Hydrotherm, Inc.

National Labor Relations Board - Board Decisions

May 16, 1991

302 N.L.R.B. 990 (N.L.R.B. 1991)

990
302 NLRB No. 153
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 On October 2, 1989, the Acting General Counsel filed a motion to strike
the Respondent’s Exception 1 and related portions of the Respondent’s brief
in support of its exceptions, as well as an affidavit pertaining to that exception
which the Respondent appended to its brief. On the same day, the Acting Gen-
eral Counsel also moved to supplement the formal record in this case to intro-
duce material in support of the motion to strike. In light of the following find-
ings, we need not pass on these motions.
Exception 1 alleges bias and prejudice on the part of the administrative law
judge. In furtherance of this exception, the Respondent attacks the conduct of
the judge at the hearing, as well as the bias it claims is apparent in his deci-
sion, which it argues caused him to distort the record to enable him to find
against the Respondent. Insofar as the exception attempts to attack the judge’s
conduct at the hearing, it is untimely raised, because the Respondent failed
to object to the judge’s actions during the hearing or before his decision
issued, as required under Sec. 102.41 of the Board’s Rules and Regulations.
Waterbed World, 286 NLRB 425 fn. 1 (1987). Similarly, the exception is un-
timely as a motion to disqualify the judge. Such motions must be made before
the judge files his decision. Sec. 102.37 of the Board’s Rules and Regulations.
R. Waldo, Inc., 280 NLRB 1237 at fn. 1 (1986). Finally, although the excep-
tion is not untimely to the extent it alleges bias and prejudice in the judge’s
decision itself, it has no merit. After careful examination of the record and
the decision, we find no evidence that the judge prejudged the case, made
prejudicial rulings, or demonstrated bias, hostility, or prejudice against the Re-
spondent.
2 The Respondent has excepted to some of the judge’s credibility findings.
The Board’s established policy is not to overrule an administrative law judge’s
credibility resolutions unless the clear preponderance of all the relevant evi-
dence convinces us that they are incorrect. Standard Dry Wall Products, 91
NLRB 544 (1950), enfd. 188 F.2d 362 (3d Cir. 1951). We have carefully ex-
amined the record and find no basis for reversing the findings.
3 We do not subscribe to some of the language the judge used to express
his findings and conclusions. Specifically, we do not endorse his characteriza-
tion of the Respondent’s proposals as ‘‘bizarre,’’ ‘‘far-out,’’ and ‘‘off-the-
wall’’ but for the reasons stated in our decision, we agree with the judge that
the Respondent’s proposals, considered as a whole, permit an inference that
the Respondent was not bargaining in good faith.
4 The Respondent breached the parties’ confidentiality agreement between
the second and third bargaining sessions, when it placed copies of the parties’
proposals near the timeclock.
5 The Respondent’s senior vice president, Paul O’Rourke, who was a lead
negotiator for the Respondent, testified that even when the Respondent’s nego-
tiating team met on December 22, ostensibly in preparation for a bargaining
session that might be scheduled during the new year, it still did not formulate
any wage proposal to be submitted to the Union.
Hydrotherm, Inc. and Petroleum, Construction,
Tankline Drivers, Yeast, Soft Drink Workers
and Driver-Salesmen, Amusement and Vending
Servicemen and Allied Workers, Local Union
No. 311 of Baltimore and Vicinity, affiliated
with International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of
America, AFL–CIO. Case 5–CA–19338
May 16, 1991
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
CRACRAFT AND DEVANEY
On July 11, 1989, Administrative Law Judge Walter
Maloney issued the attached decision. The Respondent
filed exceptions with a supporting brief. The Acting
General Counsel filed a brief in answer to the Re-
spondent’s exceptions.1
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 briefs and has de-
cided to affirm the judge’s rulings, findings,2 and con-
clusions, as amplified below,3 and to adopt the rec-
ommended Order.
I. FACTS
A. Background
On May 12, 1983, the Union won a Board-con-
ducted representation election. The Respondent subse-
quently filed objections which were overruled by the
Regional Director and, on appeal, by the Board. 270
NLRB 1131 (1984). After the Respondent refused to
bargain, a complaint was issued against it, a hearing
was held, and the Respondent was found guilty of vio-
lating Section 8(a)(5) of the Act. On August 7, 1986,
the Board affirmed that adjudication and directed the
Respondent to bargain with the Union. 280 NLRB
1425. When the Respondent again refused, the General
Counsel filed a petition for enforcement in the United
States Court of Appeals for the Fourth Circuit, which
was granted on August 5, 1987. 824 F.2d 332. After
the court’s order issued, the Respondent agreed to
meet with the Union.
B. Proposals Advanced During the Seven
Bargaining Sessions
Between September 17 and December 9, 1987, the
parties met seven times. At the first meeting, the par-
ties discussed the Union’s package of proposals, which
the Union had delivered to the Respondent prior to the
session. The Respondent presented only one written
proposal at the first meeting, entitled ‘‘Management
Functions.’’ This proposal vested all authority in the
Respondent over numerous subjects, including the fol-
lowing: scheduling of work, job descriptions, size and
makeup of the work force (i.e., the bargaining unit),
bonus or incentive compensation, subcontracting of
work, safety, the making and enforcement of work
rules, hiring, demotion, discharge, and layoff. Also at
the first session, the Respondent obtained the Union’s
consent to a set of ground rules for the negotiations,
including one mandating confidentiality of the matters
discussed.4
At the second meeting, on October 8, the Respond-
ent presented its proposal. This proposal included no
provisions on wages or fringe benefits, such as health
insurance or pensions. The Respondent’s representative
said the Respondent would furnish proposed wage
schedules, but it never did so. Nor did the Respondent
counter any of the Union’s proposals on wages or ben-
efits.5 Discussion of wages throughout the period of
bargaining was limited to the Respondent’s existing
system of annual merit increases and, as explained
991HYDROTHERM, INC.
below, on this subject, the Respondent’s bargaining
position amounted to a take-it-or-leave-it proposal in
which the Union could forestall cancellation of a
scheduled annual merit evaluation only by forgoing all
bargaining over wages for the coming year.
The Respondent’s October 8 proposal also included
the following provisions. Section 1.4.3 on ‘‘Temporary
Employees’’ stated:
Temporary employees are those employees hired
to work on a specific project or for a specific pe-
riod of time or from time to time to accommodate
seasonal increases in the Employer’s volume.
Temporary employees derive no benefits under
this Agreement, and their wage rates are estab-
lished by the Employer. [Emphasis added.]
The broad management functions clause previously
offered, which appeared to encompass virtually all as-
pects of working conditions, was again presented. Al-
though arguably subject to any limitations specified in
other provisions of the contract, the Respondent’s pro-
posals on other subjects also contained language that
essentially retained all the discretion for the Respond-
ent.
The seniority article (art. IV), for example, provided
that seniority would apply to decisions on layoff, re-
call, overtime, and promotion only if ‘‘job classifica-
tions, qualifications, abilities, experience, and skills of
two or more employees are, in the sole judgment of the
Employer, equal . . . .’’ When the Respondent, in its
sole judgment, finds that such equality exists, it need
give seniority only ‘‘due consideration’’ when making
a decision.
The hours of work article (art. V) contained a sec-
tion on paid ‘‘breaks’’ (sec. 5.5) which stated that
these would be ‘‘at times and for periods to be an-
nounced [by supervisors] at the time the break is
scheduled.’’
Pursuant to section 15.1 of the proposal, there was
to be ‘‘no limitation on the Employer’s right to use
nonunit personnel to perform bargaining unit work.’’
This was later (in the November 18 bargaining session)
modified to allow subcontracting of unit work ‘‘due to
capacity constraints or for competitive economic rea-
sons.’’ Neither of these limitations was defined.
The grievance procedure provision (art. VII) in the
October 8 proposal required an employee, as a first
step, to put his grievance into writing, with specifica-
tion of the facts and citation to particular contract
clauses. Although the provision did not expressly bar
the employee from seeking the assistance of the union
steward or alternate, section 3.2 barred the steward
from any involvement in a grievance or other union
business during worktime, except for breaks or meal
periods. With the exception of a 30-minute lunch pe-
riod, as explained above, there were to be no sched-
uled breaks.
The arbitration article (art. VII) provided that an ar-
bitrator would have no authority to alter ‘‘any wage
rate or wage structure’’ or ‘‘in the case of discipline
to alter the penalty imposed by the Employer.’’ In the
event of a discharge or other termination, the arbitrator
would ‘‘have no authority to order reinstatement or
back pay.’’ Language in the strikes and lockouts clause
indicated that discharges would not, in any event, be
arbitrable.
The article on strikes and lockouts (art. IX) con-
tained broad no-strike and no-lockout clauses, with an
exception for strikes over discharges and other ‘‘mat-
ters not subject to the grievance and arbitration proce-
dure.’’ Any strike the Union called over any ‘‘discipli-
nary action, including discharge,’’ could not be consid-
ered an unfair labor practice strike, but would be
deemed ‘‘an economic strike,’’ with the Respondent
enjoying all the concomitant rights to replace striking
employees.
In article X, the Respondent provided (sec. 10.1)
that it would discharge or suspend only for ‘‘just
cause,’’ which was defined as ‘‘any violation of a
written rule of the Employer issued pursuant to its
management rights as set forth in Article 2 or any vio-
lation of accepted principles of decency, law, or moral
behavior.’’ Section 10.2 reiterated both the prohibition
on an arbitrator’s giving backpay or reinstatement as a
discharge remedy and the description of the Union’s
right to strike as consisting of the right to ‘‘call an
economic strike to protest a discharge.’’ Although the
provisions on seniority, grievance and arbitration, and
strikes and lockouts were not contained in the groups
of proposals proffered by the Respondent in the bar-
gaining sessions of November 18 and December 3, it
never offered any revised proposals on these topics or
suggested that it was backing away from them in any
way.
At the third bargaining session, on October 14, the
parties discussed some items in the Union’s initial
package proposal that tracked established practices at
the plant. Referring to these (including ones it had ear-
lier appeared to accept), the Respondent’s chief nego-
tiator stated that the Respondent did not agree to those
items and that bargaining would ‘‘start from scratch.’’
The Respondent offered no new proposals at the Oc-
tober 27 meeting. At the November 18 meeting, it of-
fered a provision on jury duty pay that put the existing
practice into the contract, and a safety and health arti-
cle (art. XVIII) limited to providing that the Respond-
ent would obey state laws on health and safety, would
permit the Union to call the Respondent’s ‘‘attention’’
to such matters, would furnish ‘‘required safety de-
vices’’ to the employees at its own expense, and would
have the right to discipline any employee who failed
to use such equipment. The Union agreed to both the
jury duty and safety and health proposals at this meet-
992 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
6 The reporting pay provision has a practical effect only if the work that
an employee is called in to perform on a holiday does not, in fact, take up
an entire 8-hour shift, i.e., the provision guarantees 8 hours’ pay whether the
employee works the full 8 hours or not. Senior Vice President O’Rourke, the
Respondent’s principal negotiator, conceded in his testimony that no one was
called in to work on a holiday unless the Respondent had ‘‘a major, major
problem’’ and that the Respondent had never had to pay anyone for hours not
worked under the existing 4-hour guarantee.
The holiday provision as agreed to also included a concession by the Union,
which accepted the Respondent’s addition of language providing that it would
be ‘‘at option of the Company’’ whether an employee who was on vacation
during a paid holiday would receive an additional day added onto his paid va-
cation or simply an additional day off at some other time.
ing. The parties also agreed on a proposal offered by
the Union on holidays. As agreed to (with slight modi-
fication), this essentially continued the past practice at
the plant, except that employees were guaranteed 8
hours’ reporting pay, rather than 4 hours.6
The article on ‘‘Wages’’ (art. VI) was identical to
that offered on October 8, i.e., it referred to a wage
schedule without providing one; it provided overtime
pay at the rate required by Federal law; it allowed the
Respondent to give individual merit increases at will;
and it granted 4 hours’ reporting pay (thereby con-
tinuing the current practice). One concession was
agreed to in the article at this session. The Respondent
agreed to strike language which would deem employ-
ees to have waived any claim of a wage discrepancy
if the claim was not made within 2 weeks of the pay-
day involved.
The last written proposals submitted by the Re-
spondent were offered at the December 3 meeting.
They concerned only a few subjects, but the Respond-
ent agreed at this time to modify a previously agreed-
upon proposal on probationary employees by accepting
a change from 90 days to 60 days for the probationary
period and granting these employees most contract
benefits. (The Union also thereby compromised the po-
sition in its original proposal, which had provided for
a 45-day probationary period.) There were no revised
proposals presented on management rights, temporary
employees, grievance and arbitration, or the treatment
of discharge and discipline.
The Union asked whether there might be limitations
on the numbers of employees who could be hired as
‘‘temporary’’ employees (i.e., employees without con-
tract benefits whose wages would be unilaterally set by
the Respondent), but the Respondent’s representatives
refused to agree to any such limitation. They suggested
that the Respondent might consider a limit of 7 months
on the amount of time that employees could be called
‘‘temporary’’ and some coverage under the contract,
but nothing was ever proffered in writing as a modi-
fication of the ‘‘temporary employee’’ proposal that
was on the table.
In the final session, on December 9, the two sides
argued mainly about the management functions pro-
posal and the issue of a union-security clause. The
Union, aware that the Respondent had a union-shop
provision in its contract at another plant, had included
a union-security provision in its proposal from the very
beginning. O’Rourke, the Respondent’s principal nego-
tiator, testified that he knew that a ‘‘union shop’’ was
very important to the Union, that the Union was not
likely to back off on it, and that this issue would be
‘‘a major stumbling block’’ in negotiations. He further
testified that in the very first bargaining session, he
made the first of a series of ‘‘speeches’’ about the Re-
spondent’s strong opposition to union-shop clauses and
that he ‘‘kept bringing it up’’ at later sessions. The
basis for the Respondent’s opposition, as explained by
O’Rourke, was the closeness of the election in which
the Union had been certified and the Respondent’s
view that the management negotiators—and not the
union negotiators—‘‘were representing’’ the employees
who had voted against the Union in the election.
At the final session, O’Rourke told the union rep-
resentatives that the Respondent was going ahead with
a delayed implementation of scheduled annual merit
raises and that it saw no reason for further meetings—
‘‘nothing for [the parties] to talk about’’—unless the
Union agreed to drop its insistence on a union-security
proposal and to forgo presenting any wage proposals
that would be effective for any period before Novem-
ber 1 of the following year. The Respondent’s nego-
tiators then rose, gathered their papers, and left the
room after warning the union negotiators to prepare for
a strike.
No date was set for a new negotiating meeting, but
it was understood that Union Negotiator Robert
Cremen should call one of the Respondent’s represent-
atives to arrange a date after January 1.
C. The Respondent’s Actions Concerning
Employees’ Regular Annual Merit Increases
Under the Existing System
The wage system in existence when the parties
began bargaining for a contract included an annual
merit wage review in which employees were evaluated
by their foremen in the fall and, on the basis of those
evaluations, a number of them (but not all) were given
wage increases. The schedule for granting the increases
had become fixed; Senior Vice President O’Rourke
testified that the Respondent was ‘‘pretty rigid’’ about
giving these increases around November 1 each year.
At the fourth meeting, on October 27, Union Bar-
gaining Representative Cremen complained to the Re-
spondent’s negotiators that supervisors in the plant
were telling employees that they would not receive
merit evaluations and increases that year. Cremen indi-
cated that this practice could continue as before; the
Union did not demand bargaining over the amounts or
other details of these increases. The Respondent’s ne-
gotiators replied that they took this to mean that the
Union would forgo even putting forward any proposals
993HYDROTHERM, INC.
7 We deny the Respondent’s motion to reopen the record to accept evidence
concerning an alleged resumption of contract negotiations with the Union after
the hearing concluded.
for a general wage increase during the coming year.
Cremen replied that the Union did not agree, as the
price for the Respondent’s giving the scheduled merit
incrases, to surrender the right to negotiate for a gen-
eral wage increase, i.e., one that would affect all em-
ployees.
The Respondent did not grant any merit increases on
November 1. In a letter to the Respondent dated No-
vember 3, Cremen reiterated the Union’s position:
The Union has no objection, and in fact encour-
ages, the Company to conduct its yearly evalua-
tion of the employees at your plant and to grant
wage increases based on such evaluations.
The Union retains its right to negotiate wage
increase[s] during the process of collective bar-
gaining independent of any evaluation increases
which the Company may grant during this proc-
ess.
At the November 18 negotiating session, the Respond-
ent reiterated its position that, although it wanted to
make the merit evaluations and grant increases accord-
ingly, it planned to do so only if the Union agreed to
forgo putting any other wage increases on the table
that might take effect at any time during the coming
year. As one of the Respondent’s negotiators put it at
the November 18 meeting, the Respondent was not
‘‘giving the merit increases away.’’
According to the testimony of Senior Vice President
O’Rourke, the Respondent wanted, for its own pur-
poses, to give the raises, because the employees had
come to expect them at the beginning of November,
which was the Respondent’s busiest time of year, and
failing to give them would have an adverse effect on
morale and production.
At the December 3 session, the Respondent showed
the Union a list of employees with the amounts of
merit increases that would be given pursuant to the
November evaluations. Its position regarding the con-
sequences for wage negotiations of implementing the
increases remained the same. At the final session on
December 9, as described above, the Respondent an-
nounced that it would implement the increases.
On December 15, the Respondent delivered a letter
to each bargaining unit employee stating as follows:
[S]ince late October, the Company has been at-
tempting to implement this wage increase in bar-
gaining with Local 311 in accordance with legal
requirements.
Because we expect a long bargaining process
(many issues important to you to be agreed to),
we proposed to the Union on 10/27 that this in-
crease be part of the contract. They refused to
agree to this.
On 12/13 we proposed the wage increase you
received.
The Union said they would agree only if we
agreed to further increases in 6 months and a
Union Shop.
On December 10, we made our proposal again
and the Union answered in a similar manner.
We told the Union that we can’t agree to things
like that because we must protect your jobs and
the Company now and for the future.
We decided to give the increase anyway be-
cause we feel you should not suffer further from
the bargaining.
After learning of this letter, the Union filed unfair
labor practice charges with the Board and refrained
from approaching the Respondent to set a new bar-
gaining session. The Respondent likewise refrained
from seeking further negotiations.7
II. ANALYSIS
A. General Principles
The complaint alleges that the Respondent engaged
in overall bad-faith bargaining, or ‘‘surface bar-
gaining,’’ during the parties’ negotiations. The Re-
spondent denies that it engaged in surface bargaining,
urging instead that the Union was to blame for the
breakdown in negotiations, and claiming that the un-
wavering positions it took were merely part of a nego-
tiating ploy that it was willing to abandon under proper
circumstances.
After reviewing the record evidence, the judge found
that the Respondent’s behavior exceeded lawful ‘‘hard
bargaining’’ and instead demonstrated bad faith. We
agree with that conclusion for the reasons stated
below.
In arriving at our conclusion, we are mindful that
good-faith bargaining may be quite hard and still law-
ful. Reichhold Chemicals, 288 NLRB 69, 69–70
(1988), affd. in pertinent part sub nom. Teamsters
Local 515 v. NLRB, 906 F.2d 719, 726 (D.C. Cir.
1990). In determining whether a party has bargained in
good faith, making a genuine effort to reach agree-
ment, we will seldom find direct evidence of a party’s
intent to frustrate the bargaining process. Rather, we
must look at all of its conduct, both away from the
bargaining table and at the table, including the sub-
stance of the proposals on which the party has insisted.
Teamsters Local 515 v. NLRB, supra, 906 F.2d at 726–
727; NLRB v. A-1 King Size Sandwiches, 732 F.2d
872, 874 (11th Cir. 1984), cert. denied 469 U.S. 1035
(1984), enfg. 265 NLRB 850 (1982); Atlanta Hilton &
Tower, 271 NLRB 1600, 1602 (1984); NLRB v. Mar-
Len Cabinets, 659 F.2d 995, 999 (9th Cir. 1981). Such
an examination is not intended to measure the intrinsic
994 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
8 The Respondent in its brief lists 15 items on which it claims the parties
reached agreement. In fact, the record does not bear out the claim that agree-
ment was reached on two of those listed (hours of work and leaves of ab-
sence).
Of the other 13, 4 delineated conduct required of the Respondent by statute
or court order (union recognition, nondiscrimination, selective service, and
safety and welfare). One, ‘‘Special Agreements,’’ approximates the duties of
the parties under the Act.
Four others, concerning jury duty leave, overtime, adjustment of pay dis-
crepancies, and holidays, generally set forth the Respondent’s current practice.
(Three of those—pay discrepancies, overtime, and jury duty leave—required
bargaining over several sessions before the Respondent backed off from its de-
mands for reductions in these benefits and agreed to continue its current prac-
tice.)
The agreement on ‘‘just cause’’ hardly represented hard bargaining by the
Union in view of the broad definition it incorporated. The agreements on defi-
nitions of full-time and part-time work and probationary employees were ren-
dered illusory by provisions of the Respondent’s other proposals—notably, the
management functions clause; the Respondent’s reservation of the right to sub-
contract out unit work whenever it determined that ‘‘capacity constraints’’ or
‘‘competitive economic reasons’’ made this desirable; and the Respondent’s
reservation of the right to hire ‘‘temporary employees,’’ broadly and vaguely
defined, without limitation on the numbers of employees hired. (The Respond-
ent’s negotiators orally suggested they might consider a 7-month limit on em-
ployment that could be deemed ‘‘temporary.’’)
worth of the proposals, but instead to determine wheth-
er, in combination and by the manner in which they
are urged, they evince a mindset open to agreement or
one that is opposed to true give-and-take. Id.
In our view, as explained in section B, below, the
totality of the positions taken by the Respondent
throughout the seven bargaining sessions and the man-
ner in which the Respondent advanced those positions
are inconsistent with a good-faith approach to negotia-
tions. The Respondent argues, however, that, contrary
to the judge’s finding, it did not intend finally to insist
on all those positions. Rather, it contends, it was de-
prived of an opportunity to reveal its willingness to
compromise by the Union’s conduct after the seventh
bargaining session—filing an unfair labor practice
charge and failing to schedule a new negotiating ses-
sion. For the reasons set forth below in section C, we
reject that argument.
B. The Respondent’s Proposals Viewed
as a Whole
In order to assess the significance of the Respond-
ent’s proposals, it is essential to keep in mind the
rights that a union possesses even in the absence of a
contract, simply by virtue of being the employees’ ex-
clusive representative within the meaning of the Act.
See Prentice-Hall, Inc., 290 NLRB 646 (1989). The
Respondent’s proposals on key issues amounted to lit-
tle more than a demand for the surrender of certain of
those rights. An examination of the interacting oper-
ation of four proposals in particular—the management
functions clause, the discharge and suspension clause,
the grievance/arbitration clause, and the clause gov-
erning strikes—serves to illustrate the point.
The following rights and obligations under the Act
would pertain in the absence of any contract if the Re-
spondent here, for example, sought to discharge a
union steward for violating a plant rule that those who
were not supporters of the Union were allowed to vio-
late with impunity. In the first place, if the rule in
question were one that had not existed prior to the
Union’s certification, the Respondent would have been
obligated to give the Union notice and an opportunity
to bargain before imposing it. Second, the Union
would be free to strike over the discharge, and such
a strike would be deemed an unfair labor practice
strike, with the employees entitled to retrieve their jobs
upon their unconditional offer to return. Under the Re-
spondent’s proposals, the Union would have no voice
in the making of plant rules, because the Respondent
was allowed to act unilaterally on this, as well as al-
most every other aspect of wages and working condi-
tions, pursuant to its management functions clause. Al-
though the Union might be able to grieve the discharge
through arbitration, such a course of action would be
futile: the discharge would necessarily be found to be
for ‘‘just cause,’’ because under section 10.1, a ‘‘just
cause’’ discharge would include any discharge that
was imposed for violation of any rule that the Re-
spondent issued under the unrestricted rulemaking
powers granted to it in the management functions
clause. Furthermore, even if an arbitrator should decide
that the discharge was not for ‘‘just cause’’ because
others escaped punishment for overtly engaging in the
same conduct as the union steward, the arbitrator
would not be empowered to award the employee either
reinstatement or backpay. Finally, if the Union (taking
advantage of a limited exception to the broad no-strike
clause) struck over the discharge, the strike would be
deemed an economic strike.
Of course, a union might be willing to accept such
comprehensive restrictions on the employees’ statutory
rights if the employer were offering something signifi-
cant in return. The mere insistence on a waiver of stat-
utory rights as part of an employer’s overall bargaining
position does not require a finding of bad faith.
Reichhold Chemicals, supra, 288 NLRB at 71, affd.
Teamsters Local 515 v. NLRB, supra, 906 F.2d at 727–
728. But unlike the employer in Reichhold, which
made significant movement in bargaining on important
subjects (288 NLRB at 70), the Respondent here was
offering little more than the status quo in return for
these sweeping waivers.
In defense of the Respondent’s lack of movement
during negotiations, O’Rourke, the Respondent’s prin-
cipal negotiator, testified that the Respondent was re-
luctant to soften its positions because it believed the
Union was showing insufficient movement. Yet, with
few and minor exceptions, the agreements that the par-
ties had reached represented either the Union’s accept-
ance of current terms and conditions or the incorpora-
tion in the contract of obligations that were imposed
on the Respondent by law even without a contract.8
995HYDROTHERM, INC.
Finally, the agreement on ‘‘Union Business and Visitation Rights’’ signifies
the Union’s willingness to compromise. Although the provision did grant the
Union space in the Respondent’s premises for a union bulletin board, it also
specified that the bulletin board was to be provided at the Union’s expense.
Similarly, although it was specified that the Respondent could not act ‘‘unrea-
sonably’’ in withholding permission for union representatives to visit the facil-
ity on any given occasion, such representatives were not free to speak with
the employees at the end of their shifts but only during their meal periods or
breaktimes. The Respondent never, however, during the seven bargaining ses-
sions, proposed that there could be any scheduled breaks other than 30-minute
meal periods.
9 As explained in sec. I, supra, however, the Respondent had no business
reasons for offering less, because its own admitted operational needs called for
implementation of the scheduled merit increases.
The subjects agreed on were, in fact, remarkably simi-
lar to those agreed on by the parties in A-1 King Size
Sandwiches, supra, 265 NLRB at 851.
In sum, the Respondent’s proposals, considered as a
whole, would have left the employees and their rep-
resentative with less than they would enjoy by simply
relying on the certification, without a contract. This is
not the conduct of an employer sincerely attempting to
reach an agreement, and it is not good-faith bargaining.
NLRB v. A-1 King Size Sandwiches, supra, 732 F.2d at
874.
C. The Respondent’s Conditions on
Further Bargaining
As noted above, at the final bargaining session be-
tween the parties, O’Rourke told the Union’s rep-
resentatives that he saw nothing further ‘‘to talk
about’’ unless the Union agreed to drop its demand for
a union-security clause and to forgo making any pro-
posals on wages for the year beginning on the first of
the previous month (November 1). Given the manner
in which the Respondent had bargained on these two
subjects, and given the absence of any sign there was
likely to be serious movement on the major proposals
described in section B, above, the Union was war-
ranted in concluding that the Respondent was not pre-
pared to continue negotiations in good faith. The
Union’s belief that further sessions would be futile is
especially justified in light of the Respondent’s failure
to display a willingness to bargain over its proposals
on several crucial subjects, for example, the grievance
and arbitration and discipline and discharge clauses.
Although the Respondent’s witness later testified that
Respondent in fact harbored a continued willingness to
bargain, the record does not demonstrate that the Re-
spondent sufficiently conveyed these sentiments to
union negotiators. Thus, because the Union received
no intimations from the Respondent that meaningful
movement might occur, there was no separate basis for
it to pursue further talks after the Respondent laid
down the conditions described above.
The Respondent is correct in arguing that, just as a
union does not violate the Act by aggressively pressing
a demand for a union-security clause, so an employer
does not violate the Act simply by refusing to agree
to such a demand. The Respondent’s stated reasons for
its position, however, revealed a fundamental unwill-
ingness to accept the Union in its proper role as the
exclusive representative of all the bargaining unit em-
ployees. Thus, in opposing the Union’s proposals, the
Respondent’s representatives pointed to the slender
margin (59–56) by which the Union had won the rep-
resentation election in 1983. The Respondent’s rep-
resentatives openly stated their view (not based on any
communications from employees themselves) that
many employees must still oppose the Union after the
lengthy period taken up by the Respondent’s test of the
certification, and arrogated to themselves the function
of representing the interests of those employees. As
O’Rourke testified in describing his set negotiating
‘‘speech’’ on the subject of a union-shop clause, ‘‘we
felt that we—we 3 guys on the company’s side of the
table—were representing those employees,’’ i.e., the
employees whom it presumed to be opponents of the
Union. As the judge aptly observed, the Respondent’s
‘‘whole attitude, throughout the fall of 1987 and be-
yond, has been that negotiations were simply a con-
tinuation of the campaign it had been waging for 4
years to keep the Union out of the plant entirely.’’
The Respondent’s dealings with both the Union and
its employees on the subject of wages were similarly
marked by bad faith. As explained in section I, above,
when the parties sat down at the negotiating table in
the fall of 1987, an existing condition of employment
for the unit employees was an annual wage review at
the beginning of November during which merit in-
creases would be given to a number of them. This con-
dition, did not, of course, constrain the Respondent in
what it could put forth as its bargaining proposal for
wages during the year following that November 1 date.
It was free, inter alia, to propose—as it did—that wage
increases for that period be limited to the scheduled
merit increases, granted according to the standards es-
tablished in the past. It could even have proposed less,
as long as that proposal was offered in good faith.9 It
was not acting in good faith, however, when it stated
that the scheduled wage increases would be granted
only if the Union agreed to put forward no counter-
proposal whatsoever. In other words, the Respondent’s
position on wages was that the Union had only two
choices—(1) forgo any negotiations over contending
positions and accept the Respondent’s first proposal
(the status quo) or (2) accept cancellation of the sched-
uled increases as the price for having its own wage
proposals considered by the Respondent.
996 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
10 Compare Captain’s Table, 289 NLRB 22 (1988) (union failed to test em-
ployer’s good faith when it filed unfair labor practice charges after four bar-
gaining sessions in which the union itself had failed to offer counterproposals
and to provide requested information in a timely fashion).
1 The principal docket entries in this case are as follows:
Charge filed by Petroleum, Construction, Tankline Drivers, Yeast, Soft
Drink Workers and Driver-Salesmen, Amusement and Vending Servicemen
and Allied Workers, Local Union No. 311 of Baltimore and Vicinity, affiliated
with International Brotherhood of Teamsters, Chauffeurs, Warehousemen, and
Helpers of America, AFL–CIO (the Union) on January 6, 1988; complaint
issued by the Regional Director for Region 5 on July 26, 1988; Respondent’s
answer filed on August 4, 1988; complaint amended on February 10, 1989;
hearing held in Baltimore, Maryland, on March 1–3, 1989; briefs filed with
me by the General Counsel and the Respondent on or before May 23, 1989.
2 The Respondent admits, and I find, that it is a Delaware corporation which
maintains a place of business in Dundalk, Maryland, where it is engaged in
the manufacture of commercial and residential heating and hot water units. In
the preceding year, it purchased and received at its Dundalk, Maryland plant
directly from points and places located outside the State of Maryland goods
and materials valued in excess of $50,000. Accordingly, the Respondent is an
employer engaged in commerce within the meaning of Sec. 2(2), (6), and (7)
of the Act. The Union is a labor organization within the meaning of Sec. (5)
of the Act
The Respondent characterized this as merely a
shrewd tactic to avoid ‘‘giving the merit increases
away,’’ but a similar strategy by an employer aimed
at ‘‘improv[ing] its bargaining position in . . . antici-
pated negotiations with the Union’’ was found by the
Board and a reviewing court to be bad-faith bargaining
destructive of employee rights. NLRB v. United Air-
craft Corp., 490 F.2d 1105, 1110 (2d Cir. 1973). See
also Thill, Inc., 298 NLRB 688 (1990) (employer acted
unlawfully in treating a scheduled wage cut restoration
as a condition that the union would have to negotiate
in order to restore).
As in Thill, supra, the Respondent compounded its
bad faith by its communications with its employees.
The Union had never opposed the granting of the an-
nual merit increase, but merely sought to pursue its
right to put on the negotiating table a proposal for
more (e.g., for a general increase that would also ben-
efit employees bypassed in the merit review). Nonethe-
less, the Respondent—after first withholding the in-
crease to its employees’ dismay—sent them the De-
cember 15 letter in which it falsely portrayed the
Union’s position as one of allowing the Respondent to
grant the November 1 merit increases only if the Re-
spondent also granted additional increases in 6 months
and included a union-shop clause in the contract. The
letter also underscored the Respondent’s picture of
itself as the employees’ true representative (‘‘We told
the Union we can’t agree to things like that because
we must protect your jobs . . . .’’), and it sought to
portray the process of collective bargaining as a harm-
ful burden which the Union’s victory had imposed on
the employees. (‘‘We decided to give [you] the in-
crease anyway because we feel you should not suffer
further from the bargaining.’’)
In sum, there is no merit to the Respondent’s con-
tention that the Union’s failure to seek further negoti-
ating sessions after December 1987 amounted to a fail-
ure to put the Respondent’s good faith to the test.10
The Respondent’s conduct during the seven bargaining
sessions that took place and its parting remarks con-
cerning what the Union must do in order for the par-
ties to have anything ‘‘to talk about’’ made it entirely
clear that further meetings were not likely to result in
the good-faith bargaining to which the employees were
entitled under the Act.
Conclusion
For the foregoing reasons, we agree with the judge’s
finding that the Respondent violated Section 8(a)(5)
and (1) of the Act by failing to bargain in good faith
with the Union.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Hydrotherm, Inc., Dundalk,
Maryland, its officers, agents, successors, and assigns,
shall take the action set forth in the Order.
Steven L. Sokolow, Esq., for the General Counsel.
Frank L. Kollman, Esq., of Baltimore, Maryland, for the Re-
spondent.
Joel A. Smith, Esq., of Lutherville, Maryland, for the Charg-
ing Party.
DECISION
FINDINGS OF FACT
I. STATEMENT OF THE CASE
WALTER H. MALONEY, Administrative Law Judge. This
case came on for hearing before me at Baltimore, Maryland,
on an unfair labor practice complaint,1 issued by the Re-
gional Director for Region 5 of the National Labor Relations
Board and later amended, which alleges that Respondent
Hydrotherm, Inc. violated Section 8(a)(1) and (5) of the
Act.2 More particularly, the complaint alleges that, in nego-
tiations which took place between September 17 and Decem-
ber 9, 1987, the Respondent engaged in overall subjective
bad-faith bargaining, sometimes called surface bargaining, as
evidenced by several aspects of its negotiating posture—in-
sistence on an overly broad management-rights clause; as-
signing to the Respondent the unilateral right to establish
wage rates for new or changed positions; the right to change
incentive or bonus pay, and to make and enforce work rules;
insistence that pay increases be limited to merit increases; in-
sistence on an unlimited contract right to use nonunit em-
ployees to do bargaining unit work; insistence on grievance
and arbitration provisions excluding union participation in
certain steps of the grievance procedure and precluding an
arbitrator from awarding reinstatement and backpay in dis-
charge cases; and insistence on language which would waive
any right of reinstatement for employees who struck in sup-
port of a discharged employee who was seeking reinstate-
ment. The Respondent denies that it engaged in surface bar-
gaining, places the blame for a breakdown in negotiations
upon the Union, and urges that any positions it took which
997HYDROTHERM, INC.
3 Errors in the transcript have been noted and corrected.
4 Those sessions took place at the Baltimore Travel Plaza Motel in Balti-
more, Maryland, on September 17; October 8, 14, and 27; November 18; and
December 3 and 9.
5 A few employees even misrepresented to union agents the wage rates they
were currently receiving.
6 The Respondent’s proposal, styled ‘‘Section 2.1—Management Func-
tions,’’ read:
All management rights, powers, authority, and functions, whether exer-
cised, and regardless of the frequency of infrequently of their exercise,
shall remain vested exclusively in the company. It is expressly recognized
that such rights, powers, authority, and functions include, but are by no
means limited to, the full and exclusive control, management, and oper-
ation of its business and its plant; the determination of the scope of its
activities, products to be processed or manufactured, and the methods for
processing and manufacturing; the location of such processing or manu-
facturing, the materials and products to be acquired or utilized, the ma-
chinery and equipment to be utilized, and their layout; the right to estab-
lish or change shifts, schedules of work, and production schedules and
standards; the right to establish, change, combine, or eliminate jobs, posi-
tions, job classifications, and descriptions; the right to establish or change
incentive or bonus compensation; the right to introduce new or improved
procedures, methods, processes, facilities, machines, and equipment or
make technological changes; the right to maintain order and efficiency;
the right to contract or subcontract any work; determination of the num-
ber, size and location of its facilities or any part, and the extent to which
the means and manner by which its facilities, or any part, shall be oper-
ated, relocated, shut down, or abandoned; the right to terminate, merge,
consolidate, sell, or otherwise transfer its business or any part; the right
to make and enforce safety, security, and work rules and rules of conduct;
the determination of the number of employees, the assignment of their du-
ties, and the right to change, increase, or reduce the duties; and the direc-
tion of the working forces, including but by no means limited to hiring,
selecting, and training of new employees, and suspending, scheduling, as-
signing, discharging, laying off, recalling, promoting, retiring, demoting,
and transferring its employees.
seemed unduly harsh or restrictive were mere negotiating
ploys which it was willing to abandon under proper cir-
cumstances. Upon these contentions the issues herein were
joined.3
II. THE UNFAIR LABOR PRACTICES ALLEGED
A. Background
Respondent operates three plants which are engaged in the
manufacturing of heating equipment. They are located in
Missaugna, Ontario, Northvale, New Jersey, and Dundalk,
Maryland. At the Northvale plant, where the Respondent’s
headquarters is located, it has maintained a collective-bar-
gaining relationship with the Steelworkers for more than 10
years. The Dundalk plant involved in this proceeding has
been in operation for more than 40 years, either under
present management or under previous ownership. This plant
has about 125 production and maintenance employees and
had no collective-bargaining history before 1983, when
events leading up to this case began to take place.
In the spring of 1983, the Union engaged in an organizing
drive among the Respondent’s Dundalk employees and filed
a representation petition on March 22 of the year. On May
12, an election was held which the Union won by a vote of
59 to 56. The Respondent filed objections which the Re-
gional Director overruled. On appeal, the Board also over-
ruled the Respondent’s objections and certified the Union on
June 11, 1984. 270 NLRB 1131. On June 27, 1984, the
Union wrote the Respondent, asking it to meet for the pur-
pose of negotiating a contract. The Respondent refused to
honor the certification, so a complaint was issued against it
in Case 5–CA–16508. After a hearing before Administrative
Law Judge Arlene Pacht, the Respondent was found guilty
of a violation of Section 8(a)(5) of the Act. Again the Re-
spondent appealed to the Board. On August 7, 1986, the
Board affirmed Judge Pacht’s decision and directed the Re-
spondent to bargain with the Union. 280 NLRB 1425. Again
the Respondent refused, so a petition to enforce the Board’s
Order was filed in the United States Court of Appeals for the
Fourth Circuit. In a decision issued on August 5, 1987, the
Fourth Circuit affirmed the Board and directed the Respond-
ent to honor the certification which was issued in 1984 and
to bargain with the Union. 824 F.2d 332.
Following the issuance of the decree of the court of ap-
peals, the Respondent agreed to meet with the Union for pur-
poses of collective bargaining so, in the fall of 1987, seven
negotiating sessions took place.4 The principal Company ne-
gotiator on these occasions was Paul G. O’Rourke, the Re-
spondent’s senior vice president. Except at the first meeting,
the Union’s principal negotiator was its secretary-treasurer,
Robert G. Cremen. Prior to the commencement of these ne-
gotiations, union representatives held a meeting with bar-
gaining unit personnel and solicited suggestions for proposals
to be advanced at bargaining. At this meeting it also selected
an in-plant bargaining committee. The Union formulated the
suggestions it received into a single complete contract pro-
posal containing 31 articles, including a detailed wage de-
mand for each of 18 job classifications in the bargaining
unit. On three points—jury duty pay, meal allowances for
employees who work overtime, and shift differentials—the
Union’s initial proposals were slightly less than what the Re-
spondent was then offering because bargaining unit personnel
had misinformed union representatives concerning what they
were receiving for these benefits.5 The Union forwarded its
contract proposal to O’Rourke before the first session began.
The parties used it at the first session as the basis of much
of the discussion that took place. The Respondent had noth-
ing in writing to present to the Union at the first session,
other than a detailed management-rights proposal6 which was
the subject of much discussion throughout negotiations, and
a set of rules of conduct which the Company wanted the
Union to agree to as the basis for conducting negotiations.
The rules included such items as promptness for meetings,
nonpayment of employees on the Union’s bargaining com-
mittee, and the tentative nature of all items agreed to until
a contract is signed. Of some importance was a statement
contained in the proposed negotiating rules that ‘‘parties to
the meetings agree that when discussions of proposals and al-
ternatives are ‘agreed as confidential in the meeting,’ such
matters will be retained as confidential by all persons at the
meeting.’’ The Union agreed to all of these rules of conduct.
At the first meeting, as the parties were quickly going over
the provisions of the Union’s initial proposal, O’Rourke stat-
ed that the Company strongly opposed any union shop be-
cause it felt it had to defend the rights of the employees who
had voted against the Union in the 1983 election. This was
the first of several occasions on which O’Rourke voiced the
same position respecting union security for the same reason.
From time to time, the parties would come across a provision
in the Union’s proposal which was similar to or identical to
present Company practice. On such occasions O’Rourke
would point out that fact. When he did so, Gene Shiflett and
Brian Griffin, who were representing the Union at the first
998 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
7 Sec. 6.1 of the Company’s proposal given to the Union on October 8 stat-
ed: ‘‘All employees covered in this Agreement shall receive the wages set
forth in Appendix I.’’ However, there was no appendix I and it was never
supplied.
8 There seems to be a difference of opinion as to whether this proposal en-
gendered laughter among the participants in the negotiations. Apparently some
laughed and others did not.
9 Local 311 is one of the larger labor organizations in the Baltimore metro-
politan area. It negotiates and administers an estimated 125–150 contracts.
Until his retirement, Cremen had been an official of this organization for more
than 20 years.
meeting, thought that he meant that the Company was agree-
ing to the Union proposal since it recited current company
practice. They later found out that the Respondent was not
agreeing to continue current practices in its responses to
those proposals. It did not do so until much later and then
only as to some current practices and policies. The meeting
ended with the Company telling the Union that it wanted to
compare the Union’s health and welfare and pension plans
with its own, since the Union’s proposal dealt only with lev-
els of contribution and not with levels of benefits.
At the second meeting on October 8 and thereafter,
Cremen spoke for the Union. The Union corrected the origi-
nal proposal it had made concerning overtime and shift dif-
ferentials to conform with the slightly higher amount which
the Company was then paying (10 percent of base pay rather
than 40 cents extra). It also removed the 10-day cap on jury
duty pay to conform to the unlimited number of paid jury
days currently allowed by the Company. The parties disputed
the Union’s provision prohibiting the farming out of bar-
gaining unit work. The Company’s position was that it had
a seasonal operation and there were times when it needed to
engage in subcontracting to get work out in a hurry. The par-
ties discussed holidays, vacations, an 8-hour guarantee,
superseniority for shop stewards, and pay deductions to be
transmitted to the company credit union. No agreements were
reached. They also discussed nondiscrimination and selective
service. O’Rourke said he had no objection to the Union’s
proposals on these items. At the end of the meeting the
Company gave the Union its first written proposals, which
were drafts of language relating to a selected group of items
in which the Company was interested. It was not a complete
proposal and did not contain a wage offer. The Company
never furnished the Union with a list of its present wage
rates—job classes and progressions within grades.7 In fact,
throughout the entire course of bargaining in the fall of 1987,
the Company never made a conventional wage proposal, lim-
iting any wage improvement to a list of merit increases dis-
cussed infra. It also made no proposal dealing with health
and welfare benefits or a pension plan. After looking through
it hurriedly, Cremen complained that the Company’s pro-
posals made no provision for union security. Again
O’Rourke pointed out to Cremen that the Company needed
to defend the interests of employees who had voted against
the Union in 1983. He added that this was a firm position
which was agreed to by management from the top down.
Cremen countered that it was also a major issue from the
Union’s standpoint. O’Rourke noted that the Company had
told its employees all along that one thing the Union would
do if it was selected was to insist on a union shop. Cremen
asked O’Rourke on one occasion why he had a union shop
at the New Jersey plant but was unwilling to grant such a
provision at Dundalk, but he did not receive a responsive an-
swer.
Sometime between the second and third meeting, which
took place on October 14, the Respondent placed copies of
its proposal and the Union’s proposal near the timeclock in
the plant and distributed them to bargaining unit personnel.
O’Rourke admitted doing so at the October 14 meeting and
was criticized by Cremen for violating the confidentiality
provision in the agreed rules of conduct. Cremen noted that
the company proposal omitted certain items that the Union
thought had been agreed upon, to which O’Rourke replied
that some of the Company’s bargaining objectives had
changed and that bargaining would start from scratch.
Cremen noted that, among the Company’s proposals, there
was no provision on nondiscrimination. O’Rourke’s comment
was that they did not have to place items in a contract which
were already a part of the general law. Cremen also com-
mented that the Company had proposed only that rest breaks
be taken as scheduled by the supervisor, whereas the Com-
pany’s present practice was to have scheduled breaks during
the morning and afternoon. Cremen asked O’Rourke if he
was taking away the employees’ existing breaktimes.
O’Rourke admitted that this was what they were proposing.
Later, O’Rourke stated that the Company would agree to
specific breaktimes if the Union would forgo its insistence
on union shop.8 Cremen told O’Rourke that this was not a
fair exchange and rejected it without further comment.
During this session, the parties went over other provisions
of the Company’s proposal. The Union objected to a pro-
posal making new employees probationary for a period of 90
working days after they were hired, with an option on the
part of the Company to prolong this status for another 30
working days. In particular, the Union did not like the provi-
sion precluding probationary employees from having access
to the grievance procedure. Cremen and O’Rourke also had
one of several exchanges concerning the management func-
tions clause set forth in footnote 6 above. Cremen told
O’Rourke that, by agreeing to such a clause, the Union
would be giving up its right to represent the bargaining unit
and it refused to do so. Whenever, in later negotiations, this
matter came up, Cremen made the same response. O’Rourke
wanted Cremen to go through the clause line by line and
phrase by phrase to tell him exactly what he did not like
about the provision. Cremen’s standard reply was that he did
not like any of it. The original Union proposal did not have
a management-rights provision. At a later meeting, Cremen
proposed a substitute provision, drawn from the language in
one of the Union’s other contracts,9 which essentially said in
simple terms that management had the right to manage.
O’Rourke told Cremen that the company proposals made no
mention of safety matters since the Company did not think
that the Union had anything to contribute to the maintenance
or improvement of plant safety. The Union objected to a
company proposal that union representatives could enter the
plant only at the Company’s discretion. The parties agreed
to a proviso to this proposal to the effect that Union access
to the plant would not be unreasonably withheld.
The Company had also proposed that there would be only
one shop steward for its plant, which employed about 125
people, and that he could investigate and process grievances
only on breaktime or other off-duty time. The proposal said
that an employee could present a grievance directly to man-
agement but had to do so within 3 days of the event being
999HYDROTHERM, INC.
complained about. It laid down a further requirement that
any grievance had to be in writing and had to set forth in
detail the complaint and the specific provision of the contract
which was being violated. Failure to observe any of these re-
quirements would void the grievance. Cremen complained
that it would be impossible for a shop steward to investigate
and process grievances during breaktimes when another pro-
vision of the company proposal would permit the Respondent
to eliminate breaks or call them only at the foreman’s discre-
tion.
The Union also objected to the company proposal which
said that an employee could lose seniority by being absent
for a day without calling in and for several other attendance-
related infractions. It noted that the Respondent was currently
paying overtime after 8 hours of work in any one day, so
it questioned the Company’s proposal that it would pay over-
time only after 40 hours of work in a week, arguing that this
was less than current practice. When Cremen countered with
the suggestion that the parties agree to the Company’s
present practice on overtime, O’Rourke refused, saying that
bargaining starts from scratch.
The Union also had objections to several facets of the Re-
spondent’s proposal concerning arbitration. The Respondent
proposed that, when a grievance was referred to arbitration,
any party could insist on being presented with three succes-
sive lists of arbitrators and could object to each entire list
until the third list was submitted. The Union called this pro-
posal mere time wasting. The proposal also stated that an ar-
bitrator had no power to award reinstatement or backpay in
a discharge case and that the employees could strike over the
discharge of a fellow employee, but any such strike would
be deemed an economic strike rather than an unfair labor
practice strike. Cremen noted that there was a standard griev-
ance and arbitration provision in the contract which the Re-
spondent negotiated with the Steelworkers in New Jersey and
complained that it was ridiculous to empower an arbitrator
to hear a discharge case but prevent him from granting a
meaningful remedy. O’Rourke’s rejoinder was that remedies
should be up to the Company and that it did not want a third
party running its business. Cremen also did not care for the
provision in the company proposal that the prevailing party
to an arbitration pay all of the costs. He told O’Rourke that
the standard practice in the contracts which he had negotiated
was that the expenses of the arbitrator were shared by both
sides, regardless of who won.
The Respondent has followed a practice for several years
of granting merit increases each year on the first of Novem-
ber. As O’Rourke put it, ‘‘it’s pretty rigid’’ that the Com-
pany give these increases around November 1. Each member
of the bargaining unit is evaluated by his foreman and, fol-
lowing the submission of these evaluations to higher man-
agement, hourly rate increases are given in varying amounts.
In some instances, no increases may be given. O’Rourke tes-
tified that it is important to management to be able to grant
these increases each fall because employees have come to
expect them at that time. He added that the fall of the year
is the Respondent’s busy time and a failure of the Company
to provide expected wage increases could bring about a seri-
ous morale problem in the shop which might affect produc-
tion. He also noted that the Company was having difficulty
in recruiting new employees at its 1987 wage scale. At the
fourth bargaining session on October 27, Cremen told man-
agement representatives that he was receiving reports that su-
pervisors in the plant were telling employees that there
would be no merit increases because collective bargaining
was in progress. He announced that the Union had no objec-
tion to a continuation of the Respondent’s past practice and
that management was free to grant merit increases to unit
employees as it had previously done. O’Rourke’s reply was
to thank Cremen for relinquishing the Union’s right to bar-
gain over wages. Cremen said he had done no such thing but
had merely stated that the Union had no objection to a con-
tinuation of the Respondent’s past practice regarding merit
increases. According to O’Rourke, he proposed that merit in-
creases be handled by what he called a ‘‘Gentlemen’s Agree-
ment,’’ which he defined on the record as an oral arrange-
ment which could be put into effect but which neither side
would have any obligation to agree to as part of a final writ-
ten contract.
The parties went on to discuss other subjects but, during
that discussion, O’Rourke came back to the subject of merit
increases and proposed that the Company should grant these
increases in exchange for an agreement on the part of the
Union that it would not ask for any additional increases for
a year. His argument was that the Company did not want to
be in the position of having to grant two wage increases in
the course of a single year. Cremen refused, saying that his
earlier statement had referred only to the Company’s practice
of granting merit increases on November 1 and to nothing
else. A few days later, Cremen confirmed his statement in
writing by a letter to Plant Manager David Tucker, dated No-
vember 3. In that letter he wrote:
The purpose of this letter is to restate the Union’s
position on yearly evaluations and wage increases that
are due in November, 1987.
The Union has no objection, and in fact encourages,
the Company to conduct its yearly evaluation of em-
ployees at your plant and to grant wage increases based
on such evaluations.
The Union retains its right to negotiate wage in-
creases during the process of collective bargaining inde-
pendent of any evaluation increases which the Com-
pany may grant during this process.
At the October 27 meeting, the parties discussed subjects
other than merit increases. The Union had prepared a number
of individual sheets of paper containing the language of a
number of minor items on which it thought there either was
agreement or on which agreement might easily be obtained.
The Union also presented its own management-rights pro-
posal as a part of this package. The parties began to examine
each of these items. The Respondent opened the discussion
by objecting to the Union’s proposed preamble to the con-
tract, saying that it was unnecessary. The Company agreed
to a recognition clause which embodied the language of the
certification but felt that the language in the Union’s pro-
posal was not sufficiently detailed. There was no agreement
on the subcontracting of bargaining unit work. The Company
insisted on its own no-strike, no-lockout provision. Cremen
argued that the language of his no-strike, no-lockout proposal
was simple and direct and was drawn from the Company’s
agreement with the Steelworkers in New Jersey. In light of
the company proposal limiting the power of arbitrators in
1000 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
discharge cases, it had an additional proviso saying that the
no-strike provision would be inapplicable if the Respondent
failed to comply with an arbitrator’s award. Cremen criti-
cized the Company’s no-strike proposal as being so detailed
that it was internally contradictory. O’Rourke asked what
would happen if a single member of the bargaining unit went
on strike. Cremen’s reply was that this would be an unau-
thorized strike, subject to internal union disciplinary proce-
dures, and that Local 311 had a long history of living up to
its no-strike contractual commitments because it preferred to
use the grievance machinery to resolve disputes.
The parties next addressed the company proposal that all
strikes to protest discharges be deemed economic strikes, in
which case strikers could be permanently replaced. After tak-
ing a brief caucus, Cremen told O’Rourke that this language
was unsatisfactory but added that the Union did not want to
be striking in the first place. The parties again talked about
the Company’s original management functions proposal.
Cremen reiterated his earlier objection that, if the Union
agreed to the company proposal as stated, it would be giving
up its right to represent the people in the bargaining unit and
it would not do so. The Company, in turn, objected to the
Union’s nondiscrimination proposal, saying that it did not
want to be fighting the Union and the EEOC at the same
time.
There was agreement on some aspects of jury duty pay.
After discussing the merit pay system, as outlined above, the
Company asked Cremen to present a ‘‘realistic’’ general pay
proposal so the Company could cost it out. The parties ap-
proached agreement on the number of paid holidays but
agreement in this area was not firm. The parties addressed
the Union’s proposal relating to reemployment of former em-
ployees who were honorably discharged from the armed
services. O’Rourke said he would have to let his lawyer re-
view this item.
At the November 18 meeting, O’Rourke again brought up
the question of merit increases. He told the Union that the
Company was not giving these increases away and wanted
a concession from the Union in exchange for implementing
its merit increase program. He suggested an agreement from
the Union to forgo any other increases for a year. Again
Cremen declined, saying he was not going to forego his right
to bargain over a general pay increase. The Company then
told the Union it had already distributed certificates to em-
ployees with which they could pick up their Thanksgiving
turkeys. O’Rourke also said that the Company had followed
a practice for a number of years of holding employee meet-
ings from time to time to bring everyone up to date about
developments within the Company, and he wanted to be able
to continue to do so. Cremen said he had no objections to
such meetings so long as the Respondent did not take advan-
tage of these occasions to bargain directly with its labor
force.
The Company then presented the Union with a revised
package of written proposals. Some of these proposals were
identical to the ones submitted at the end of the second nego-
tiating session. There was revised language in the areas of
jury duty pay, safety and health, and selective service obliga-
tions. The second package contained nothing concerning
grievance machinery, arbitration, or seniority. The parties
discussed the question of subcontracting bargaining unit
work. The Union voiced its objection to the proposal which
would permit such subcontracting ‘‘for competitive economic
reasons,’’ asserting the language was too vague. It did agree
to a management proposal that there should be no individual
contracts with employees. It disagreed concerning the bal-
ance of the newly proposed section 11.2. In the first package
of proposals submitted at the end of the second meeting, the
Company had proposed that it should be permitted to discuss
grievances with employees without the assistance of the
Union. Its revised proposal would allow it to discuss ‘‘mat-
ters related to wages and working conditions’’ directly with
employees without Union intervention. Cremen objected to
this idea. He also objected to a company proposal that any
employee be deemed to have waived any complaint about
being shortchanged in his paycheck if he did not present his
complaint to the attention of the Company within 2 weeks
from receiving the check.
Although the parties agreed on a definition of probationary
employees, the question of temporary employees was never
resolved. The Company had proposed that it be allowed to
employ temporary employees outside the terms of the con-
tract and pay them without reference to contract rates. It did
not define what it meant by ‘‘temporary employee’’ and
would not agree to any limitation of the number of tem-
porary employees that might be on its payroll in this manner
at any given time. O’Rourke said on one occasion that he
was thinking in terms of 7 months as an appropriate limita-
tion on the length of service for a temporary employee but
no formal proposal to this effect was ever advanced or
agreed upon. To the Union the distinction between a part-
time employee covered by the contract and temporary em-
ployee excluded from the contract was obscure, so it insisted
on a better definition from the Company to differentiate the
two categories. No such definition was ever proposed.
O’Rourke admitted that there might be some confusion be-
tween temporary employees and probationary employees.
The Union receded from its initial proposal for double
time on holidays over and above the regular 8 hours of pay,
so agreement was concluded that any employee working a
holiday would receive a total compensation equal to twice
his normal hourly rate. It also agreed to some flexibility in
the scheduling of holidays which fell on weekends. There
was agreement on permitting access to the plant by union of-
ficials and agreement that the length of probationary service
be determined by calendar days rather than working days.
There was additional agreement on one or two other minor
items but no agreement on management rights or union secu-
rity. The meeting ended with a presentation by the Union of
a revised wage rate schedule.
At the sixth meeting on December 3, O’Rourke handed
Cremen a two-page document authorizing proposed merit in-
creases. The first page contained a list of 69 unit employees
to whom the Company was proposing to give individual in-
creases ranging from 21 cents to 66 cents an hour. Page 2
contained a list of 26 other employees who were not slated
to get merit increases, either because the increases were to
be delayed or because the individual was a probationary em-
ployee and was not evaluated as a part of the existing merit
increase program. O’Rourke again asked Cremen to agree
that, if these increases were put into effect, the Union would
not ask for an additional wage increase for a year. He also
told Cremen that he wanted the document returned because
it was confidential and he did not want its contents disclosed
1001HYDROTHERM, INC.
10 The Respondent did contact the Union many months later to request per-
mission to implement additional merit increases and to implement certain
health care cost containment measures. The Union’s response was an accusa-
tion that the Respondent’s offer to bargain was disingenous and that the Union
had no intention of resuming negotiations until the Respondent recognized its
previous violations of the Act, agreed to remedy those violations, and dem-
onstrated a willingness to bargain in good faith.
in the plant. One union representative asked O’Rourke if the
names of all of the employees in the unit were on the list.
O’Rourke replied that they were not. He then asked
O’Rourke if the absence of an employee’s name from the list
meant that the employee would not be getting any wage in-
crease. O’Rourke agreed that this was so.
After a caucus, Cremen told O’Rourke that he would not
agree to the listed increases because he did not want to be
blamed out in the plant for agreeing to it. He said he re-
served the right to negotiate for a general increase and of-
fered a 6-month delay before any such increase might take
place, but the Respondent rejected this counterproposal.
Cremen told O’Rourke that, if the Union abandoned any ef-
fort to obtain a general increase for a year and simply settled
for the 1987 merit increases, the employees could conclude
that they did not need a union because they would have got-
ten the merit increases anyway.
Later in that session, the parties agreed that 60 rather than
90 calendar days would define the normal span of proba-
tionary employment and that probationary employees would
receive all Company benefits except for tuition assistance.
When the parties discussed temporary employees, O’Rourke
still refused to place a limit on the number of such employ-
ees who might be employed at any one given time but
agreed to try to come up with a definition of what con-
stituted a temporary employee. At the end of the session, the
Union proposed to the Respondent a 7-percent general
across-the-board wage increase. O’Rourke rejected it, saying
that the Company would go broke if it granted that kind of
a pay raise.
The seventh and last negotiating session took place on De-
cember 9. Cremen began the session by complaining that he
had heard that supervisors were telling employees in the
plant how much they were scheduled to receive as merit in-
creases and were not going to get because of objections from
the Union. He mentioned that his information concerned em-
ployee Jeanine Gardner, a supervisor named Sarah Albertine,
and a specific increase to Miss Gardner of 21 cents.
O’Rourke denied that such statements were being made at
the plant. Cremen further asserted the belief that supervisors
were receiving this information directly from Tucker. Tucker
said that he had told supervisors only in general terms what
had transpired at the December 3 meeting and that he had
not informed them of any specific wage rates which the
Company had proposed for particular employees. Cremen
asked how Sarah Albertine could have known of the par-
ticular increase which had been intended for Miss Gardner
if she had not learned about it from Tucker. Tucker and
O’Rourke replied they did not know.
The Company then told Cremen that it had completed its
merit evaluations and were reproposing the same increases
they had proposed at the previous meeting. They again asked
the Union to agree that there would be no further wage in-
creases for another year. Cremen again declined the offer, so
O’Rourke said that the Company would go ahead and give
the raises anyhow, retroactive to the last week in November.
He went on to state that he was not sure that the Union had
the interests of the employees at heart and that the Union
should stop insisting on two wage increases in a single year
and on union security, adding that so long as these were the
Union’s positions the Company had nothing further to talk
about with the Union. He said that the Union was not reflect-
ing what the employees really wanted and that it should go
back and talk to employees and rethink its bargaining posi-
tions. O’Rourke then got up from the bargaining table and
began to leave, telling the Union that it should get ready for
a strike. Cremen replied that the Union was not afraid of a
strike if that is what it was going to take. As O’Rourke was
leaving, he asked Cremen when they might meet again.
Cremen had no dates immediately available so it was left
that Cremen should call Tucker to arrange for another negoti-
ating date after the first of the year.
The merit increases proposed by the Respondent were put
in effect, as O’Rourke said they would be, effective as of
November 30. On December 15, O’Rourke, Tucker, and
Burmeister sent a ‘‘Dear Fellow Employees’’ letter to each
member of the bargaining unit in which they stated:
As you know, the paycheck you receive Thursday
will contain a retroactive payment of higher wages to
11/30 at your increased pay rate.
You also probably know that since late October, the
Company has been attempting to implement this wage
increase in bargaining with Local 311 in accordance
with legal requirements.
Because we expect a long bargaining process (many
issues important to you must be agreed to), we pro-
posed to the Union on 10/27 that this increase be part
of the contract. They refused to agree to this.
On 12/3 we proposed the wage increase you re-
ceived.
The Union said they would agree only if we agreed
to further increases in 6 months and a Union Shop.
On December 10, we made our proposal again and
the Union answered in a similar manner.
We told the Union we can’t agree to things like that
because we must protect your jobs and the Company
now and for the future.
We decided to give the increase anyway because we
feel you should not suffer further from the bargaining.
Although we expect to see you at the Christmas
Luncheon on December 18, please have a happy, safe
and pleasant preholiday period.
Shortly thereafter Cremen met with his attorney. After
consultation with counsel, he decided to file the unfair labor
practice charge in the instant case and did so on January 6,
1988. Cremen never called the Respondent for another nego-
tiating date, nor did the Respondent ever call him for another
general bargaining session.10
B. Analysis and Conclusions
When negotiations between these parties commenced on
September 17, 1987, the Respondent was honoring for the
first time a certification of the Union as the exclusive collec-
tive-bargaining representative of its production and mainte-
nance employees which was issued nearly 3-1/2 years before.
It was responding for the first time to a request for bargain-
1002 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
11 One of the defenses advanced by the Respondent at the hearing was that
the Union was responsible for the breakdown in negotiations which occurred
because it did not do its homework and came to the bargaining table unpre-
pared. Such a dereliction on the part of a union is not an excuse for bad-faith
bargaining on the company’s part, but it has no foundation in the facts ad-
duced in this record. Cremen actually prepared certain bargaining proposals
back in 1984 when he made his original request for negotiations. When that
request was finally honored 3-1/2 years later, he and other union officials held
a meeting with the members of the bargaining unit, at which time an in-plant
bargaining committee was selected. They also solicited and obtained sugges-
tions for proposals which were then incorporated into the detailed and com-
prehensive contract proposal that the Union provided to the Respondent in ad-
vance of the first negotiating session. The Union was represented by agents
with years of negotiating experience, whose full-time occupation is negotiating
and administering the terms of 125–150 contracts in the Baltimore metropoli-
tan area. The contention that the Union came to the bargaining table unpre-
pared because its agents had been misinformed by their constituency con-
cerning a few minor items of current shop practice is without merit.
ing which the Union had served upon it on June 27, 1984.
The Respondent did not comply with its duty to bargain,
which arose when the Union won a representation election
in 1983, until a United States court of appeals had placed it
under a decree in 1987 ordering it to bargain. At issue here
is whether what the Respondent did after the entry of that
decree was merely a continuation of its effort to avoid col-
lective bargaining, an effort which chewed up more than 4
years during which negotiations should have been conducted
and bargaining over a contract should have been completed.
As the Second Circuit put it:
Sophisticated pretense in the form of apparent bar-
gaining, sometimes referred to as ‘‘shadow boxing’’ or
‘‘surface bargaining,’’ see N.L.R.B. v. Herman Sausage,
275 F.2d 229, 232 (5th Cir. 1960), will not satisfy a
party’s duty under the Act; and where years pass the
conduct of the parties must be scrutinized carefully, es-
pecially when experience discloses that collective bar-
gaining agreements are usually reached in a fraction of
that time. [Continental Insurance Co., 495 F.2d 44, 48
(2d Cir. 1974).]
In making this careful scrutiny it is well to observe at the
outset that what the Respondent and its principal witness told
the Board in the course of a 3-day hearing in this case differs
considerably from what the Respondent disclosed to the
Union throughout 3 months of bargaining. Much of the testi-
mony given in defense of the Respondent’s activities during
this period of time dwelt on considerations of the ‘‘strategy’’
which the Respondent adopted in light of its perception that
it was dealing with a weak bargaining adversary. Whether its
adversary was strong or weak, both the Act and the decree
of the Fourth Circuit imposed on the Respondent a duty to
negotiate for the purpose of concluding a contract with the
Union. Any other ‘‘strategy’’ is simply another violation of
Section 8(a)(1) and (5) of the Act. Moreover, it is what the
Respondent did ‘‘on stage,’’ not what it said it was going
to do while ‘‘waiting in the wings,’’ that is entitled to cre-
dence. Ideas which were being kicked about by company ne-
gotiators during strategy sessions but which never saw the
light of day at negotiating sessions mean little in evaluating
the question of ‘‘good faith.’’
Like the problem which confronts the Board whenever it
is called on to determine the true motive behind the dis-
charge of a union adherent, an assessment of whether an em-
ployer is engaged in surface bargaining must normally be de-
rived from inferences based on reported conduct rather than
upon direct evidence. Although public agencies may not pass
judgment on the merits of proposals advanced during bar-
gaining, the Board and the courts have long held that they
may examine the contents of these proposals to determine
whether a proposal ‘‘is so consistently and predictably
unpalatable to the other party that the proposer should know
that agreement is impossible.’’ NLRB v. Mar-Len Cabinets,
659 F.2d 995, 999 (9th Cir. 1981). If so, the making of such
proposals will be deemed ‘‘evidence of an intent to frustrate
the collective bargaining process.’’ Reichhold Chemicals, 288
NLRB 69 (1988), citing Atlanta Hilton & Tower, 271 NLRB
1600 (1984). In this case, the Respondent never made a com-
plete contract proposal to the Union during the 3 months
they were engaged in negotiations, although it had before it
from the time of the first negotiating session a complete
Union proposal, including a detailed wage offer.11 The Com-
pany’s response to the Union and to its duty to bargain was
to present an array of bizarre, off-the-wall ideas which, in
some instances, it admitted at the hearing it knew the Union
would never accept.
The only document of its own which the Respondent prof-
fered at the first negotiating session was a management func-
tions proposal. Later, it reproposed that item as a part of two
successive packages that it presented to the Union. On each
occasion Cremen rejected it, saying that, if the Union agreed
to this proposal, it would be giving up its rights to ‘‘rep-
resent the people.’’ The duty to bargain, as defined in Sec-
tion 8(d) of the Act, extends to ‘‘wages, hours, and terms
and conditions of employment.’’ If adopted, this proposal
would give the Company, during the contract term, the com-
plete unilateral right to establish or change shifts, schedules
of work and production schedules and standards; the right to
establish, change, combine, or eliminate jobs, positions, clas-
sifications, and descriptions; the right to establish or change
incentive or bonus compensation; the right to maintain order
and efficiency; the right to subcontract work or transfer it out
of the plant to another company plant; the right to make and
enforce safety, security and work rules, as well as rules of
conduct; the right to determine the number of employees, the
assignment of their duties, and the right to change, increase,
or reduce those duties. It also would give the Company the
complete right to suspend, schedule, discharge, lay off, re-
call, demote, or promote employees. No restrictions would
exist by contract to limit the exercise of these powers and
no recourse could be taken to the grievance machinery by
any employee adversely affected by such actions. In short,
the setting of wages, hours, and terms and conditions of em-
ployment would continue to be under complete management
control, as they had been before the representation election
and for several years thereafter. Cremen’s shorthand descrip-
tion of this proposal, made on several occasions and quoted
above, was quite accurate. O’Rourke apparently felt that he
was satisfying his duty to bargain when he persisted in ask-
ing Cremen to go over the proposal and tell company offi-
cials what he specifically did not like about it and why.
Cremen did not like anything about the proposal and he told
O’Rourke as much. The Supreme Court long ago pointed out
that ‘‘the duty to bargain requires more than a willingness
to enter upon a sterile discussion of union-management dif-
ferences.’’ NLRB v. American National Insurance Co., 343
U.S. 395, 402 (1952). A lengthy discussion on a proposal
1003HYDROTHERM, INC.
asking the Union to relinquish its right to bargain about
wages, hours, and terms and conditions of employment could
be nothing more than a sterile discussion of union-manage-
ment differences, more appropriate to a preelection campaign
than to a collective-bargaining session. Requests to engage in
such discussions are more in the nature of attempts to waste
time than to satisfy a duty to bargain.
O’Rourke admitted in his testimony that he knew that the
management-rights proposal, to which Cremen voiced such
strong and repeated objection, would be unacceptable to the
Union. In referring to this proposal, O’Rourke testified that
‘‘when we first looked at it . . . we had a conscious decision
to set this thing up so that we could move from it and—and
give—give parts of it away as we . . . were negotiating.’’
He flatly admitted that he did not expect the Union to agree
to it and he expected to modify it as negotiations wore on.
However, he also admitted that the Company never did re-
cede from the proposal nor tell Union negotiators that it
would do so. I discredit his self-serving assertion.
One of the particular elements of the management func-
tions proposal which O’Rourke addressed in his testimony
was the unlimited right to grant discretionary merit increases
to bargaining unit personnel. O’Rourke stated: ‘‘I wouldn’t
expect the union to sign a contract that allows the company
to give discretionary increases on as broad a basis as de-
scribed’’ in the company proposal. However, the Respondent
never receded in any way from that particular proposal. As
explained by O’Rourke, ‘‘we never got to that.’’ Respondent
proffered a similar excuse relating to a proposal giving the
Company the unlimited discretion to assign supervisors and
other nonunit employees to do bargaining unit work.
O’Rourke said that the Company backed away from this pro-
posal by virtue of a subsequent proposal submitted in its sec-
ond package. However, the proposal he referred to gave the
Company the right to subcontract bargaining unit work ‘‘for
economic reasons,’’ a term the Respondent never defined, so
the protection afforded unit personnel by the Company’s re-
vised proposal, over and above the Company’s first and pre-
dictably unacceptable offer, was illusory at best.
The Company also proposed that it be allowed to strike
two entire arbitration panels before being confronted with a
panel from which it would be required to select an arbitrator.
This unusual proposal was denounced by Cremen as time-
wasting; its effect on delaying the processing of cases in ar-
bitration is obvious. The Respondent never gave the Union
or the Board the slightest justification or explanation for such
a strange proposal. Its failure to do so is additional evidence
of an intention to waste time on proposals which would pre-
dictably be unacceptable. See NLRB v. A-1 King-Sized Sand-
wiches, 732 F.2d 872, 876 (11th Cir. 1984). The manage-
ment functions clause discussed above gave the Company the
unlimited right to discharge employees, as well as to take a
host of other enumerated personnel actions. The Company’s
arbitration clause should be read in tandem with management
rights secured elsewhere in the proposed agreement. Arbitra-
tors would be permitted to adjudicate discharge cases, but
under the company-proposal, they would not be allowed to
order reinstatement or backpay, two conventional remedies in
any arbitration case. If employees did not like an award, they
could strike, but the strike would be deemed an economic
strike in which they would be risking their jobs to obtain a
remedy which the contract precluded the arbitrator from
granting. In light of the sweeping provision outlined above
giving management the unlimited right to discharge, it is dif-
ficult to know what kind of a discharge case could arise in
which an arbitrator could make a finding against the Com-
pany, since management would not have to prove ‘‘just
cause’’ for its action, a requirement normally found in col-
lective-bargaining agreements. About the only occasion in
which an arbitrator, acting under a contract envisioned by the
Respondent, could make a finding against the Company in
a discharge case would be for a discharge which infringed
upon some statutory employment right, such as an unfair
labor practice discharge or a firing which violated a civil
rights law. Hence, the proposal that strikes to enforce arbitra-
tion awards be deemed economic strikes is in essence a pro-
posal that employees relinquish their rights under Section 7
of the Act. Just such a proposal was deemed evidence of sur-
face bargaining in NLRB v A-1 King-Sized Sandwiches,
supra.
The Respondent’s proposal that an employee should forfeit
what might, in some cases, be many years of seniority be-
cause of a single failure to call in sick was certainly harsh,
vindictive, and unreasonable, to use the terminology often
applied to predictably unacceptable proposals. Its proposals
relating to the policing of the contract by the Union was little
better. The Respondent would have limited the Union to one
steward to serve approximately 125 employees. He could in-
vestigate and process complaints only on breaktimes or off-
duty times and, as Cremen pointed out, since the Respondent
would not agree to any stated contractual break periods, a
steward might not have any time available to him to perform
his contractual responsibilities. Originally the Respondent
proposed that outside union representatives be allowed on
Company premises only with management’s permission.
Under such circumstances they could be absolutely precluded
from coming to the assistance of an overworked steward as
he tried to perform his duties. Even when the Respondent
agreed that Union agents would not unreasonably be denied
access to the plant, it still adhered to another facet of its
grievance proposal which would permit Union agents to be
excluded from any participation in the first two steps in-
volved in the processing of a grievance. Here again, the Re-
spondent was proposing that the Union agree to abandon its
duty of ‘‘representing the people,’’ this time in the area of
contract administration.
The certification which the Respondent was obligated to
honor drew no distinction between temporary employees and
permanent ones, nor did it draw any distinction between full-
time and part-time employees. All were part of the bar-
gaining unit and all were entitled to be covered by the terms
and conditions of any contract negotiated by the parties. The
Respondent proposed that temporary employees be excluded
from the coverage of the agreement and that the Company
be given the unilateral right to establish their wages. Of real
consequence to permanent members of the unit was the fact
that the Respondent did not define ‘‘temporary’’ and would
not agree to any limitation on the number of temporaries
who might be hired at any one time. Theoretically, part-tim-
ers might be hired to perform all bargaining unit work. Re-
spondent promised the Union to come up with a definition
of ‘‘temporary,’’ but, as in so many other matters, it never
got around to it. These proposals, taken together with what
1004 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
12 In its December 15 letter to employees, the Respondent included at least
one falsehood and one half-truth. In this letter, it stated that it had proposed
to the Union that merit increases be included in the contract. O’Rourke took
great pains at the hearing to state that he was proposing a gentlemen’s agree-
ment on merit increases, namely the granting of these raises in such a manner
that they would not have to be included in a contract but could be repudiated
down the line in further bargaining. The letter also failed to tell the Union’s
constituents that the Company proposed repeatedly that merit increases be
granted only in exchange for an agreement on the part of the Union that it
would ask for no other wage increases for a year.
was omitted from them, seriously threatened to erode the
bargaining unit.
In some instances, the Respondent proposed that the Union
enter into a contract providing employees with less than they
were currently enjoying without a contract and without a
union to represent them. The Respondent proposed that an
employee be precluded from objecting to an error in his pay-
check if he failed to complain about the error within 2
weeks. The current statute of limitations for unpaid wages is
3 years. The employer was then paying its employees time
and one-half for any work in excess of 8 hours in any 1 day.
It proposed to pay overtime only for work performed in ex-
cess of 40 hours in any 1 week, as required by Federal law.
Employees were currently enjoying specified morning and
afternoon breaks, as well as a specified lunchbreak. Respond-
ent proposed that the Union enter into a contract providing
that breaks would only take place when and if the foreman
decided to call them. The limitation proposed by the Com-
pany on the right of employees to strike in support of a
grievance was less than they would have enjoyed without a
contract, since, in the absence of a binding no-strike commit-
ment, employees have the right to strike at any time in sup-
port of any grievance or bargaining demand. Prentice-Hall,
Inc., 290 NLRB 646 (1988). When Cremen protested that the
Company, in some instances, was offering less than current
benefits, O’Rourke’s only response was that ‘‘bargaining
starts from scratch.’’ It is evident from these and other as-
pects of the Respondent’s behavior over a period of several
months that it intended to see that bargaining never got much
beyond ‘‘scratch.’’
The parties were strongly at odds over the question of
union security. Cremen proposed a conventional 30-day
union-security clause, told the Company that this provision
was important to him, and stated that he rarely signed a con-
tract without one. O’Rourke was adamant that a contract
should contain no such provision. When Cremen asked
O’Rourke why the Company was willing to agree to a union-
security clause in its New Jersey contract but was holding
out against one at Dundalk, O’Rourke simply pointed to the
size of the vote at the 1983 representation election, which the
Union had won by a margin of 59 to 56. Again and again
O’Rourke brought up the question of union security at nego-
tiations as if to goad the Union, once even proposing to
agree to guaranteed breaks which the employees were cur-
rently enjoying if the Union would just forget about a union
shop provision. O’Rourke explained in the record the reason
for his stance: ‘‘I think it involved the fact that we wanted—
we wanted to be sure that the union understood that there
were 56 employees that had voted that they didn’t want to
have union representation and that we felt that we—we three
guys on the company’s side of the table—were representing
those employees.’’ Cremen asked O’Rourke how could he
tell after 4 years which of the 56 ‘‘no’’ voters were still in
the plant, but O’Rourke gave no meaningful response.
The Respondent’s asserted reason in justification of its op-
position to a union shop is diametrically opposed to a funda-
mental concept embodied in the Act. On receiving a certifi-
cation, a union is both obligated and entitled to represent
every employee in the bargaining unit, irrespective of how
that employee may have voted in a representation election.
An employer is not entitled at negotiations to represent any
employee in the bargaining unit; its sole duty is to its share-
holders. When, as here, an employer attempts to interpose
itself between a bargaining agent and the constituency that
the union is entitled to represent, its effort is not only patron-
izing and pretentious but contrary to a basic intendment of
Federal law. By the statement quoted above, as well as by
many other similar statements in this record, the Respondent
asserted that it was refusing to agree to a union shop pro-
posal advanced by the bargaining agent because it wanted to
stand between the Union and the members of its bargaining
unit, thereby acting as the protector of these employees
against the organization which was legally entitled to assume
that mantle. This posture is the essence of bad faith, and
what sprang from that posture is quintessential bad-faith bar-
gaining. However, it never made any proposal of its own, ei-
ther as to wages or as to health, welfare, and pension bene-
fits. O’Rourke testified that, at a strategy session on Decem-
ber 22, company officials were thinking about formulating a
wage proposal but none was ever formulated and none was
ever presented. Respondent’s only excuse was that it never
got a chance to do so. The excuse is so patently silly that
it requires no further discussion. All that this testimony re-
veals is the fact that the Respondent was beginning to realize
that it was becoming late in the day to claim that it was bar-
gaining in good faith while not making any economic offers.
It is apparent from this record that the Respondent has
never come to grips with the fact that an election was held
in its Dundalk plant and it lost. Its whole attitude, throughout
the fall of 1987 and beyond, has been that negotiations were
simply a continuation of the campaign it had been waging
for 4 years to keep the Union out of the plant entirely. It
riled union negotiators by going behind their backs and dis-
tributing copies of Company and union proposals to every
employee at the plant. Its stated reason for doing so was to
let employees know that the Union was doing just what the
Company had always said it would do if the Union won,
namely insist on union shop and checkoff. After negotiations
were essentially broken off on December 9, the Respondent
communicated directly with employees to let them know that
they were going to get merit increases after all because the
Company had insisted that this had to be done, notwithstand-
ing bargaining ploys on the part of union negotiators who
would consent to these raises only if they were tied to agree-
ments on union shop and further raises in 6 months.12 The
obvious intendment and effect of this direct communication
with bargaining unit members was to disparage the Union
and make the claim that it was the Company, not the Union,
who was looking out for them in negotiations. Although an
employer may direct communications to unit employees dur-
ing negotiations under certain circumstances, an effort ‘‘to
portray the employer rather than the union as the workers’
true protector remove(s) such speech from the penumbra of
protection and may constitute an unfair labor practice.’’
NLRB v. United Technologies Corp., 789 F.2d 121, 134 (2d
1005HYDROTHERM, INC.
Cir. 1986). While the General Counsel does not allege that
this letter was per se an unfair labor practice, it is certainly
convincing evidence of overall subjective bad faith on the
part of the Respondent.
Although the Respondent attempts to excuse its behavior
on the basis that the parties did in fact reach agreement on
a number of items before negotiations went sour, its claim
is illusory. With minor exception, Cremen was correct in
saying that there was no agreement on any matter which did
not reflect either the Company’s existing practice or a re-
quirement of Federal law. The sole exception to this claim
among the items of agreement listed by the Respondent in
its brief is an agreement to pay an increased amount of call-
in pay on holidays. The impact of this concession can be
judged by O’Rourke’s testimony that the Company never
called in any employees to work on a holiday, and an ex-
traordinary emergency would have to exist before it ever
would do so.
The Company broke off negotiations on December 9 with
a warning from O’Rourke to Cremen that the Union had bet-
ter get ready for a strike. Much has been made of the fact
that O’Rourke left it to Cremen to call for another bargaining
session and Cremen never called. However, O’Rourke’s stat-
ed willingness to resume negotiations was at best conditional.
He told Cremen in no uncertain terms before walking out
that, so long as the Union was asking for both a general in-
crease and merit increases and was insisting on a union shop,
the Company had nothing more to say to them. This was its
bargaining stance before making any major economic pro-
posals.
A revealing glimpse into the core of the Respondent’s ille-
gal negotiating ‘‘strategy’’ can be obtained in the matter of
the ‘‘gentlemen’s agreement’’ which O’Rourke proposed rel-
ative to merit increases. O’Rourke testified that, in late Octo-
ber, the Respondent was under real pressure from its employ-
ees to grant some kind of a pay raise. In the Respondent’s
mind this pressure came from bargaining unit voters of all
persuasions. It feared that, if it did not produce as expected
and as it had in previous years, it faced the real possibility
of a strike at a critical season in its production year. More-
over, new employees, who might serve as strike replace-
ments, were not readily available at the wages the Respond-
ent was then paying. To get over this practical and imme-
diate hurdle without giving anything away at the bargaining
table, it proposed to the Union that it be empowered to make
annual evaluations and give merit increases based on those
evaluations, separate and apart from the negotiations which
were then in progress. By gentlemen’s agreement O’Rourke
meant that any merit raises which might result from Novem-
ber evaluations would not have to be reflected in the provi-
sions of any final contract, and that either party might be
free to disavow and repudiate them in the course of any bar-
gaining which might follow. The obligation imposed by the
Act on negotiators is to bargain in good faith and, on agree-
ment, to embody the results of those agreements in a signed
written document. What the Respondent was proposing was
an interim agreement which would permit it to get past a
sticky situation in the plant but avoid placing the results of
that agreement into a final contract. In so doing, it was also
violating a fundamental tenet of good-faith bargaining, name-
ly to make the results of agreements part of a written docu-
ment on which all parties sign off. When O’Rourke’s pro-
posal was made to Cremen, his reply was ‘‘this isn’t bar-
gaining,’’ and indeed it was not.
The many indicia of bad faith exhibited by the Respondent
involved not only what it proposed but what it failed to pro-
pose. Over a period of 3 months, in seven bargaining ses-
sions, the Respondent spent a great deal of time and required
all parties to endure the lengthy consideration of a large
number of far-out proposals, discussed above, although it
failed to propose anything at all concerning the heart of col-
lective bargaining, namely, economics. The Respondent had
received from the Union two detailed wage proposals, both
broken down by job classification, and it had also received
a general across-the-board proposal for an increase of 7 per-
cent. All these it rejected out of hand. No participant in col-
lective bargaining, on either side of the table, ever expects
that a contract can be concluded without agreement on wages
and health insurance. O’Rourke implicitly recognized this re-
ality, but his excuse for failing to come forward with any
wage offer at all was that he did not have the time to do
so before negotiations broke off. His excuse borders on the
absurd. O’Rourke never explained why it took so long to for-
mulate a wage offer; the Union was able to do so before ne-
gotiations ever began and with much less data at its disposal
than the Company possessed. O’Rourke was able to find
time during these 3 months for proposals which were predict-
ably unacceptable, but he asserted, with a straight face, that,
during that same period, he never had the time even to for-
mulate, much less present, a serious wage offer. It is clear
that the Company never formulated a wage offer because it
never intended to come to an agreement with the Union on
wages and was intent on continuing its existing practice of
establishing wages on a unilateral and individual basis
through its annual merit increase system. This is exactly
what the Company did in 1987 and again in 1988. It never
deviated from that practice at any time and never proposed
to do so.
One final consideration portrays the Respondent’s con-
tempt for the collective-bargaining process and a fixed inten-
tion to avoid participating in it in any meaningful way. At
the end of the second session the Respondent proposed that
discharge grievances—the only imaginable kind of grievance
which could possibly arise in light of its sweeping of its
management functions proposal—be settled ultimately by a
strike in which strikers could forfeit their jobs. At the final
session, O’Rourke stated to Cremen, as he was getting ready
to walk out, that the Union should get ready for a strike.
Challenging employees to strike rather than attempting to re-
solve differences by collective bargaining or by arbitration—
a form of collective bargaining—is an indicia of bad faith
and a revealing insight into the Respondent’s actual strategy.
O’Rourke testified that he felt that problems which had given
rise to the Union victory in the 1983 election had been
solved. He also disclosed management’s assessment that the
Union’s negotiating posture was weak. This testimony could
have no other meaning than to announce a belief on the part
of the Company that it could win a strike, that it could re-
place any Union dissidents still in the shop, and could then
continue to operate its business in the same union-free at-
mosphere it enjoyed before a representation election was
1006 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
13 O’Rourke testified:
[A]t about the fourth meeting, when we came away from that, we decided
that we were going to take a very hard approach to bargaining and we
were going to, in effect, make the union work for everything they had.
I construe these remarks as really meaning that they were going to make
the Union strike for everything they wanted.
14 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules
and Regulations, the findings, conclusions, and recommended Order shall, as
provided in Sec. 102.48 of the Rules, be adopted by the Board and all objec-
tions to them shall be deemed waived for all purposes.
15 If this Order is enforced by a judgment of a United States court of ap-
peals, 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.’’
held in 1983.13 The pursuit of a course of action designed
to turn the clock back to a time when the Company was
under no obligation to bargain with the Union at all discloses
what the Company was really up to when it met with the
Union on seven occasions during the fall of 1987. In light
of this and of all the other facets of the Respondent’s behav-
ior during a time when it was supposed to be working out
a contract with the Union, I conclude that it was engaged in
surface bargaining and violated Section 8(a)(1) and (5) of the
Act.
CONCLUSIONS OF LAW
1. The Respondent Hydrotherm, Inc. is now, and at all
times material has been, an employer engaged in commerce
within the meaning of Section 2(2), (6), and (7) of the Act.
2. Petroleum, Construction, Tankline Drivers, Yeast, Soft
Drink Workers and Driver-Salesmen, Amusement and Vend-
ing Servicemen and Allied Workers, Local Union No. 311 of
Baltimore and Vicinity, affiliated with International Brother-
hood of Teamsters, Chauffeurs, Warehousemen and Helpers
of America, AFL–CIO is a labor organization within the
meaning of Section 2(5) of the Act.
3. All production and maintenance employees employed at
Respondent’s Dundalk, Maryland, facility, including
maintenance/utility employees, assemblers, machine opera-
tors, testers, inspectors, brazers, painters, welders, machinists,
set-up operators, material handlers, store keepers, shipping
and receiving clerks, tool and die makers, but excluding
managerial employees, lead supervisors, office clericals,
schedulers, expediters, production control clerks, quality as-
surance technicians, purchasing agents, industrial and manu-
facturing engineers, professional employees, confidential em-
ployees, guards and supervisors as defined in the Act con-
stitute a unit appropriate for collective bargaining within the
meaning of Section 9(b) of the Act.
4. At all times material, the Union, by virtue of Section
9(a) of the Act, has been and is the exclusive collective-bar-
gaining representative of all the employees in the unit found
appropriate in Conclusion of Law 3 for the purpose of col-
lective bargaining within the meaning of Section 9(a) of the
Act.
5. By refusing to bargain collectively in good faith with
the Union, the Respondent has violated Section 8(a)(5) of the
Act.
6. The aforesaid unfair labor practice violates Section
8(a)(1) of the Act and has a close, intimate, and adverse ef-
fect on the free flow of commerce within the meaning of
Section 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has committed various
unfair labor practices, I recommend that it be required to
cease and desist therefrom and to take other affirmative ac-
tions designed to effectuate the purposes and policies of the
Act. I recommend that the Respondent be required to bargain
collectively in good faith with the Union and, if an agree-
ment is reached, to embody the terms of that agreement in
a signed written instrument. Because the Respondent has
never honored the certification which the Board issued to the
Union on June 11, 1984, I recommend that the certification
year be extended to run for a period of 1 year commencing
from the date that it begins to bargain in good faith. Mar-
Jac Poultry Co., 136 NLRB 785 (1962). I recommend that
the Respondent be required to post the usual notice advising
its employees of their rights and of the results in this case,
and I further recommend that any further violations of Sec-
tion 8(a)(1) and (5) of the Act on the part of this Respondent
be prosecuted as contempt of a decree of the United States
Court of Appeals for the Fourth Circuit, a decree which this
Respondent has yet to comply with.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended14
ORDER
The Respondent, Hydrotherm, Inc., Dundalk, Maryland, its
officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Refusing to bargain collectively in good faith with the
Union as the exclusive collective-bargaining representative of
the production and maintenance employees at its Dundalk,
Maryland plant.
(b) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of the rights guar-
anteed to them by Section 7 of the Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) On request, bargain in good faith with the Union as
the exclusive collective-bargaining representative of all of the
employees employed in the aforesaid collective-bargaining
unit with respect to rates of pay, wages, hours, and other
terms and conditions of employment and, if an understanding
is reached, embody the same in a signed written agreement.
(b) Post at its Dundalk, Maryland plant copies of the at-
tached notice marked ‘‘Appendix.’’15 Copies of the notice,
on forms provided by the Regional Director for Region 5,
after being signed by the Respondent’s authorized representa-
tive, shall be posted by the Respondent immediately upon re-
ceipt and maintained for 60 consecutive days in conspicuous
places including all places where notices to employees are
customarily posted. Reasonable steps shall be taken by the
Respondent to ensure that the notices are not altered, de-
faced, or covered by any other material.
(c) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondent has
taken to comply.
IT IS FURTHER ORDERED that the certification of the Union
issued by the Board on June 11, 1984, be, and the same is,
extended for a period of 1 year commencing from the date
on which the Respondent begins to comply with the terms
of this Order.
1007HYDROTHERM, INC.
APPENDIX
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.
WE WILL NOT refuse to bargain collectively in good faith
with Petroleum, Construction, Tankline Drivers, Yeast, Soft
Drink Workers and Driver-Salesmen, Amusement and Vend-
ing Servicemen and Allied Workers, Local Union No. 311 of
Baltimore and Vicinity, affiliated with International Brother-
hood of Teamsters, Chauffeurs, Warehousemen and Helpers
of America, AFL–CIO as the exclusive collective-bargaining
representative of the production and maintenance employees
employed at our Dundalk, Maryland plant.
WE WILL NOT in any like or related manner interfere with,
restrain, or coerce you in the exercise of the rights guaran-
teed you by Section 7 of the Act.
WE WILL bargain collectively and in good faith with the
Union as the exclusive bargaining representative of our Dun-
dalk, Maryland production and maintenance employees and,
if an understanding is reached, WE WILL embody that under-
standing in a signed, written agreement.
HYDROTHERM, INC.