Doerfer Engineering

National Labor Relations Board - Board Decisions

Dec 22, 1994

315 N.L.R.B. 1137 (N.L.R.B. 1994)

1137
315 NLRB No. 136
DOERFER ENGINEERING
Doerfer Engineering, a division of Container Cor-
poration of America, an affiliate of the Jeffer-
son Smurfit Corporation and International
Union, United Automobile, Aerospace and Ag-
ricultural Implement Workers of America
(UAW) and its Local 1740. Case 18–CA–12507
December 22, 1994
DECISION AND ORDER
BY CHAIRMAN GOULD AND MEMBERS BROWNING
AND COHEN
On August 23, 1994, Administrative Law Judge
Clifford H. Anderson issued the attached decision. The
Respondent filed exceptions and a supporting brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the exceptions and brief and has de-
cided to affirm the judge’s rulings, findings, and con-
clusions and to adopt the recommended Order.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Doerfer Engineering, a di-
vision of Container Corporation of America, an affili-
ate of the Jefferson Smurfit Corporation, Cedar Falls,
Iowa, its officers, agents, successors, and assigns, shall
take the action set forth in the Order.
James L. Fox, Esq., for the General Counsel.
Thomas M. Hanna, Esq. (McMahon, Berger, Hanna, Linihan,
Cody & McCarthy), of St. Louis, Missouri, for the Re-
spondent.
DECISION
STATEMENT OF THE CASE
CLIFFORD H. ANDERSON, Administrative Law Judge. I was
assigned the above-captioned case by order of the Deputy
Chief Administrative Law Judge for the San Francisco, Cali-
fornia office of the Division of Judges Earldean V.S. Rob-
bins, dated May 19, 1994. That order accepted the stipula-
tion, waiver, and motion of the General Counsel, Respond-
ent, and the Charging Party filed May 10, 1994, waiving
their rights to a hearing and oral argument before an admin-
istrative law judge, designating a stipulated record and mov-
ing that the matter be decided on the basis of the record and
briefs.
The matter arose with the filing of a charge on January
12, 1993, docketed as Case 18–CA–12507 by International
Union, United Automobile, Aerospace and Agricultural Im-
plement Workers of America (UAW) and its Local 1740 (the
Union or the Charging Party) against Doerfer Engineering, a
division of Container Corporation of America, an affiliate of
the Jefferson Smurfit Corporation. Following an initial defer-
ral of the charge to arbitration, the Regional Director for Re-
gion 18 of the National Labor Relations Board (the Regional
Director) revoked his deferral of the charge and issued a
complaint on February 4, 1994, and an amended complaint
on February 17, 1994. Respondent filed an answer to com-
plaint on February 17, 1994, and an answer to the amended
complaint on February 24, 1994.
The complaint alleges that Respondent unilaterally
changed a term and condition of employment respecting a
unit of its employees represented by the Charging Party in
violation of Section 8(a)(5) and (1) of the National Labor
Relations Act (the Act). Respondent does not dispute the ini-
tiation of a unilateral change but avers first that the charge
has been resolved by an arbitration decision and award to
which the Board must defer and, second, that it had no obli-
gation to bargain with the Union respecting the change under
the Act.
On the entire record here including helpful briefs from the
General Counsel and Respondent, I make the following
FINDINGS OF FACT
I. JURISDICTION
At all times material, Respondent, a corporation with an
office and place of business in Cedar Falls, Iowa, has been
engaged in the manufacture and nonretail sale and distribu-
tion of machine tools. During the calendar year ending De-
cember 31, 1993, Respondent, in conducting its business op-
eration, purchased and received at its Cedar Falls facility
goods valued in excess of $50,000 directly from points out-
side the State of Iowa and from the same location sold and
shipped goods valued in excess of $50,000 directly to points
outside the State of Iowa.
Based on the above, the complaint alleges, the answer ad-
mits, and I find that Respondent at all times material has
been an employer engaged in commerce within the meaning
of Section 2(2), (6), and (7) of the Act.
II. LABOR ORGANIZATION
The parties stipulated and I find the Union is a labor orga-
nization within the meaning of Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. History and Events
1. Background
Respondent designs and builds proprietary machines and
related equipment for other enterprises and has for a number
of years. On December 12, 1975, in Case 18–RC–10686 the
Union was certified as the exclusive representative of Re-
spondent’s employees in the following unit (the unit):
All production and maintenance employees employed at
its plant located at highway 218 North, Cedar Falls,
Iowa; excluding office clerical employees, quoters-ex-
pediters, professional employees, guards and super-
visors as defined in the Act, and all employees em-
ployed at its Office, Engineering and Technical Centers
located at 201 Washington Street, Cedar Falls, Iowa
and all other employees.
1138 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
The unit comprises some 50-odd employees—about half of
Respondent’s total employee compliment.
The unit has at all material times been appropriate for col-
lective bargaining within the meaning of Section 9 of the
Act. At all times following the certification the Union has
continued to represent unit employees and has been recog-
nized by Respondent as the exclusive representative of unit
employees for purposes of collective bargaining. This rec-
ognition has been embodied in successive collective-bargain-
ing agreements, the most recent of which is effective from
February 1, 1992, to January 31, 1995.
2. The practice
Respondent had from it inception almost 30 years ago—
a time predating recognition of the Union as representative
of unit employees—allowed unit employees under regulated
circumstances to utilize Respondent’s tools and equipment at
the facility for personal projects and endeavors. In addition
to use of equipment on Respondent’s premises, employees
with prior approval could take certain tools home and also
could utilize Respondent’s parts and part ordering facilities,
paying for materials used. Collectively, the right to use plant
premises, Respondent’s tools and equipment, and Respond-
ent’s parts and parts ordering facility are referred to herein-
after as the practice. These opportunities were conditioned on
employer approval of various aspects of the practice and vio-
lation of Respondent’s rules and regulations respecting the
practice could and historically did result in discipline of unit
employees up to and including discharge. Historically Re-
spondent amended its regulations respecting the practice
without notifying or bargaining with the Union. The practice
was never raised in contract negotiations. Until the events in
issue, Respondent had continuously offered these opportuni-
ties and employees had regularly utilized them.
Respondent over time became increasingly sensitive to the
costs and burdens the practice placed on it. Thus, employee
use of Respondent’s equipment, both at Respondent’s prem-
ises and away from the premises, involved ‘‘wear and tear,’’
loss or damage of equipment, and loss of employee produc-
tivity and raised issues of Respondent’s legal liability and
maintenance of plant security.
Robert Plante, Respondent’s general manager, took the de-
cision to discontinue the practice. On January 4, 1993, Ralph
Greenwood, plant manager, met with a union committee and
provided them with a written notice announcing discontinu-
ance of the practice. The notice was subsequently posted at
the plant and the practice discontinued. Respondent simply
announced its decision and neither notified the Union before
the decision was taken nor offered to bargain respecting the
decision.
3. Grievance and arbitration of the discontinuance
of the practice
The Union filed a grievance on January 21, 1993, contend-
ing that the tool use was a practice ‘‘never taken away dur-
ing open contract negotiations’’ and seeking reinstatement of
the practice. Respondent asserted business reasons for dis-
continuance and the management-rights clause of the collec-
tive-bargaining agreement, article XX, as permitting the ac-
tion. Article XX states in part:
Management Rights
The Union recognizes that the Company is vested
exclusively with the Management of the Plant, the di-
rection of all work, and the working force, for which
functions the Company retains full rights and powers.
Without limiting the generality of the forgoing, this in-
cludes the right to . . . enforce reasonable shop rules
to carry out the functions of Management, except to the
extent this Agreement specifically provides otherwise.
The Company retains the sole right to determine the
extent to which its Plant or any part thereof shall be op-
erated or shut down . . . . The right to establish manu-
facturing standards and tolerances and the scheduling of
operations and the choice of equipment for various
jobs, shall be the right of the Company.
Each side cleaved to its position through the grievance proc-
ess. Respondent also took the position that the grievance was
not properly arbitrible. The Union disagreed.
An arbitration was held on May 21, 1993, before Arbitra-
tor Kent Hutcheson. He issued his opinion and award on Au-
gust 5, 1993. The award is reproduced in full in Appendix
I (omitted from publication), infra. The parties stipulated that
the arbitration proceedings were fair and regular and that the
parties had agreed to be bound by the arbitrator’s award.
B. Analysis and Conclusions
1. The issue of deference to the arbitrator’s opinion
and award
a. Identification of deferral issues and arguments
The Board in Spielberg Mfg. Co., 112 NLRB 1080 (1955),
adopted a policy of deferral to arbitral decisions in order to
encourage voluntary settlement of labor disputes. In deciding
whether deferral is appropriate in a given case, the Board in
Spielberg considered: (1) whether the proceedings were fair
and regular; (2) whether all parties agreed to be bound; and
(3) whether the arbitrator’s decision is repugnant to the pur-
poses and policies of the Act. In Raytheon Co., 140 NLRB
883 (1963), the Board declined to defer to an arbitration
award based on a determination that the arbitrator had con-
sidered only the contract grievance issue and not the statu-
tory questions underlying the unfair labor practice change
and complaint. The Board required as a precondition to de-
ferral that the arbitral forum had ‘‘considered’’ the unfair
labor practice issue.
This ‘‘considered’’ requirement has evolved over the
course of time. The Board in Olin Corp., 268 NLRB 573,
574 (1984), again addressed the issue announcing the follow-
ing standard for deferral to arbitration awards:
We would find that an arbitrator has adequately consid-
ered the unfair labor practice if (1) the contractual issue
is factually parallel to the unfair labor practice issue,
and (2) the arbitrator was presented generally with the
facts relevant to resolving the unfair labor practice.
[Footnote omitted.] In this respect, differences, if any,
between the contractual and statutory standards of re-
view should be weighed by the Board as part of its de-
termination under the Spielberg standards of whether an
award is ‘‘clearly repugnant’’ to the Act. And, with re-
1139DOERFER ENGINEERING
gard to the inquiry into the ‘‘clearly repugnant’’ stand-
ard, we would not require an arbitrator’s award to be
totally consistent with Board precedent. Unless the
award is ‘‘palpably wrong’’ [footnote omitted], i.e. un-
less the arbitrator’s decision is not susceptible to an in-
terpretation consistent with the Act, we will defer.
The Board held further in Olin that the party seeking to have
the Board ignore the determination of the arbitrator bore the
burden of affirmatively demonstrating the defects in the arbi-
tral process or award.
The General Counsel makes two independent arguments
that the arbitration award should be disregarded in this case.
First, the General Counsel argues that the arbitrator accepted
Respondent’s argument that the grievance was not an arbitra-
ble issue and, on that basis, denied the grievance. The Gen-
eral Counsel argues in effect that deferral is only appropriate
when the arbitrator has applied the contract to resolve the
grievance one way or the other. Where an arbitrator finds the
dispute not to be resolvable under the arbitration provisions
of the contract, that decision makes the arbitrator’s decision
irrelevant to the dispute under the Act and it must be dis-
regarded. Counsel for the General Counsel on brief cites
Southwestern Bell Telephone Co., 198 NLRB 569, 570
(1972), wherein the Board states it will not defer to an arbi-
trator’s decision if that decision ‘‘has been found by the arbi-
trator not to be arbitral.’’
Respondent does not challenge the legal proposition ad-
vanced by the General Counsel, but rather asserts the Gen-
eral Counsel mischaracterizes the arbitrator’s opinion and
award by engaging in a ‘‘semantic seizure’’ of the language
of the award portion of the arbitrator’s opinion and award
while ignoring the remainder of the document. A fair reading
of the arbitrator’s decision in its entirety, argues Respondent,
shows that the arbitrator did in fact resolve the arbitration in
a manner worthy of deference under Board and court stand-
ards.
The General Counsel’s second argument respecting the de-
ferral issue is that the arbitrator’s conclusion is inconsistent
with the purposes and policies of the Act. Since the arbitra-
tor’s opinion and award is contrary to Board law and not
susceptible to an interpretation consistent with the Act, ar-
gues the General Counsel, deferral is inappropriate under
Spielberg Mfg. Co., supra, and its progeny. Respondent ar-
gues that the arbitrator’s opinion and award is reasonably
susceptible to an interpretation consistent with the Act and
is therefore properly deferrable under Olin Corp., 268 NLRB
573, 576 (1984).
b. Did the arbitrator determine the grievance was
not arbitrable?
(1) The language of the arbitrator’s opinion and award
The entire opinion and award is set forth in Appendix I,
infra. The opinion and award is divided into various portions.
The ‘‘issue’’ portion is as follows, capitalization and under-
lining in original:
THE ISSUE
A. IS THE MATTER ONE ABOUT WHICH THE
COMPANY IS COMPELLED TO NEGOTIATE AND
THUS ARBITRATE?
B. DID THE COMPANY HAVE THE RIGHT TO
TERMINATE THE PERSONAL USE OF COMPANY
TOOLS AND EQUIPMENT AFTER HOURS BY
BARGAINING UNIT EMPLOYEES?
The portion of the opinion and award entitled ‘‘OPINION’’
begins:
The issue as to arbitrability has been raised and must
first be addressed. The Company objected to the entire
proceedings on the grounds that this matter is not one
about which the company is obligated to bargain with
the union.
The opinion portion discusses the matter and continues:
The Union argues that this is a past practice which
has been in effect for more than a quarter of a century
and is essentially a benefit to the employees which can-
not be terminated unilaterally by the company without
proper notice and subsequent negotiation.
If the company can refuse each incident or each re-
quest by an employee then the practice can be termi-
nated simply by refusing ALL REQUESTS [capitaliza-
tion in original]. There is absolutely no argument that
the company in the exercise of its rights can refuse
each request therefore it can refuse every request. It
would be false reasoning to determine that the company
can determine every request but it cannot terminate the
practice.
The opinion portion concludes with general admonitions for
good labor management relations and the opinion and award
continues as follows to its conclusion:
RULING
The Company had a right to unilaterally terminate
the practice of loaning tools, equipment and materials
and permitting use of company premises for personal
use.
AWARD
The Grievance is not arbitrable and is therefore de-
nied.
llllllll
Kent Hutcheson
DATED THIS 5TH DAY OF AUGUST, 1993
(2) Conclusions concerning the arbitrator’s findings
respecting arbitrability
Respondent correctly notes that the arbitrator’s decision
must be read in its entirety to fairly determine its meaning.
Further, Respondent correctly notes the burden is on the
General and the Charging Party here to prove that the arbi-
trator specifically determined that the grievance was not arbi-
trable in that they argue the opinion and award should not
be deferred to. It is also true that the arbitrator’s decision is
not a model of clarity and seems to blend issues of nego-
tiability and arbitrability. It is clear that the arbitrator’s opin-
ion and award does not confine itself to a pure, isolated de-
termination that the matter was simply not properly arbitra-
ble.
1140 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
Irrespective of all the above, I conclude that the arbitrator
did in fact rule that the grievance was not arbitrible and that
his award did not for that reason reach the merits of the un-
fair labor practice issue. As noted in the portions of the arbi-
trator’s opinion and award quoted immediately above, the ar-
bitrator squarely recognized: ‘‘The issue of arbitrability was
raised and must first [emphasis added] be addressed.’’ His
award, the action portion of his opinion and award, states in
its entirety: ‘‘The Grievance is not arbitrable and is therefore
denied.’’ The clarity of these unambiguous assertions, in my
view, requires that they be taken at their face value irrespec-
tive of dicta in the opinion which suggests the arbitrator had
views beyond the issue of arbitrability.
There is no confusion about these quoted statements in-
cluding, in particular, the award language itself, which re-
quires or even allows the remainder of the opinion and award
to modify the clear holding of the award itself. This is espe-
cially true where the remainder of the arbitrator’s opinion
and award does not contradict the explicit finding of
nonarbitrability.
In effect what Respondent seeks that I do here is find that
the arbitrator did not mean to answer the issue the opinion
and award specifically holds is the first issue to be ad-
dressed. Further, Respondent argues that the specific lan-
guage of the award which decides that threshold issue is to
be disregarded. On this record there is no reason not to give
the arbitrator’s language its plain meaning. Indeed, I believe
to disregard Arbitrator Hutcheson’s unambiguous ruling on
an issue he specifically held should be resolved at the thresh-
old of his decision would be unfair to both the arbitrator and
to the process of arbitration long favored by the courts.
Having determined that the arbitrator’s August 5, 1993
opinion and award held the grievance to be ‘‘not arbitrable,’’
it is unnecessary to determine if the arbitrator’s decision is
also not properly deferred to because it does not meet other
aspects of the Board requirements for deferral as argued by
the General Counsel and opposed by Respondent.
c. Conclusions respecting deferral
Having concluded above that the arbitrator’s opinion and
award determined that the Union’s grievance was not arbitra-
ble, it follows, based on the General Counsel’s cited case,
Southwestern Bell Telephone Co., 198 NLRB 569, 570
(1772), that deferral is inappropriate. Accordingly, I shall not
defer the unfair labor practice allegations of the complaint to
Arbitrator Kent Hutcheson’s August 5, 1993 opinion and
award.
2. Did Respondent’s unilateral discontinuance of the
practice violate the Act?
a. Narrowing of the issues
The stipulated record and the posthearing briefs of the par-
ties admirably narrow the focus of the arguments respecting
the propriety of Respondent’s unilateral discontinuance of the
practice. There is no dispute that the Union has for many
years represented a unit of Respondent’s employees who
were allowed to use Respondent’s tools and equipment at the
facility for their personal affairs and to take Respondent’s
tools away from the facility for similar purposes. There is
also no dispute that Respondent discontinued this practice
unilaterally on January 4, 1993, without notifying or provid-
ing the Union with an opportunity to bargain respecting the
matter. Finally there is no contention that the Charging Par-
ty’s conduct thereafter constitutes a waiver of its claims here.
The parties start with the basic proposition that employers
generally must bargain with their employees’ representatives
respecting terms and conditions of employment. The General
Counsel argues that this simple proposition applies here and
that Respondent was obligated to notify and provide the
Union with an opportunity to bargain about the discontinu-
ance of the practice before the employer took any action. Re-
spondent asserts several defenses. First, Respondent argues
that the practice was independent of the employment rela-
tionship and was a mere gratuity about which Respondent
had no obligation to bargain. Second, Respondent argues that
the decision to terminate the practice was an entrepreneurial
decision about which Respondent had no notification or bar-
gaining obligation. Further Respondent asserts its actions
were permitted as a result of the contract and bargaining his-
tory respecting the practice. The General Counsel challenges
each defense.
b. Was the practice at issue here a gratuity about
which there is no obligation to bargain?
In support of its gratuity argument, Respondent cites the
cases Benchmark Industries, 270 NLRB 22 (1984), and Won-
der State Mfg. Co., 344 F.2d 210 (8th Cir. 1965). In Bench-
mark the Board considered the unilateral discontinuance by
an employer of a practice of holding Christmas dinners for
employees or giving 5-pound Christmas hams to employees.
The Board majority found the hams to be merely gifts and
further asserted the view that litigation of the propriety of an
employer’s discontinuance of a dinner and a 5-pound ham,
given once a year, did not further the purposes and policies
of the Act. In Wonder State, a decision cited with approval
in Benchmark, the Eighth Circuit reversed the Board and
found an irregular Christmas bonus given to all employees
to be a gift and not a term and condition of employment
about which Respondent was obligated to bargain.
The General Counsel seeks to distinguish Benchmark by
advancing the subsequent Board cases Owens-Corning Fiber-
glass, 282 NLRB 609 (1987), and Getty Refining Co., 279
NLRB 924 (1986). Owens-Corning Fiberglass held that a
longstanding employee right to purchase the employer’s
products was a mandatory subject of bargaining and specifi-
cally distinguished Benchmark as limited to token gifts.
Getty reached the same conclusion with respect to an em-
ployee social fund administered by the employer. The Board
specifically found the fund to be a significant economic ben-
efit to employees and an integral part of the employees’ total
economic package.
The cases cited by the parties and other cases on the issue
make it clear that the distinctions here are ones of fact and
require consideration of the practice or practices which were
discontinued. It is appropriate then to consider the practice
from the employees’ perspective.
Sixteen year unit employee and union official Paul
Brietske testified at the arbitration that during his job appli-
cation process with Respondent he received a tour of the
shop at which time he was informed by the touring foreman
of the practices at issue here. Brietske further testified that
the opportunity to use Respondent’s tools and facility after
hours was a critical factor in staying with Respondent rather
1141DOERFER ENGINEERING
than taking other employment offering more money and ben-
efits but not the opportunities at issue here. Asked whether
other employees took advantage of the practice of using Re-
spondent’s tools he answered: ‘‘In my opinion, every person
there has used that benefit at one time or another, and some
use it quite a bit. ’’
It should not be considered surprising that production unit
employees of an employer which manufactures machine tools
would have the interest, talent, and desire to utilize the ex-
pensive and specialized equipment, facility, and parts which
Respondent provided through the years. Brietske’s litany of
personal projects completed over the years utilizing the prac-
tice at issue here is lengthy and multifarious.
Respondent points out that the practice is an unreasonable
burden on Respondent in that there are substantial costs in-
volved in replacing perishable and lost tools, in supplying
and monitoring the use of the tools and facility and potential
liabilities in allowing its premises and tools and parts to be
used by employees for their own projects. The General
Counsel does not dispute these assertions. While the costs to
Respondent are not a strict determinant of the benefits to em-
ployees, it is clear that employees are benefiting from an ex-
pensive opportunity and one that is not likely to be cheaply
or easily replaced. The area of inquiry in this aspect of the
case, however, is the benefit to employees of the existing
practice rather than the cost to the employer.
Given all the above, I find that the benefit to unit employ-
ees of the use of Respondent’s tools, parts, and premises for
their personal business or interests, as described more par-
ticularly supra, is substantial. The benefit is at least partially
monetary—some employees have used the practice in the op-
eration of independent commercial activities. Many have
used the practice to undertake ‘‘do it yourself’’ projects
which resulted in indirect savings. It is also clearly nonmone-
tary in that the practice has allowed employees to pursue in-
terests and hobbies which, while not necessarily remunera-
tive, give great satisfaction. The fact that not all employees
may utilize the opportunities the practice offers with the
same frequency does not diminish the overall value to the
unit as a whole. It is clear that the practice is neither a rarely
used or token benefit for employees, but is rather an valu-
able, integral part of the unit employees’ terms and condi-
tions of employment.
I find therefore that the practice involved here is a sub-
stantial benefit to unit employees. The practice, although in-
creasingly regulated over time, is one which has been in
place for many years. These factors under the cases cited
supra convince me that the practice is not a simple token or
gratuity respecting which the Board should not concern itself.
Respondent’s gratuity argument is therefore rejected on the
facts of the case.
c. Was the decision to terminate the practice an
entrepreneurial decision not requiring notice and
bargaining with the Union?
Respondent in its brief argues that the entrepreneurial na-
ture of its decision to terminate the practice involved here is
exempt from a bargaining obligation in three ways. First Re-
spondent notes that its rationale for terminating the practice
was primarily grounded in concerns over legal liability and
only secondarily based on operational costs and employee
loss of efficiency. Based on this assertion counsel for Re-
spondent argues on brief at 12:
None of these matters constitute ‘‘wages, hours, and
other terms and conditions of employment’’ within the
meaning of section 8(d) of the Act, which means that
‘‘. . . each party is free to bargain or not to bargain
. . .’’ NLRB v. Wooster Division of Borg-Warner
Corp., 356 U.S. 342, 349, 42 LRRM 2034. See also
Fibreboard Paper Products Corp. v. NLRB, 379 U.S.
203, 57 LRRM 2609 [(1964)] where the Court noted
that some management decisions have only an indirect
and attenuated impact on the employment relationship.
379 U.S. at 233.
I do not believe the cited cases sustain Respondent’s argu-
ment here. I have found, supra, that the benefits to unit em-
ployees of the practice at issue here was both substantial and
a term and condition of employment. Thus the decision of
Respondent to end the practice clearly had more than an ‘‘in-
direct and attenuated impact on the employment relation-
ship’’ which is the key language quoted by Respondent from
Fibreboard.
Further, counsel for Respondent errs when he argues that
since Respondent’s motives for ending the practice were not
based on unit employees’ wages, hours, and conditions of
employment, it was free to make any changes it desired. It
is not the employer’s motive that is at issue in this aspect
of the case under the cases cited, but rather the change in
working conditions that in fact occurred.
Respondent also argues that Respondent’s decisions re-
specting employees’ use of its facility and tools
falls within the exclusive ambit of management deci-
sion-making because the Union has no right to expose
Doerfer to the risk of liability the practice presents, es-
pecially in today’s litigation-oriented society. [Br. 12.]
Respondent cites First National Maintenance Corp. v. NLRB,
452 U.S. 666 (1981), in support of its argument.
The Board and courts have evolved a line of cases, includ-
ing First National, which hold that certain types of employer
decisions involving major business changes need not be bar-
gained over irrespective of the substantial impact on unit em-
ployees. These cases however are limited to core business
decisions. Respondent’s decision to discontinue the practice
is simply not such a core decision. Irrespective of the impor-
tance which Respondent views the termination of the prac-
tice, it does not change the basic operations of the enterprise
as required under the cases. Accordingly, Respondent’s cases
are distinguishable and its argument must fail.
Respondent argues that negotiations with the Union over
the elimination of the practice would have been a futility or
‘‘needless burden’’ because ‘‘Doerfer’s concerns were real
and rational and there is nothing the [Union] could do to
allay these concerns’’ (Br. 12). Respondent notes the stipu-
lated facts that Respondent’s general manager, who made the
decision to terminate the practice, knows of nothing the
Union could have said, done, or offered that would have alle-
viated his concerns regarding possible civil liability and thus
caused him to abandon his desire to terminate the practice.
Further the stipulation notes that the general manager would
testify that, after the decision, the Union offered nothing,
1142 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
other than objections and argument, in support of its request
that the rule be withdrawn.
Chief Justice Warren writing for the majority in
Fibreboard Paper Products v. NLRB, 379 U.S. 203, 214
(1964), addressed the ‘‘futility’’ issue:
Yet, it is contended that when an employer can effect
cost savings in these respects . . . . there is no need
to attempt to achieve similar economies through nego-
tiation with existing employees or provide them with an
opportunity to bargain a mutually acceptable alternative.
The short answer is that, although it is not possible to
say whether a satisfactory solution could be reached,
national labor policy is founded upon the congressional
determination that the chances are good enough to war-
rant subjecting such issues to the process of collective
negotiation. . . .
While ‘‘the Act does not encourage a party to en-
gage in fruitless marathon discussions at the expense of
frank statement and support of his position,’’ Labor
Board v. American Nat. Ins. Co., 343 U.S. 395, 404,
it at least demands that the issue be submitted to the
mediatory influence of collective negotiations. As the
Court of Appeals pointed out, ‘‘[i]t is not necessary that
it be likely or probable that the union will yield or sup-
ply a feasible solution but rather that the union be af-
forded an opportunity to meet management’s legitimate
complaints . . . .’’ [Quoting 322 F.2d 411, 415 (D.C.
Cir. 1963).]
I am unable to conclude from this record or the nature of
the change that Respondent undertook, that the decision of
Respondent was so immune from being influenced by the
Union, that bargaining would be a futility and thus was un-
necessary under Board law.
d. Was Respondent’s failure to give notice to and an
opportunity to bargain to the Union respecting the
decision to terminate the practice allowed or justified
by the contract and/or the parties’ bargaining history?
The contract’s management-rights clause is quoted in full,
supra. Respondent suggests that any bargaining obligation it
might otherwise have had respecting the practice at issue was
eliminated by that clause. Respondent further argues that the
various aspects of the practice at issue here were never men-
tioned in bargaining and, further, have been the subject of
unilateral action in the past by Respondent without complaint
by the Union.
The General Counsel cites Owens-Corning Fiberglass, 282
NLRB 609 (1987), for the proposition that neither an ab-
sence of bargaining respecting a subject nor a history of uni-
lateral action by an employer with respect to that subject
matter diminishes, waives, or otherwise limits a labor organi-
zation’s statutory right to bargain over changes. That case is
determinative of the issue.
The General Counsel also cites Johnson-Bateman Co., 295
NLRB 180, 184–185 (1989), and the cases cited there, for
the proposition that generally worded management-rights
clauses will not be construed to waive statutory bargaining
rights. The clause at issue here is such a clause and therefore
does not allow the unilateral elimination of the practice at
issue here. The argument that since Respondent is allowed
to regulate its work rules which include the regulation of the
practices here and therefore may eliminate the practice en-
tirely as a simple regulatory act is not tenable. Simply put,
the right to reasonably regulate does not automatically in-
clude the right to eliminate.
e. Conclusion
I have found that Respondent’s practice is a significant
benefit to unit employees and is an important part of the unit
employees’ terms and conditions of employment. I have fur-
ther found that Respondent’s unilateral decision to terminate
the practice without notifying or providing the Union an op-
portunity to bargain over the decision was neither a de mini-
mus or trivial matter nor a decision at the heart of the mana-
gerial enterprise or otherwise exempt from that neither the
contract nor the bargaining history respecting the practice di-
minished the Union’s statutory bargaining rights.
Based on the above, I further find that Respondent was
obligated to provide notice to and an opportunity to bargain
to the Union respecting changes in employees’ terms and
conditions of employment. Respondent did not give such no-
tice nor opportunity to bargain to the Union before it unilat-
erally terminated the practice at issue here. Accordingly, I
find Respondent’s failure to notify and provide the Union an
opportunity to bargain respecting the decision to terminate
the practice and the termination itself violate Respondent’s
obligation to bargain in good faith with the exclusive rep-
resentative of unit employees. I therefore sustain the allega-
tion of the complaint that Respondent by its January 4, 1993
action violated Section 8(a)(5) and (1) of the Act.
REMEDY
Having found Respondent engaged in certain unfair labor
practices, I shall recommend that it be ordered to cease and
desist therefrom and to take certain affirmative action nec-
essary to effectuate the purposes and policies of the Act in-
cluding the posting of a remedial notice.
The remedy for Respondent’s failure to notify the Union
and give it an opportunity to bargain respecting the termi-
nation of the practice described above shall include restora-
tion of the improperly terminated practice. Fibreboard Paper
Products Corp. v. NLRB, 379 U.S. 203, 215–216 (1964). The
practice shall be maintained by Respondent until such time
as it gives proper notice to and an opportunity to the Union
to bargain respecting the termination of the practice.
As the Board directed in Owens-Corning Fiberglass, 282
NLRB 609, 610 (1987), and Getty Refining Co., 279 NLRB
924 (1986), I shall include a provision that Respondent make
unit employees whole for any and all losses suffered by them
as a result of the improper termination of the privilege, with
interest as set forth in New Horizons for the Retarded, 283
NLRB 1173 (1987); see also Florida Steel Corp., 231 NLRB
651 (1977); and Isis Plumbing Co., 139 NLRB 716 (1962).
On the basis of the above findings of fact and on the en-
tire record here, I make the following
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
2. The Union is a labor organization within the meaning
of Section 2(5) of the Act.
1143DOERFER ENGINEERING
1 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections shall be waived for all pur-
poses.
2 If 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.’’
3. The Union represents Respondent’s employees in the
following unit (the unit) which is appropriate for bargaining
within the meaning of Section 9 of the Act:
All production and maintenance employees employed at
its plant located at highway 218 North, Cedar Falls,
Iowa; excluding office clerical employees, quoters-ex-
pediters, professional employees, guards and super-
visors as defined in the Act, and all employees em-
ployed at its Office, Engineering and Technical Centers
located at 201 Washington Street, Cedar Falls, Iowa
and all other employees.
4. Respondent violated Section 8(a)(5) and (1) of the Act
on January 4, 1993, by unilaterally terminating without noti-
fying the Union or providing it an opportunity to bargain the
following unit employees’ rights: (1) the right to work on
personal projects on Respondents premises; (2) the right to
use Respondent’s tools at home or at work; and, (3) the right
to use Respondent’s parts and parts ordering offices.
5. The unfair labor practice described above is an unfair
labor practice affecting commerce within the meaning of
Section 2(2), (6), and (7) of the Act.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended1
ORDER
The Respondent, Doerfer Engineering, a division of Con-
tainer Corporation of America, an affiliate of the Jefferson
Smurfit Corporation, Cedar Falls, Iowa, its officers, agents,
successors, and assigns, shall
1. Cease and desist from
(a) Failing to notify the Union and afford it an opportunity
to bargain concerning a decision to discontinue Respondent’s
practice of affording unit employees the right to use Re-
spondent’s tools at work and at home on their personal
projects, to use Respondent’s facilities for personal projects
and to use Respondent’s parts and ordering facilities for per-
sonal projects.
(b) Terminating the practices without first notifying the
Union and affording it an opportunity to bargain respecting
such decision.
(c) In any like or related manner violating the provisions
of the National Labor Relations Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Reinstate Respondent’s practice of affording unit em-
ployees the right to use Respondent’s tools at work and at
home on their personal projects, to use Respondent’s facili-
ties for personal projects, and to use Respondent’s parts and
ordering facilities for personal projects.
(b) Make whole any and all unit employees for any and
all losses incurred as a result of Respondent’s unlawful ter-
mination of the above-described practices on January 4,
1993, with interest, as provided in the remedy section of this
decision.
(c) Preserve and, on 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 money due under the terms of this Order and fur-
ther to ensure that the terms of this Order have been fully
complied with.
(d) Post at its Cedar Falls, Iowa machine shop facility cop-
ies of the attached notice marked ‘‘Appendix II.’’2 Copies of
the notice, on forms provided by the Regional Director in
English and such additional languages as the Regional Direc-
tor determines are necessary to fully communicate with em-
ployees, after being signed by Respondent’s authorized rep-
resentative, shall be posted by Respondent immediately upon
receipt and maintained for 60 consecutive days in conspicu-
ous places, including all places where notices to employees
are customarily posted. Reasonable steps shall be taken by
Respondent to ensure that the notices are not altered, de-
faced, or covered by other material.
(e) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondent has
taken to comply.
APPENDIX II
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we vio-
lated the National Labor Relations Act and has ordered us
to post and abide by this notice.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representatives of
their own choice
To act together for other mutual aid or protection
To choose not to engage in any of these protected
concerted activities.
WE WILL NOT fail to notify the Union and afford it an op-
portunity to bargain concerning a decision to discontinue Re-
spondent’s practice of affording unit employees the right to
use Respondent’s tools at work and at home on their per-
sonal projects, to use Respondent’s facilities for personal
projects, and to use Respondent’s parts and ordering facilities
for personal projects.
WE WILL NOT terminate the practices without first notify-
ing the Union and affording it an opportunity to bargain re-
specting such decision.
WE WILL NOT in any like or related manner violate the
provisions of the National Labor Relations Act.
WE WILL instate our practice of affording unit employees
the right to use our tools at work and at home on their per-
1144 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
sonal projects, to use our facilities for personal projects, and
to use our parts and ordering facilities for personal projects.
WE WILL make whole any and all unit employees for any
and all losses incurred as a result of our unlawful termination
of the above-described practices on January 4, 1993, with in-
terest.
DOERFER ENGINEERING, A DIVISION OF CON-
TAINER CORPORATION OF AMERICA, AN AFFIL-
IATE OF THE JEFFERSON SMURFIT CORPORA-
TION