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National Labor Relations Board v. Bagel Bakers Council of Greater New York

decided: November 20, 1970.


Lumbard, Chief Judge, and Anderson and Feinberg, Circuit Judges.

Author: Feinberg


The National Labor Relations Board petitions for enforcement of its order, which found that the Bagel Bakers Council of Greater New York and its employer-members had failed to bargain in good faith with Bagel Bakers Union Local 338 and had unlawfully locked out employee members of that Local and of Bakery Drivers Union Local 802.*fn1 The Council cross-petitions for review of the same order. We enforce the order of the Board as to violations with respect to Local 338. We reverse the Board's determination with respect to Local 802.


Each of the respondent employers manufactures and sells bagels, which may be technically described as hard rolls shaped like doughnuts, although such a description is like calling a sunset a collection of colors.*fn2 Respondents are all members of the Bagel Bakers Council, which was formed some years ago for social reasons and to aid the member employers in discussing common problems. Just how much aid the Council was to furnish and on what problems are important issues in the litigation because their resolution determines a basic jurisdictional issue. The Board concedes that its monetary standards for asserting jurisdiction would be met only if the individual businesses were part of a multiemployer bargaining unit. Therefore, we must consider first the Board's finding that the Council members engaged in multiemployer bargaining with Local 338.

Among the subsidiary findings of the Board on this issue were the following: For some years a committee of Council members, headed by Council President and full -time employee Isidore Glass, had negotiated collective bargaining agreements with the unions representing employees of Council members. When agreement was reached, the practice was for the contract to be approved by the Council and then signed by the individual members.*fn3 When Local 338 struck three shops in 1966, the members of the Council dealt jointly with Local 338 through the Council, even though the union protested that its contract was with individual employers, not with the Council. In addition, the Council's Financial Secretary admitted that in bargaining for the 1967 contract, which led to the unfair labor practice findings now under review, the Council committee was seeking for Council members a contract that would be "one for all and all for one." Based upon this and other evidence, the Board found that the business of respondent employers was properly considered collectively.

In determining whether a multiemployer unit was appropriate, the standard applied by the Trial Examiner, and affirmed by the Board, was

whether Respondent employers have expressly or by implication indicated their intention to be bound in collective bargaining by group, rather than individual action.

In other cases, the Board has stated the test somewhat differently, adding as an integral part thereof the question whether the union "has been notified of the formation of the group and the delegation of bargaining authority to it, and has assented and entered upon negotiations with the group representative." See, e. g., Weyerhauser Co., 166 NLRB 299 (1967). The test phrased in that manner was specifically approved by the Court of Appeals for the District of Columbia in Western States Regional Council No. 3, International Woodworkers of America v. NLRB, 130 U.S. App. D.C. 176, 398 F.2d 770, 773 (1968). We have impliedly accepted the proposition that the validity of a multiemployer unit depends not only upon the intent of the employers but the acceptance of the group unit by the union. See NLRB v. Great Atlantic & Pacific Tea Co., 340 F.2d 690, 693 (2d Cir. 1965). Therefore, it might be argued that the test used by the Board here was inadequate since it ostensibly focused only on the intention of the employers. However, such an objection would be undue formalism on this record since the Board made subsidiary findings, which showed union acceptance of the group unit.

On the ultimate finding of employer intent, no express agreement to be bound by group action was required, see NLRB v. Sightseeing Guides and Lecturers, Local 20076, 310 F.2d 40, 42 (2d Cir. 1962), although that sometimes exists. Rather, as we have indicated in a slightly different context, "a history of multiemployer bargaining may suffice." Publishers' Association of New York City v. NLRB, 364 F.2d 293, 295 (2d Cir.), cert. denied, 385 U.S. 971, 87 S. Ct. 509, 17 L. Ed. 2d 435 (1966). The facts set forth above, adequately supported by the record, show that there was more than enough history here of employer intent.*fn4 As to union reaction, the Examiner found that for some years bargaining had gone on between the Council and Local 338. Union acceptance of the group unit was therefore obvious.*fn5 The Council emphasizes that the employers signed separate contracts and that no employer formally authorized the Council to act upon its behalf for negotiating a contract or processing a grievance, even though the 1966 individual contracts provided a mechanism for doing so. There is no doubt that the Board considered these facts; the Examiner's opinion refers to them. Yet the Board concluded that the contrary evidence of intention to engage in group bargaining nonetheless was stronger. Based upon this record, that was a finding with which we should not interfere.


We turn now to the other questions in the case. The Board found that in December 1966 the Council and Local 338 began bargaining for the 1967 contract. Between that time and January 31, 1967, the expiration date of the existing contract, a number of negotiating sessions were held. Local 338 sought no pay increase but only a two-year extension of the existing contract. Respondents claimed to be losing money because of increased competition from automated manufacturers, non-union shops and out-of-town producers shipping frozen bagels into the metropolitan area, and demanded a 40 per cent reduction in labor costs as a condition of a new agreement. Local 338 replied that it would consider a "roll back" in labor costs on the basis of individual demonstrated need. It therefore requested those Council members losing money either to allow Local 338 to examine their books or to bring in audits in support of their position. At one of the meetings, the Council indicated that it might take less than a 40 per cent cut but made no specific offer. Union negotiators told the Council:

Bring your books to us. Bring an audit, accountant's report. Show us where you are losing money so we can guide ourselves and ...

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