Hi-Grade Materials Co.

National Labor Relations Board - Board Decisions

Dec 20, 1978

239 N.L.R.B. 947 (N.L.R.B. 1978)

HI-GRADE MATERIALS CO.
Hi-Grade Materials Co. and General Truck Drivers,
Warehousemen & Helpers Union Local 467, Inter-
national Brotherhood of Teamsters, Chauffeurs,
Warehousemen & Helpers of America. Case 31-
CA-7378
December 20, 1978
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS JENKINS
AND PENELLO
On August 31, 1978, Administrative Law Judge
Russell L. Stevens issued the attached Decision in
this proceeding. Thereafter, Respondent and counsel
for the General Counsel filed exceptions and a sup-
porting brief, and Respondent filed an answer to the
General Counsel's exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
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 2 of the Administrative Law Judge and
to adopt his recommended Order.3
IThe Administrative Law Judge inadvertently found that a bargaining
session was held on October 5. 1977 The record indicates that this session
occurred on October 3, 1977.
2 The Administrative Law Judge concluded that Respondent. unilaterally
and without bargaining with the Union. decreased the wages of emplouees.
including replacements. by $3 per hour Respondent has defended its ac-
tions partly on the ground that the replacements were untrained The Ad-
ministrative Law Judge found. however. that this reduction violated the
terms established in the bargaining agreement still then in effect. In art. Vl.
sec. 3. of this agreement, certain modifications to the standard classification
rate have been provided for with respect to driver trainees. This factor. not
considered by the Administrative Law Judge or mentioned by the parties in
their briefs to thdie Board. does not affect his finding of an 8(aX5) vilation. as
the wage reduction offer was correctly found to have covered all employees
and the wages actually paid replacements were far below that provided for
in the contract for trained or untrained dnvers. What effect. if any. this
contract provision has on Respondent's backpay obligation is best left for
resolution in the compliance stage of this proceeding.
3In his remedy. the Administrative Law Judge provided that should Re-
spondent fail to reinstate the employees engaged In the unfair labor practice
strike within 5 days of their application for reinstatement. backpay for these
employees shall begin to accrue. The Board has found that the 5-das period
is a reasonable accommodation between the interests of the employees in
returning to work as quickly as possible and the emplo)er's need to effectu-
ate that return in an orderly manner. Drug Package (Compan. Inc.. 228
NLRB 108 (1977). Accordingly. if Respondent herein has already rejected.
or hereafter rejects. unduly delays, or ignores any unconditional offer to
return to work. or attaches unlawful conditions to its offer of reinstatement.
the 5-day period serves no useful purpose and backpa) will commence as of
the unconditional offer to return to work. National (ar Rental S vster Inc.
Car Rental Division. 237 NLRB 172 (1978); Newport Ne'cs Shipbuilding &
Do, Dock Consparn. 236 NLRB 1637 (1978). While Chairman Fanning and
Member Jenkins would not. in any event. automatically grant this 5-day
grace period. they acknowledge that, until such time as the majority view
approving this , 'actice changes. they are institutionally bound by this posl-
tion
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board adopts as its Order the recommended
Order of the Administrative Law Judge and hereby
orders that the Respondent, Hi-Grade Materials Co.,
Hesperia, California, its officers, agents, successors,
and assigns, shall take the action set forth in the said
recommended Order, except that the attached notice
is substituted for that of the Administrative Law
Judge.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOAR[)
An Agency of the United States Government
WE WILL NOT, unilaterally and without bar-
gaining with the Union, decrease the wages of
our employees by the sum of approximately $3
per hour, or similarly refuse to pay our employ-
ees holiday and vacation pay.
WE WILL NOT fail and refuse to negotiate in
good faith with the Union for a new collective-
bargaining agreement.
WE WILL N07 in any other manner interfere
with, restrain, or coerce our employees in the
exercise of their rights under Section 7 of the
Act.
WF WILL. recognize and, upon request, bargain
collectively with the Union as the exclusive rep-
resentative of all our employees in the appropri-
ate unit with regard to rates of pay, hours of
employment. and other terms and conditions of
employment and, if an understanding is
reached, embody such understanding in a signed
agreement.
WE WILL restore and put into effect forthwith
all terms and conditions of employment provid-
ed by the contract effective September 1, 1974,
through August 31, 1977, including those provi-
sions which were unilaterally changed by us, but
excluding those provisions relating to health and
welfare and the union trust fund, until such time
as we have bargained in good faith for a reason-
able time and have reached a new agreement or,
in the alternative, have reached an impasse.
WE WILL make whole all employees whose
wages were reduced, and whose holiday and va-
cation pay were not paid by us, as those wages
and payments should have been made under our
agreement with the Union.
947
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
WE WILL, upon application, reinstate our strik-
ing employees, who it has been found were, on
and after October 3, 1977, protesting our unlaw-
ful refusal to bargain with General Truck Driv-
ers, Warehousemen & Helpers Union Local 467,
International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen & Helpers of America, as
follows:
(1) Striking employees whose jobs were not
filled by permanent replacements before Octo-
ber 3, i977, will, upon application, be offered
immediate reinstatement, and persons hired on
or after that date will be dismissed if necessary
to make room for them.
(2) Striking employees whose jobs were filled
by permanent replacements before October 3,
1977, will, upon application, be offered rein-
statement upon departure of their replacements.
(3) If we do not reinstate the striking employ-
ees in the manner set forth above within 5 days
from the date reinstatement is required, backpay
shall begin running, with interest, from the date
on which the 5 days expire.
HI-GRADE MATERIALS CO.
DECISION
STATEMENT OF THE CASE
RUSSELL L STEVENS, Administrative Law Judge: This
matter was heard in San Bernardino, California, on May
25 and 26 and June 14, 1978.' The original charge was filed
on September 16, a first amended charge was filed on No-
vember 7, and a second amended charge was filed on Feb-
ruary 17, 1978, by General Truck Drivers, Warehousemen
& Helpers Union Local 467, International Brotherhood of
Teamsters, Chauffeurs, Warehousemen & Helpers of
America (Union). The complaint was issued on November
21, and an amended complaint (herein called complaint) 2
was issued April 4, 1978. The complaint alleges that Hi-
Grade Materials Co. (Respondent) violated Section 8(a)(1)
(3), and (5) of the National Labor Relations Act (Act).
All parties were given full opportunity to participate, to
introduce relevant evidence, to examine and cross-examine
witnesses, to argue orally, and to file briefs. Briefs, which
have been carefully considered, were filed on behalf of
General Counsel and Respondent.
Upon the entire record of the case, and from my obser-
vation of the witnesses and their demeanor, I make the
following:
IAll dates hereinafter are within 1977. unless stated to be otherwise.
2The compla it further was amended at the hearing to make minor
changes and corrections.
FINDINGS OF FACT
I. THE BUSINESS OF RESPONDENT
Respondent is, and at all times material herein has been,
a corporation duly organized and existing under and by
virtue of the laws of the State of California, with an office
and principal place of business in Hesperia, California,
where it is engaged in business as a supplier of ready-mix
concrete, rock, sand, and aggregates. In the course and
conduct of its business operations, Respondent annually
sells goods or services valued in excess of $50,000 to cus-
tomers or business enterprises within the State of Califor-
nia, which customers or business enterprises have a sub-
stantial impact on national defense.
I find that Respondent is, and at all times material
herein has been, an employer engaged in commerce, and in
a business affecting commerce, within the meaning of Sec-
tion 2(6) and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
General Truck Drivers, Warehousemen & Helpers
Union Local 467, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen & Helpers of America is, and
at all times material herein has been, a labor organization
within the meaning of Section 2(5) of the Act.
Local 12, International Union of Operating Engineers,
is, and at all times material herein has been, a labor organi-
zation within the meaning of Section 2(5) of the Act.
Ill. THE ALLEGED UNFAIR LABOR PRACTICES
Background
Respondent's business is the sale of ready-mix concrete,
rock and sand products, with a batch plant located in
Hesperia, California, and a quarry located in Lucerne Val-
ley, California. In addition to fixed facilities, Respondent
owns and operates a fleet of vehicles for transportation of
its products. Robert Hove 3 is Respondent's president. Re-
spondent usually employs approximately 25 employees, in-
cluding approximately 20 drivers and mechanics.
Respondent is a member of the Southern California
Rock Products Association, and the Southern California
Ready Mix Association, the two of which consolidated for
the purpose of negotiating bargaining agreements for their
members. Respondent has operated under contracts nego-
tiated by the association for approximately 10 years. The
most recent agreement with the Union was effective Sep-
tember 1, 1974 through August 31, 1977. 4 Respondent's
most recent agreement with International Union of Oper-
ating Engineers, Local No. 12 (hereinafter referred to as
Local 12), also expired on August 31, 1977. On June 24,
1975, Hove addressed a letter to Local 12, which repre-
sented a small unit of Respondent's employees, reading as
follows:
IAll individuals are referred to herein by their last names.
4 G.C. Exh. 3.
948
HI-GRADE MATERIALS CO.
June 24, 1975 trust fur
International Union of Operating Engineers August
Local No. 12
4320 West Ist St
Santa Ana, CA 92703
Attention: A. V. Ramirez
DGM/tGentlemen: DGM
We are faced with economic extinction in our Market cc: Hy-
Area. On July I
Daly Ready Mix and Hesperia Ready-Mix, our pres- relations for
ent two competitors, are non-union. Their wage scale ing as follov
for employees is $5.00 per hour maximum and they do This
not pay union benefits such as pension, vacation, holi- attornei
day, and health. Our average wage will be somewhat wherein
over $12.00 per hour and our cost per yard will be Authori
about $6.45 September 1, 1975 as against the competi- lation v
tors $2.50 to $3.00 per yard. You
We request that as of September 1, 1975 that our affili- terms o
ation be terminated with the Southern California are a p;
Ready Mix and Rock Products Associations along and yoi
with our agreements with the Teamsters Local No. 467 all emp
and the Operating Engineers Local No. 12. Agreem
We are willing to review our cost figures with you to Comi
justify our position. Negotia
Very truly yours, Grade I
HI-GRADE MATERIALS CO. collectiances,
Robert E. Hove, President will be
Copies to: Frank Fitzsimmons, Al Wing (Teamsters) with re:
Hunter P. Wharton, Joseph H. Seymour, A. V. Rami- the ben
rez (Operating Engineers) John Truesdale, Abraham If yo
Siegel (National Labor Relations Board) Don Reining please c
(Rock Products Association)
On April 19, 1977, David Moore, an attorney who repre-
sented Respondent, sent the following letter to the Union:
April 19, 1977 HWS:d
Teamsters Local No. 467 cc: Em
1074 La Cadena Drive Approxin
Riverside, California business age
Western Conference of Teamsters their bargail
Pension Trust Fund form" letter
Southwest Area Respondent
1616 West Ninth Street well as to c
Los Angeles, California 90015 was r6Place
ment to ac
Southern California Rock was necessa
Products & Ready Mixed the Union's
Concrete Industries Group ed to Respc
Insurance Plan the health a
c/o P. Gray nized Respc
Wells Fargo Bank age for its
Post Office Box 400 Hove, who
South Pasadena, California 91030 the associat
Gentlemen: reading as f
Our office represents Hy-Grade [sic] Materials
Company.
This letter will constitute notice pursuant to Article 5G.C Exh.
XXXIV that all collective bargaining agreements and 6 G.C. Exh.
949
nd agreements shall terminate as of midnight,
31, 1977.
Very truly yours,
REID, BABBAGE & COIL
David G. Moore
Grade[sic] Materials Co.
3, 1977, H. W. Samson, director of industrial
the associations, wrote a letter to Hove, read-
will acknowledge receipt of a letter from your
ys, Reid, Babbage & Coil, dated April 19, 1977,
i we were advised of the cancellation of your
ization for Collective Bargaining. This cancel-
will become effective August 31, 1977.
will, of course, continue to be bound by the
f the various Labor Agreements to which you
arty until their expiration on August 31, 1977,
i will be required to continue to contribute to
'loyee benefit plans in accordance with those
lents.
mencing September 1, 1977, the Employer's
ating Committee will no longer represent Hi-
Materials Company in any matters relating to
ve bargaining, including negotiations, griev-
group insurance, and pensions. Therefore, it
necessary for you to make other arrangements
spect to group insurance and/or pensions for
efit of your hourly bargaining unit employees.
'u have any questions regarding this matter,
contact me by calling (213) 682-2193.
Very truly yours,
H. W. Samson
Director of Industrial Relations
Ic
ployers' Negotiating Committee
nately in mid-August Samuel Cole, a union
ent, visited Hove in the latter's office relative to
ning relationship. Cole had with him a "short
of agreement which, if signed, would bind
to the associations' new 1977 agreement, as
ontinuation of the 1974-77 agreement until it
i. Cole also had with him a form of trust agree-
:company the letter of agreement. Cole said it
.ry for Respondent to sign both documents if
trust, health, and welfare benefits were extend-
,ndent's employees. Hove and Cole discussed
and welfare matter, and Hove said he recog-
ondent's obligation to have some sort of cover-
employees. Neither document was signed by
wanted to negotiate with Cole separately from
ions. On August 22 Cole sent a letter to Hove,
ollows:
S.
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Hi-Grade Materials
P.O. Box 908
Apple Valley, Ca 92307
ATTN: Mr. Robert Hove
cc: Mr. Dave Moore, Esq.
Dear Sir:
With reference to negotiations for a new Labor
Agreement between your Company and Teamsters
Union Local 467, please be advised that I am willing
to meet with you for that purpose. I have two avail-
able dates open, August 24 and August 25, 1977.
Please advise if these dates are satisfactory.
Very truly yours,
GENERAL TRUCK DRIVERS, WAREHOUSE-
MEN AND HELPERS UNION LOCAl 467
Samuel H. Cole, Business Representative
SC:pp
During the last part of August Hove retained a labor
consultant, M. K. Sullivan, to assist Respondent in negoti-
ations with the Union. Sullivan retained a labor attorney,
Noel Shipman, to work with him on behalf of Respondent.
On September 2 Sullivan notified the Union by telegram
that he represented Respondent and that all negotiations
should be with him.
Hove and Sullivan discussed the fact that Respondent's
employees would not be covered by health insurance after
the contract with the Union expired on August 31 and Sul-
livan recommended that insurance be obtained. Respon-
dent is a member of the Associated Builders and Contrac-
tors Association (ABC) in addition to its membership in
the two associations mentioned supra, and ABC provides
insurance for its members, upon application. By letter dat-
ed September 6, Respondent applied to ABC for insurance
coverage of its employees. By letter dated September 14.
received by Respondent on September 19, ABC advised
Respondent that its insurance coverage would be in force
retroactive to September I upon receipt of cards signed by
employees and other necessary forms. It was stipulated by
counsel that 11 employees signed ABC insurance applica-
tion cards on September I and 2.
After receiving Sullivan's telegram of September 2, Cole
called Sullivan and they agreed to meet on September 6 in
the Union's office. Meetings thereafter were held on Sep-
tember 6 and 28 and October 3, 13, and 31. Those meetings
are discussed infra.
On September 7 Local 12 went on strike and com-
menced picketing. Local 12 then represented three of Re-
spondent's employees, all of whom were on strike. Two
pickets were posted at the batch plant and one was posted
at Lucerne Valley. The Union's members refused to cross
the picket line, except for two employees. A letter to all
employees signed by, Hove, was given to the employees on
September 7. The letter reads as follows:
TO ALL STRIKING EMPLOYEES OF HI-GRADE MATERIALS CO
Please be advised that if you do not report to work on
9-8-77 -it 8 a.m., it is within our rights to hire new
employees to fill your job. These employees will be
permanent replacements and your jobs will be avail-
able again, only when we have room for you. Please
consider, our long, friendly history and don't jeopar-
dize your future with this company by continuing this
rash work stoppage.
Sincerely yours,
HI-GRADE MATERIALS CO.
Robert E. Hove
President
On September 7 Hove and Sullivan discussed Local 12's
strike and refusal of other employees to cross the picket
line. The two decided to hire replacements, and thereafter,
19 replacement employees were hired.7
On September 7 Sullivan addressed the following letter,
delivered September 8 to Cole:
Due to work stoppage engaged in by the employees
of Hi-Grade Materials, I am unable to counter pro-
pose on your proposals within the time schedule set in
yesterdays meeting. Please contact me for an addition-
al meeting date, as the Wednesday, September 14
date, agreed upon is no longer available.
The work stoppage out at Hi Grade Materials will
require the company to permanently replace the men
on strike. It is our intention to pay these permanent
replacements $3.00 an hour less than what the striking
workers were receiving. We are offering you this wage
decrease as our final offer. You have until Friday,
September 9, to agree to this offer. Barring this re-
sponse from you, I shall consider the issue of wages to
be at impass in our bargaining and shall unilaterally
implement this, my final wage proposal.
I am deeply disappointed that your organization has
resorted to economic action at this stage of the bar-
gaining. Your attitude would appear to preclude any
friendly resolution of our differences. Please contact
me as soon as possible on the above matter.
On September 16, the Union replied to Sullivan by tele-
gram, as follows: 8
We have received your letter dated September 1,
1977, re High Grade Materials and have instructed
our attorneys to take all action necessary including the
filing of unfair labor practice charges, to bring you
into compliance with State and Federal Labor Laws.
We specifically protest your unilateral change in
terms and conditions of employment, your final offer
of 3.00 less per hour than unit employees were previ-
ously being paid, your unfounded and unsupported
declaration of impasse on wages and your unwanted
cancellation of our scheduled September 14, 1977 bar-
gaining meeting.
We demand that you meet and bargain with us at
reasonable times and places as required by law, con-
7 hose employees are named in ( .( Fxh 2. the accuracy of which bas
stipulaled by counsel
Counsel stipulated that the date of September I in the first line of the
telegram is an error: that the correct date is September 7
950
HI-GRADE MATERIALS CO.
tact us immediately to arrange for the earliest possible
bargaining date. Your failure to do so will be taken to
mean that you will not meet and bargain with us. In
the meantime unit employees will picket to protest the
unfair labor practices of High Grade Material.
Loca! 12's picketing ceased on September 30, and the
Union commenced picketing on October 3 with signs pro-
testing Respondent's alleged unfair labor practices. The
Union contends that the unfair labor practices include re-
fusal to bargain in good faith. The Union's picketing con-
tinued until April 25, when the pickets were removed.
Issues
The principal issues are whether or not Respondent re-
fused to bargain in good faith with the Union, and whether
or not the Union's work stoppage was prolonged by Re-
spondent's unfair labor practices. Several subsidiary issues
are discussed infra.
A. The 1974-77 Contract
General Counsel argues that the 1974-77 contract con-
tinued in effect on a day-to-day basis after August 31, or
that, in the alternative, the old contract set the terms and
conditions of work after August 31 until those terms and
conditions properly were changed.
The contract did not, by its terms, continue in effect
after August 31 since Respondent gave ample and proper
notice of its intention to permit the contract to expire on
that date. However, a question arises as to whether the
parties agreed to a day-to-day extension. Cole testified
that, at the bargaining session of September 6, the parties
agreed to "continue operating on a day-to-day basis under
the last contract while we were negotiating .... " That tes-
timony was corroborated by Rex Sommerville, a union
representative. Shipman initially testified, "We agreed to a
day-to-day extension if it meant we could pay into the trust
fund to keep the men covered. At least that was in my
mind. I am not sure of the exact words at the time." How-
ever, Shipman later testified concerning the bargaining ses-
sion of September 28:
A. Ivan Potts claimed that we had continued-had
agreed to continue the contract on a day to day basis.
I agreed at the earlier session to do just that but that
the walkout may have changed the facts, and I wasn't
quite sure of my situation now.
Q. Was there anything mentioned about retroactiv-
ity?
A. I had agreed right on the spot again to retroac-
tivity of the contract.
Shipman also testified:
Did you advise Respondent or have any conversa-
tions with Respondent relative to the continuation of
the old contract?
THE WITNESS: The only discussions I had with-
were with Mr. Sullivan-and that was concerning uni-
lateral changes. Whether we had a contract or not we
couldn't start changing any of the wages, hours, or
working conditions.
JLUDGE: Let me put it another way. Do you know
whether or not the company acted upon the old con-
tract on a day to day basis after its termination-its
expiration-on August 31st?
THE WITNESS: To my understanding the wages,
hours, and working conditions remained the same.
The only thing we changed was the welfare-the trust
payments. I am not sure what the facts are in the pen-
sion plan, but some of the health and welfare facts
have come out in this hearing.
JUDGE: So the contract was created as a continuing
one but for the health and welfare provision?
THE WITNESS: To my knowledge.
Sullivan testified:
A. Yes. Mr. Shipman having had experience with
the Board, dictated the letter because he was quite
concerned or he informed me or warned me, that we
could not make a unilateral change in the contract,
that we would have to continue the contract in full
force.
Further, Respondent's witnesses repeatedly stated at the
hearing that employees who crossed the picket line or who
were not replaced continued to receive contract pay. Still
later in his testimony, Shipman reiterated that he agreed
during the meeting of September 6, "to continue on a day-
to-day basis," and he explained:
THE WITNESS: I wasn't clear at that time whether
the contract was in existence or not because of the
walkout. I didn't know whether the walkout affected
our earlier agreement to continue it on a day-to-day
basis. In my mind the fact that I was willing to agree
to retroactivity which I did in the next breath, negated
any question of whether there was-it was continuing
on a day-to-day basis. I was going to pay whatever we
agreed to retroactively anyway, and in my mind that is
all that was important, and the subject was dropped
immediately. And then I concluded in their mind it
wasn't important either.
Finally, Respondent's counsel stipulated that Shipman rep-
resented to the Union that the contract was on a day-to-
day basis, at least until September 6.
A question arises as to whether or not Shipman abrogat-
ed his oral agreement with the Union to continue the con-
tract. There is no indication that he did. Sommerville testi-
fied that, at the negotiation session of September 28,
Shipman said he no longer was willing to operate on a
day-to-day basis because when he did so agree he was not
aware the Union's employees were going to honor Local
12's picket lines. However, that is not the sense of
Shipman's testimony. Shipman testified that he merely was
in doubt about the situation and that, anyway, the matter
was not important since he already had agreed to retroac-
tivity to September 1, of any new contract.
It is found that the 1974-77 contract, except the health
and welfare provision, continued on a day-to-day basis af-
ter August 31 by agreement of the parties, and that the
agreement was not abrogated by either party. In any event,
951
DECISIONS OF NA IONAL LABOR RELATIONS BOARD
it is beyond question that the 1974-77 contract established
the terms and conditions of work until those terms and
conditions properly are changed.
B. Union Members' Refusal To Cross Picket Line
There is no factual dispute concerning Local 12's estab-
lishment of a picket line on September 7 and refusal of all
except two of Respondent's employees to cross the line.
Because of that refusal, Respondent's business was brought
to a standstill. The business is a sizable one and depends
almost entirely upon truck transportation since it deals in
ready-mix concrete and related products. Since nearly all
truck drivers refused to work, Respondent could operate its
business, and avoid severe economic hardship, only by hir-
ing replacements. Sullivan and Hove are credited in their
testimony that they discussed the necessity for hiring re-
placements as soon as possible.
Article V of the 1974-77 contract provides, "For the pe-
riod of this Agreement, neither the Union nor its members
will cause or take part in any strike ... ."
Respondent attempted to establish at the hearing that
the Union collaborated with Local 12 in preparation for
the latter's strike and that, in effect, both Local 12 and the
Union participated in a joint strike. That attempt included
testimony relative to prestrike discussions between Cole
and representatives of Local 12; presence of union mem-
bers on the picket line during the week and on weekends;
alleged participation of union members in picket line vio-
lence; Cole's testimony that a representative of Local 12
told him in advance about Local 12's plan to strike; Cole's
frequent visits to Local 12's picket line; presence of Cole
and Sommerville at Local 12's picket site early in the
morning of the strike; and the timing of the two strikes.
Cole denied that it was a joint strike, and that denial is
given full credence. Respondent's testimony did not show a
joint strike. Thus, this issue involves the right of union em-
ployees to respect another unit's picket line rather than
violation of a no-strike contract clause, or right to strike, at
least until the date when the Union went on strike and
picketed, which was October 3. The 1974-77 contract does
not refer to employees' right to respect picket lines, and
absent contractual or other preclusion, that right was one
held by Respondent's employees when they refused to
cross Local 12's picket line on September 7. It is found,
infra, that the Union's strike of October 3 was an unfair
labor practice strike, thus, the strike clause in the 1974-77
agreement did not preclude the Union's strike."
C. Alleged Refusal To Bargain in Good Faith
Paragraph 12 of the complaint alleges that Respondent
refused to bargain with the Union in good faith and lists
several indicia of such alleged conduct. In order to assess
the allegations, it is necessary to consider the various bar-
gaining sessions.
9Keller-Crescent Company, a Division of Mosler, 217 NLRB 685 (1975);
Gary-Hobart Water Corporation, 210 NLRB 742 (1974).
° Mastro Pk -tics Corp., and French-American Reeds Mfg. Co, Inc, v.
N.LRB., 350 U.S. 270 (1956).
1. Session of September 6
In attendance were Cole, Rex Sommerville, and Ed Ho-
dell for the Union, and Shipman and Sullivan for Respon-
dent. The meeting was held in the Union's offices and last-
ed approximately I hour. Cole presented the Union's letter
of acceptance form and trust agreement, but Shipman and
Sullivan declined to sign, stating that they wanted to nego-
tiate an independent agreement. The parties agreed to con-
tinue the 1974-77 agreement on a day-to-day basis. Cole
told Shipman and Sullivan that the employees would not
be covered by insurance after August 31 unless the letter of
acceptance and trust agreement were signed, and Shipman
said he wanted to look for cheaper insurance. Cole pre-
sented the Union's proposed contract," but there was only
brief discussion of it. The next meeting was scheduled for
September 14, but the meeting later was canceled by Re-
spondent.
2. Session of September 28
In attendance for the Union were Cole, Sommerville,
and Ivan Potts, an attorney. Shipman attended, alone, for
Respondent. The meeting was held in the offices of attor-
neys Richman and Garrett, where Potts worked, and lasted
approximately I hour. Cole credibly testified, without con-
tradiction by Shipman, that Shipman had promised in the
meeting of September 6 to bring to the meeting of Septem-
ber 14, later changed to 28, health and welfare information
to be accumulated by Shipman and Respondent's counter-
proposals. Cole credibly testified that Shipman was asked
in September to present those two items, but Shipman did
not have them. Shipman testified that he told the union
representatives he would have the counterproposals at the
next session and that he would present the health and wel-
fare information when it was obtained. The Union again
pressed Shipman to sign the letter of agreement, but he
refused to do so.
3. Session of October 5
In attendance for the Union were Cole, Sommerville,
and Potts. Shipman attended alone for Respondent. The
meeting was held in Potts' office and lasted approximately
I hour. Shipman presented Respondent's counterpropos-
als and the parties discussed several of them including
those covering union security (Respondent wanted an open
shop for replacement employees), wages, cost of living in-
creases, and others through article VI of the counterpro-
posals. The Union rejected outright the modified open
shop and wage increase proposals. Shipman stated that Re-
spondent was "financially strapped," could afford no more
than the wages set forth in the counterproposal, and could
not compete if it had to pay the wages demanded by the
Union. Potts said he wanted to see Respondent's books
and records relating to Shipman's contention and Shipman
said he would make arrangements through Sullivan for
'' G.C. Exh. 9.
2 The Union went on strike October 3 and placed pickets at both of
Respondent's facilities.
952
HI-GRADE MATERIALS CO.
Potts to see the books.' Cole credibly testified that Ship-
man asked him to obtain information concerning "the vest-
ed rights of the striking employees . . ." and that he re-
plied only the individuals involved could do that. Cole said
Shipman stated that he would not bargain about pensions
unless he had the requested information.
4. Session of October 13
Sommerville, Potts, and Cole attended for the Union
and Shipman attended for Respondent. The meeting was
held in Potts' office. Most of this session was devoted to an
item-by-item consideration of Respondent's counterpro-
posals. Respondent's counterproposals included its agree-
ment, or substantial agreement, to 19 of the 40 articles of
the Union's proposals, and Respondent agreed to or par-
tially agreed to 11 more articles. The parties remained far
apart on the trust fund, wages, union security, and a few
other items. Cole and Sommerville credibly testified that
the Union again asked for Respondent's books and rec-
ords, which to that time had not been made available.
Shipman did not say when they would be made available.
Cole testified:
A. Mr. Shipman. Said that these meetings are just a
stall; that the issue would be settled in the street.
Q. Anything further?
A. Yes. He also stated-Mr. Shipman stated that if
the Union beats the Company in the streets, he will
sign our pension agreement.
Sommerville testified that Shipman said "the meetings
were just a stall and this thing would never be settled on
the bargaining table; that if it were settled, it would have to
be out in the streets." Shipman testified on this subject:
A. I kept saying what are we doing here if you are
not going to give in on anything, you know, it is take it
or leave it, and you are hammering us on the street.
You've got all this violence and all this stuff is going
on and they were talking tough and talking about how
Hi-Grade was going to suffer for this, and how it was
going to cost Hi-Grade more to hire Mike than it
would have just to sign the agreement and my re-
sponse was why are we here; it is just a stall obiously;
it will be handled on the street.
Q. Did you mean by that that the Company was
stalling and wanted to have the Union handle it on the
street?
A. Well, the Union was already on the street. The
Union had put it into the street and I was fulfilling my
obligation as far as I was concerned on the bargaining.
Cole testified that Shipman said Respondent had cov-
ered the employees with health and welfare provisions and
would provide the information relative to coverage at a
later date. Shipman did not deny this alleged statement.
Cole testified that Shipman asked if the Union "were
ready for an impasse," and Potts replied "what's the hur-
l Shipman testified that he called Sullivan on October 4 about the books.
then called Potts and asked him to deal with Sullivan on this subject be-
cause Shipman's office was located in Manhattan Beach. more than 100
miles distant.
ry?" Shipman then said, "so I can increase my fee." Som-
merville testified:
A. We were talking again about the union security
clause. Mr. Shipman asked Mr. Potts if he thought we
were at an impasse on the negotiations and Mr. Potts
said no. He asked Mr. Shipman what his hurry was
and I do recall Shipman making some remark about
his fees-I don't recall exactly what the wording was.
Shipman testified:
A. I responded to their stubbordness [sic] with if
you are not going to give on this, then delcare [sic] an
impasse. I wanted them to make the move on it. I was
willing to keep showing up; I get paid for it. But they
wouldn't. They had something else in mind.
Q. Mr. Cole stated that you also made a remark
that the quicker you get to an impasse, the higher your
fees are. What was the basis of your hire: Were you on
an hourly basis?
A. I had a special arrangement with Mr. Sullivan at
less than full attorney's rates.
Q. But were you working on an hourly basis or on a
retainer basis?
A. It was an hourly basis.
Q. So is it fair to conclude that the more hours you
put in, the higher you fees would be?
A. Well, of course.
5. Session of October 31
This session also was held in Potts' office, attended by
Sommerville and Cole for the Union and Shipman for Re-
spondent. Sommerville testified:
A. Well, the first thing that we discussed at this
meeting was the audit of the company books. I asked
Mr. Shipman again who the auditor was and when we
could set up a meeting and he said that he didn't have
that information for me; that Mr. Sullivan was sup-
posed to get back to him with it or get back to me with
it, but he would call me that day-that evening-this
was a morning meeting. I was going to be back in my
office that afternoon and he was going to call me that
day and let me know who the company's bookkeeper
was so that we could set a date for this audit.
Q. What else was said at this meeting?
A. We discussed a few more of the articles of the
contract or the proposals. I don't recall which ones.
But Mr. Potts asked Mr. Shipman-it wasn't really too
far into that meeting-if he thought this matter could
be settled at the bargaining table and Mr. Shipman
said no, we are at an impasse and this matter cannot
be settled at the bargaining table.
Shipman testified:
A. Well, Ivan announced right away that Region
31-he had heard from Region 31 that they were
going to issue on the 8(aX5), and that the stike [sic]
was an unfair labor practice strike. And I made some
remark about the investigation because nobody had
contacted me.
953
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
He said, well, enough of this bullshit, lets [sic] get
this over with, I am going to declare an impasse on,
and he started listing the things that he was declaring
an impasse on, and I was just writing them down.
And when we were all through, I asked him how the
union could refuse to take our money for the trust
fund; why wasn't that a unilateral change. Tnis is a
student and teacher kind of thing; why isn't this a
unilateral change. He said, well, there is a case on it
inhouse, number two, and that was about the whole
meeting. It only lasted about 10 or 15 minutes.
Q. Were there any negotiations at that meeting?
A. No. This was over with. We got the bail rolling
with this and goodbye.
Discussion
(a) Discontinuance of benefits
The complaint alleges that, on or about September I,
Respondent unilaterally discontinued existing health, wel-
fare, and pension benefits for employees who refused to
cross Local 12's picket lines.
The fact of discontinuance of benefit contributions, ef-
fective after August 31, 1977, is not in dispute.
Counsel stipulated that Respondent obtained substitute
coverage of its employees, effective September 1.
This allegation is based upon two false assumptions: (a)
that Respondent unilaterally and arbitrarily discontinued
contributions, and (b) that it did so because of the employ-
ees' refusal to cross picket lines.
Cole was well aware, when he visited Hove in the latter's
office in mid-August, that Respondent wanted to negotiate
independently with the Union. Cole also was well aware of
the problem with contributions that would manifest itself
on September 1. Hove equally was well aware of the prob-
lem since he was informed of it by the associations' letter
of July 13.
Hove recognized at least a moral obligation to cover the
employees with insurance and he attempted to make ar-
rangements with Cole to pay into the contract fund as in
the past, pending negotiation of a new contract. However,
Cole insisted that Respondent first must sign a long-term
contract with the Union, which Hove was not willing to do.
Hove had made it clear since 1975 that he wanted to nego-
tiate his own independent contract after August 31, 1977.
Possibly the parties could have negotiated a mutually ac-
ceptable arrangement, but Cole foreclosed that possibility
by his flat statement that there was only one way for Re-
spondent to pay into the union fund as in the past, i.e., by
signing an agreement that would bring all bargaining to an
end.
Only after being faced with a refusal by Cole to negoti-
ate further on this subject did Hove turn to an alternative
arrangement. He covered the employees with an indepen-
dent plan, effective September 1, 1977.
General Counsel relies upon Wayne's Olive Knoll Farms,
Inc. d/b/a Wayne's Dairy, 223 NLRB 260 (1976), as au-
thority for this allegation, but that case is inapposite since
it did not involve a union's contention that contributions
could be accepted only if a long-term contract was signed
without bargaining or negotiation, as is the case herein.
Respondent attempted to show that Cole was an agent
of the trust fund when he advised Hove that a union con-
tract was a condition precedent to trust fund contributions,
and Cole denied that relationship. However, that matter is
irrelevant since, in taking the position he did, Cole was
refusing on behalf of the Union to negotiate further; he
made no apparent attempt to ascertain whether or not his
statements were correct. Cole created the impasse relative
to contributions.
In view of the foregoing, it is clear that this allegation of
the complaint is not supported by the record.
(b) Medical expenses incurred by Olson
The complaint alleges that, as a result of the discontin-
uance of health and welfare coverage described in (a)
above, employee Gerald Olson incurred medical expenses
commencing on or about September 5 totaling approxi-
mately $1,400.
Olson credibly testified, without contradiction or chal-
lenge by Respondent: His wife went to the hospital August
26 and was told that she must have surgery. Thereafter, she
had some laboratory work done and was hospitalized Sep-
tember 5. Her total medical and surgical expenses were
approximately $1,400.)4 Olson filed a claim for payment
with Travelers Insurance Company (Travelers), the carrier
under the 1974-77 agreement. The claim was rejected be-
cause the bills were incurred after the agreement expired
August 31. Olson visited the hospital and was shown a
verification of insurance coverage as of September 6 by
Lily Titus, Respondent's secretary. Olson talked with Titus
after being informed by Travelers that they would not pay
the claim and asked Titus about the replacement policy for
which he had applied when he signed the card given to him
by Respondent for that purpose. Titus said that replace-
ment policy "was thrown out." Olson then paid the bills
himself and has not been repaid.
Respondent stated at trial that, if neither Travelers nor
the replacement insurance company reimburses Olson, it
will do so.
It appears that there may be some disagreement between
the two insurance companies relative to liability for Olson's
claim, but that is irrelevant to this issue. If Travelers refus-
es to pay Olson's claim, the liability must be considered by
the new carrier. That is a subject that may be a proper one
at the compliance stage of these proceedings, but it is not
one to be disposed of in this Decision.
General Counsel argues that employees were not advised
concerning the new insurance carrier, but that does not
square with the record. Counsel stipulated that I employ-
ees signed ABC insurance application cards on September
I and 2, and one of the signers was the shop steward. Cole
and Sommerville said they were not kept advised concern-
ing the new carrier, but Cole already had foreclosed negoti-
ation on that subject. It may be possible that what Cole
and the association told Hove concerning his inability to
pay into the trust fund was not correct, but Hove was enti-
1 Fixpense hills are G (. Exh. 17
954
HI-GRADE MATERIALS CO.
tied to accept Cole at his word. That word was, no stan-
dard contract, no insurance.
(c) Sullivan's letter of September 7
The complaint alleges that this letter "5 is Respondent's
"first and final wage offer to the Union to decrease the
wages of employees-by $3.00 per hour," which shows that
Respondent's bargaining was surface bargaining, with no
intent to negotiate an agreement.
Respondent contends that the offer of $3 per hour less
than their current contract refers to replacement wages and
not to all unit employees.
Respondent's contention is contrary to the record, and is
given no credence because: I. The letter is clear and unam-
biguous. The parties were in negotiation as of September 7
and the letter states, inter alia, "We are offering you this
wage decrease as our final offer." Respondent contended
throughout the hearing that the Union was not interested
in the replacements, that the Union did not like the fact
that replacements crossed the picket lines, that the right of
replacements not to join the Union should be protected,
that the interests of replacements were contrary to those of
the Union, and that the Union did not want to represent
the replacements. In light of such recognition of the facts
of union life on the part of Respondent, and in light of the
fact that negotiations then were being carried on, it is in-
congruous to contend that the letter was written in order to
make an offer that applied only to replacements. The letter
obviously is an offer of decreased wages for unit employ-
ees, the decrease being the same as that which was to be
applied to replacements. 2. Cole credibly testified that he
understood the letter to be an offer to unit employees of a
decrease of $3 per hour and that he talked with employees
about the offer. 3. Hove, Shipman, and Sullivan contend
that the $3 per hour decrease for replacements was based
upon the necessity to train replacements. However, Ship-
man told Cole during negotiations that Respondent could
not afford the 1974-77 contract rate and further, Shipman
and Cole made it clear that Respondent wanted to pay
employees less than the contract rate in order to be able to
compete with nonunion competitors. It may well be, as
Respondent contends, that replacements need some train-
ing, however, at no time did Shipman, Sullivan, or Hove
propose the $3 less per hour as a starting or hiring-in rate.
Rather, the rate was proposed as a permanent one. It is
clear beyond reasonable question that the $3 decrease was
proposed as a competitive device and had little relation-
ship, if any, to training. 4. Respondent argues that its intent
to limit the $3 decrease to replacements is shown by the
fact that reductions were not applied to two employees
who crossed the picket lines; that those two were paid at
the contract rate. That argument is not pursuasive. Re-
spondent set its proposed schedule with the replacements.
Sullivan and Shipman are seasoned representatives in labor
matters. They would understand the implications of reduc-
ing the wages of employees then under a holdover contract,
or a contract likely to be found a holdover, and it would be
most unusual for them to recommend such action. Setting
reduced rates for replacements would be a different matter
1s G.C. Exh 11
and would present fewer problems, as well as possibly giv-
ing Respondent some leverage in negotiating. 5. Shipman
testified that both he and Sullivan were very angry on Sep-
tember 7 because of the Local 12 strike initiated that day.
Clearly the letter of the same day was written in anger and
that frame of mind is consistent with a threat to Cole that
all employees, not just unit employees, would be paid $3
per hour less than the contract rate. 6. Sommerville credi-
bly testified that he and unit employees considered the let-
ter to be a final offer of a S3 decrease for all unit employ-
ees. 7. Shipman testified that Respondent's wage offer of
0-25-25 increases in its counterproposal was its initial offer
and was all it could afford. That testimony is inconsistent
with the letter of September 7 and further, Respondent
offered nothing in support of its claim of inability to pay.
either to the Union or at trial. 8. There is no indiciation in
Respondent's contract counterproposals that the proposed
increases of 0-25-25 apply only to union members. Appar-
ently, replacements were not considered as a group sepa-
rate and apart from the unit when the counterproposals
were drawn up.
It is apparent from the foregoing and from the record,
and it is found, that Sullivan's letter of September 7 was an
offer, said at that time to be final, of a $3 per hour decrease
in wages for all unit employees. Sullivan stated in his letter
that, if the Union did not agree to the offer by September
9, Sullivan would "consider the issue of wages to be at
impasse in our bargaining and shall unilaterally implement
this, my final wage proposal." It is further found that Re-
spondent changed its position and offered in its counter-
proposals of October to give wage increases to unit em-
ployees of 0-25-25 during the life of a new contract. That
wage counterproposal was not accepted by the Union.
(d) Wage decrease
The complaint alleges that, on or about September 12,
Respondent unilaterally and without bargaining with the
Union, decreased the wages of all unit employees, includ-
ing replacements, by $3 per hour.
The fact that Respondent unilaterally and without bar-
gaining paid replacement employees $3 per hour less than
the old contract rate is not in dispute.
It is found, above, that the parties agreed to, and did,
continue the terms and conditions of the 1974-77 contract
on a day-to-day basis, except for health and welfare provi-
sions, after August 31.
At no time did Respondent decrease the wages of any
striking employee, and the wages of the two unit employees
who crossed the picket lines to work were paid at the old
contract rate. It is clear, therefore, that wages of replace-
ment employees were fixed at $3 below the old contract
rate while the parties were negotiating and not at impasse,
and while they still were operating, by agreement, under
provisions of the expired contract, except for health and
welfare provisions thereof.' 6 Under such circumstances, the
replacement employees are entitled to wage rates estab-
, Respondent's rehliance upoln Leield h14hlesale. Inc. 218 NLRB 1334
(1975). and Imtperll Outdoor .4dvertiring. 192 Nl.RB 1248 (1971). is mis-
placed. since there, and in cases listed therein. the conracts In question had
been terminated ir had expired
955
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
lished by the old contract.1 In unilaterally reducing re-
placement wage rates Respondent violated Section 8(a)(5)
and (I) of the Act, and in paying those rates Respondent
violated Section 8(a)(3) and (1) of the Act, as alleged.
(e) Respondent's refusal of holiday pay
The complaint alleges that, on or about September 12,
Respondent refused to pay contractually agreed upon holi-
day pay to employees engaged in the work stoppage that
commenced September 7.
Counsel stipulated at the hearing that the following
named employees were not paid for the Labor Day holi-
day, September 5:
(1)
(2)
(3)
(4)
(5)
(6)
(7)
Joe Akins
Dan Bailey
Phil Bailey
Charles Collarini
George Flitcroft
Grant Hamlin
Boyd Jackson
(8) Rick Loveland
(9) Gerald Olson
(10) Ken Schraeder
(11) George Vernaci
(12) Leonard Melton
(13) Richard Davidson
As discussed supra, the 1974-77 contract was continued
on a day-to-day basis after'it expired on August 31, except
for health and welfare provisions thereof. The parties stipu-
lated at the hearing that all unit employees had met the
contract requirements for payment of the holiday here in-
volved. Even if it is assumed, arguendo, that the contract
was not continued on a day-to-day basis after September 6,
payment for holidays was a practice of 10 years' standing,
thus it was a condition of employment and the employees
were entitled to pay for the holiday.
Respondent's failure to pay the holiday compensation as
agreed upon, which action was taken unilaterally and with-
out bargaining, constituted violation of Section 8(a)(3), (5),
and (1) of the Act.
(f) Cancellation of a scheduled meeting
Shipman and Sullivan acknowledged that the meeting of
September 14 was canceled by Sullivan. They gave as the
reason the pressure of business, including Shipman's in-
volvement in drafting pleadings in proposed legal action
against the Union.
General Counsel contends that the cancellation was an
intentional delay of negotiations, a tactic of harassment,
and part of a plan not to negotiate in good faith.
No other meeting was cancelled by Respondent, and ab-
sent the other facts of this case, perhaps the cancellation of
the meeting of September 14 would not be suspect. How-
ever, as discussed herein, Respondent did not bargain in
good faith, and the cancellation therefore is suspect. That
suspicion is enhanced by the timing of the events.
Shipman acknowledged that there was no violence at the
picketing site prior to September 12. The lawsuit he said he
was working on was based upon such violence. However,
Sullivan canceled the meeting on September 7, well before
7 Leveld Whlu.'sale, Inc., supra, Home Roofing Co.. Inc.. 211 NL RB 910
(1974).
any violence. Further, Shipman testified that both he and
Sullivan were "very angry" about the picketing of Septem-
ber 7 and the refusal of employees to cross the picket line.
As a result of that anger, Sullivan drafted his letter of Sep-
tember 7 addressed to Cole, discussed supra. It is logical to
infer, therefore, that the meeting was canceled in anger,
partially at least to delay negotiations and to retaliate for
the actions of employees. That inference is drawn.
(g) Failure to offer substantive proposals
The complaint alleges that Respondent failed to offer
substantive proposals regarding wages, hours, and working
conditions.
General Counsel argues that Respondent's counterpro-
posals, and agreements with union proposals, affected only
minor or noneconomic issues. However, the record shows
otherwise. It is clear that Respondent's counterproposals,
its agreement with some of the Union's proposals, its will-
ingness to compromise on some union proposals, and the
Union's intransigence on some issues show full discussion
on nearly all contract provisions, including matters of sub-
stance. This contention by General Counsel is not support-
ed by the record.
It is clear that the Union wanted Respondent to sign its
agreement with the association and that it attempted to
pressure Respondent into signing, partially by stating that
payments into the trust fund for health and welfare could
not be accepted after August 31 unless the contract was
signed and further, by refusing to agree to a substitute ar-
rangement. It is equally clear that Respondent was de-
termined to lower its wages in order to compete with non-
union companies within its area.
The question then arises as to whether Respondent was
negotiating with no intent to agree or whether it negotiated
in good faith. That question cannot be answered solely by
considering the Union's proposals and Respondent's coun-
terproposals, since, on the surface, some movement is indi-
cated, particularly so far as Respondent is concerned. The
question is considered in greater detail infra.
(h) Failure to provide timely counterproposals
The complaint alleges that Respondent failed to provide
the Union with counterproposals in a timely manner as
promised.
The Union's proposals were submitted to Respondent
during the meeting of September 6. Those proposals con-
sisted of a letter of agreement to be bound by the associa-
tion contract and the Union's trust fund agreement. Ship-
man stated that he would bring Respondent's
counterproposals to the next meeting, which was scheduled
for September 14. As discussed supra, the meeting of Sep-
tember 14 was canceled by Respondentand the next meet-
ing was scheduled for September 28. Shipman did not have
the counterproposals at that time, but said he would have
them at the meeting of October 3, which he did.
The 1974-77 contract expired by its terms on August 31,
and it is apparent that little was done by either party to
prepare in advance for that expiration, so far as negotia-
tions are concerned.
956
HI-GRADE MATERIALS CO.
General Counsel elicited testimony about Shipman's
brief trip to Hawaii just prior to September 28, and asks for
an inference that the trip shows that Shipman was not too
busy to prepare counterproposals. It appears that it was a
pleasure trip rather than one for business reasons, but that
is not shown by the record, although Shipman did not state
that it was a business trip. In any event, the question is
whether or not the delay between September 6 and Octo-
ber 3 was occasioned by legitimate cause or by Respon-
dent's desire to interfere with the bargaining process.
Respondent's counterproposals consist of 7-1/2 typed
pages, 8 most of which treat cursorily with the Union's pro-
posals. No item is discussed extensively and it is apparent
that the document does not involve extensive effort. But
for the fact that the old contract expired on August 31,
perhaps a period of approximately I month would not be
excessive for counterproposing to the Union's offer. How-
ever, Respondent's business had been interfered with since
the work stoppage that commenced September 7 and tlere
appears to be no reasonable reason for delay in negotiating
an agreement. Neither Shipman, Sullivan, or Hove ex-
plained the reason for the delay other than Shipman's con-
tention that he was "busy." A persuasive contention would
require something more than such a broad generalization.
The only logical explanation for the delay is Respon-
dent's desire to drag out negotiations as long as possible
and to hope that, in the meantime, it could defeat the
Union through use of replacements.
In view of the entire record, and the circumstances of the
delay, it is found that failure of Shipman to present his
counterproposals in timely manner was occasioned, at least
partially, by Respondent's desire intentionally to delay
bargaining.
(i) Respondent's failure to provide health and welfare
information
The complaint alleges that Respondent failed to provide
the Union with information concerning health and welfare
coverage for employees, as Respondent previously agreed
to.
Respondent gave ample and proper notice to the Union
of its intention to withdraw from association bargaining
and to negotiate separately with the Union. That action by
Respondent gave rise to the problem of insurance coverage
for the employees. The Union stated to Respondent that its
insurance program could be applied to Respondent's em-
ployees only if Respondent signed a letter of agreement to
be bound by the same contract the association negotiated
for its members. Respondent did not want, or did it agree,
to be bound by the letter of agreement. Hove acknowl-
edged Respondent's obligation, at least moral in nature, to
cover its employees with insurance and Respondent did
cover employees with ABC insurance effective September
1, provided employees signed application cards by that
date and certain other conditions were met. At least 11
employees signed cards on September I and 2, and counsel
stipulated the names of those employees." However, the
" G.C. Exh. 1 A.
9 Tr. p. 16. Boyd Jackson, the job steward. signed a card on September I.
change of insurance coverage created some confusion and
uncertainty, and resulted in detriment to at least one em-
ployee, as discussed supra.
Cole testified that during the meeting of September 6,
Shipman stated that Respondent was exploring the possi-
bility of health and welfare coverage for the employees and
that he would bring to the meeting of September 14, which
meeting date later was changed to September 28, informa-
tion relative to the new coverage. The information was not
supplied by Shipman on September 28, or on October 3,
although the Union repeatedly was asked for the informa-
tion. When the parties met October 13, Shipman an-
nounced that Respondent had obtained coverage for the
employees. Shipman said he would give the Union infor-
mation concerning that coverage, but Shipman never has
done so.
There is no dispute concerning the facts that Shipman
repeatedly was asked to give the Union information about
the coverage, that Shipman promised to do so, and that the
information never has been given.
Because of Cole's actions in attempting to force an un-
wanted contract upon Respondent, described supra, Re-
spondent was free to consider the matter of health and
welfare to be at impasse and to seek insurance coverage for
its employees other than through the Union. Respondent
obtained alternate coverage. It may well be that keeping
the Union advised of its actions on this subject as promised
would have been advisable, but such was not required
since Cole already had cleared the field for Respondent.
No 8(a)(5) action was taken by Respondent.
(j) Respondent's failure to provide economic data
The complaint alleges that Respondent failed to provide
economic data to substantiate its claim of inability to pay
the Union's wage demands. There is no dispute about the
facts that Shipman told the Union negotiators that Re-
spondent was "strapped" and financially unable to meet
the Union's demands, that Sommerville and Cole repeated-
ly asked for supporting information, and that the informa-
tion never was supplied.
Hove testified that Respondent was not "strapped," and
it is clear from the record that Respondent's business was
good.
Shipman testified that the Union never seriously pressed
the issue concerning financial data, that his responsibility
merely was to put Sommerville in touch with Sullivan, that
the Union never formally requested the books and records,
and that Potts, who was the Union's principal negotiator,
did not care whether or not the books were available for
audit.
Sommerville testified that the Union was quite serious
about seeing Respondent's financial information and that
he repeatedly asked Shipman and Sullivan for the books,
but without success. Sommerville's testimony on this issue
is credited in its entirety. The financial data frequently was
requested, but never given. Shipman is not credited, and
further, Hove flatly contradicted Shipman's claim of ina-
bility to pay the Union's wage demands. Shipman was obli-
gated either to withdraw his claim or to provide documen-
tary support thereof. He did neither, and his failure to do
957
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
so makes it clear that Shipman was not bargaining with the
Union in good faith.20
(k) Respondent's conditional bargaining
The complaint alleges that Respondent improperly con-
ditioned its bargaining by requiring the Union to provide
pension information it legally was precluded from obtain-
ing.
Cole credibly testified that during the October 3 negotia-
tion session and on one other occasion, Shipman asked for
the amounts of vested rights of employees under expired
contracts and said he would not bargain on pension mat-
ters without that information. Cole informed Shipman that
only employees themselves were permitted to divulge that
information.
Shipman did not deny Cole's testimony on this subject.
Cole offered no evidence to support his testimony that
the information Shipman requested could not be divu:ged
except by employees, but based upon Cole's experience in
negotiating, his testimony is credited. However, there is no
indication that Shipman refused to bargain concerning
pensions after Cole's reply. So far as the record shows, that
request was dropped by Shipman after Cole's response.
There is no showing that Shipman knew in advance of his
request that it was improper.
This piece of testimony is given some weight to indicate
that Shipman adopted this tactic, among others, to stall
and to delay the negotiations. The value of employees'
vested rights is irrelevant to negotiators for a new contract.
(1) Shipman's alleged statement that the bargaining
sessions were just a stall
The testimony on this issue is quoted supra.
Shipman's statement is ambiguous and is susceptible of
more than one interpretation. General Counsel contends
that Shipman said he was stalling. Shipman contends he
said the Union was stalling. It seems unlikely that Ship-
man, who is not a stranger to labor negotiations, would
publicly indict himself during a negotiating session by say-
ing he was stalling. It is clear from the record that he was
stalling, but General Counsel's contention is farfetched
and unrealistic. This piece of testimony is given no weight.
Summary
General Counsel's contention is that Respondent's ac-
tions show that it was bargaining in name only; that Re-
spondent did not intend to negotiate a contract on other
than its own terms.
Respondent contends that the Union was bargaining in
name only and that it did not intend to negotiate a contract
other than the one negotiated with the association. Re-
spondent argues that it agreed with nearly all of the
Union's contract proposals and that the Union's intransi-
gence on the remaining items shows that it was the Union.
rather than Respondent, that created an impasse. Shipman
20 Milgo Ind u.'ral, Inc.. 229 NLRB 25 (1977). Unoco Apparel. Inc., 208
NLRB 601 (1974). Globe Gear Company. 189 NLRB 422 (1971),
testified that Sommerville told him after the meeting of
October 13 that the parties had reached impasse.
It is found that the parties did not reach impasse at any
time relevant herein, but rather, that Respondent did not
bargain in good faith with the Union.
There is no question but what the Union was insisting
upon its industry contract and adopted tactics to pressure
Respondent into signing the letter of agreement relating to
that contract. One of those tactics was the argument that,
without the contract, insurance and trust fund payments
could not be accepted.
Respondent's response to the Union's tactics was to
create the appearance of bargaining, while actually going
its own way. It is true that Respondent agreed with many
of the Union's contract proposals, but that agreement for
the most part applied to items with which Respondent had
no serious quarrel in any event. That Respondent did not
intend to reach agreement is shown by: 1. Respondent's
insistence upon a split union-security clause that it knew
the Union would not accept, i.e., a clause providing an
open shop for replacements, but a union shop for all
others. 2. Respondent's insistence upon no raise for em-
ployees during the first year, and only minimal raises for
each of 2 years thereafter. In view of the association con-
tract provision for raises, and in view of the period of high
inflation now prevalent,21 it is apparent that the Union
would not accept such a raise schedule. 3. Boyd Jackson, a
former employee of Respondent, testified that he talked in
July with Mr. Pedigo, Respondent's manager,2 2 and that
Pedigo attempted to prevail upon him to talk other em-
ployees into "going non-union." Jackson said Pedigo gave
his opinion of several actions he believed Respondent
would take in order to "go non-union," several of which
are discussed herein. Pedigo denied that he importuned
Jackson to talk other employees into going nonunion.
Jackson is credited: Pedigo's denial is given no credence. 4.
Cancellation of the meeting of September 14, and
Sullivan's letter of September 7, both of which actions were
taken in anger because of employees' refusal to cross Local
12's picket line, clearly were intended to delay, and inter-
fere with, negotiations. 5. Respondent's refusal to accede to
the Union's request for documentary support of Shipman's
claim of inability to give pay raises was carried out in a
manner showing that Respondent never intended to pro-
duce books and records, even though Shipman said they
would be made available. 6. Respondent's delay in offering
its counterproposals was a clearly intentional delay of ne-
gotiations.
Local 12's pickets were withdrawn on Friday, September
30, and employees who had refused to cross the picket lines
could have offered to return to work on Monday, October
3. However, according to Sommerville's credited testi-
mony, credibly corroborated by Jackson, the employees
decided to strike and post their own pickets, 23 because: I.
"We more or less decided that we would not work for three
dollars an hour less in this day and age." 24 2. As Respon-
' Administrative ,otice is taken of this fact.
( Counsel stipulated that Pedigo was a supervisor within the meaning of
the Act.
11 Ihe picket signs read "Teamsters on strike against Hi-Grade Materials
protesting unfair labor practices: Teamster Local 4677"
1 hi is Jackson's testimony
958
HI-GRADE MATERIALS CO.
dent knew, the Union would not accept the split union
security provision offered by Respondent. 3. Respondent
claimed inability to give raises, yet refused to give support-
ing evidence of that inability.
During pendency of Local 12's strike, Respondent's em-
ployees and the Union were made aware of Respondent's
determination to "go non-union," Respondent's refusal to
bargain in good faith, and Respondent's hiring of replace-
ments for employees refusing to cross Local 12's picket
lines. That course of conduct continued from September 7
until Local 12 removed its pickets on September 30, at
which time there was no indication of positive efforts by
Respondent to move forward with negotiations. Wages re-
mained most uncertain, with the possibility of no raise or
even a reduction. Respondent continued its refusal to fur-
nish requested information. The Union's strength was
threatened by Respondent's union security offer. The par-
ties were not at impasse on October 3, even in Respon-
dent's view, and Respondent clearly was using the bargain-
ing process as a tactic for delay and threat to union
solidity, rather than as an instrument for possible agree-
ment. Under such circumstances, there is no reasonable
doubt but what the strike of October 3 was a prolongation
of the preceding work stoppage, occasioned by Respon-
dent's unfair labor practices.
D. Alleged Refusal To Pay Vacation Accruals
Paragraph 13 of the complaint alleges that, on or about
September 7, Respondent illegally refused to pay contrac-
tually agreed upon prorated vacation pay to the following
employees who refused to cross the picket line established
by Local 12:
Joe Akins
Dan Bailey
Phillip Bailey
Charles Collarini
George Flitcroft
Boyd Jackson
Gerald Olson
Ken Schraedor
George Vernaci
$63.80
191.40
63.80
638.00
127.60
469.50
767.20
375.60
63.80
Hove acknowledged that some employees requested
their vacation pay.
The fact of refusal to pay is acknowledged by Respondent.
The fact that the 1974-77 contract provision on this sub-
ject was applicable on September 7 is found supra.
That refusal to make payments was limited to employees
who refused to cross the picket line is not in dispute.
Respondent's only defense at the hearing was that it did
not know whether it was supposed to make the payments.
Respondent contends in its brief that notice of termination
is a necessary condition precedent to receipt of vacation
compensation, without which Respondent has no contrac-
tual obligation to distribute the money.
The contract states, inter alia: "Employees who, after
employment of not less than one (I) year, are discharged,
quit, laid off indefinitely, or with the consent of the em-
ployer, are allowed to take their vacation prior to their
anniversary of hire eligibility date. ." shall be entitled to
prorated vacation pay.
Respondent's argument is not persuasive. Clearly, if that
argument was accepted, striking employees could lose ac-
crued vacation benefits if Respondent replaced those em-
ployees prior to October 3, 1977. Such a practice would be
inherently destructive of employees' rights to engage in ac-
tivity protected by the Act. Respondent's actions herein
resulted in economic loss to employees solely because of
those employees' protected activity. Such actions consti-
tuted a violation of Section 8(a)(3) and (5) of the Act.25
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICE UPON
COMMERCE
The activities of Respondent set forth in section IV,
above, occurring in connection with the operations of Re-
spondent as described in section 1, above, have a close,
intimate, and substantial relationship to trade, traffic, and
commerce among the several States and tend to lead to
labor disputes burdening and obstructing commerce and
the free flow of commerce.
V THE REMEDY
Having found that Respondent has engaged in certain
unfair labor practices in violation of Section 8(a)(3), (5),
and (1) of the Act, it will be recommended that Respon-
dent cease and desist therefrom and take certain affirma-
tive action designed and found necessary to effectuate the
policies of the Act.
It will be recommended that the terms of the collective-
bargaining agreement and trust fund provisions thereof,
which expired on August 31, 1977, be reinstated forthwith,
except for the health and welfare, and trust fund provisions
thereof, and continued in effect until after the terms of a
new agreement are agreed upon or until after the terms of
a new agreement are agreed upon or until impasse is
reached.
Having found that Respondent unilaterally and without
bargaining with the Union, on or about September 12,
1977, decreased the wages of employees in the unit de-
scribed, infra, by $3 per hour, I shall recommend that Re-
spondent make whole the employees so involved, with in-
terest computed thereon in the manner prescribed in F W.
Woolworth Company, 90 NLRB 289 (1950), and Florida
Steel Corporation, 231 NLRB 651 (1977)?2'
Having found that Respondent, on or about September
12, 1977, and thereafter, refused to pay contractually
agreed upon holiday pay to its employees named in C. (e).
supra, and on or about September 7, 1977, and thereafter
refused to pay contractually agreed upon vacation pay to
its employees named in D, supra, I shall recommend that
Respondent make whole the employees so involved, with
interest as described above.
Having found that the refusal of employees to cross the
picket lines began September 7, which is tantamount to an
economic strike as of that date, and that the work stoppage
was prolonged October 3 by Respondent's unlawful refusal
Anuth Brns. In,-. 229 NLRB 1204 (1977)
2' See. generally. Ists Plumhing & Heating, (o. 138 Ni.RB 716 (1962)
959
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to bargain in good faith with the Union, and that the em-
ployees therefore became unfair labor practice strikers on
and after October 3, 1977, it will be recommended that
Respondent be ordered, upon application, to offer to those
employees reinstatement to their former or substantially
equivalent positions, without prejudice to their seniority or
other rights and privileges, as follows:
1. Striking employees whose jobs were not filled by per-
manent replacements before October 3, 1977, are, upon
application, to be offered immediate reinstatement, dis-
missing persons hired on or after that date, if necessary, to
make room for them.
2. Striking employees whose jobs were filled by perma-
nent replacements before October 3, 1977, are, upon appli-
cation, to be offered reinstatement upon departure of their
replacements.
In the event Respondent does not reinstate the striking
employees in the manner set forth above within 5 days
from the date reinstatement is required, backpay shall
commence running with interest, as described in The Rem-
edy section above, from the date on which the 5 days ex-
pires.
Any dispute concerning to whom offers of reinstatement
must be made and what backpay, if any, is due, may, if
necessary, be litigated in a backpay proceeding.
It is recommended that all allegations of the complaint
not having been found proved be dismissed in their en-
tirety.
Upon the basis of the above findings of fact and upon
the entire record in the case, I make the following:
CONCLUSIONS OF LAW
1. Hi-Grade Materials Co. is, and at all times material
herein has been, an employer engaged in commerce and in
a business affecting commerce within the meaning of Sec-
tion 2(2), (6), and (7) of the Act.
2. General Truck Drivers, Warehousemen & Helpers
Union Local 467, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen & Helpers of America is, and
at all times material herein has been, a labor organization
within the meaning of Section 2(5) of the Act.
3. The following unit is appropriate for purposes of col-
lective bargaining within the meaning of Section 9(b) of the
Act:
All drivers and truck mechanics employed by Hi-
Grade Materials Co. at its Hesperia, California plant;
excluding all professional employees, office clerical,
guards and supervisors as defined in the Act.
4. The Union is, and at all times material has been, the
exclusive bargaining representative of all employees in the
appropriate unit described above.
5. By unilaterally and without bargaining with the
Union, decreasing the wages of employees in the aforesaid
unit in the sum of approximately $3 per hour, and by simi-
larly refusing to pay employees holiday and vacation pay,
Respondent violated Section 8(aX3), (5), and (I) of the Act.
6. By failing and refusing to negotiate in good faith with
the Union fer a new collective-bargaining agreement, Re-
spondent violated Section 8(a)(5) and (1) of the Act.
7. The aforesaid unfair labor practices are unfair labor
practices affecting commerce within the meaning of Sec-
tion 2(6) and (7) of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, I hereby issue the following recommended:
ORDER 27
The Respondent, Hi-Grade Materials Co., its officers,
agents, successors, and assigns, shall:
I. Cease and desist from:
(a) Unilaterally and without bargaining with the Union,
decreasing the wages of employees in the aforesaid unit in
the sum of approximately $3 per hour, and similarly refus-
ing to pay employees holiday and vacation pay.
(b) Failing and refusing to negotiate in good faith with
the Union for a new collective-bargaining agreement.
(c) In any other manner interfering with, restraining, or
coercing its employees in the exercise of their rights under
Section 7 of the Act.
2. Take the following affirmative action, which is
deemed necessary to effectuate the purposes of the Act:
(a) Recognize and, upon request, bargain collectively in
good faith with the Union as the exclusive representative of
all employees in the appropriate unit, described above,
with regard to rates of pay, hours of employment, and
other terms and conditions of employment and, if an un-
derstanding is reached, embody such understanding in a
signed agreement.
(b) Restore and put into effect forthwith all terms and
conditions of employment provided by the contract effec-
tive September 1, 1974, through August 31, 1977, including
those provisions which were unilaterally changed by Re-
spondent, but excluding those provisions relating to health
and welfare and the union trust fund, until such time as the
parties have bargained in good faith for a reasonable time
and have reached a new agreement or, in the alternative,
have reached an impasse.
(c) Make whole as described in The Remedy section
hereof, all employees whose wages were reduced, and
whose holiday and vacation pay were not paid, as de-
scribed in this decision.
(d) Upon application, reinstate the unfair labor practice
strikers and make them whole for any loss of earnings they
may have incurred, in the manner set forth in The Remedy
section of this Decision.
(e) Post at its principal place of business in Hesperia,
California, copies of the attached notice marked "Appen-
dix." 28 Copies of said notice, on forms provided by the
Regional Director for Region 31, after being duly signed
27 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions. and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations, be adopted by the Board and become
its findings, conclusions, and Order, and all objections thereto shall be
deemed waived for all purposes.
28 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."
960
HI-GRADE MATERIALS CO.
by Respondent's representative, shall be posted by Re-
spondent immediately upon receipt thereof, and be main-
tained by it for 60 consecutive days thereafter, in conspicu-
ous places, including all places where notices to employees
are customarily posted. Reasonable steps shall be taken by
the Respondent to insure that said notices are not altered,
defaced, or covered with any other material.
(f) Preserve and, upon request, make available to author-
ized agents of the Board, for examination and copying, all
payroll records, social security payment records, timecards,
personnel records and reports, and all other records and
documents necessary to analyze the amount of payments
due under the terms of this recommended Order.
(g) Notify the Regional Director for Region 31, in writ-
ing, within 20 days from the date of this Order, what steps
Respondent has taken to comply herewith.
961