N.L.R.B. v. Marland One-Way Clutch Co., Inc.
| Decision Date | 03 September 1975 |
| Docket Number | Nos. 74-1348,74-1413 and 74-1414,ONE-WAY,74-1349,s. 74-1348 |
| Citation | 520 F.2d 856 |
| Parties | 89 L.R.R.M. (BNA) 2721, 90 L.R.R.M. (BNA) 2316, 77 Lab.Cas. P 10,959 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MARLANDCLUTCH CO., INC., Respondent. MARLANDCLUTCH CO., INC., Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Elliott Moore, Deputy Associate Gen. Counsel, Frank C. Morris, Jr., and Abigail Cooley, N. L. R. B., Washington, D. C., for N. L. R. B.
L. Lee Burks, Jr., Park Forest, Ill. for Marland One-Way Clutch Co., Inc.
Before MARIS, * Senior Circuit Judge, and CUMMINGS and PELL, Circuit Judges.
These cases are before the court upon applications for enforcement and cross-petitions for review of two orders of the National Labor Relations Board. In case 13-CA-10161(61)(74-1348, 74-1413) the board found that the company violated § 8(a)(1) and (5) of the National Labor Relations Act (29 U.S.C. § 151 et seq.) by withholding payment of third quarter bonus payments in 1970 without giving the union an opportunity to bargain and by refusing to supply information regarding the method used to compute the amount of bonus payments. The board originally ordered, inter alia, that the third quarter bonus be paid, that relevant information be supplied, and that the company bargain in good faith regarding future bonus payments. Subsequently the board modified its order and ordered payment of all bonuses unilaterally withheld. In 13-CA-10823(23)(74-1349, 74-1414) the board found the company violated § 8(a)(1) of the Act by creating the impression of surveillance of the union and threatening plant closure.
Marland One-Way Clutch Co., Inc. is an Illinois corporation engaged in the manufacture of mechanical clutches. The Tool & Die Makers Lodge No. 113, International Association of Machinists and Aerospace Workers, AFL-CIO, was certified on September 14, 1970. The union's efforts to organize the company's employees were opposed by management, but the alleged violations occurred after the election.
From 1947 through 1967 the company paid a bonus to employees at Christmas. In 1968 the company began paying the bonus in quarterly installments. On several occasions, the company wrote letters or memoranda to the employees which upon reasonable interpretation could have caused the employees to think of the bonuses as part of their compensation. Some of these letters related the bonuses to hourly rates and by adding the bonuses to regular hourly rates arrived at a "Marland hourly rate total." The bonuses were paid quarterly until the third quarter of 1970, shortly after the union election, when no payment was made. The third quarter bonus has since been paid in compliance with the board's order, 1 but no bonuses have been paid for subsequent quarters.
When the bonus was not paid, the union representative questioned the company representative about the bonus. He was told that the decision at the particular time was to withhold payment and that the bonus was discretionary. The union representative then requested information on the bonus. The company responded:
"Bonus : Christmas bonus is discretionary and based on management evaluation of business."
Shortly after that colloquy, on October 20, 1970, the union filed charges with the board which resulted in the 61 case.
On December 30, 1970, the union wrote the company with a view to further negotiations on the bonus, making the following request:
"(W)e are hereby requesting that the Company submit in written form, as soon as possible, all information relating in any way to the Method the Company has used in Computing the Christmas bonus in the past for the employees we now represent."
The company responded that its position on the bonus was detailed in its Answer to Complaint in the 61 case. 2
The Trial Examiner (now Administrative Law Judge) (ALJ) in the 61 case found that the bonuses were wages within the meaning of the Act and were therefore a subject of mandatory bargaining; that the decision to withhold the bonus was made and executed without giving the union an opportunity to bargain; and that Marland had failed to supply information needed to bargain intelligently. The board subsequently adopted the findings and conclusions of the ALJ.
The 23 action arose from two conversations between Joseph Marland, President of Marland One-Way Clutch Co., and John Russell, an employee of the company.
The first conversation occurred on July 15, 1971. Russell wanted to borrow $500.00 from profit-sharing funds. Marland explained that this was not possible but said he would personally lend him the money. Russell testified:
Russell also testified that Marland handed him a piece of paper which had the following notations on it 27,000 Payroll loss
The ALJ found that the wages lost were probably a reference to a strike that had occurred. The ALJ found that Marland's remarks were no more than a contention that as a result of unionization, employees went on strike and lost wages as a result and that this could not constitute a violation of § 8(a)(1) of the Act. The board disagreed, finding that the conversation constituted a violation because the reference to Stan created an impression of surveillance the company knew he was the union organizer and blamed him for financial loss.
The second conversation occurred August 9, 1971, when Russell, Marland, and their spouses went to the Russell residence after a religious retreat they had attended together. Russell testified that Marland stated during their conversation: "I'll promise you the men will never get their bonus and I'll sell the place before I settle." Marland denied he made that statement though he admitted he said he was disappointed that relations were not as harmonious as before and that he mentioned that he had received offers from several conglomerates to merge. The ALJ carefully analyzed this conflicting testimony, partially crediting Russell to the extent of being persuaded that Marland did speak to Russell about the bonus but not to the extent of being persuaded "that the facts as to exactly what was said has been presented by Russell." 4
He concluded:
The board interpreted the conversation as a threat of plant closure which therefore violated the act.
Additionally, the 23 action complaint initially sought, according to the ALJ, an order directing the company to pay the employees for all bonus payments withheld that have accrued up to the decision. The ALJ dismissed this portion of the complaint on the grounds that as a matter of sound judicial administration of the Act, a complaint proceeding should not be utilized to effect a modification of a prior order of the board (the 61 order) or to determine compliance issues. The general counsel now concedes this was correct.
Later, the general counsel sought and obtained the modification of the 61 order which is now in issue. The modification changed the language in the affirmative action section of the order. The relevant section originally ordered the company to:
"Make whole the employees in the appropriate unit in 1970 for any loss they may have suffered of the third quarterly bonus payment in the manner set forth in the section of this Decision entitled 'The Remedy.' "
After modification the section read as follows:
"Make whole employees in the appropriate unit for any losses they may have suffered by reason of Respondent's unilateral withholding of any bonus payments, in the manner set forth in the section of the Administrative Law Judge's Decision entitled 'The Remedy.' "
The company argues that the original 61 order should be denied enforcement on three grounds. First, it is contended that the bonus did not equate with "wages" within the meaning of the Act. Second, according to the company, the order is moot the company has paid the third quarter bonus, it has bargained in good faith within the meaning of the Act, and it has supplied the union with information. Finally, with respect to the section of the order dealing with information, the company argues that enforcement would deprive it of due process because the failure to supply information was not charged in the complaint.
It is clear that bonuses and fringe benefits may constitute wages within the meaning of the Act. Beacon Journal Publishing Co. v. NLRB, 401 F.2d 366, 367 (6th Cir. 1968); NLRB v. Central Illinois Public Service Co.,324 F.2d 916, 918-19 (7th Cir. 1963). Upon the basis of the evidence as set forth hereinbefore, we have no difficulty in saying that there is a substantial basis in the record for the board's finding that the bonus payments were wages within the meaning of the Act.
Circumstances may arise where an enforcement proceeding will become moot because a party can establish that there is no...
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