had
a private conversation with Ryane, in which he promised to
raise Ryane's rate to more than $5 per hour and that of the
others to over $4 per hour.
It is clear from the foregoing that there is no substantial
dispute, and it is found that Respondent reacted to the
Union's demand for recognition by the interrogation and
promises of benefit described above, thereby violating Sec-
tion 8(a)(1) of the Act.
2. The subcontracting issue
The General Counsel contends that, in subcontracting its
dock work on January 14, Respondent violated Section
8(a)(5) and (1) of the Act, by failing to give the Union prior
notice of the decision to subcontract and by failing to bar-
gain with the Union about the impact of that decision on
the employees. In addition, the General Counsel contends
that, by such subcontracting, Respondent violated Section
8(a)(3) and (1), because the motive therefor was the union
activity of Respondent's dock employees.
As for the latter contention, as found above, Respondent
displayed union animus through interrogation and promises
of benefits and Cory's vague warning that he would fight the
Union all the way. However, not only was there no evidence
of threats of reprisal for union activity but Ryane admitted
that Cory assured him in November that regardless of the
outcome of the election there would be no discharges except
for cause. And, Cory testified that the decision to subcon-
tract was motivated solely by the relatively low productivity
and the inefficiency of Respondent's direct labor; that its
direct labor cost during 1971 ranged between 32 cents and
37 cents per hundredweight, whereas under both its initial
subcontract with Cummins and the later one with McMul-
len Respondent paid the subcontractor only 25 cents per
hundredweight; and that a great deal more cargo was misdi-
rected or damaged by its dock employees than by those of
its subcontractors. Not only was there no effective rebuttal
of this testimony but it was largely corroborated by Mc-
Mullen, as well as by Respondent's business records.4 More-
over, there was no contradiction of Cory's further testimony
that Respondent sustained a loss on its direct labor opera-
tion; and, the record of the final bargaining sessions on
February 22 and 25 5 shows that Respondent offered to
reinstate the employees at their former wage rate, upon
condition that they demonstrate for a period of 90 days that
they were capable of achieving a level of productivity that
would bring Respondent's labor cost in line with the 25
cents per hundredweight rate currently being paid to the
subcontractor.6 When the Union rejected this offer, Re-
spondent amended it to require only that the employees
reduce their labor cost to 27 'cents per hundredweight, and
offered to extend the trial period to at least 6 months? In
addition, Respondent proposed that, if its labor cost was
reduced during the trial period below the foregoing level, it
would reward the employees with wage increases . All these
proposals were rejected.
As against the foregoing evidence of economic motiva-
tion, it may be urged that it is a suspicious circumstance that
Respondent did nothing to solve its economic problem until
after the certification of the Union. Cory's explanation for
this was that he, in fact, began to look for a suitable subcon-
tractor in March or April, long before the advent of the
Union, but his efforts were unproductive until some time in
December when McMullen made him an acceptable offer.
° These records were produced after the hearing and received in evidence
under the circumstances described in my orders of June 28 , July 25, and
August 7, 1972. See also, the General Counsel's letter of August 2, 1972.
These records show that at its Cincinnati terminal Respondent's labor cost
per hundredweight in 1971 ranged between 32 cents and 47 cents, the lower
figure being achieved towards the end of the year, and that the number of
claims received by Respondent for mishandling of freight were more than
twice as high in 1971 than during a comparable period in 1972, under the
subcontracting arrangement No records were produced with respect to
mishandling of freight before 1971 , and there was no explanation for such
failure . However, even if an adverse inference be drawn from that circum-
stance , it would not affect the result here. It is clear from Respondent's
negotiations with the Union in February 1972, that its decision to subcon-
tract was motivated primarily by the labor cost factor, and that it was willing
to reinstate the instant employees if they would but increase the quantity of
their output to a competitive level.
5 A stenographic transcript of those sessions was received in evidence.
6 In its contract with McMullen Respondent reserved the right to cancel
that arrangement, if it was able to reach agreement with the Union.
7 The stenographic transcript of the negotiations reads "16 months." How-
ever , in his brief Respondent 's counsel states that the proposed extension was
for 6 months
516 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
McMullen confirmed that his negotiations with Cory began
in July and culminated in mid-December, when he submit-
ted a bid to do the work on the basis of 25 cents per hun-
dredweight. Moreover, the mutually corroborative
testimony of Cory, McMullen, and Respondent 's counsel,
Smith, shows that even after that bid was submitted Cory
delayed formal acceptance thereof until January 14, pend-
ing efforts to resume negotiations with the Union,8 and that
the apparent failure of such efforts coupled with Mc-
Mullen's impatience over the delay induced Respondent to
complete the transaction with him.
One might well ask, nevertheless, why Respondent did
not at any time resort to another , obvious means of reducing
its labor cost-namely, the replacement of the allegedly
unproductive employees with more efficient , direct labor.
Not only did Respondent fail to replace the men but, as
found above, it even held out the prospect of raises to in-
duce them to reject the Union. Cory's explanation was that
Respondent was a "little " lenient , hoping that the work of
the dockmen would improve. Terminal Manager Alwin in-
sisted that some efforts were made to find suitable replace-
ments but they were unsuccessful . While there might seem
to be some conflict between these explanations , I do not
regard that alone as a sufficiently cogent reason for reject-
ing Respondent's contention that it was motivated solely by
economic considerations , buttressed as it was by uncontro-
verted and documented proof of the relative costliness and
inefficiency of the direct labor operations and of
Respondent's apparently sincere efforts, described above,
to reach an accommodation with the Union that would
obviate the need for subcontracting. Accordingly, I find no
preponderance of evidence that Respondent's motive for
subcontracting was discriminatory.
There will next be considered whether Respondent
breached its bargaining obligation by failing to give the
Union advance notice of its decision to subcontract the
dock work to McMullen. While not disputing that there was
discussion at the December 16 bargaining session of the
Union's contract proposal for a ban on subcontracting,
union representative Barnes and Mitchell denied that any
reference was made on that occasion by Respondent to
an intention to subcontract the instant operation.
s There was extensive testimony concerning repeated, fruitless efforts by
Smith, for Respondent , and Barnes, for the Union, to reach each other by
telephone in late December and early January for the purpose of arranging
a second bargaining meeting Both testified that on each occasion a message
was left for the other Smith denied receiving any such messages before
January 11, and insisted that repeated efforts by him to reach Barnes thereaf-
ter were unavailing until January 14, by which time it had been decided by
Respondent that it was not feasible to require McMullen to wait any longer
for his subcontract While Barnes denied receiving any message or telephone
call from Smith before January 14, it is undisputed that on January 4, Smith
wrote Barnes about the difficulty Smith was having in reaching Barnes and
asked him to call . Accordingly, whether or not the Union made diligent
efforts to reach Smith , the record affords insufficient basis for rejecting
Smith's testimony as to his efforts to reach the Union Barnes' denial that he
received any message concerning a telephone call from Smith is not necessar-
ily inconsistent with the latter 's testimony that such a call was made. And,
the fact that on January 4, Smith resorted to a more reliable means of
communication attests to the sincerity of his desire to reach the Union.
Accordingly, Respondent made diligent , but unsuccessful , efforts to contact
the Union for the purpose of resuming negotiations and delayed consummat-
ing any deal with McMullen because of the pendency of such efforts
Respondent's counsel, Smith, on the other hand, insisted
that, having been advised before that meeting that Respon-
dent was close to agreement with McMullen on a subcon-
tract, he announced at the meeting that Respondent was
considering subcontracting the dock work, and that, when
Mitchell asked whether the subcontractor would retain the
incumbent employees, Smith answered that it would be up
to the subcontractor. In view of the circumstantiality of
Smith's testimony, as well as demeanor considerations, I am
inclined to credit his version.9 It was agreed that there was
no further discussion of the matter between December 16
and February 22, when the parties next met.
In the meantime, as related above, on January 14, after
repeatedly putting off final action thereon, Respondent fi-
nally decided to execute the subcontract with McMullen
and the dock work was transferred on that date to him, but
Respondent expressly reserved the right to cancel that arrange-
ment, if agreement was reached with the Union. At the subse-
quent bargaining sessions of February 22 and 25, when the
Union proposed immediate reinstatement of the employees,
Respondent countered with the plan outlined above, which
envisaged their immediate reinstatement on a trial basis,
and the record shows that Respondent made an earnest
effort to induce the Union to accept that proposal, even to
the point of amending its original offer to allow for a labor
cost of 27 cents, rather than 25 cents, per hundredweight
and substantially extending the trial period. Letters by Re-
spondent to the Union of March 17 and 29, 1972, seeking
resumption of the negotiations elicited no response.
In a case strikingly similar to this 10 the Board affirmed
Trial Examiner Reel's finding that the Respondent did not
violate Section 8(a)(5) or (1) by entering into a subcontract
without any prior notice to the employees' statutory repre-
sentative. In that case, the Trial Examiner found that the
subcontract did not irrevocably commit the respondent to
transfer unit work and that the Respondent might have
retained such work consistently with the terms of the sub-
contract. In view of this, and finding that in a subsequent
bargaining session the Respondent did not foreclose the
union from bargaining about reversal of the decision to
subcontract, the Trial Examiner concluded that the respon-
dent "effectively cured the statutory violation inherent in its
unilateral action of February 9." The Trial Examiner add-
ed:
Stated otherwise, the Union's failure to ask that the
[subcontract] be rescinded or not effectuated, and the
Union's concentration on other aspects of the situa-
tion, amounted to an acquiescence in the Company's
determination, and removed the unilateral character
with which that determination had been tainted. [Hart-
mann, supra at 1579.]
In affirming the Trial Examiner, the Board in that case
indicated that it was relying at least in part on the foregoing,
post-subcontract events. 11
9 The General Counsel points to Smith's failure to include in his two
pretrial affidavits any reference to this matter Smith attributed such ommi-
sion to the fact that the Board agent who prepared the affidavits did not put
the question to him. Whether Smith should have volunteered the information
is a moot point.
10 Hartmann Luggage Company, 145 NLRB 1572.
11 See, also, Muscle Shoals Rubber Company, 157 NLRB 829, 845.
FLORIDA-TEXAS FREIGHT, INC.
Here, too, the decision to subcontract was reversible un-
der the terms of the arrangement with McMullen, and the
fact that Respondent expressly reserved the right to cancel
it, if agreement was reached with the Union, is persuasive
evidence that Respondent was, in fact, prepared to reverse
that decision, if a suitable alternative arrangement could be
negotiated with the Union. Moreover, here, the Union was
not only afforded an opportunity to, but did, bargain at
length about the invalidation of the subcontracting arrange-
ment and the terms and conditions under which the status
quo ante might be restored.
There is , thus, at least as much reason here as there was
in Hartmann Luggage for finding that any defect in the
notice given to the Union of the impending subcontract was
cured by the subsequent bargaining.
Another factor that seems to have influenced the Board
in Hartmann Luggage was that about a year before entering
into the subcontract, the respondent served notice on the
union that it was considering subcontracting part of the
work, unless a substantial reduction in labor costs could be
effected through contract negotiations then pending. Al-
though the Trial Examiner found that was not adequate,
advance notice because of its vagueness and remoteness in
time, the Board expressly overruled him on that score, say-
ing that the respondent was not "required to give the Union
notice of the specific proposed subcontracting agreement
just `at the time the Company was prepared to make a firm
offer to [the subcontractor] or to accept a counter-offer
from it,' and to furnish the Union at that moment an oppor-
tunity to bargain precisely with reference thereto before
consummating that subcontracting agreement." And, the
Board indicated that it relied on the foregoing advance
notice , as well as the post-subcontract bargaining, in finding
no violation. Similarly, in Young Motor Truck Service, Inc.,
156 NLRB 661, in finding no violation in the sale of an
operation, the Board relied on the fact that a few months
before the actual sale the respondent had told the union in
general terms that its business was for sale . Under the rule
of these cases it would seem that the notice given by Smith
to the Union on December 16, as found above, of
Respondent's intention to subcontract the dock operation
was sufficient advance notice.
Thus, under the foregoing authorities, the finding is war-
ranted that Respondent, on December 16, gave sufficient
advance notice of its intent to subcontract and that, in any
event, any defect in such notice was cured by bargaining in
February.
517
There remains the allegation that Respondent failed to
discharge its obligation to give the Union an opportunity to
bargain about the impact of the subcontracting action on
the employees. Credence has been given to Smith's testimo-
ny that at the December 16 meeting, when he apprised it
that Respondent was considering subcontracting, the
Union asked whether the incumbent employees would be
retained by the subcontractor, to which Smith rejoined that
that was a decision for the subcontractor to make. Although
there was no further discussion of means of mitigating the
impact on the employees of the elimination of their jobs,
there was no evidence that the Union was foreclosed from
doing so either at the December meeting or at the two
February meetings. The Union chose instead to explore
other matters. It was not incumbent upon Respondent to
initiate such a discussion. It was sufficient that it afforded
the Union an adequate opportunity to raise the issue, and
it cannot be doubted that it had such opportunity at the last
two meetings, if not at the first meeting.12
It will, therefore, be recommended that the allegations of
the complaint pertaining to the legality of the subcontract
arrangement be dismissed.
IV THE REMEDY
It having been found that Respondent violated Section
8(a)(1) of the Act by interrogation and promises of benefit,
it will be recommended that it be ordered to cease and desist
therefrom and take appropriate, affirmative action.
CONCLUSIONS OF LAW
1. By interrogating employees about their union activity
and those of other employees and by promising benefits to
deter employees from engaging in union activity, Respon-
dent has violated Section 8(a)(1) of the Act.
2. Such violations are unfair labor practices affecting
commerce within the meaning of the Act.
[Recommended Order omitted from publication.]
i2 Hartmann Luggage, supra, Southern California Stationers, 162 NLRB
1517, 1546.
It is clear that the result here would not be affected , even if it were found
that the employees ' jobs had already been irrevocably eliminated before the
Union was given any opportunity to bargain about the effect of such action
on the employees New York Mirror, Division of Hearst Corp., 151 NLRB 834,
841-842; Said Harberg, d/b/a Ilfeld Hardware & Furniture Co., 157 NLRB
1401, 1403. There is no requirement that an opportunity to bargain about the
effect of a transfer of unit work be afforded before such transfer.