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National Labor Relations Board v. Warrensburg Board & Paper Corp.

January 5, 1965

NATIONAL LABOR RELATIONS BOARD, PETITIONER
v.
WARRENSBURG BOARD & PAPER CORPORATION, RESPONDENT.



Author: Smith

Before LUMBARD, Chief Judge, MOORE and SMITH, Circuit Judges.

SMITH, C. J.:

The National Labor Relations Board pursuant to § 10(e) of the National Labor Relations Act petitions for enforcement of its order issued on July 3, 1963 against Respondent, Warrensburg Board & Paper Corporation. The Board found that the Respondent had violated § 8(a)(1) and (5) of the Act by refusing to sign an agreement embodying orally agreedupon terms and conditions of employment. No jurisdictional issue is presented because the claimed unfair labor practices occurred in Warrensburg, New York, where the Company is engaged in the manufacture and sale of paperboard and related products and because the Respondent is engaged in commerce within the meaning of the Act. We hold that the Board's findings are supported by substantial evidence on the record as a whole and accordingly enforce the Board's order.

On June 16, 1961, the Union, United Paper Makers and Paper Workers AFL-CIO, following a program of recruitment among the Respondent's employees, petitioned the Board for an election. Respondent objected to allegedly illegal methods used by the Union to obtain signed membership cards, but the Regional Office of the Board made no investigation into the merits of the complaint, and on August 11, the Company consented to an election. The Union won by a vote of 15 to 14, and within a week Respondent wrote to the Regional Director of the Board to object to claimed irregularities in the voting.In his Report on Objections, the Regional Director overruled the Company's claims because the Respondent had neglected to serve copies of these objections on the Union as required. Shortly thereafter, Respondent filed with the Board a request for extension of time for filing exceptions to the Regional Director's Report, neglecting this time, however, to submit proof of service on the Union. The Board, on October 4, after advising Respondent to no avail that proof of service was requisite to the granting of Respondent's request, certified the Union as the exclusive collective bargaining representative of the employees.

Following a preliminary meeting on December 15, 1961, at which the Union submitted a proposed contract, the parties met four times, discussing various provisions of the contract on January 15, February 12, and March 8 and 16. In the course of the first three meetings, the Union succeeded in most of its major demands, gaining agreement to an employee insurance plan, a Union bulletin board, free access to the mill to contact employees, grievance discussion rights, and wage increases.A two year contract, incorporating these concessions, was tentatively agreed upon. The last meeting was scheduled for the sole purpose of attempting to resolve a disagreement on the Union security issue; however, considerable confusion arose with regard to how that issue was finally settled. The Trial Examiner determined that the parties agreed to hold a secret ballot vote among the employees permitting them to choose between a membership or union shop, in either case with a 30-day escape period. A union shop provision with a 30-day escape clause was interpreted by the Board to mean that all employees who did not withdraw from membership during the escape period had to remain members, and that all new employees would automatically become members. The Respondent claims that the Union agreed, in assenting to the 30-day escape clause, that it would make no claim to represent the employees and would waive its rights following certification of the Union if the Union did not represent a majority of the employees at the end of the escape period.

At a meeting on March 31, the employees, by a single vote margin, voted in favor of the modified union shop provision. Between April 1 and May 1, 25 of the Respondent's 29 employees signed withdrawals from the Union, as they were permitted to do under the 30-day escape clause. Claiming that the employees had by their widespread defection rejected the Union, the Respondent refused to sign the contract.

The Board concluded on the basis of these facts that the Company had violated § 8(a)(1) and (5) of the Act by refusing to sign a collective bargaining contract embodying agreed-upon terms and conditions of employment. Accordingly, the Board ordered the Respondent to cease and desist from the commission of this unfair labor practice and from in any like or related manner interfering with the rights guaranteed its employees under Section 7 of the Act. Respondent was further ordered to execute the contract submitted to it by the Union, with an effective terminal date of March 1, 1964, if the Union requested that it be signed. If no such request was made, Respondent was ordered to bargain with the Union and to embody any understanding in a written agreement. In any case, Respondent was required to post an appropriate notice.

Clearly the Board had the authority to issue the orders and to make the findings that it did. Respondent's contention that the Board acted improperly in accepting the finding made by the Trial Examiner as to the meaning of the 30-day escape clause is completely without merit. The Trial Examiner determined that the parties by including that provision did not intend in any way to terminate their association in the event that more than a majority of the employees withdrew from the Union. Although there was conflicting testimony on this issue, we have held in the past that questions of credibility are for the trier of fact and that we will not upset the decision of the Board "when it accepts a finding of an Examiner which is grounded upon (a) his disbelief in an orally testifying witness' testimony because of the witness' demeanor or (b) the Examiner's evaluation of oral testimony as reliable, unless on its face it is hopelessly incredible or flatly contradicts either a so-called 'law of nature' or undisputed documentary testimony" (citations omitted). NLRB v. Dinion Coil Co ., 201 F.2d 484, 190 (2 Cir. 1952). See also, NLRB v. Marcus Trucking Co ., 286 F.2d 583, 590 (2 Cir. 1961).

There was sufficient basis for the Board's interpretation of the 30-day clause. The notice entitled "Our Last Offer," posted in the Respondent's plant for the purpose of advising employees of their right to elect between two union security provisions, makes it evident that the parties did not contemplate an end to the Union contract or the withdrawal of the Union in the event the Union lost a majority of its members.*fn1 The testimony of those who attempted to buttress the Respondent's position was of questionable value since two of the witnesses were closely identified with the Company's management and the others, although originally Union members, were not shown to have retained their membership. In any event, we hold that there exists a presumption against the finding of such an agreement during the one-year certification period, in view of the policy of permitting the union to have every opportunity to establish itself during that time, even if it has lost its majority status. See Brooks v. NLRB, 348 U.S. 96, 99 L. Ed. 125, 75 S. Ct. 176 (1954).

The major question raised by this appeal is whether an employer can be required by the Board to enter into a contract with a duly certified union when the contract, if properly signed, would have expired prior to the Board's enforcement order, and under circumstances where the employer has granted such employee benefits as were demanded by the union and where the union has lost its majority status. We hold that the employer in such a case should be required to enter into a contract with the union and that the Board acted properly here in so ordering. We further hold, in agreement with the Board's findings, that the Respondent's refusal to sign the Union contract constituted a violation of § 8(a)(1) and (5) of the National Labor Relations Act.

Were we merely to weigh the respective equities of the parties we might be inclined to deny enforcement of the Board's orders or, alternatively, to require that the Board conduct another representation election. There are arguments against subjecting the large majority of the employees to the leadership of a union which they have repudiated and to the terms of a two-year contract which by this time would have expired.*fn2 It would do violence to the Act, however, so to hold, for failure to enforce would encourage purposeful delay in other cases.

Under the Act an existing certification must be honored until lawfully rescinded, possibly subject to the exception originated by the Fifth Circuit, that an employer will not be required to bargain with a union which has demonstrably lost its majority status and where the filing of a petition for decertification would be futile. NLRB v. Florida Citrus Canners Cooperative, 288 F.2d 630, 639 (5 Cir. 1961). See also NLRB v. Satilla Rural Electric Membership Corp ., 322 F.2d 251, 253 (5 Cir. 1963); NLRB v. Mayer, 196 F.2d 286, 289 (5 Cir. 1952).*fn3 That exception would not apply to a situation such as here where it was possible for the union to be removed as the bargaining agent of the employees. Those employees who were dissatisfied with the union arrangement could have submitted their grievances to the Board, and following the twelve month certification period any remaining dissatisfied employees, under § 9(e)(1) and (2) of the Act, could have filed a petition for a new election.*fn4 Alternatively, the Respondent might have petitioned the Board for relief.*fn5 See, e.g., McLean v. NLRB, 333 F.2d 84 (6 Cir. 1964).

It is clear that wherever there is a change in the representative status of a union, the Board, and not the reviewing court, is the proper body to reassess the change. NLRB v. International Union, Progressive Mine Workers of America, 375 U.S. 396, 11 L. Ed. 2d 41, 84 S. Ct. 453 (1964) (per curiam ), reversing 319 F.2d 428 (7 Cir. 1963); NLRB v. Katz, 369 U.S. 736, 8 L. Ed. 2d 230, 82 S. Ct. 1107 (1961); Franks Bros. Co. v. NLRB, 321 U.S. 702, 88 L. Ed. 1020, 64 S. Ct. 817 (1944).*fn6 See, also, McLean v. NLRB, supra . The Board had ample basis for concluding that the Respondent was under a duty to enter into a contract with the Union notwithstanding the Union's apparent loss of majority support. In Brooks v. United States, 348 U.S. 96, 99 L. Ed. 125, 75 S. Ct. 176 (1954), the Supreme Court upheld the Board's determination that the employer had committed an unfair labor practice by refusing to negotiate with a duly certified union which no longer represented a majority of the employees. Said the Court:

"The underlying purpose of this statute is industrial peace.To allow employers to rely on employees' rights in refusing to bargain with the formally designated union is not conducive to that end, it is inimical to it. Congress has devised a formal mode for the selection and rejection of bargaining agents and has fixed the spacing of elections, with a view of furthering industrial ...


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