Contech Division, SPX Corp. v. N.L.R.B.

Decision Date30 December 1998
Docket NumberNos. 97-5099,97-5247,s. 97-5099
Citation164 F.3d 297
Parties160 L.R.R.M. (BNA) 2071, 137 Lab.Cas. P 10,323 CONTECH DIVISION, SPX CORPORATION, Petitioner/Cross-Respondent, v. NATIONAL LABOR RELATIONS BOARD, Respondent/Cross-Petitioner, International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, UAW, Intervenor.
CourtU.S. Court of Appeals — Sixth Circuit

Peter J. Kok (argued and briefed), James R. Peterson, Miller, Johnson, Snell & Cummiskey, Grand Rapids, MI, David M. Buday (briefed), Miller, Johnson, Snell & Cummiskey, Kalamazoo, MI, for Petitioner/Cross-Respondent.

Aileen A. Armstrong, (briefed), Deputy Assoc. Gen. Counsel, Peter Winkler (argued and briefed), Deborah E. Shrager (briefed), National Labor Relations Board, Washington, DC, for Respondent/Cross-Petitioner.

Jordan Rossen (briefed), Nancy Schiffer (argued and briefed), Associate General Counsel, Detroit, MI, for Intervenor.

Before: RYAN, COLE, and GILMAN, Circuit Judges.

GILMAN, Circuit Judge.

This matter arises from the efforts of the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America ("the UAW") to organize the production and maintenance employees ("the employees") of Contech Division, SPX Corporation in Dowagiac, Michigan. After setting aside the results of a certification election in which a majority of the employees voted against UAW representation, the National Labor Relations Board ("the Board") ordered a new election in which the UAW prevailed. The Board subsequently certified the results of the latter election and designated the UAW as the exclusive collective-bargaining representative of the employees.

Upon Contech's refusal to bargain with the UAW, the Board charged Contech with a violation of Sections 8(a)(1) and (5) of the National Labor Relations Act ("the Act"), 29 U.S.C. § 158(a)(1) and (5), and issued an order directing that Contech bargain on request with the UAW. Contech now petitions for review of that order, and the Board brings a cross-application to enforce the same. Contech asserts that the Board improperly set aside the results of the first election and also improperly certified the results of the second election. We are satisfied, however, that substantial evidence supports each of the Board's decisions in question. Accordingly, we DENY Contech's petition for review and GRANT the Board's cross-application for enforcement of its order.


Contech, a parts manufacturer for TRW, Ford Motor Company, and other automotive suppliers, operates two plants in Dowagiac, Michigan ("Plant 1" and "Plant 3") and a plant in Auburn, Indiana. SPX Corporation, Contech's parent company, operates a plant in Muskegon, Michigan.

In November of 1994, the UAW filed a petition for a Certification of Representative ("the representation petition") with the Board, indicating that "a substantial number of [the] employees wish to be represented for purposes of collective bargaining by [the UAW] and [the UAW] desires to be certified as representative of the employees." Pursuant to a Stipulated Election Agreement, a certification election was scheduled for January 12, 1995. During the pre-election campaign, Contech engaged in conduct that prompted the Board to set aside the results of the election. The specific nature and effect of that conduct, as found by the Board, is set forth in detail below.

A. The First Election

On November 17, 1994, three days after the UAW filed the representation petition, the employees received a letter from Dwayne Weber, Contech's Human Resources Manager. Weber stated in the letter that over two-thirds of the 600 plants that had closed in Michigan over the past two decades had union work forces.

The employees also received a handout containing a reprinted newspaper article addressing Ford's removal of manufacturing dies from an Indiana plant where employees were on strike. The following statements from the article were emphasized in the margins of the reprinted pages: "DIES OWNED BY FORD MOTOR COMPANY," and "THE DIES WOULD HAVE STAYED AT THE PLANT ANOTHER FOUR YEARS IF THE STRIKE HAD NOT OCCURRED." The handout noted that the UAW was the union involved in the article. Another Contech handout contained a reprint of a 1982 letter in which a Contech customer informed Contech's general manager that it had "closed its doors ... due to union difficulties." On the back page of both of the above handouts, the following message appeared in large print: "SAY NO TO THE POSSIBILITY OF LOST CUSTOMERS, LOST JOBS, LOST PAY, LOST BENEFITS, AND OTHER TROUBLES--VOTE NO."

In late December, Contech transferred the production of the MN-12, a Ford part, from Plant 3 in Dowagiac, Michigan to the plant in Auburn, Indiana. Contech did not provide any explanation to the employees for making this transfer.

Several days after the UAW filed the representation petition, Robert Davis, Contech's Director of Sales and Marketing, met with Gary Mahon, TRW's Director of Purchasing. The purpose of the meeting was to negotiate a renewal of their contract for the manufacture of TRW's rack-and-pinion steering housings, the production of which constituted about 15% of the output of Plant 1 and 90% of Plant 3. At the meeting, Mahon informed Davis of TRW's desire to postpone contract-renewal negotiations "until [Contech's] union representation issue as well as some longstanding quality and delivery issues between [Contech] and TRW were resolved."

In a December speech, Contech's Director of Manufacturing Joe Barry indicated to the employees that TRW would not renew its contract with Contech until after the election. In a separate speech, Brad Farver, Contech's Manufacturing Manager, referred to a letter from TRW to Contech in which TRW purportedly communicated a concern about Contech becoming unionized. Farver, however, declined to elaborate when asked by the employees to explain why TRW would not want to deal with Contech in the event that Contech became unionized. Moreover, Contech did not explain to the employees that product quality and delivery issues were contributing factors in TRW's hesitancy at entering into a long-term renewal contract.

Also in December, Contech showed its employees a video depicting strike violence. At that meeting, Barry and Farver discussed with them the status of the TRW contract-renewal negotiations. Barry stated that "negotiations had been suspended 'until we got some of our problems behind us.' " Farver stated that "TRW had postponed long-term agreements 'until our issues are resolved.' "

During the two weeks preceding the election, Contech displayed large poster photographs of closed manufacturing plants. These posters remained on display until immediately before the election. On January 10, 1995, two days before the election, Contech distributed a handout signed by Weber explaining that the closed plants pictured in the posters "were in Michigan and were now closed, that all of the employees who had worked in those plants were now laid off, many permanently, and that in each instance the laid off employees had been represented by a union." The handout also provided that since 1987, there had been a reduction of almost 400 UAW jobs at SPX's Muskegon, Michigan plant. Moreover, the handout stated that within that past year, 105 union jobs were lost when SPX closed its Ravenna, Michigan plant because of "ineffective operation." Weber's note concluded: "A UNION DOES NOT PROVIDE JOB SECURITY." In the interim, Mark Hunsberger, a Contech Supervisor, stated to "at least three or four employees individually" that TRW had sent one of its dies to another company to determine whether that company could produce the part.

On January 9, 1995, three days before the first election, Al Zagotta, Contech's President, sent a letter to the employees. In the letter, Zagotta explained that Contech was in a "very critical stage in its relationship with certain key customers like TRW, Ford, and Saginaw." Zagotta's letter continued as follows:

I am concerned that if the Dowagiac plant develops a reputation for not being a dependable supplier--because of labor problems, a UAW-led strike, or even the possibility of a strike every time the contract comes up for renewal--our customers may become nervous and look elsewhere for another source for their parts.

On January 10, 1995, two days before the election, Gary Walker, a Division Manager of Contech, spoke to the employees. He stated that Contech was "greatly concerned about the impact the union could eventually have on our customers like TRW and our ability to compete." He also referred to what he termed as the "horrendous strike record of the UAW," "the [hundreds] of closed plants in Michigan and the hundreds of thousands [of] UAW members who lost their jobs ... as a result of inefficient operation and UAW-led strikes." Furthermore, Walker shared his observation that "the UAW is always at the heart of conflict." He also discussed three unionized SPX plants in Western Michigan that "were either partially or totally shut down because they were allegedly no longer competitive."

During January 9 and 10, the same two-day period that Zagotta and Walker made the above statements to the employees, Jack Fannon, TRW's Quality Representative, made a thorough inspection tour of Contech's two Dowagiac facilities, accompanied by an entourage of Contech managers and supervisors--all of which was highly visible to the employees.

Finally, Contech's supervisors at both Plant 1 and Plant 3, on all three shifts, regularly discarded UAW literature left in the respective lunchrooms of the plants. Those supervisors, however, did not disturb current newspapers, magazines, and Avon booklets.

An election by secret ballot was conducted on January 12, 1995 ("the first election"). The results of the first election were as follows: 154 votes in favor of UAW representation, 196 votes...

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