San Juan Bautista Medical Center

National Labor Relations Board - Board Decisions

Feb 28, 2011

356 N.L.R.B. 736 (N.L.R.B. 2011)

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 736
San Juan Bautista, Inc., d/b/a San Juan Bautista
Medical Center and Hermandad De Empleados
De La Salud Y Otras Agencias. Case 24–CA–
11419
February 28, 2011
DECISION AND ORDER
BY CHAIRMAN LIEBMAN AND MEMBERS BECKER
AND PEARCE
On July 14, 2010, Administrative Law Judge William
N. Cates issued the attached decision. The Respondent
filed exceptions and a supporting brief, and the General
Counsel filed an answering brief, as well as a cross-
exception with a supporting brief.
The National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the decision and the record
in light of the exceptions and briefs and has decided to
affirm the judge’s rulings, findings, and conclusions as
modified below, to modify his remedy,1 and to adopt his
recommended Order as modified.2
The issues in this case are (1) whether the judge
properly concluded that deferring the instant case to arbi-
tration was inappropriate, and (2) whether the judge
properly concluded that the Respondent violated Section
8(a)(5) and (1) of the Act by modifying its collective-
bargaining agreement with the Union by failing to pay
the contractually guaranteed Christmas bonus without the
Union’s consent. As explained below, we agree with
both of the judge’s conclusions.
The Respondent operates a hospital in Caguas, Puerto
Rico. The Union was certified as the exclusive collec-
tive-bargaining representative for several bargaining
units within the hospital on December 17, 2008. Subse-
quently, the Respondent and the Union entered into a
collective-bargaining agreement covering the units effec-
tive from June 19, 2009–June 19, 2012.
Three provisions of the parties’ collective-bargaining
agreement are relevant to the instant dispute. Article 26
of the agreement provides:
Section 1- The Hospital recognizes the payment of a
Christmas Bonus to each union member of the appro-
priate units, according to the established dispositions of
1 In his cross-exception, the General Counsel requests that any mon-
etary award to employees be paid with compound interest. In accord-
ance with our decision in Kentucky River Medical Center, 356 NLRB 6
(2010), we modify the judge’s recommended remedy by requiring that
the monetary award shall be paid with interest compounded on a daily
basis.
2 We shall modify the judge’s recommended Order to provide for the
posting of the notice in accord with J. Picini Flooring, 356 NLRB 11
(2010).
Law 148, of June 30, 1969, as amended, during the first
year of the Collective Bargaining Agreement.
Section 2- The Union will present the Hospital with a
Christmas Bonus proposal to be negotiated for the se-
cond and third year of this Collective Bargaining
Agreement.
Article 49 provides for bargaining over proposed modifica-
tions to the agreement, and article 10 establishes a grievance
and arbitration procedure to resolve “all of the controver-
sies, disputes, differences, complaints and claims which
may emerge from the interpretation, application and admin-
istration” of the agreement.
Puerto Rico Law 1483 requires employers to pay a
Christmas bonus to employees who have worked at least
700 hours between October 1 of the previous year and
September 30 of the current year. Id. at Sec. 501. An
individual’s bonus is calculated based on his or her total
wage, and constitutes compensation in addition to wages
and benefits. Id. The bonus must be paid between De-
cember 1 and 15, unless the employer and employees
agree on another payment date. Id. at Sec. 502. Em-
ployers may obtain an exemption from paying the bonus
in any year in which the employer has not made a profit
or if the total bonus amount would exceed 15 percent of
the employer’s net profit. Id. at Sec. 501. To avail itself
of the exemption, the employer must submit certified
balance sheets to the Puerto Rico Secretary of Labor and
Human Resources (the Secretary), who is empowered to
administer the law. Id. at Sec. 507. By its express terms,
Law 148 does not apply “where the workers or employ-
ees receive an annual bonus by collective agreement,”
unless the contractual bonus would be lower than the
statute created bonus, in which case the employer must
pay the statutory amount. Id. at Sec. 506.
In November 2009, the Respondent requested a
Christmas bonus exemption from the Secretary. On De-
cember 4, the Puerto Rico Department of Labor and Hu-
man Resources (the Department) informed the Respond-
ent that it was determining whether the Respondent qual-
ified for an exemption; its letter also stated that any ex-
emption granted would apply only to employees not cov-
ered by the collective-bargaining agreement. On De-
cember 11, the Department informed the Union that it
had granted the Respondent an exemption, but stated that
it had specifically informed the Respondent that the ex-
emption would “only apply to those employees that are
not part of the bargaining unit” covered by the collective-
bargaining agreement. Nevertheless, the Respondent
3 Puerto Rico Law No. 148 of June 30, 1969, as amended, P.R. Laws
Ann. tit. 29, Sec. 501 et seq. (2007).
356 NLRB No. 102

SAN JUAN BAUTISTA MEDICAL CENTER 737
refused to pay the contractual bonus to its bargaining-
unit employees.4
I. DEFERRAL TO ARBITRATION
The judge found, and we agree, that deferring the in-
stant controversy to arbitration would be inappropriate.
The Board considers six factors in deciding whether to
defer a dispute to arbitration: (1) whether the dispute
“arose within the confines of a long and productive col-
lective-bargaining relationship;” (2) whether there is a
“claim of employer animosity to the employees’ exercise
of protected rights;” (3) whether the agreement provides
for arbitration “in a very broad range of disputes;” (4)
whether the arbitration clause “clearly encompasse[s] the
dispute at issue;” (5) whether the employer asserts its
willingness to resort to arbitration for the dispute; and (6)
whether the dispute is “eminently well suited to resolu-
tion by arbitration.” United Technologies Corp., 268
NLRB 557, 558 (1984); see Collyer Insulated Wire, 192
NLRB 837, 842 (1971). Neither the first nor the last
factor is present here.5 Accordingly, we reject deferral.
A. Long and Productive Bargaining Relationship
The present dispute does not arise within the confines
of a long and productive bargaining relationship. At the
time the Respondent refused to pay the bonus, the Union
had been the employees’ exclusive bargaining repre-
sentative for 1 year and the collective-bargaining agree-
ment had been in place for only 6 months. Considering
the fact that four other charges were settled before or
during the hearing in this matter, it is clear that this was,
at a minimum, a contentious year, characterized by disa-
greements and legal wrangling extending well beyond
the Christmas bonus dispute.6 Whatever the nature and
4 The Respondent initially tried to negotiate a different bonus pay-
ment schedule with the Union, but the Union rejected Respondent’s
proposals. The Union appears to have taken some initial steps to in-
voke the agreement’s grievance and arbitration procedures, but it filed
the instant unfair labor practice charge when the Respondent resolved
that it would not pay the bonus.
5 There is no dispute that factors (3), (4), and (5) favor deferral. Re-
garding factor (2), we note that this dispute takes place within the con-
text of various other unfair labor practice allegations that were resolved
by a non-Board settlement. No additional evidence of employer ani-
mosity has been offered, however.
6 The Union originally filed charges against the Respondent, and the
General Counsel issued a complaint, alleging discriminatory discharge
of two employees, failure to give notice of and bargain over unilateral
changes to terms and conditions of employment (through layoffs, elim-
ination of positions, subcontracting of unit work, health insurance can-
cellation, and changes in the Respondent’s Rules of Conduct), unrea-
sonable delay in furnishing information, and threatening employees
with discharge for participating in a strike. The dates of the alleged
conduct ranged from January to December 2009. The Respondent, for
its part, sought and obtained a temporary restraining order from the
U.S. District Court for the District of Puerto Rico to prevent a threat-
merits of these disagreements, their existence indicates
the relationship between the Union and the Respondent
had not matured. We are unaware of any decision find-
ing that a relationship as new and contentious as the one
at issue here can be considered “long and productive” for
the purposes of a Collyer Wire analysis, and we note that
the Board has previously found that a similarly short and
fraught relationship does not satisfy the standard. See
Beverly Enterprises, 310 NLRB 222, 257–258 (1993),
enfd. in relevant part sub nom. Torrington Extend-A-
Care Employee Assn. v. NLRB, 17 F.3d 580 (2d Cir.
1994) (relationship was less than 2 years old and the em-
ployer committed four violations during that time).
B. Suitability of the Dispute to Resolution by Arbitration
The dispute here is not well suited to resolution by ar-
bitration. A dispute is well suited to arbitration when the
meaning of a contract provision is at the heart of the dis-
pute. See Collyer, supra at 842. Deferral is not appro-
priate when “no construction of the contract is relevant
for evaluating the reasons advanced by Respondent for
failing to comply with that contract provision.” Struthers
Wells Corp., 245 NLRB 1170, 1171 fn. 4 (1979), enfd.
mem. 636 F.2d 1210 (3d Cir. 1980), cert. denied 452
U.S. 916 (1981). Moreover, deferral is also not appro-
priate if the contract provision at issue is unambiguous.
See, e.g., New Mexico Symphony Orchestra, 335 NLRB
896, 897 (2001).
In evaluating this factor, it is crucial to correctly char-
acterize the present dispute. Although the Respondent
describes the dispute as one over the meaning of article
26, the actual dispute is over whether the statutory ex-
emption granted to the Respondent by the Department
applies to the employees covered by the collective-
bargaining agreement. In fact, the Respondent is defend-
ing this case not simply on the basis of the contract, but
also—and, primarily—on the basis of the statutory ex-
emption.7 Recognizing that the dispute is over the scope
of the exemption, the question then becomes whether
resolution of the dispute primarily requires interpretation
of the collective-bargaining agreement.
We conclude that determining the scope of the statuto-
ry exemption does not, in this case, primarily require
such interpretation. The Respondent argues that the con-
tract incorporates the requirements of Law 148. Absent
the issuance of an exemption, there would be no question
that the Respondent was required to pay a Christmas
bonus in accordance with the law’s terms. Thus, the only
even colorable argument in this case is that the exemp-
ened December 2009 strike over the Christmas bonus dispute and an
unrelated disagreement over shift assignments for nurses.
7 See R. Br. in support of exceptions at 9–12.

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 738
tion applied to the unit employees. This is not a question
of contractual interpretation.
Moreover, the provisions requiring interpretation in
this case are not ambiguous. As stated above, but for the
issuance of the exemption, the Respondent concedes that
the contract required it to pay a bonus in accordance with
the requirements of Law 148. The exemption clearly did
not alter that contractual requirement. The Department
explicitly stated that the exemption granted to the Re-
spondent does not apply to employees covered by the
collective-bargaining agreement. Thus, there simply is
no reasonable construction of the exemption that leads to
the conclusion that it relieved Respondent of its contrac-
tual commitment to pay bonuses in accordance with the
law.8
Finally, even if a construction of article 26 of the col-
lective-bargaining agreement were necessary to resolve
this dispute, we conclude that this provision, too, is un-
ambiguous in the relevant respect. As stated above, all
parties agree that, absent the exemption, article 26 re-
quired the Respondent to pay a bonus in accordance with
the terms of Law 148. The key phrase here is “according
to the established dispositions of Law 148.” Respondent
argues that because article 26 of the parties’ agreement
“incorporated” Law 148 it also incorporated the exemp-
tion, thereby making the exemption applicable to unit
members. The problem with that argument, of course, is
that the exemption expressly did not apply to represented
employees. Thus, the appropriate government agency
clearly expressed its intention that the exemption would
not affect the rights of represented employees. The ex-
emption accordingly did not in any way alter the “estab-
lished dispositions of Law 148” as they are incorporated
by reference into the agreement. We therefore conclude
that the relevant provision of the contract is unambigu-
ous.9 For each of these reasons, the dispute is ill-suited
to arbitration.
II. UNLAWFUL CONTRACT MODIFICATION
We agree with the judge that the Respondent’s failure
to pay the bonus was an unlawful contract modification
that violated Section 8(a)(5) and (1).10 We affirm the
8 We further observe that if this dispute were deferred to arbitration,
the arbitrator, to reach a contrary result, would not be explicating the
contract but reexamining the Department’s determination of the scope
of the exemption.
9 Had the Department simply granted the Respondent a blanket ex-
emption, whether such an exemption applied to unit members might
well have posed a question of contract interpretation.
10 The complaint alleged a unilateral change without notice and op-
portunity to bargain, rather than a contract modification without the
Union’s consent. At the hearing, however, the General Counsel sum-
marized his position in a manner consistent with a contract-
modification theory, stating: “The collective-bargaining agreement
judge’s threshold finding that the Christmas bonus was a
term and condition of employment within the meaning of
Section 8(d) and thus a mandatory subject of bargain-
ing.11 Absent the union’s consent, a mid-term contract
modification of a term governing a mandatory subject of
bargaining violates Section 8(a)(5). See Bon-
nell/Tredegar Industries, 313 NLRB 789, 790 (1994),
enfd. 46 F.3d 339 (4th Cir. 1995). An employer, howev-
er, can justify that conduct by articulating a “sound argu-
able basis” for believing that the contract allowed such a
modification. See Hospital San Carlos Borromeo, 355
NLRB 153, 153 (2010).
The Respondent’s sole basis for its refusal to pay the
bonus is that the exemption granted it by the Department
permitted nonpayment. As discussed above, the exemp-
tion, on its face, does not apply to employees covered by
a collective-bargaining agreement. Accordingly, the
Respondent has failed to meet the “sound arguable basis”
standard. See id. at 153. We therefore agree with the
judge that the refusal to pay the Christmas bonus was an
unlawful contract modification in violation of Section
8(a)(5) and (1).
AMENDED REMEDY
In addition to the relief recommended by the adminis-
trative law judge, any interest due to the unit employees
shall be compounded daily as prescribed in Kentucky
River Medical Center, 356 NLRB 6 (2010).
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge as
modified below and orders that the Respondent, San Juan
Bautista Medical Center, Caguas, Puerto Rico, its offic-
ers, agents, successors, and assigns, shall take the action
set forth in the Order as modified.
1. Substitute the following for paragraph 2(a).
“(a) Continue in effect all the terms and conditions of
employment contained in the collective-bargaining
agreement covering its employees in the units described
above and pay each unit employee their 2009 Christmas
bonus, with interest at the rate prescribed in New Hori-
zons for the Retarded, Inc., 283 NLRB 1173 (1987),
provided for the payment of a Christmas bonus, and the Employer
failed to pay the Christmas bonus without the Union’s consent.” In any
event, the Respondent does not contend that the contract-modification
theory was not fully and fairly litigated nor does it otherwise contend
that the alleged breach of contract does not rise to the level of a viola-
tion of Sec. 8(a)(5). Cf. NCR Corp., 271 NLRB 1212, 1213 fn. 6
(1984) (observing that “a mere breach of contract is not in itself an
unfair labor practice”); United Telephone Co. of the West, 112 NLRB
779 (1955) (holding that alleged isolated breach of contract does not
necessarily violate Sec. 8(a)(5)).
11 The Respondent did not except to this finding.

SAN JUAN BAUTISTA MEDICAL CENTER 739
compounded daily as prescribed in Kentucky River Medi-
cal Center, 356 NLRB 6 (2010).”
2. Substitute the following for paragraph 2(c).
“(c) Within 14 days after service by the Region, post
at its Caguas, Puerto Rico facility, copies of the attached
notice marked “Appendix.”13 Copies of the notice, on
forms provided by the Regional Director for Region 24,
after being signed by the Respondent’s authorized repre-
sentative, shall be posted by the Respondent and main-
tained for 60 consecutive days in conspicuous places
including all places where notices to employees are cus-
tomarily posted. In addition to physical posting of paper
notices, notices shall be distributed electronically, such
as by email, posting on an intranet or an internet site,
and/or other electronic means, if the Respondent custom-
arily communicates with its employees by such means.
Reasonable steps shall be taken by the Respondent to
ensure that the notices are not altered, defaced, or cov-
ered by any other material. In the event that, during the
pendency of these proceedings, the Respondent has gone
out of business or closed the facility involved in these
proceedings, the Respondent shall duplicate and mail, at
its own expense, a copy of the notice to all current em-
ployees and former employees employed by the Re-
spondent at any time since December 15, 2009.”

Ayehsa K. Villegas Estrada, Esq., for the Government.1
Eliseo Roques Arroyo, Esq., Luis R. Perez Giusti, Esq., and
Mariel Ayala Morales, Esq., for the Hospital.2
DECISION
STATEMENT OF THE CASE
WILLIAM N. CATES, Administrative Law Judge. This is an
alleged failure by San Juan Bautista, Inc., d/b/a San Juan Bau-
tista Medical Center (the Hospital) to pay employees in certain
bargaining units their 2009 Christmas bonus. I heard this case
in San Juan, Puerto Rico, on May 18, 2010. The case origi-
nates from a charge filed by Hermandad de Empleados de la
Salud y Otras Agencias (the Union) on December 16, 2009, and
amended on March 10, 2010, against the Hospital. The prose-
cution of the case was formalized on March 31, 2010, when the
Regional Director for Region 24 of the National Labor Rela-
tions Board (the Board), acting in the name of the Board’s
General Counsel, issued an Order Further Consolidating Cases,
Consolidated Amended Complaint, and notice of hearing
(complaint) against the Hospital.
The consolidated amended complaint related to five cases.
Prior to trial, the Hospital and Union reached a settlement of
Cases 24–CA–11096 and 24–CA–11119 which settlement was
approved by the Regional Director for Region 24. At the trial,
1 I shall refer to counsel for General Counsel as counsel for the Gov-
ernment and General Counsel as the Government.
2 I shall refer to counsel for the Respondent as counsel for the Hospi-
tal and shall refer to the Respondent as the Hospital.
the Hospital and Union reached a settlement of Cases 24–CA–
11243 and 24–CA–11416, which I approved on the record at
the beginning of the trial, and I remanded those cases to the
Regional Director for compliance. The Regional Director, on
May 28, 2010, issued an Order reflecting the foregoing, sever-
ing those cases, and withdrawing the complaint as to those
cases. I have amended the caption herein to delete the case
numbers of those cases. The remaining Case, 24–CA–11419,
was litigated.
The complaint alleges the Hospital, on or about December
15, 2009, failed and/or refused to pay unit employees’ their
2009 Christmas bonus without prior notice to the Union and
without affording the Union an opportunity to bargain with the
Hospital with respect to this conduct and the effects of this
conduct and/or without first bargaining with the Union to a
good-faith impasse. It is alleged the Christmas bonus is a man-
datory subject for the purpose of collective bargaining and that
the Hospital has by its actions failed and refused to bargain
collectively with the exclusive collective-bargaining representa-
tive of its employees in violation of Section 8(a)(1) and (5) of
the National Labor Relations Act, as amended (the Act).
The Hospital, in a timely filed answer to the complaint, de-
nied having violated the Act in any manner alleged in the com-
plaint, and raised certain affirmative defenses.
The parties were given full opportunity to participate, to in-
troduce relevant evidence, to examine and cross-examine wit-
nesses, and to file briefs. The parties stipulated to the facts and
called no witnesses. I have studied the whole record, the
posttrial briefs, and the authorities cited therein. Based on the
analysis below, I conclude and find the Hospital violated the
Act substantially as alleged in the complaint.
FINDINGS OF FACT
I. JURISDICTION, LABOR ORGANIZATION STATUS, AND
OFFICIAL POSITIONS
The Hospital is a Commonwealth of Puerto Rico corporation
with an office and place of business in Caguas, Puerto Rico,
where it is, and has been, engaged in the operation of an acute
health care facility. During the past 12 months ending March
31, 2010, a representative period, the Hospital purchased and
received directly from points and places located outside the
Commonwealth of Puerto Rico goods and materials valued in
excess of $50,000. During the same period of time it also had
gross revenues in excess of $250,000. The parties admit, and I
find, the Hospital is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
The parties admit, and I find, the Union is a labor organiza-
tion within the meaning of Section 2(5) of the Act.
Hospital Human Resources Director Calvin Tua Algarin and
Hospital Director Julio Andino Rodriguez are supervisors and
agents of the Hospital within the meaning of Section 2(11) and
(13) of the Act and Hospital School of Medicine President Yo-
casta Brugal is an agent of the Hospital within the meaning of
Section 2(13) of the Act. Sixto Alvelo is the Union’s executive
director and Maria Diaz Bigio is its president. Miguel Romero
is secretary of the commonwealth of Puerto Rico department of
labor and human resources; and, Carlos Maldonado Lopez is

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 740
deputy director for the work norms bureau of the Common-
wealth of Puerto Rico Department of Labor.
II. THE FACTS
A. Background
Before getting to the Christmas bonus at issue here, it is
helpful to review certain background information that places
the bonus issue in context.3 It is admitted that the units (units),
described below, constitute units appropriate for the purposes
of collective bargaining within the meaning of Section 9(b) of
the Act. It is admitted the Union was certified as the exclusive
collective-bargaining representative of the Units on December
17, 2008. It is also admitted that at all times since December
17, 2008, based on Section 9(a) of the Act, the Union has been
the exclusive collective-bargaining representative of the units.
B. The Collective-Bargaining Units
INCLUDED: All licensed registered nurses and technologists
employed by the Employer at its hospital located at Caguas,
Puerto Rico.
EXCLUDED: All other employees, including supervisors
and guards as defined in the Act.
INCLUDED: All business office clerical employees em-
ployed by the Employer at its hospital located in Caguas,
Puerto Rico.
EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.
INCLUDED: All licensed practical nurses and technician
employees employed by the Employer at its hospital located
in Caguas, Puerto Rico.
EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.
INCLUDED: All maintenance and non-skilled employees
employed by the Employer at its facility located in Caguas,
Puerto Rico.
EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.
C. The 2009 Christmas Bonus
It is stipulated that the Hospital and Union are parties to a
collective-bargaining agreement effective from June 19, 2009,
3 The Hospital filed a Motion for Partial Summary Judgment with
the Board asking the Board to defer the complaint allegations concern-
ing the 2009 Christmas bonus issues to arbitration. The Board in an
Order dated May 17, 2010, declined to do so. The Board concluded the
Hospital failed to establish there were no material issues of fact and that
it was entitled to partial summary judgment as a matter of law. The
Board explained it was further declining to defer because of numerous
other complaint allegations including several alleged unilateral changes
by the Hospital. The Board’s denial was without prejudice to the Hos-
pital renewing its deferral argument before the judge in the event the
remaining complaint allegations were resolved prior to trial. Member
Schaumber, however, dissented from the majority and would defer the
2009 Christmas bonus dispute to arbitration pursuant to the principles
set forth in Collyer Insulated Wire, 192 NLRB 837 (1971). Member
Schaumber views the dispute as arising from differing interpretations of
art. 26 of the parties’ collective-bargaining agreement and as such
covered by the arbitration.
through June 19, 2012, covering terms and conditions of em-
ployment for employees in the units. Pertinent to this case the
parties’ collective-bargaining agreement at article 26, “Christ-
mas Bonus” states:

Section 1- The Hospital recognizes the payment of a Christ-
mas Bonus to each union member of the appropriate units, ac-
cording to the established dispositions of Law 148, of June
30, 1969, as amended, during the first year of the Collective
Bargaining Agreement.

Section 2- The Union will present the Hospital with a Christ-
mas Bonus proposal to be negotiated for the second and third
year of this Collective Bargaining Agreement.

On October 30, 2009, Union Executive Director Sixto Alve-
lo notified the Hospital in writing of certain actions the Union
would be taking including a 24-hour strike commencing at 6
a.m. on December 16, 2009. It was explained that the justifica-
tion for the various actions was the Hospital’s unfair labor prac-
tices and bad-faith negotiations.
On November 10, 2009, Union Executive Director Sixto
Alvelo and Union President Diaz Bigio hand delivered a letter
to Puerto Rico Secretary of Labor Miguel Romero. In their
letter they explain they have information the Hospital has solic-
ited to be exempted from paying the 2009 Christmas bonus to
its employees. The Union states in the letter that it represents
the Hospital employees and they have a collective-bargaining
agreement with the Hospital covering the employees. The Un-
ion asks that the Hospital’s exemption request be denied and
suggests that any controversy regarding the 2009 Christmas
bonus be resolved by the parties.
On December 4, 2009, Commonwealth Deputy Director for
the Work Norms Bureau of the Puerto Rico Department of
Labor Maldonado Lopez wrote the Hospital regarding their
request for an exemption from paying the 2009 Christmas bo-
nus. He advised the Hospital that an audit of their finances
would be made to determine if the requested exoneration of
payment could be granted. He also noted that Puerto Rico’s
Christmas Bonus Law would “not apply in cases where the
employees receive a Christmas bonus by means of a Collective
Bargaining Agreement,” and that any exemption would “apply
to those employees not covered by the Collective Bargaining
Agreement.”
On December 11, 2009, Deputy Director Maldonado Lopez
wrote Union Executive Director Sixto Alvelo acknowledging
the Union’s representative status of certain Hospital employees
and indicated that the exoneration granted to the Hospital re-
garding the 2009 Christmas bonus would only apply to those
employees that are not part of the Units. He also stated the
Hospital had been so notified.
Hospital Director Andino Rodriguez attached a memoran-
dum to the pay stubs of all unit employees on December 15,
2009, in which he noted the Union had called a strike for De-
cember 16, 2009. He urged the employees not to participate in
the “illegal” strike which he said the Union called “due to Hos-
pital Management’s determination not to grant the [2009]
Christmas Bonus.” He suggested that if the employees felt the
Hospital was not complying with its contractual requirements
to file grievances as outlined in the parties’ collective-

SAN JUAN BAUTISTA MEDICAL CENTER 741
bargaining agreement. Director Andino Rodriguez noted the
Hospital had proposed to pay the bonus over time starting in
December 2009 and concluding in July 2010, but, indicated the
Union rejected that offer.
In order to avoid a work stoppage the parties met on several
occasions, bargained and exchanged proposals for payment of
the employees’ Christmas bonus but never reached an agree-
ment.
On December 21, 2009, Union Executive Director Sixto
Alvelo wrote Hospital HR Director Tua Algarin requesting he
summon the Grievance Arbitration Committee to resolve the
Hospital’s failure to pay the 2009 Christmas bonus and noted
the Hospital’s denial of the bonus “constitutes a violation of
Article 26, of the Collective Bargaining Agreement.” In a fol-
low up letter of January 5, 2010, Sixto Alvelo asked Tua Al-
garin to confirm in writing, in accordance with “Section 7-
Third Step of Article 10, Grievances and Arbitration Proce-
dures” of the parties collective-bargaining agreement, that the
Hospital was not going to pay the Christmas bonus.
The parties stipulated the Hospital never at any time paid the
2009 Christmas bonus.
It is helpful at this point, to examine the Christmas Bonus
Law which requires any employer who employs one or more
worker or employee to pay the worker or employee a Christmas
bonus. The Christmas Bonus Law sets forth the hours (700) an
employee must work in a natural year (October 1 to September
30) to be eligible for a bonus and provides computations utiliz-
ing employees’ wages or salary, up to a fixed maximum, to
determine the amount of the bonus. The time frame (December
1 to 15) for paying the bonus is set forth, as well as, penalties
for late or nonpayment of the Christmas bonus.
The Puerto Rico Secretary of Labor and Human Resources is
designated to administer the Christmas Bonus Law and is em-
powered to examine an employer’s books, accounts, files, and
related documents to determine an employer’s responsibilities
toward their employees regarding Christmas bonuses. An em-
ployer may be exempt from paying, in whole or in part, the
statutory Christmas bonus by petitioning the Secretary for such
relief. An employer may be exempt, in whole or in part, by
demonstrating to the Secretary the employer has not obtained
profits from its business or the profits are not sufficient to cover
the total amount of the bonuses without exceeding a 15-percent
limit on net annual profits that must be utilized for the statutory
Christmas bonuses. In order to seek any type of exemption an
employer must submit by November 30 a general balance sheet
and a profit-and-loss statement to the Secretary for the 12-
month period from October 1 of the previous year to September
30 of the current year. The balance sheet and profit-and-loss
statements must be certified by a certified public accountant. If
an employer does not submit the above described general bal-
ance sheet and profit-and-loss statements within the time and in
the manner specified, the employer is required to pay the statu-
tory Christmas bonuses.
The Christmas Bonus Law states: “The provisions of this
chapter shall not apply in cases where the workers or employ-
ees receive an annual bonus by collective agreement; except in
the event where the amount of the bonus to which entitled by
such agreement may result lower than the one provided by this
chapter in which case they shall receive the necessary amounts
to complete the bonus provided herein.”
III. ANALYSIS, DISCUSSION, AND CONCLUSIONS
The complaint alleges that the Hospital violated the Act by
failing to pay the Christmas bonus without prior notice to the
Union and without affording the Union an opportunity to bar-
gain.
The General Counsel argues that the failure to pay the
Christmas bonus constituted a unilateral change in the contract
to which the Union did not agree and that deferral to the con-
tractual grievance arbitration procedure is inappropriate.
The Hospital, at the hearing and in its brief, argues that de-
ferral to arbitration is appropriate because its failure to pay the
Christmas bonus relates to “interpretations or application of the
agreement.” I disagree. Deferral to arbitration is appropriate
when the issue relates to the meaning of contractual provisions.
As explained in Alfred M. Lewis, Inc. v. NLRB, 587 F.2d 403,
408 (9th Cir. 1978), it would “undercut the duty to bargain if
the employer were allowed to act with reference to a mandatory
bargaining subject and then simply defend its actions in a later
arbitration hearing.” The contractual language regarding the
obligation of the Hospital during the first year of the contract to
pay the Christmas bonus consistent with the Puerto Rico statute
is clear and unambiguous:

The Hospital recognizes the payment of a Christmas Bonus to
each union member of the appropriate units, according to the
established dispositions of Law 148, of June 30, 1969, as
amended, during the first year of the Collective Bargaining
Agreement.

When the meaning of a contract provision is free from ambi-
guity, arbitration is unnecessary and deferral is inappropriate.
Caritas Good Samaritan Medical Center, 340 NLRB 61, 63
(2003).
The Hospital, in its brief, argues that it was not obligated to
pay the bonus because it sought and was granted an exemption.
In that regard, the Hospital contends that the contractual lan-
guage “incorporated the economic waiver provision.” The brief
neglects to acknowledge that the exemption was not granted
with regard to employees in the bargaining units whose terms
and conditions of employment, including specifically payment
of the Christmas bonus, were addressed in the collective bar-
gaining agreement. The December 4, 2009 letter to the Hospi-
tal from Maldonado Lopez points out that Puerto Rico’s
Christmas Bonus Law does “not apply in cases where the em-
ployees receive a Christmas bonus by means of a Collective
Bargaining Agreement” and that any exemption granted would
apply only “to those employees not covered by the Collective
Bargaining Agreement.” Thus, the exemption did not apply to
employees who were covered by the collective-bargaining
agreement. As correctly argued in the brief of the General
Counsel, upon the receipt of the December 4 letter the Hospital
had two choices: “(1) obtain the consent of the Union to pay a
different amount for the Christmas bonus; or (2) pay the
Christmas bonus.”
The Christmas bonus, monetary compensation comparable to
wages, was a term and condition of employment of the employ-
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 742
ees in the Units and was a mandatory subject of bargaining.
“[I]t is well settled that an employer violates Section 8(a)(5)
and (1) of the Act as elucidated in Section 8(d) of the Act, by
modifying a term of a collective bargaining agreement without
the consent of the other party while the contract is in effect
[footnote omitted].” Bonnell/Tredegar Industries, 313 NLRB
789, 790 (1994). An employer is prohibited from modifying
the terms and conditions of employment established by a col-
lective-bargaining agreement without first obtaining the con-
sent of the union.
I find the Hospital violated Section 8(a)(5) and (1) of the Act
when it modified the Christmas bonus provisions of the parties’
collective-bargaining agreement by failing to pay the Christmas
bonus provided therein without the consent of the Union.
REMEDY
Having found that the Hospital has engaged in certain unfair
labor practices, I find it necessary to order the Hospital to cease
and desist there from and to take certain affirmative action
designed to effectuate the polices of the Act as set forth in the
recommended Order below.
The Hospital, having unlawfully failed to pay employees in
the Units the Christmas bonus, it must make them whole by
paying the bonus plus interest as computed in New Horizons for
the Retarded, 283 NLRB 1173 (1987).
The General Counsel requests that compound interest be
awarded upon any backpay due. Consistent with the decision of
the Board in Carpenters Local 687 (Convention & Show Ser-
vices), 352 NLRB 1016 fn. 2 (2008), not to deviate from its
current practice of awarding simple interest, I deny that request.
The Respondent will also be ordered to post an appropriate
notice in both English and Spanish.
On these findings of fact and conclusions of law and on the
entire record, I issue the following recommended4
ORDER
The Hospital, San Juan Bautista, Inc. d/b/a San Juan Bautista
Medical Center, Caguas, Puerto Rico, its officers, agents, and
successors, and assigns, shall
1. Cease and desist from
(a) Failing to bargain in good faith with Hermandad de
Empleados de la Salud y Otras Agencias as the exclusive col-
lective-bargaining representative in the following units:

INCLUDED: All licensed registered nurses and technologists
employed by the Employer at its hospital located at Caguas,
Puerto Rico.

EXCLUDED: All other employees, including supervisors
and guards as defined in the Act.

INCLUDED: All business office clerical employees em-
ployed by the Employer at its hospital located in Caguas,
Puerto Rico.
4 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 objections to them shall be deemed waived for all pur-
poses.

EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.

INCLUDED: All licensed practical nurses and technician
employees employed by the Employer at its hospital located
in Caguas, Puerto Rico.

EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.

INCLUDED: All maintenance and non-skilled employees
employed by the Employer at its facility located in Caguas,
Puerto Rico.

EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.

(b) Failing to continue in effect all the terms and conditions
of employment contained in the collective-bargaining agree-
ment covering its employees in the units described above, and
failing and refusing to pay those unit employees their 2009
Christmas bonus as set forth in the collective-bargaining
agreement covering the unit employees.
(c) In any like or related manner interfering with, restraining,
or coercing employees in the exercise of the rights guaranteed
them by Section 7 of the Act.
2. Take the following affirmative action.
(a) Continue in effect all the terms and conditions of em-
ployment contained in the collective-bargaining agreement
covering its employees in the units described above and pay
each unit employee their 2009 Christmas bonus, with interest as
prescribed in New Horizons for the Retarded, Inc., 283 NLRB
1173 (1987).
(b) Preserve and, within 14 days of a request, or such addi-
tional time as the Regional Director for Region 24 may allow
for good cause shown, provide at a reasonable place designated
by the Board or its agents, all payroll records, social security
records, timecards, personnel records and reports, and all other
records, including an electronic copy of such records if stored
in electronic from, necessary to analyze the amount, with inter-
est, of the 2009 Christmas bonus due under the terms of this
Order.
(c) Within 14 days after service by the Region, post at its fa-
cility in Caguas, Puerto Rico, copies of the attached notice
marked “Appendix” in both English and Spanish.12 Copies of
the notice on forms provided by the Regional Director for Re-
gion 24, after being signed by the Hospital’s authorized repre-
sentative, shall be posted by the Hospital and maintained for 60
consecutive days in conspicuous places including all places
where notices to employees are customarily posted. Reasona-
ble steps shall be taken by the Hospital to ensure that the notic-
es are not altered, defaced, or covered by any other material. In
the event that, during the pendency of these proceedings, the
Hospital has gone out of business or closed the facility involved
12 If this Order is enforced by a Judgment of a United States Court of
Appeals, the words in the notice reading “Posted by Order of the Na-
tional Labor Relations Board” shall read “Posted Pursuant to a Judg-
ment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”

SAN JUAN BAUTISTA MEDICAL CENTER 743
in these proceedings, the Hospital shall duplicate and mail, at
its own expense, a copy of the notice in both English and Span-
ish to all current employees and former employees employed
by the Hospital at any time since December 15, 2009.
(d) Within 21 days after service by the Region, file with the
Regional Director for Region 24 of the Board a sworn certifica-
tion of a responsible official on a form provided by the Region
attesting to the steps that the Hospital has taken to comply.

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 Federal labor law and has ordered us to post and obey this
notice.
FEDERAL LAW GIVES YOU THE RIGHT TO

Form, join, or assist a union
Choose representatives to bargain with us on your
behalf
Act together with other employees for your benefit
and protection
Choose not to engage in any of these protected activi-
ties.

WE WILL NOT fail to bargain in good faith with Hermandad
de Empleados de la Salud y Otras Agencias as the exclusive
collective-bargaining representative of the employees in the
following appropriate units:

INCLUDED: All licensed registered nurses and technologists
employed by the Employer at its hospital located at Caguas,
Puerto Rico.

EXCLUDED: All other employees, including supervisors
and guards as defined in the Act.

INCLUDED: All business office clerical employees em-
ployed by the Employer at its hospital located in Caguas,
Puerto Rico.

EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.

INCLUDED: All licensed practical nurses and technician
employees employed by the Employer at its hospital located
in Caguas, Puerto Rico.

EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.

INCLUDED: All maintenance and non-skilled employees
employed by the Employer at its facility located in Caguas,
Puerto Rico.

EXCLUDED: All other employees, including supervisors,
guards and professionals as defined in the Act.

WE WILL NOT fail and refuse to continue in effect all the
terms and conditions of employment contained in the collec-
tive-bargaining agreement covering employees in the units
described above.
WE WILL NOT fail and refuse to pay the unit employees their
2009 Christmas bonus as set forth in the collective-bargaining
agreement.
WE WILL NOT in any like or related manner interfere with, re-
strain, or coerce our employees in the exercise of the rights
guaranteed them by Section 7 of the Act.
WE WILL continue in effect all the terms and conditions of
employment contained in the collective-bargaining agreement
covering our employees in the units described above.
WE WILL pay each unit employee their 2009 Christmas bonus
as set forth in the collective-bargaining agreement with interest.

SAN JUAN BAUTISTA, INC. D/B/A SAN JUAN BAUTISTA
MEDICAL CENTER