National Supply Co.

National Labor Relations Board - Board Decisions

Oct 23, 1939

16 N.L.R.B. 304 (N.L.R.B. 1939)

In the Matter of NATIONAL SUPPLY COMPANY and STEEL WORKERS
ORGANIZING COMMITTEE
Case No. C-862-Decided October W,1939
Oil Production Machinery Industry-Company -Dominated Union: charges of,
dismissed ; neutral position on part of company toward rival inside and out-
side unions ; both unions given equal opportunity and facility to organize on
company time and property ; notices posted by company during organization
advising employees of Company's neutrality and of the employees ' freedom
to exercise rights under the Act-Discrimination : charges of , dismissed as to
three employees-Procedure: function of charge : not essential to describe
alleged unfair labor practices with the same particularity as the complaint ;
Board reviews evidence bearing upon the discharges of two employees and
sustains findings of Trial Examiner who recommended complaint be dismissed
as to them , although no exceptions were filed thereto-Employer: responsibility
of corporate successor for unfair labor practices committed by predecessor
where successor corporation was subject to substantially the same stock owner-
ship and control as predecessor and continued the business of the predecessor-
Complaint : dismissed.
Mr. Charles Brooks, for the Board.
Latham, Watkins, & Bouchard, by Mr. Paul R. Watkins, of Los
Angeles, Calif., and Mr. Robert W. Eiler, of Pittsburgh, Pa., for the
respondent.
Mr. Ken Hunter, of Los Angeles, Calif., for the S. W. O. C.
Mr. Roman Beck, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon charges and amended charges duly filed by Steel Workers
Organizing Committee, herein called the S. W. O. C.,1 the National
Labor Relations Board, herein called the Board, by the Regional
Director for the Twenty-first Region (Los Angeles, California), is-
1 The record shows that the S. W. O. C. acts as an organizing agency on behalf of Amal-
gamated Association of Iron, Steel and Tin Workers of North America.
16 N. L. It. B., No. 35
304
NATIONAL SUPPLY COMPANY 305
sued its complaint dated March 17, 1938, against The National Supply
Company,2 Torrance, California, herein called the respondent, alleg-
ing that.the respondent had engaged in and was engaging in unfair
labor practices affecting commerce, within the meaning of Section 8
(1), (2), and (3) and Section 2 (6) and (7) of the National Labor
Relations Act, herein called the Act. Copies of the complaint and of
the accompanying notice of hearing were duly served upon the re-
spondent, upon the S. W. O. C., and upon Employees Association of
Workers of The National Supply Company, herein called the Associ-
ation. At the hearing, the complaint was amended on motion of the
Board in certain respects.
The complaint, as amended, alleged in substance that the respond-
ent : (1) discharged three named persons employed at its Torrance
plant for the reason that they joined Amalgamated Association of
Iron, Steel and Tin Workers of North America, herein called the
Amalgamated, through the S. W. O. C., and assisted said labor organ-
izations, thereby discriminating in regard to the hire and tenure of
said employees and discouraging membership in the Amalgamated; s
(2) urged and persuaded its employees during January, March,
April, May, July, August, and September 1937, and at other times,
to refrain from joining the S. W. O. C., and threatened its employees
with discharge if they became or remained members thereof; (3)
organized and assisted in organizing the Association, subsequent to
January 1, 1937, and since then has controlled the Association and its
activities, given it advice, permitted its organizational activities on
company time and property, assisted it in the collection of dues, and
permitted it the use of company facilities denied to other labor organ-
izations, thereby dominating and interfering with the formation and
administration of and contributing financial and other support to the
Association; and (4) by the foregoing acts interfered with, restrained,
and coerced its employees in the exercise of the rights guaranteed in
Section 7 of the Act.
On April 6, 1938, the respondent filed a motion with the Regional
Director to dismiss the complaint for failure of the charges to set
forth with sufficient particularity the alleged unfair labor practices
upon which the complaint was based. The Regional Director denied
this motion, and we hereby affirm his ruling.
On April 11, 1938, the respondent filed its answer to the complaint,
admitting the interstate character of its business, but denying that it
2 The respondent is a Pennsylvania corporation and is the successor to a Delaware cor-
poration of similar name. The relationship of the respondent and its predecessor is
described in Sections I and III A of this Decision.
8 The names of these employees are Joseph Cox, Norman Tatro , and Joseph Vaughn.
306 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
had engaged in any of the unfair labor practices therein alleged.
The answer averred "that at all times respondent and its officers and
agents have intentionally remained wholly neutral with. respect to all
Labor Organizations; that it has at all times specifically and carefully
avoided any action or deed on its part and that of its officers and
agents which could be indicated as warning its employees from be-
coming members of any Union or fostering or assisting its employees
in organizing any Labor Organization or belonging to any particular
Labor Organization."
Pursuant to notice a hearing was held at Los Angeles, California,.
on April 14, 15, 18, 19, 20, 21, 22, 25, and 26, 1938, before Alvin J.
Rockwell, the Trial Examiner duly designated by the Board. The
Board and the respondent were represented by counsel and partici-
pated in the hearing; the S. W. O. C. was also represented during the
greater part of the hearing by its representative. Full opportunity
to be heard, to examine and cross-examine witnesses, and to introduce
evidence bearing on the issues was afforded the parties. Various mo-
tions and objections to the admission of evidence were made during
the hearing and ruled upon by the Trial Examiner. The Board has.
reviewed these rulings and finds that no prejudicial errors were com-
mitted. The rulings are hereby affirmed.
Thereafter, the Trial Examiner filed his Intermediate Report, dated
August 10, 1938, copies of which were duly served upon the respond-
ent and upon the S. W. O. C., in which he found that the respondent
had engaged in unfair labor practices affecting commerce within the
meaning of Section 8 (1) and (2) and Section 2 (6) and (7) of the
Act, but that it had not engaged in -unfair labor practices within the
meaning of Section 8 (3) of the Act. The Trial Examiner recom-
mended that the respondent cease and desist from the unfair labor
practices which he found and that it take certain action to remedy
the situation brought about by these unfair labor practices.
On September 6, 1938, the respondent filed its exceptions to the
Intermediate Report, and on September 3, 1938, the S. W. O. C. and
the Amalgamated did likewise. In their exceptions, the S. W. O. C..
and the Amalgamated objected solely to the Trial Examiner's finding
that the respondent had not discriminatorily discharged Vaughn. Al-
though no exceptions were filed respecting the Trial Examiner's find-
ings in regard to Cox and Tatro, we, nevertheless, have reviewed the
evidence bearing upon their discharges and concur in his findings:
concerning them.'
Pursuant to notice a hearing was had for the purpose of oral argu-
ment before the Board in Washington, D. C., on June 16, 1939. The
respondent appeared by counsel, presented its argument, and sub-
Cf. Matter of Godchaux Sugars, Inc. and Sugar Mill Workers' Union, Locals No. 21-
177, and No. 2188 affiliated with the American Federation of Labor, 12 N. L. R. B. 568.
NATIONAL SUPPLY COMPANY 307
mitted a brief in support of its position. The Amalgamated did not
appear. .
The Board has considered the exceptions to the Intermediate Report
filed by the respondent and, in so far as they are consistent with the
findings, conclusion, and order set forth below, finds them to be meri-
torious. The exceptions of the S. W. 0. C. and the Amalgamated are
not sustained.
Upon the entire record in the case, the Board makes the following:
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
The National Supply Company, the respondent, is a Pennsylvania
corporation engaged in the manufacture and sale of heavy machinery
used in the oil-production industry. It owns and operates a large
manufacturing plant at Torrance, California, and operates approxi-
mately 80 selling agencies or stores distributed throughout 18 States of
the United States. The respondent, together with eight subsidiary
corporations, is among the four largest enterprises of its kind in the
United States. This proceeding is concerned only with employees of
the Torrance plant.
During 1937 the respondent purchased for use in production ap-
proximately 6,000 tons of steel and steel scrap and approximately 50
tons of brass and copper. Between 20 and 25 per cent of these raw
.materials were purchased outside of California. During that period
the respondent manufactured at the Torrance plant approximately
7,000 tons of oil-drilling and production machinery, of which approxi-
mately 70 per cent was transported from the plant to domestic oil
fields outside of California and to oil fields in foreign countries. The
respondent orally agreed at the hearing for the purposes of this pro-
ceeding that the Board has jurisdiction of the subject matter.
At the time of the occurrence of the unfair labor practices alleged
in the complaint, as amended, the respondent was not in existence,
and the Torrance plant was owned and operated by The National
Supply Company, a Delaware corporation. Subsequently, as a re-
sult of a statutory consolidation, the Delaware corporation ceased
to exist and the respondent acquired all of its assets, including the
Torrance plant.5 The respondent is subject to the same stock owner-
5 At the oral argument before the Board, counsel for the respondent described the con-
solidation as follows :
"This was a statutory consolidation . There were two companies , the National Supply
Company of Delaware, which owned the Torrance plant , and some of the other plants,
and Chalfont Company, and those two companies consolidated to form one company, the
National Supply Company , which is a Pennsylvania corporation , and that company
assumed all of the assets and liabilities of the constituent corporations , and there was
no change whatsoever in management."
308 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ship and control as was the Delaware company, and has continued
the business enterprise of the Delaware company. Since.the con-
solidation there has been no substantial change in the interstate
character of the business done at the plaint.
H. THE ORGANIZATIONS • INVOLVED
Amalgamated Association of Iron, Steel and Tin Workers of North
America and Steel Workers Organizing Committee are labor organi-
zations affiliated with the Committee for Industrial Organization.r,
The Amalgamated admits to its membership employees of the
respondent.
Employees Association of Workers of The National Supply Com-
pany is an unaffiliated labor organization admitting to its member-
ship employees of the respondent.7
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. The responsibility of the respondent for acts of the predecessor
Delaware corporation
As above stated, the respondent was not in existence when the alleged
unfair labor practices at the Torrance plant occurred. At that time
the plant was owned and operated by the Delaware company of
similar name . We already have found that the respondent is subject
to substantially the same stock ownership and control as . was the
Delaware company and,that the respondent has continued the busi-
ness of the Delaware company. Under these circumstances, we find
that any of the alleged unfair labor practices in which the Delaware
corporation may have engaged with respect to employees of the
Torrance plant are unfair labor practices for which the respondent
is responsible s At the oral argument counsel for the respondent
stated,in reply to a question asked him by the Board as to whether
the respondent was responsible for any unfair labor practices engaged
in by the Delaware company : "Oh, yes, I don't think there is any
question about it."
Now the Congress of Industrial Organizations.
' The Association was originally formed as an unincorporated association . In August
1937 it was chartered by the State of California as a non -profit corporation . Its certifi-
cate of incorporation contains the following provision : "all members of the hitherto
unincorporated association which this Corporation supplants , as set forth hereinabove,
shall automatically become members of this Corporation."
s See National Labor Relations Board v. Arthur J. Colten and Abe J. Colman , co-part-
ners doing business as Kiddie Kover Manufacturing Company, 105 F. (2d) 179 (C. C. A.
Gib). Cf. Federal Trade Commission v. Standard Education Society, et al., 302 U . S. 112.
NATIONAL SUPPLY COMPANI 309
B. The alleged domination , interference , and support concerning the
Plan and the Association
During February 1937 employees at the Torrance plant prepared
and circulated among themselves for signature certain petitions ad-
dressed to the respondent requesting an increase in wages. At that
time no labor organization existed at the plant. More than 300 of the
700 employees signed the petitions. The movement was entirely spon-
taneous and manifested the desire of these workers for some means of
collective action to advance their employee interests . In consequence,
under the leadership of those employees who had been most active in
the matter of the petitions , a simple plan of employee representation,
herein called the Plan, was set up by the employees . Employees in
each of the plant departments selected two "representatives ," who in
turn chose from their number an "executive committee" empowered to
represent the employees in collective bargaining with the respondent,
in the adjustment of employee grievances with it, and in other matters
of employee concern. About March 1, 1937, the representatives
adopted formal bylaws for the organization, and about the same time
the plan executive committee successfully negotiated a wage increase
for the hourly rated employees . Thereafter and continuing through
April and May the Plan solicited members among the plant employees.
Conferences were regularly held by the executive committee with the
respondent at which employee grievances and other matters were con-
sidered.
Previously , in the latter part of March 1937 , the Amalgamated be-
gan a membership campaign among the respondent 's workers. Dur-
ing the following months it enrolled a substantial number of these em-
ployees. On June . 12 the Amalgamated requested the respondent to
recognize it as the representative of these persons for the presentation
of grievances . The respondent acceded to this request. This was the
first meeting of the Amalgamated with the respondent.
Theretofore , on March 17, 1937, the respondent posted on its plant
bulletin boards the following notice addressed to its employees :
Under present circumstances we believe that our position must
.be strictly neutral, and that the decision as to what group, if any,
to join must be made by each individual employee , or group of
employees, with the understanding that the company is willing
to meet with such representative committees as any of our em-
ployees may choose to have represent them.
310 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
In April 1937, after the Supreme Court sustained the constitu-
tionality of the Act," the respondent again posted notices, setting
forth :
You may remain in, join or refuse to join, any organization you
desire, which rights of yours will be fully respected and pro-
tected by the Company to the best of its ability.
In June 1937 two members of the executive committee, of the Plan
resigned. The third member, one Lloyd Babcock, and several other
employees thereupon decided that the Plan should be abandoned and
that in its place a strong unaffiliated union should be organized.
These individuals were opposed to representation by the Amalga-
mated which then had embarked upon a vigorous membership drive.
No formal steps were taken to dissolve the Plan. Instead, Babcock
and his associates proceeded to form their union. An organizational
meeting for the respondent's employees was held on July 2, 1931: in a
local American Legion hall. The Association thus had its genesis.
Thereafter, an organizational committee, assisted by counsel, pre-
pared bylaws for the Association, and these were adopted at subse-
quent general membership meeting of the organization. All expenses
incurred in the formation of the Association were borne by Babcock
and his associates.
The bylaws of the Association provide for a form of labor organ-
ization in certain respects similar to the Plan : General authority over
the affairs of the Association is vested in a "Board of Directors" com-
posed of employee representatives elected annually by members of the
Association from each of the plant departments. Membership is re-,
stricted to the respondent's employees. There are, however, two im-
portant differences between the organization of the Plan and that of
the Association. The bylaws of the Association provide for monthly
meetings of the general membership and for dues. Thus, administra-
tion of the Association is subject to direct control by popular vote of
the members, and financial resources are supplied by the member-
shi p. io
Following the organizational meeting of July 2, Babcock and the
other persons interested in the Association conducted an aggressive
membership campaign. Members of the old Plan who wished to join
were required to sign membership cards of the Association. A board
of directors was elected by the Association, and the board in turn
elected the officers. Babcock was chosen president.
On July 9, 1937, to set at rest rumors at the plant that the respond-
ent had accorded, exclusive recognition to the Association, the re-
'National Labor Relations Board v. Jones eC Laughlin Steel Corporation, 301 U. S. 1,
and companion cases.
10 Cf. Matter of Servel, Inc., and United Electrical Radio and Machine Workers of
America, Local No. 1002, 11 N. L . R. B. 1295, 1313, 1314.
NATIONAL SUPPLY COMPANY: 311
spondent posted notices further proclaiming its neutrality and
stating :
The'. management has met with committees selected by two
organized groups within the plant, which committees have been
recognized by the management as representing only the members
of their own group.
As previously ... the position of the company with respect to
its employees either as groups or individuals, will continue to be
strictly neutral.
In the early part of July the Amalgamated filed with the Board a
petition requesting the Board to investigate and certify the repre-
sentative selected by the respondent's employees for the purposes of
collective bargaining. On July 9 the Regional Director wrote to the
respondent informing it of that fact. On July 15 the respondent, the
Amalgamated, and the Association entered into an agreement for a
consent election to be held among the plant employees to determine
the employees' choice of a collective bargaining representative. The
agreement provided that the Regional Director should conduct the
election pursuant to the Act and the election procedure of the Board,
that both the Association and the Amalgamated should appear on the
ballot, that eligibility to vote should be limited to the employees paid
on an hourly basis in certain enumerated departments who, in sub-
stance, comprised the respondent's production and maintenance force,
and that the respondent should recognize as the exclusive bargaining
representative of such employees for a period of at least one year the
labor organization receiving a majority of the votes cast in the elec-
tion.11 Pursuant to the agreement an election was held on July 22,
1937. Of the 708 votes cast, the Association received 366. After the
votes were counted a certificate was signed by the respondent, the
Amalgamated, the Association, and the Board attesting to the fair
conduct of the election. Following the election the Association was
incorporated as a non-profit corporation under the laws of the State
of California, and thereafter the Association entered into a contract
with the respondent covering wages, hours of service, and other work-
ing conditions of the plant employees. The contract accorded express
recognition to the Association as the exclusive bargaining repre-
sentative of all the respondent's hourly paid workmen.
Upon the record before us we do not find that the respondent domi-
nated or interfered with the formation or administration of either the
Plan or the Association, or that it contributed support to either of these
11 At the time of the execution of the consent-election agreement, the Board had not
been apprised of the unfair labor practice charges involved in this proceeding. Cf. Matter
of Godchaux Sugars, Inc. and Sugar Mill T-Vorker.s' Union, Locals No. 21177, and No. 2188
affiliated with the American Federation of Labor . 12 N. L . R. B. 568.
247383-40-vol. 16-21
312• DECISIONS OF NATIONAL LABOR' RELATIONS BOARD
organizations. As stated above, the origin of the Plan was dissociated
from any action of the respondent, and there is no substantial evidence
that employees active in its affairs were identified with the manage-
ment.12 Certain witnesses for the Amalgamated testified that super-
visory employees at the plant made statements to employees favoring
an "inside" organization and opposing the Amalgamated. The making
of these statements was specifically denied by other witnesses. We are
not convinced that such statements were made. As we have found, the
respondent repeatedly took steps to declare its neutrality. The record
also shows that in consonance with this policy the respondent's foremen
were instructed to keep strictly aloof from the union rivalry. The
president of the Amalgamated in testifying regarding a conference had
with the respondent's vice president vaguely referred to reports that
had reached him of favoritism expressed by foremen toward the Asso-
ciation. He admitted, however, that the respondent's vice president,
when told of this alleged favoritism, invited the Amalgamated to
report any specific instance of such conduct by the foremen. There is
no evidence that the Amalgamated thereafter made such a report.
In Matter of Wisconsin Telephone Company and Telephone Oper-
ators Union, Local 175-A, International Brotherhood of Electrical
Workers, 12 N. L. R. B. 375, the Board considered whether the forma-
tion of an independent union in that case was in violation of the Act.
In concluding that the union was free of company domination, the
Board used language which is apposite to the formation of the Asso-
ciation.,
A substantial number of the respondent's employees proceeded
with the organization of the Independent at a mass meeting free
from the respondent's participation and without restriction in
the exercise of their freedom of choice. In addition, the respondent
refrained from interfering in the membership campaign of the
Independent and affirmatively proclaimed its neutrality.
The record shows that various employee adherents of the Plan, of
the Association, and of the Amalgamated were permitted by the
respondent to and did engage freely in organizational activities at
12 In making this finding we have not overlooked the role of Lloyd Babcock in the affairs
of the Plan and of the Association . Babcock is a draftsman and engineer . His desk is
in the office of the maintenance superintendent . He is among five employees receiving the
highest hourly wage rates paid by the respondent. Babcock significantly refused to sign
the petition for a wage increase . However, he early became very active in the affairs of
the Plan . He was a member of the executive committee and drafted the Plan bylaws.
Thereafter , as stated above, be was the leading spirit in the formation and affairs of the
Association . While Babcock is not a supervisory employee , his interests and problems as
an employee differ substantially from those of the ordinary production and maintenance)
workmen at the plant . All these circumstances tend to cast doubt upon the singleness
of Babcock 's devotion to the interests of the persons be has represented, and upon his
freedom from employer suggestion and control . However, we cannot say that these
circumstances, in the absence of other proof, show that Babcock's activities in connection
with the Plan and the Association were at the instance of the respondent.
NATIONAL SUPPLY COMPANY 313
the plant during working hours. We do not have before us the situ-
ation where a single labor organization is granted or permitted em-
ployer facilities,'3 nor does this case present a situation where an
employer unequally grants such facilities to several competing labor
organizations.'''
In Matter of Aeolian-American Corporation and Amalgamated
Piano Workers of America,', the respondent permitted rival labor
organizations to organize on its time and property, but the Board
held that under the circumstances there present the respondent did
not engage in unfair labor practices, within the meaning of Section
8 (2) of the Act.. The Decision in that case stated :
The fact that the respondent permitted solicitation of member-
ship by the Independent on company time would of course be
strong proof of domination and interference with that organi-
zation, if t:he Amalgamated had been denied similar privileges.
However, since members and adherents of the Amalgamated were
treated equally and afforded full opportunities in this regard,
we cannot say that sponsorship and support of the Independent
are shown, within the meaning of the Act.
In Matter of Godchaux Sugars, Inc. and Sugar Mill Workers'
Union, Locals 2.11%'7 and No. 2188, of liated with the American
Federation, of Labor," the applicable principle was stated thus :
We have held that a grant by an employer under certain cir-
cumstances of its time and property to a labor organization for
organizational purposes constituted a violation of the Act. The
question in all cases, however, is whether by such grant the em-
ployer has interfered with self-organization or collective bar-
gaining.
We find that the respondent has not dominated or interfered with
the formation or administration of the Plan or of the Association.
or contributed financial or other support to either of said organiza-
tions.
C. The allegedly discriminatory discharge of Vaughn
Joseph Vaughn was employed in the respondent's foundry at a
machine called the "sand mill."" On September 3, 1937, Vaughn
1..Matter of Servel, Inc. and United Electrical, Radio and. Machine Workers of America,
Local No. 1002 , 11 N. L . R. B. 1295, 1316.
14 Cf . Matter of Swift