631 F.2d 669 (10th Cir. 1980), 79-1152, N.L.R.B. v. Northeast Oklahoma City Mfg. Co.

Docket Nº:79-1152.
Citation:631 F.2d 669
Case Date:September 08, 1980
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit

Page 669

631 F.2d 669 (10th Cir. 1980)




No. 79-1152.

United States Court of Appeals, Tenth Circuit

September 8, 1980

Argued May 7, 1980.

Page 670

James Callear, Washington, D. C. (William F. Wachter of N. L. R. B., Washington, D. C., with him on the brief), for petitioner.

Peter T. Van Dyke, Lytle Soule & Emery, Oklahoma City, Okl., for respondent.

Before BARRETT and SEYMOUR, Circuit Judges, and PECK, Senior Circuit Judge. [*]

JOHN W. PECK, Senior Circuit Judge.

This case is before the Court on application of the National Labor Relations Board (the Board), brought under Section 10(e) of the National Labor Relations Act, as amended, 29 U.S.C. § 151 et seq. (the Act) for enforcement of its July 6, 1978, Order

Page 671

against Northeast Oklahoma City Manufacturing Company (the Company). 1 The issues to be decided are: (1) whether the Board properly refused to defer this case to arbitration, (2) whether substantial evidence on the record supports the Board's finding that payment of employee bonuses after the middle of the month constituted an unlawful unilateral change in working conditions, in violation of Section 8(a)(5) of the Act, and a material breach of the collective bargaining agreement, (3) whether the late payments excused the employees' resort to strike action, notwithstanding the contract's grievance-arbitration and no-strike provisions, rendering the Company's discharge of the strikers a violation of Section 8(a)(3) and (1) of the Act, and (4) whether the Board properly imposed backpay liability from the date of discharge of the strikers rather than from 5 days after the strikers made an unconditional offer to return to work. For the reasons appearing hereinafter, we resolve all of the above issues in favor of the Board, and grant enforcement of its order.


This case arises from the respondent's February 5, 1975, discharge of 12 employees who took part in a walkout on that date to protest the Company's delay in paying monthly bonuses. The respondent, which was engaged in the manufacture of electrical hardware, employed 18 production and maintenance employees at its plant. Since 1972, the employees have been represented by the International Brotherhood of Electrical Workers, Local 2021 (the Union). The Company and the Union were parties to a collective bargaining agreement that was effective from November 13, 1972, until November 12, 1975.

In addition to an hourly wage, the contract provided that,

the Company will pay monthly, a bonus to all qualified employees based upon the following formula: Five per cent (5%) of production attributable to labor minus the cost of labor. . . . In order to qualify an employee must have a minimum of two (2) months service; must work a minimum of Eighty Percent (80%) of the hours available for work; must be present as of the end of the month for which the bonus is paid; and must meet minimum expected output and quality requirements set by supervisors. . . .

The testimony credited by the administrative law judge showed that, in practice, Plant Manager Ralph Stevenson generally permitted employees to receive a bonus on the basis of their attendance alone, without regard to the efficiency and quality of their work. The Board also found, and the Company concedes, that it was the respondent's practice to pay the bonus in the second week of the month following the month in which it was earned. This practice began prior to the time the employees were represented by the Union, and continued after the collective bargaining agreement was entered into, though the exact time for payment was not specified therein.

Trouble began when the Company failed to pay the July '74 bonus in mid-August. Following that, bonuses were paid after the middle of the month in five of the next six months. Bonuses for August and September were not received until the second month following the month in which they were earned. And December's bonus had not yet been paid as of February 5, 1975, when the workers walked out of the plant.

Prior to the walkout, the evidence shows that the employees and the Union attempted to resolve the dispute through their contractual grievance machinery. The collective bargaining agreement established an informal grievance procedure for presenting complaints to and discussing them with successively higher levels of management. Typically, when bonus payments were not forthcoming by the middle of the month,

Page 672

the employees would complain to the employee-stewards at the plant, the stewards would present a grievance to their plant supervisor, Nesbitt, and to plant manager Stevenson, and the Union's chief steward, Hill, would meet with Stevenson and/or President James to discuss the matter. Just as typical was the Company's response. Nesbitt would assert that he had nothing to do with bonus payments, Stevenson would promise that payment would be made by a certain date, and the promise would be broken.

The proverbial straw that broke the camel's back was the untimeliness of December's bonus payment. Manager Stevenson promised Hill, in October of 1974, that the December bonus would be paid the first week of January. When the appointed time arrived, Steward Jackson contacted Stevenson to remind him of his promise. Stevenson replied that he did not know anything about it and that the employees would probably receive the bonus the following week. The first week of January passed without payment, and the employees began to protest to their stewards. Chief Steward Hill met with Manager Stevenson who said that "he was tired of fooling with it" and told Hill to speak with President James. James told Hill that the employees had earned a December bonus, but that the Company did not have any money. He referred Hill back to Stevenson. Stevenson promised Hill that the bonus would be paid on January 13. It was not paid on that date. When approached again, Stevenson promised that the employees would receive their bonus in the last week of January, but that promise too was broken. Finally, on Monday, February 3, Stevenson told Steward Jackson that the Company would pay the bonus that Friday.

On Wednesday of that week, Stevenson stated that the bonus would not be paid on Friday. Steward Jackson sought to speak with President James, but he refused to see her that week. Jackson relayed this information to the employees. The employees discussed the delay and decided to walk out to protest the Company's paying the bonus late so often. Without informing the Union of their intended action, 12 of the 18 employees clocked out and left the plant.

That afternoon, President James sent letters to the 12 employees who had left the plant, informing them that they were discharged for walking out and striking in violation of the no-strike clause in the contract. The contract then in effect provided that:

The purpose of the Agreement is to provide orderly collective bargaining arrangements between the Company and the Union and to secure a prompt and fair disposition of all disagreements. The Union agrees that there will be no strikes, slowdowns or walkouts and that there will be no interruption of work or...

To continue reading