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Welch Scientific Co. v. National Labor Relations Board

January 14, 1965


Author: Medina

Before MEDINA, MOORE and MARSHALL, Circuit Judges.


Petitioner, a manufacturer and distributor of educational and scientific materials, is an Illinois corporation with its main office and four plants located in Chicago. In 1937, when petitioner operated but one plant in Chicago, it entered into an "open shop" collective bargaining agreement with Local 325 of the Paper Makers Union. Four years later, the agreement was modified to cover "The Welch Scientific Company, of Chicago, Illinois, and its subdivisions and subsidiaries." Every subsequent agreement between petitioner and Local 325 has contained this coverage clause, including a two year contract executed on May 6, 1963 and effective from July 1, 1963. Since 1941, contracts with Local 325 have provided that Welch "agrees to recognize and to bargain collectively with Local 325 * * * as the sole collective-bargaining agent for all employees of the Company * * *."

In 1961, Welch, seeking to obtain outlets on the East and West Coasts, established a branch in San Carlos, California. In April 1962, Welch purchased the New York Scientific Supply Company, a more specialized operation, producing biological models and scales. The New York plant is the principal subject of the Board order before us for review.

Between April 1962 and April 1963, New York Scientific continued to operate under its old name at its old location. In April 1963, the New York branch moved to its present larger quarters under the name of Welch Scientific Company. The new facilities were capable of handling the warehouse and service functions that Welch wished to add to the production activities previously carried on by New York Scientific. While a substantial portion of the affairs of the New York operation was conducted by the Chicago office, Welch retained the former owners of New York Scientific, Rubinger and Cohn, to manage the New York plant. The managers were given authority to hire and discharge employees. Some supervisory personnel were transferred from Chicago to New York and several new employees were added to the previous complement of approximately 14 workers at the New York plant.

With these essentially undisputed facts as a background, we turn to the conduct found by the Board to have violated the National Labor Relations Act. In April 1962, when Welch bought New York Scientific, Rubinger was supplied with information and booklets describing Welch's pension, profit-sharing and hospitalization plans, which were independent of the agreement with Local 325, and Rubinger was instructed to distribute this material to the New York employees. Though Rubinger had been told about the contract with Local 325, no information about the union or the agreement was provided the employees as a whole until much later on. In the meantime, however, Welch paid wages and sick benefits and established holidays and vacations in accordance with the agreements negotiated with Local 325, and on several occasions the company informed individual employees that it was doing so because it considered the agreements applicable to the New York plant.

During June 1963, Local 2682 of the Union Brotherhood of Carpenters & Joiners, AFL-CIO, began an attempt to organize the New York employees, who had never during the forty years of New York Scientific's existence been represented officially by any union. A meeting of Local 2682 was held on Monday evening, June 24, 1963, and the Local's president, Prezioso, announced that he would telephone the company at about 11 o'clock the next morning to request recognition. Prezioso called Rubinger at about 11:30 A.M., Tuesday, June 25, and arranged a meeting for Friday, June 28. Local 325 was not mentioned during the conversation between Prezioso and Rubinger. Shortly after the telephone call, Prezioso filed a representation petition with the Board.

On June 25 and June 26, Rubinger briefly asked each employee, individually and at the employee's customary place of work, whether or not he had joined Local 2682. Each employee's answer was checked off by Rubinger on a list of employees that he carried with him.

At 5:30 P.M. on June 25, an employee, Abraham Axelrod, was discharged by the company. We shall have more to say about this phase of the case later, as the Board found that Axelrod was discharged for participation in union activities and entered its customary order of reinstatement and back pay.

On June 28, Rubinger told Local 2682's representatives that he could not recognize or bargain with them as the contract with Local 325 already covered the New York employees. Subsequently, the company informed Local 325 of Local 2682's organizational effort.

On July 8, Richard Welch, Jr., vice president and treasurer of the company, appeared at the New York plant and spoke to small groups of employees. Welch told the employees that they had been and were covered by contracts with Local 325 and were entitled to all their terms and benefits, including a five cent an hour raise contained in the agreement executed May 6, 1963 and effective July 1, 1963. With the exception of one employee who received a vacation paycheck on June 28 which included the raise, the employees had no prior knowledge of the negotiations carried on in their behalf by Local 325 or the terms of the agreement that supposedly covered them. The vice president also distributed copies of the latest contract to the employees.

Eight days later, on July 16, an organizer for Local 325 came to the New York plant and requested Rubinger's permission to solicit memberships. Permission was granted, and the organizer was introduced to one of the employees by a foreman who left immediately after the introduction. This was the first contact between Local 325 and the New York employees.

An unfair labor practice charge was filed by Local 2682 on July 15, 1963, while the representation proceeding instituted by Local 2682 on June 25 was still pending. The Regional Director's decision directing an election was handed down on August 6, 1963. Welch's twin claims of contract bar and accretion were rejected by the Regional Director, the first as the 1961-1963 contract "was not applied" to the New York employees and the petition preceded the effective date, July 1, of the 1963-1965 contract, and the second on the ground that the "New York plant is a new operation and not just an accretion to the existing unit." The election, conducted on January 24, 1964, resulted in a victory for Local 325. The Regional Director, however, set aside the election on September 25, 1964, because of the company's pre-election activities previously discussed, and ordered a new election. We were informed at oral argument by counsel for Welch that Local 325 will not participate in this election.

The General Counsel's unfair labor practice complaint was issued on August 30, 1963. The complaint alleged that the following acts constituted violations of Section 8(a)(1) as they interfered with, restrained and coerced the New York employees in their freedom to choose to be represented by Local 325, Local 2682 or no union: (1) the interrogation of employees on June 25 and June 26; (2) the vice president's talks to employees on July 8, during which he adverted to the wage increase under the terms of the 1963-1965 contract with Local 325; (3) the company's application in July 1963 of the contract to the New York employees who had not as yet chosen to be represented by Local 325; (4) the ...

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