Phelps Dodge Corp.

National Labor Relations Board - Board Decisions

Jun 6, 1941

32 N.L.R.B. 338 (N.L.R.B. 1941)

In the Matter Of PHELPS DODGE CORPORATION and METAL TRADES
COUNCIL OF Ajo, ARIZONA
Case No. C-1784.-Decided June 6, 1941
Jurisdiction: copper mining industry.
Unfair Labor Practices
Interference, Restraint, and Coercion: anti-union statements; interrogation
concerning union membership; and threatened interference with tenure and
other conditions of employment.
Company-Dominated Union: establishment of employees association upon dis-
solution of admittedly illegal employees representation plan after effective
date of Act by representatives acting in such capacity under plan-manage-
ment participation in creation of organic structure by : plant manager's attend-
ance at meetings with organization committee : by approval of formation of
successor organization and by suggesting constitution and bylaw provisions-
contribution of support by: furnishing company machine for printing of
association notices ; permitting posting of such notices on plant bulletin boards ;
aiding in distribution of membership cards through time office; undertaking
to give preference to association members in the matter of lay-offs and in
the allotment of company houses.
Discrimination: discharges for union membership and activity.
Remedial Orders: dominated organization disestablished; contract with dom-
inated organization, abrogated ; reinstatement and back pay awarded.
Mr. Paul S. Kuelthau, for the Board.
Mr. Denison Kitchel and Mr. Everett M. Ross , of Phoenix , Ariz.,
for the respondent.
Mr. F. H. Sizemore , of Carlsbad , N. Mex., for the Union.
Mr. S. E. McDaniel , of Ajo, Ariz ., for the Association.
Mr. Eugene R. Th.orrens, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon an amended charge duly filed on March 1; 1940, by Metal
Trades Council of Ajo, Arizona, affiliated with the American Federa-
tion of Labor, herein called the Union, the National Labor Relations
32 N. L. R. B., No. 77.
338
PHELPS DODGE CORPORATION 339
Board, herein called the Board, by the Regional Director for the
Twenty-Second Region (Denver, Colorado), issued its amended com-
plaint dated November 8, 1940, against the respondent, Phelps Dodge
Corporation, Ajo, Arizona, alleging that the respondent had engaged
in and was engaging in unfair labor practices affecting commerce,
within the meaning of Section 8 (1), (2), and (3) and Section 2
(6) and (7) of the National Labor Relations Act, 49 Stat. 449, herein
called the Act. Copies of the amended complaint, accompanied by
notices of hearing, were duly served upon the respondent, the Union,
and the Ajo Association of Copper Mine Employees, herein called the
Association, a labor organization alleged in the complaint to be
dominated by the respondent.
With respect to 'the unfair labor practices, the amended complaint
alleged in substance (1) that the respondent on or about February 10,
1940, at its New Cornelia Branch, Ajo, Arizona, discharged L. D.
Ruyle, J. B. Slaughter. George T. Skinner, W. C. Johnston, J. R.'
Vermillion, and Everett Stoker because they joined and assisted the
Union; (2) that from and after July 5, 1935, the respondent dom-
inated and interfered with the formation and administration of the
Association and contributed support thereto; (3) that the respondent,
during the period from' February 1939 down to and including the
date of the filing of the amended charge, 'urged, persuaded, and
warned its employees to refrain from joining or retaining member-
ship in any, union other than the Association and from engaging in
concerted activities with other employees for the purposes of collec-
tive bargaining or other mutual aid and protection, and threatened its
employees with discharge or loss of earnings if they joined or
assisted the Union 'or 'any labor organization affiliated therewith;
and (4) that by the foregoing and other acts, the respondent inter-
fered with; restrained, and coerced its employees in the exercise of the
rights guaranteed-in Section 7 of the Act.
In its answer, dated November 19, 1940, the respondent admitted,
among other things, that the Association is a labor organization and
denied all other material allegations with respect to the , unfair
labor practices.
Pursuant to' notice, a hearing- was held at Ajo, Arizona, fron.
November 25 to November 30, 1940, inclusive, before Frank Bloom,
the Trial Examiner duly designated by the Chief Trial Examiner.
At the opening of the hearing the Association moved to intervene in
the proceeding. The Trial Examiner granted the Association's pe-
tition for intervention but limited its participation in the proceeding
to the allegation of unfair labor practices within' the meaning of
443€92-42-vol. 32-23
340 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Section 8 (2) of the Act. The Board and the respondent were rep-
resented by counsel; the Union and the Association, by their repre-
sentatives. All participated in the hearing and were afforded full
opportunity to be heard, to examine and cross-examine witnesses,
and to introduce evidence bearing on the issues.
At the conclusion of the hearing, counsel for the Board moved to
conform the pleadings to the proof. There was no objection and the
Trial Examiner granted the motion. At the close of the entire case,
the - respondent. moved to dismiss the complaint for insufficiency of
proof. The Trial Examiner reserved ruling upon the motion and
disposed of it in his Intermediate Report in the manner hereinafter
indicated. During the course of the hearing, the Trial Examiner
ruled on other motions and on objections to the admission of evidence.
The Board has reviewed the rulings of the Trial Examiner made. at
the hearing and finds that no prejudicial errors were committed. The
rulings are hereby affirmed.
The Trial Examiner thereafter filed his Intermediate Report, dated
January 9, 1941, copies of which were duly served upon the parties.
He found that the respondent had engaged in and was engaging in
unfair labor practices within the meaning of Section 8 (1), (2), and
(3) and Section 2 (6) and (7) of the Act, and recommended that
the respondent cease and desist from its unfair labor practices, dis-
establish and withdraw all recognition from the Association as a
representative of its employees for the purposes of collective bar-
gaining, and offer reinstatement with back pay-to W. C. Johnston,
J. R. Vermillion, and Everett Stoker. The Trial Examiner also
found that the respondent had not discouraged membership in a labor
organization by discrimination in regard to hire and tenure of em-
ployment with respect to L. D. Ruyle, J. B. Slaughter, and George
T. Skinner, and reconunended dismissal of the complaint as to them.
Thereafter the respondent and the Association filed exceptions to the
Intermediate Report and the respondent filed a brief in support of its
exceptions. The Union did not file exceptions. Pursuant to notice
duly served on all parties, a hearing for the purpose of oral argument
was held before the Board in Washington, D. C., on March 13, 1941.
The respondent was represented by counsel and participated in the
argument; the Union and the Association did not appear.
The Board has considered the exceptions to the Intermediate Report
and the briefs submitted by the parties, and save as the exceptions
are consistent with the findings of fact, conclusions of law, and order
set forth below, finds them to be without merit.
Upon the entire record in the case, the Board makes the following :
PHELPS DODGE CORPORATION
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
341
The respondent is, and has been since August 10, 1885, a New
York corporation with its principal office in the City of New York.
The respondent and its subsidiary corporations are engaged in the
mining, milling, smelting and refining of ore containing substantial
values in copper, gold, and silver, in the fabricating of articles froill
copper, and the sale of copper, copper products, and other metals.
In this proceeding we are concerned only with a mine and mill, known
as the New Cornelia Branch, which the respondent maintains at
Ajo, Arizona. The ore mined at the New Cornelia Branch is con-
verted at the mill into concentrates containing copper, gold, and
silver. The concentrates are shipped to the respondent's smelter at
Douglas, Arizona, where they are commingled with concentrates and
ore from other mines and are smelted and converted into blister
copper, 'which is then shipped to a refinery, at El Paso, Texas; a
wholly owned subsidiary of the respondent, where it is refined and
the copper and precious metals of which blister copper is com-
posed are separated, purified, and prepared for market. The copper
is then sold in the world market or shipped to other subsidiaries of
the respondent for fabrication and sale throughout the United States.
During the year 1939, the respondent produced at the New Cornelia
Branch 99,742,587 pounds of copper concentrates. The entire output
was shipped outside the State of Arizona. The respondent concedes
the jurisdiction of the Board.
II. THE LABOR ORGANIZATIONS INVOLVED
Metal Trades Counsel of Ajo, Arizona, is a labor organization
chartered by the metal trades department of the American Federa-
tion of Labor, herein called the A. F. of L. International Brother-
hood of Teamsters, Chauffeurs, Stablemen and Helpers of America,
Local 310 and International Union of Operating Engineers, Local
428 are labor organizations affiliated with the A. F. of L. Local 310
admits to membership the truck drivers employed by the respondent,
and Local 428 admits to membership bulldozer operators and -helpers
in the respondent's employment. The Union represents these locals,
and other A.' F. of L. organizations and their members who are
employed by the respondent, in their dealings with the respondent.'
The Ajo Association of Copper Mine Employees is an unaffiliated
' The 8 ( 3) allegations of the complaint involve only members of Local 310 and Local
428. Except where otherwise indicated,' we will refer hereinafter to the Council and the
locals jointly as the Union. _
342 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
labor organization admitting to membership only employees of the
respondent, excluding all in a supervisory capacity.
III. THE UNFAIR LABOR PRACTICES
A. Events pn'ior to the formation of the Association 2
In the spring of 1934, the mine at the New Cornelia: Branch
reopened after a shut-down of approximately 2 years:- Shortly after
the men returned to work an Employees Representation Plan, herein
called the Plan, was established' under the sponsorship of Michael
Curley, the branch manager.3 According to the uncontradicted testi-
mony 4 of E. E. Hopper, a deputy sheriff who had worked for the
respondent from 1918 until September 1938, he was first approached
with regard to the Plan shortly after the mine resumed operations
in the spring of 1934, by Ben O'Neil, presently a member of the
legislature of the State of Arizona. A meeting was held at O'Neil's
house, attended by seven or eight employees.5 At the meeting O'Neil
stated that he thought it would be advisable to organize "a represent-
ative plan" for the men of the community in order "to keep outside
labor organizations from coming in and causing strikes. O'Neil
distributed pamphlets and suggested that the men read them over
and return the following evening. He stated that he would see
Curley and ascertain if he would meet with the men. The following
evening the same group had another meeting, and O'Neil stated that
Curley would meet with them the next day. A third meeting was
held in the branch manager's office. Curley was present. O'Neil
made some introductory remarks and left. This meeting was brief.
Curley stated that lie would take the "plan" home with him and
meet with the group the following evening. • The next night another
meeting was held, attended by the 'same group. Hopper's undenied
testimony as to what occurred at the meeting is as follows :
He (Curley) said he had read the, thing over, and he said
he thought a plan of that description would ,be; a good thing
for the community, and they debated as to how it should be put
into effect, and one thing and, another, and some said one, way,
and some said another. Some said it was a proposition to sell
to the men. And I 'said I didn't think that that was a good
plan, that the simple reason was you couldn't force things on
2 Events occurring prior to July 5, 1935,' the effective date of the Act, are considered
in order to evaluate the respondent 's conduct since that date and not as the basis for any
findings of unfair labor practices . See N. L. R B. v. Pennsylvania Greyhound Linea,
Inc., 303 U. S . 261, rev'g. 91 F. (2d) 178 (C. C. A. 3), enf'g. as mod . 1 N. L. R. B. 1.
8 Curley was succeeded as branch manager by J. H; Davis about March 1, 1940.
* Curley did not appear as a witness.
6 These Included Joe Peters, Alfredo Lopez, Clayt Williams , L. McIntosh , and one
Monahan.
PHELPS DODGE CORPORATION 343
men, ... But I dismissed the proposition, told them that I
didn't want nothing, to do with it,, because I didn't think
it was the right way to go about anything.
Q. Now what happened the next day?
A. Well, to the best of my knowledge, it was the next day
or the following day after that, why, it was Joe Peters, he was
around passing cards out, and, in fact, he passed one to me...,
Q. While you were working?
A. Yes.
About a month later, sometime during the summer of 1934, an
unidentified person from Bisbee, Arizona, where the respondent con-
ducts part of its operations, came to Ajo to assist in the establishment
of the Plan. Curley assembled the same group of employees in his
office. Hopper's uncontradicted testimony as to what occurred at
the meeting is as follows :
Q. Tell us what was said at that meeting?
A. Well, Mr. Curley, he introduced this man to the committee
that was there, and said that he understood the plans, 'these
representative plans, and he could probably give us some dope on
it. And then he, Mr. Curley, excused himself, said he had busi-
ness to attend to, and this man went on to ask first one thing and
then another, what was done, and it was told to him, and 'he
looked at some of the cards and he said that that was no good.
He said it would have to be a volunteer movement and hold a
little election to let the men vote on it; to see whether that was-
to see whether they wanted a plan of that kind of not. And
A hen what was done, there was a little election held. It was
held right here, to the best of my 'recollection, right in this
building." .
We find, as did the Trial Examiner, that the foregoing events
occurred substantially as testified to by Hopper.
At the election a majority of the employees voted in favor of the
establishment of the Plan. The votes were counted in the respond-
ent's employment office in the presence of L. K. Davis, its employment
agent. Shortly thereafter, about July 1934, the employees voted to
elect nine departmental representatives to function under the Plan.
Ballot boxes were carried through the respondent's premises to allow
the employees to cast their votes. Richard E. Harmon, the respond-
ent's safety director at the time of the hearing, testified that the
respondent paid the employee representatives for acting as such
under the Plan and admitted at the hearing that the Plan, under
O The witness referred to Moose Hall, the building where the hearing before the Trial
Examiner In this proceeding was conducted.
844 DECISIONS OF NATIONAL LABOR RELATIONS 13OAtt1)
which he had served as an employee representative, was illegal.
Manager Curley recognized the illegality of the Plan after the pas-
sage of the Act at a meeting between Curley and the organization
committee of the Association, hereinafter discussed, on October 2,
1935.
In the spring of 1935 the employee representatives under the Plan
became aware of the bill then pending in Congress and known as the
Wagner-Connery Bill. It was recognized by them that enactment
of the bill into law would mean the end of the Plan. The repre-
sentatives discussed among themselves possible procedure in the event
that the bill became law. With the passage of the Act on July' 5,
1935, they decided that during the summer lay-off the representatives
would consider plans for the organization of a new association or
plan. This was done. Harmon, then employed as a boilermaker in
the respondent's power plant directing the work of as many as 10
helpers, was the most active in this project. He obtained copies of
constitutions and bylaws of various organizations, including that of
the representation plan in existence at the Bisbee branch of the re-
spondent. In the late summer of 1935, when the mine reopened, the
representatives under the old Plan 7 met for the purpose of considering
a new constitution and bylaws -for a proposed employees' association,
and they agreed upon a tentative draft in September 1935.
B. The Association
About this time, Harmon, who had been promoted to a higher
supervisory position, severed his connection with the Plan. On
October 2, 1935, a meeting attended by Manager Curley, G. C.
Neblett, J. B. Mead,8 T. J. Jones, S. V. Findley, Ed Farrell, C. H.
Munson, and Alfredo Lopez, constituting the organization committee
of the Association, was held in Curley's office. The minutes of this
meeting are headed :
PHELPS DODGE CORPORATION
NEW CORNELIA BRANCH
MINUTES OF MEETING HELD BETWEEN THE MANAGEMENT AND THE
ORGANIZATION COMMITTEE OF THE AJO ASSOCIATION OF COPPER
MINE EMPLOYEES PHELPS DODGE CORPORATION , NEW CORNELLA
BRANCH
Curley explained the purpose of the meeting at its outset. He
stated that he had received on September 24 from Harmon a
4 These were G. C. Neblett, J. B. Mead, T. J. Jones, S. V. Findley, M. Findley, Ed Farrell,
C. H. Munson, Alfredo Lopez, and Frank Ortiz.
8 Mead was the respondent's cashier . He had acted either as chairman or secretary
under the Plan.
PHELPS DODGE CORPORATION 3,45
letter, to, which was attached a copy of the, proposed constitution
ancl_ bylaws; of the Association requesting an appointment with
the management "to discuss the Company's attitude toward the
new organization and,, if possible, come to, some mutual agree
ment and understanding." Mead read the proposed constitution,
and bylaws, and Curley discussed their various provisions, and
made suggestions with respect to revisions to the organizing- com-
mittee. Curley told the committee that when the Wagner Bill
became, a -law, all Associations went out of existence and now, he
thought,, the logical step was made by the elected representatives
of the, employees under the previous, plan in taping the initiative
in organizing the, new Association.
After Neblett and Mead had expressed doubt as to the propriety of
proceeding in this manner, Curley characterized the Act as presenting
-`just a technicality", and declared that if ". . . the men who elected
you to office under the old plan feel that you are their- representative
," he approved the action being taken as "... the proper pro-
cedure to get the Association underway." - When Mead asked whether-
a lawyer should be consulted, Curley replied that "an attorney would
give the same interpretation. . . ."
In addition, Curley suggested that the proposed constitution and
bylaws be amended to permit the calling of Association meetings on
less than 24 hours' notice and to provide for- an independent audit
of Association accounts . He also suggested that employees at the
company hospital be entitled to representation by the Association.
Curley proposed that the Association conduct an election for mem-
bers of its Executive Board soon after the adoption of an amended
constitution and bylaws and that there be "an agreement between
the employees and the Company" after the election. Cur-ley assured
the committee that the respondent was "in favor of the Plan". He
urged the committee members "to make a concerted drive to get the
greatest number of employees into the organization . . . ,'-" and to
"conduct an election at the earliest possible date." The respondent
placed one limitation upon the scope of the membership drive.
Curley instructed the committee that employees need not join the
Association since "they are given the option of presenting their own
case to the management."
During November and December 1935 the Association adopted
the constitution and bylaws as proposed with several amendments and
elected officers. The constitution and bylaws as amended contain
e Earlier in the meeting Neblett had expressed it as his opinion that the employees feel
the old plan is out and the new one has no bearing , whatsoever, on the old one,'', but
withdrew the objection when the other members of the committee overruled him.
346 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
provisions for membership upon application and for dues of $1.50
a year. It divides the New Cornelia Branch into electoral divisions,
each of which is entitled to one or more representatives depending
on the number of employees on the pay roll of the division. The
governing body is the Executive Board,1° which has exclusive power
to act as the "collective bargaining agency for all members" and is
composed of the representatives elected by the divisions.
At the first formal meeting between the management, represented
by Curley, and the Executve Committee of the Association on Jan.-
uary 13, 1936, the Association, through its president, G. C. Neblett,
and its secretary, J. N. Chapman, presented a letter, dated January
4, 1936, outlining the purpose of the Association, stating that it had a
membership of- 51 per cent of the employees, and requesting recog-
nition in writing. However, when Curley objected to "approval of
the organization" in writing, Neblett immediately dropped the de-
mand and accepted the fact of the meeting as ample proof of the
management's willingness to recognize the Association. Curley an-
nounced that the purpose of the initial meeting was to discuss the
"organization of the Association" and inquired whether any changes
had been made in the Association's constitution and bylaws since
the meeting of October 2, 1935. Accordingly, the amendments
adopted by the Association during November and December 1935
were spread upon the minutes of the meeting.
Thereafter meetings between the Executive Board and the man-
agement were held at least monthly, special meetings being called
occasionally. - Beginning with the meeting of October 2, 1935, so
far as the Association is concerned, the management started the
practice of recording the minutes of all meetings with the employee
representatives and posting copies on the Company's bulletin boards."
On July 17, 1936, the respondent entered into a so-called "Collec-
tive Bargaining Agreement" with the Association. It contains no
provision relating to terms or conditions of employment but merely
reestablished, in general, the method of dealing between the em-
ployees and the management which had been theretofore in opera-
tion. In detail, the "Collective Bargaining Agreement" states that
its purpose is "to provide a method for the prompt settlement of any
difference that may arise, and to provide means whereby the mem-
1' Also referred to in the record as the Executive Committee
"The Association used the Company 's hectograph machine in the time office for the
printing of Association notices and posted them on the respondent 's bulletin boards. The
Association utilized the time office as a medium for the distribution of membership cards
to employees who were otherwise inaccessible to Association representatives . In addition,
the respondent agreed to give preference to Association members in the matter of lay-offs
and in the allotment of company houses.
PHELPS. DODGE CORPORATION 347
bers of the ...Association . . . may bargain collectively with
the Management." It provides that members of the Association
shall be represented by the Executive Board of the Association; that.
joint meetings shall be held at least monthly between the Board and
management representatives; and that the manager is also to appoint
a secretary to record the proceedings, including all discussions and
decisions, copies of which are to be furnished to the secretary of the
Association. A majority of the management's representatives, to-
gether with a majority of the employee representatives, are required
for a quorum. Each group of representatives is to vote as a unit.
Agreements reached are to be referred to the "Manager of the Com-
pany for execution." As to any matter not settled with the consent
of the management's representatives at such meetings, substitute or
compromise proposals may be offered, and if an agreement is still
not reached the matter may be submitted for final decision to arbitra-
tors then to be selected by the two groups of representativves.12 ` The
agreement also contains several specific reservations by the manage-
ment removing the reserved subject matter from the field of collec-
tive bargaining." Finally, its provisions may be terminated by a
majority vote of the Executive Board or by action of the respondent's
Board of Directors upon 30 days' written notice. The agreement was
in force at the time of the hearing.
Besides the support furnished by the respondent in the form of
facilities afforded the Association, as hereinabove set forth, there
is also evidence that after the establishment of the Association the
respondent persistently sought to maintain its existence. On June
13, 1936, Curley stated to the Association's Executive Board:
I believe it is the duty ' of the men, who have been
elected representatives, to contact more men so there will be a
greater number in your organization . . .
Again, on October 16, 1936, when Neblett, president of the Associa-
tion, expressed' doubt as to the wisdom of continuing "the Bargain-
ing Plan with the Management" since "some of the men feel they do
not receive value for their dues," and asked the management for an
opinion, Curley stated that "it should be continued by all means and
the membership also increased." A statement particularly demonstra-
12 Resort to arbitration has been had on one occasion , and on that occasion the pro-
ceedings extended over a long period of time.
13 Article VII, entitled "Reservations ," provides
1. . . . the Company has the right to increase or decrease production at any time,
or to increase or decrease the scale of its operations in any and all departments
2. . . . the management of operations , and the direction of the working forces,
including the right to hire, suspend , transfer, or discharge employees for proper cause, and
the right to relieve employees from duty because of lack of work, or for other legitimate
reason, is vested in the Management of the Company , and, except as expressly provided
herein, these rights shall not be abridged by anything contained herein
348 DECISIONS OF NATIONAL L'A'BOR RELATIONS BOARD
five of continued support of the Association by the respondent
appears in the minutes of November 7, 1938. One of the Association's
'represen'ta'tives, Jones, had 'compl'ained about the fact that ," soiree
of the foremen are not'coopei ating with members of the Ass'oci'ation."
He added fl: rther that "the Association will not be able to continue
if it does not receive 'cooperation from the fo'rem'en." , -In reply.,
Curley, chairman of the =meeting, stated that
he wished to impress upon the members of 'the Associa-
tion that the Management is 'beh