Schierbrock Motors

National Labor Relations Board - Board Decisions

Oct 13, 1939

15 N.L.R.B. 1109 (N.L.R.B. 1939)

In the Matter of SCHIERBROCH MOTORS and TRI-CITY AUTO MECHANICS
LODGE 1215, AFFILIATED WITH THE A . F. OF L.
Case No. C-1105.-Decided October 13, 1939
Wholesale and Retail Distribution of Automobiles and Parts-Interference,
Restraint, and Coercion : securing of individual contracts of employment during
period when conferences with Union were in progress-Representatives: proof
of choice : membership -in union ; change in majority representation due to
unfair labor practices , disregarded-Unit Appropriate for Collective Bargaining:
mechanics in garage-Collective Bargaining : employer 's refusal to bargain col-
lectively with Union as exclusive representative of employees in appropriate
unit; execution of individual contracts of employment ; ordered , upon request,
to bargain with the Union and notify employees that contracts will no longer
be enforced.
Mr. Sanvuel M. Spencer, for the Board.
Mr. Edward A. Doerr, of Davenport, Iowa , for the respondent.
Miss Marcia Hertzmark, of counsel to the Board.
DECISION
AND
ORDER
STATEMENT OF THE CASE
Upon charges duly filed by Tri-City Auto Mechanics Lodge 1215,
herein called the Union, the National Labor Relations Board, herein
called the Board, by the Regional Director for the Eighteenth Region
(Minneapolis, Minnesota),' issued its complaint dated November 10,
1938, against Schierbrock Motors, Davenport, Iowa, individually
owned by Frank Schierbrock, herein called the respondent, alleging
that the respondent had engaged-in and was engaging in unfair labor
practices affecting commerce, within the meaning of Section 8 (1)
and (5) and Section 2 (6) and (7) of the National Labor Relations
Act, 49 Stat. 449, herein called the Act. A copy of the complaint
and a notice of hearing thereon were duly served upon the respondent
and the Union.
1 The charge was filed in the Thirteenth Region, but was transferred to the Eighteenth
Region because of a reclassification of territory covered by the respective regions pur-
suant to an order of the Board dated May 10, 1938.
15 N. L. R. B., No. 120.
1109
199549-39-vol. 15--71
1110 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
With respect to the unfair labor practices, the complaint alleged.
in substance : (1) that on or about June 14, 1938, the respondent
had refused to bargain collectively with the Union as the exclusive
representative of his employees in an appropriate unit, consisting of
the mechanics employed in his garage at Davenport, Iowa, although
a majority of the employees in'su'ch unit had, prior to March 1, 1938,
and at all times subsequent thereto, designated the Union as their
representative; (2) that prior to June 28, 1938, the respondent entered
into individual ,contracts with his employees without the consent. or
knowledge of the Union, thereby, further indicating his refusal. to
bargain with the Union -' and (3) that the respondent had interfered
with, restrained, : and coerced his employees by' refusing to meet with
the Union on or about April 10, 1938, and by meeting with the Union::
on or about June 13, 1938, but refusing to bargain in good faith.
The _ respondent thereafter filed his answer to the complaint, ad-
mitting the execution of individual contracts with his employees, but
denying that such action constituted a refusal to bargain collectively,
and denying the commission of. unfair labor practices..
Pursuant to notice, a hearing was held at Davenport, Iowa, on
November 21, 1938, before Mapes Davidson,,the Trial Examiner duly
designated by the Board. The Board and the respondent were rep-
resented by counsel and participated ' in the hearing. Full oppor-
tunity to be heard, to examine and cross-examine witnesses, and to
introduce evidence bearing on the issues was afforded all parties.
At the beginning of the hearing the respondent moved to dismiss the
complaint, or in the alternative, to strike certain pertinent portions, on
the ground that the Board lacked jurisdiction because neither the
respondent nor his employees were engaged in commerce as defined
in the Act; because the respondent had entered into'individual con-
tracts with his employees and there was, therefore, no controversy
and because the respondent had not refused to bargain except in that
he had entered into the individual contracts, allegedly permissible.
under the Act. The Trial Examiner denied the motion to strike and
reserved decision as to the motion to dismiss. At the close of the
hearing the respondent renewed his motion to dismiss and the Trial
Examiner denied it. His rulings are hereby affirmed. During the
course of the hearing the Trial Examiner made other rulings on
motions and on objections to the admission of evidence. The Board
has reviewed the rulings of the Trial Examiner and finds that no
prejudicial errors were committed. The rulings are hereby affirmed.
On December 29, 1938, the Trial Examiner filed his Intermediate
Report and an order allowing 'a certain stipulation as to facts to be
made a part of the record, copies of which were duly served upon the
respondent and the Union. The Trial Examiner found that the re-
SCHIERBROCK MOTORS 1111
spondent had engaged in. and was engaging in unfair labor practices.
affecting commerce as alleged in the complaint , and recommended
that the respondent cease and desist from engaging in such practices,
cease giving any effect to the individual contracts existing between
the respondent and his employees , and, upon request , bargain col-
lectively with the Union as the exclusive representative of such em-
ployees. The. respondent thereafter filed exceptions and amended
exceptions to the Intermediate Report.
The Board has considered the exceptions and amended exceptions
of the respondent , and in so far , as they are inconsistent with the
findings, conclusions , and order set forth below, finds no merit in
them. .. I . '
Upon the entire record in the case, the Board makes the following :
FINDINGS OF FACT
I. THE BUSINESS OF THE RESPONDENT
Frank Schierbrock is engaged, under the name of Schierbrock
Motors, in the wholesale and retail distribution of Chrysler and
Plymouth automobiles and parts at Davenport, Iowa, and at Moline,
Illinois. The Davenport plant is the only one here involved. The.
respondent has the sole right of distribution of such automobiles in
designated areas in Iowa and Illinois and makes individual contracts.
for delivery to automobile dealers in such areas. In 1937 respondent
sold 515 automobiles at wholesale, 60 of which were sold in Iowa
and the remainder in Illinois. During that year he sold 214 cars
at retail in Davenport, Iowa,'of which number about one-fourth were
bought by customers from Illinois. Approximately 50 per cent of
the automobiles he received during 1937 as distributor and sold at
wholesale were delivered directly from the factory in Michigan to
Davenport by truck and from there redistributed to dealers in Illinois
and Iowa. The other 50 per cent were delivered to the dealers at
the factory in Michigan and were driven back to their respective
territories by the dealers. In 1938 the respondent received in his
plant 232 automobiles from the factory in Michigan and redistributed
29 in Iowa and 86 in Illinois ; the rest-were sold at retail. About
the same number as the total received in the respondent's plant were
shipped directly to the dealers.
In 1937 the respondent purchased parts valued at $25,178.10 and
sold parts totaling in value $25,601. Of the latter amount, approx-
imately 43 per cent represented parts sold at wholesale both in, Iowa
and Illinois.2 In the 10 months of 1938 preceding the hearing, the
respondent purchased $20,860 worth of parts and sold parts 'valued
2 The exact percentages sold outside Iowa do not appear.
1112 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
at $17,005. All parts are shipped to respondent's plant by freight
or truck from outside the State of Iowa.
IT. THE UNION
Tri-City Auto Mechanics Lodge 1215 is a labor organization affiliated
with the International Association of Machinists and with the Amer-
ican Federation of Labor. It admits to membership the automobile
mechanics employed by the respondent.
III. THE UNFAIR LABOR PRACTICES
A. The refusal to bargain collectively
1. The appropriate unit
The complaint alleges, the respondent admits, and the record
shows that the two mechanics in the respondent's Davenport, Iowa,
plant constitute a unit appropriate for the purposes of collective
bargaining within the meaning of Section 9 (b) of the Act.
We find that the mechanics employed by the respondent constitute
a unit appropriate for the purposes of collective bargaining and
that said unit insures to employees of the respondent the full bene-
fit of their right to self-organization and collective bargaining and
otherwise effectuates the policies of the Act.
2. Representation by the Union of a majority in the appropriate unit
At the time of the alleged unfair labor practices, both of the
mechanics employed by respondent were members of the Union in
good standing and on May 6, 1938, had signed cards authorizing the
Union to represent them for purposes of collective bargaining. They
joined the Union on January 1, 1938, and paid dues during May
1938 for that month and April.3 Pursuant to provisions of the
Union's constitution, they remained in good standing until September
1, 1938, a period of 3 months' delinquency automatically canceling
their membership. Both men testified that subsequent to June 28,
1938, they informed a representative of the Union that they no longer
desired to belong to the Union. As we find below, these defections
were the direct result of the respondent's unlawful refusal to bar-
gain, and hence may not be regarded as effective to destroy the
Union's majority status.
We find that on January 1, 1938, and at all times thereafter, the
Union was the duly designated representative of all the employees
$ The Union was reorganized on January 1, 1938, and members were given credit in the
Union for dues paid in advance to the old organization. The two mechanics here involved
were members of the old organization.
SCHIERBROCIi MOTORS 1113
in the unit hereinabove found to be appropriate for purposes of
collective bargaining, and that, pursuant to Section 9 (a) of the
Act, it was the exclusive representative of all the employees in such
unit for the purposes of collective bargaining with respect to rates
of pay, wages, hours of employment, and other conditions of
employment.
3. The refusal to bargain
Early in April 1938, J. T. Farr, the Union's grand-lodge repre-
sentative, and W. B. Music, then financial secretary of the Union,
met with the respondent and requested that he bargain with the
Union for the automobile mechanics in his shop. The respondent
replied that he saw no reason for a contract because his shop was
small, the men were satisfied, and he felt that it was unnecessary for
them to belong to a union to secure favorable working conditions.
Farr *and Music 'nevertheless -left 'with the 'respondent a copy of a
proposed contract which they were submitting to automobile dis-
tributors and dealers in the territory, and asked the respondent to
attend a meeting on April 10 between employers and union repre-
sentatives. Neither the respondent nor any other employer appeared
at the April 10 meeting. During the month of May, Farr went to
see the respondent on two occasions and, although there was some
discussion of the provisions of the contract submitted by the Union,
no agreement was reached. Subsequent to these conferences, during
the early part of June, Music met with the respondent and attempted
to get from him a counterproposal but was told that respondent did
not want to talk to Music without his attorney. Arrangements were
thereupon made for a conference on the following day. At that
meeting Ben Jacobson, president of the Tri-City Federation of
Labor, Music, the respondent, and his attorney, Doerr, were present.
Doerr told the union representatives that respondent had not refused
to bargain and he did not' think "it was their intention to." He
asked for more time to consider the Union's proposal and was given
until the following Tuesday, June 14. On that date the same per-
sons met, and Music and Jacobson were presented with a copy of
certain proposed "rules," submitted by the respondent. Music
informed the respondent that he thought the proposal was satis-
factory except for some provisions which he felt should be included
and which would not be detrimental to the respondent. Before this
conference adjourned, the respondent and his attorney spoke together
privately and Doerr then asked Music if he represented the men or
the Union. Music replied that he represented both, to which the
respondent answered that he "wouldn't be interested in the union
side of it," that he would bargain for the men as individuals, but
that he would not sign any agreement with the Union.. Music sug-
1114 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
gested reading a copy of the respondent's proposed rules at the next
union meeting, in an effort to secure. their approval, but the respond-
ent objected to this being. done. Both the respondent and Doerr
made, notes of Music's suggestions in their copies of the rules pro-
posed by 'the respondent; Doerr agreed to consider further whether
the respondent should deal with the Union or with the individual
men, and promised to. inform Music of his conclusion.
On June 28 Doerr addressed to Music, as secretary of the Union,
a letter stating that the mechanics employed by the respondent had
signed individual contracts of employment. Among other things,
the letter contained the following :
My client's privilege to deal with his employees individually is
established beyond argument. The contracts expressly reserve
A o the employees their privilege to engage in ' union activities.
It appears to me there is little, if anything, left about which
we,can negotiate further. At least, under the' circumstances,
it would not be unreasonable . for my client to be reluctant to
consider terms more advantageous to his employees than those
now in force-particularly not since you so recently were satis-
fied ' 'with less. I should also think it reasonable to wait until
about the time of.. expiration . of the present contracts before
negotiating in respect of a period thereafter. We remain, how-
ever, willing to meet with you further if you wish to do so.
The Union made no further effort to negotiate with respondent after
the receipt of. this letter.
The respondent's position is that,, under the provisions of the Act,
he' is privileged' to execute individual contracts with his employees,
and that he is under no obligation to sign a contract with the Union
as exclusive bargaining representative, of his employees within the
appropriate unit. . '
We' have previously' held that an -employer may not avoid his
responsibility to .deal with the- authorized agent of a majority of his
employees within an .appropriate,.unit by refusing to enter' into a
contract with'a labor organization and instead. offering his employees
individual contracts of employment.4 Were such action to be per-
mitted, it is obvious that 'there would be little opportunity for a
labor organization to secure recognition even though acting as the
designated representative of a majority of the, employees in a par-
ticular unit. There is no' doubt that such a course would offer an
effective method for rendering fruitless any efforts, on the part' of
labor organizations to bargain for employees. '
See, for example, Matter of The Stolle Corporation and Metal Polishers, Buffers, Platera
and'Helpers International Union, 13 N: L . R. B 370.
SCHIERBROCK MOTORS 1115
In support of his contention that he may, without violating the
Act, enter into individual contracts with his employees, the respond-
ent cites National Labor Relations Board v. Jones do Laughlin Steel
Corporation,5 and Virginian Ry. Co. v. System Federation No. 40,°
which is cited in the 'former case. We see nothing in these cases
which would validate an. evasion of the collective bargaining obli-
gation in the .manner' attempted here. As we said in platter of
The' Stolle Corporation,' "... the right to make individual con-
tracts has not been . held by the Supreme Court ... to be a per-
missible alternative to the obligation of collective bargaining where
the employees have, in' accordance with the Act, selected representa-
tives therefor ..." '
'We find,' therefore, that on .June 28; 1938, and at all times there-
after, the respondent refused to bargain collectively with the Union
as the exclusive representative of his employees in an appropriate
unit. By such refusal ' the respondent also interfered with, re-
strained, and coerced .his^ employees in the exercise of the rights
guaranteed by Section 7 of the Act. .
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE -
We find'that the activities of the respondent set forth in Section
III above, occurring in connection with the operations of the re-
spondent described in Section I above, havea close, intimate, and
substantial relation to trade, traffic, and commerce among the several
States, and tend to lead to labor disputes burdening and obstructing
,commerce and the free flow of commerce.
V.. THE REMEDY
The respondent , having ' engaged in unfair labor practices, we
shall order him to cease and desist therefrom and . to take certain
affirmative action designed to effectuate the policies of the Act and
to restore as nearly as possible the situation which existed prior to
the commission of the unfair, labor- practices. .
The respondent contends. that the employees here involved are no
longer members of the Union and that.the Union, therefore, does. not
represent a majority of the employees within the appropriate unit.
The evidence shows, however, that they were members of the Union
at the time of the unfair labor practices and had designated the
Union 'to represent them for the purposes of collective bargaining.
Their connection with the Union ceased only after the, execution
of the individual. contracts' of employment at the, instance of the
5 National Labor Relations Board v. Jones & Laughlin Steel Corporation, 301 U. S. 1.
9 Virginian By. Co. v. System Federation No. 40, 300 U. S. 515.
7 See footnote 4.
1116 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
respondent. It is plain that the direct cause of their defection from
the Union was the respondent's illegal evasion of his duty to bargain
with the Union. We cannot permit the respondent to evade his duty
to bargain with the Union because of the dissipation of its majority
resulting from the commission of his -unfair labor practices. We
shall order the respondent to bargain with the Union upon request.
Since the respondent's refusal to bargain was accomplished through
the use of individual contracts, executed in disregard of the Union's
authority to bargain for the men, we shall order the respondent to
refrain from enforcing or attempting to enforce such individual
contracts, and to give appropriate notice to the employees involved
that the contracts will not be enforced.
Upon the basis of the above findings of fact and upon the entire
record in the case, the Board makes the following :
CONCLusIONs OF LAW
1. Tri-City Auto Mechanics Lodge 1215 is a labor organization,
within the meaning of Section 2 (5) of the Act.
2. The automobile mechanics employed by respondent at his
Davenport, Iowa, garage constitute a unit appropriate for the pur-
poses of collective bargaining, within the meaning of Section 9 (b)
of the Act.
3. Tri-City Auto Mechanics Lodge 1215 was on January 1, 1938,
and at all times thereafter has been, the exclusive representative of
all employees in such unit for the purposes of collective bargaining
within the meaning of Section 9 (a) of the Act.
4. By refusing to bargain collectively with Tri-City Auto
Mechanics Lodge 1215 as the exclusive representative of his em-
ployees in the appropriate unit, the respondent has. engaged in, and
is engaging in unfair labor practices, within the meaning of Section
8 (5) of the Act.
5. By the acts set forth in the preceding paragraph, the respond-
ent has engaged in and is engaging in unfair labor practices within
the meaning of Section 8 (1) of the Act.
6. The aforesaid unfair labor practices are unfair labor practices
affecting commerce, within the meaning of Section 2 (6) and (7)
of the Act.
ORDER
Upon the basis of the above findings of fact and conclusions of
law and pursuant to Section 10 (c) of the National Labor Relations
Act, the National Labor Relations Board hereby orders that the
SCHIBRBROOK MOTORS 1117
respondent, Frank Schierbrock, doing business as Schierbrock Mo-
tors, Davenport, Iowa, and his agents, successors, and assigns, shall:
1. Cease and desist :
(a) From refusing to bargain collectively with Tri-City Auto
Mechanics Lodge 1215 as the exclusive representative of the auto-
mobile mechanics employed at his Davenport, Iowa, plant;
(b) From in any manner continuing, enforcing, or attempting
to enforce the individual contracts of employment with the em-
ployees in the - unit hereinabove found to be appropriate, or any
extension or renewal of such contracts, or any successor contracts
thereto ;
(c) From in any other manner interfering with, restraining, or
coercing his employees in the exercise of the right to self-organiza-
tion, to form, join, or assist labor organizations, to bargain collec-
tively through representatives of their own choosing, and to en-
gage in concerted activities for the purpose of collective bargaining
or. other mutual aid or protection, as guaranteed in Section 7 of the
Nat 6i al,-LdW- r ,Rel'ations Act.
2. Take the following affirmative action, which the Board finds
will effectuate the policies of the Act :
(a) Upon request, bargain collectively with Tri-City Auto
Mechanics Lodge 1215 as the exclusive representative of the auto-
mobile mechanics employed at his Davenport, Iowa, plant, with
respect to rates of pay, wages, hours of employment, and other
conditions of employment;
(b) Notify in writing each of his employees within the unit
hereinabove found to be appropriate and with whom individual
contracts of employment have been executed, that such contracts
will no longer be continued or enforced and that they are thereby
removed as an obstacle to collective bargaining by Tri-City Auto
,Mechanics Lodge...1215, acting as the duly chosen representative of
the employees ;
(c) Immediately post notices to his employees in conspicuous
places throughout his Davenport, Iowa, plant and maintain such
notices for a period of at least sixty (60) consecutive days from the
date of posting, stating that the respondent will cease and desist in
the manner set forth in 1 (a), (b), and (c) and that he will take
the affirmative action set forth in 2 (a) and (b) of this Order;
(d) Notify the Regional Director for the Eighteenth Region in
writing within ten (10) days from the date of this Order what steps
the respondent has taken to comply herewith.