N.L.R.B. v. Montgomery Ward & Co., Inc.

• Court: U.S. Court of Appeals — Tenth Circuit
• Writing for the Court: Before SETH, BARRETT and DOYLE; BARRETT
• Citation: N.L.R.B. v. Montgomery Ward & Co., Inc., 554 F.2d 996 (10th Cir. 1977)
• Decision Date: 12 April 1977
• Docket Number: No. 76-1020,76-1020
• Parties: 95 L.R.R.M. (BNA) 2433, 81 Lab.Cas. P 13,223 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MONTGOMERY WARD & CO., INCORPORATED, Respondent.

Page 996

554 F.2d 996

95 L.R.R.M. (BNA) 2433, 81 Lab.Cas. P 13,223

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. MONTGOMERY WARD & CO., INCORPORATED, Respondent.

No. 76-1020.

United States Court of Appeals Tenth Circuit.

Submitted Jan. 24, 1977.

Decided April 12, 1977.

Corinna Lothar Metcalf, Washington, D. C. (John D. Burgoyne, John S. Irving, Jr., John E. Higgins, Jr., and Elliott Moore, N. L. R. B., Washington, D. C., on the brief), attys. and counsel, for petitioner.

Christopher J. Michas, Chicago, Ill. (Mark C. Curran, Chicago, Ill., on the brief), and Sidley & Austin, Chicago, Ill., of counsel, for respondent.

Before SETH, BARRETT and DOYLE, Circuit Judges.

BARRETT, Circuit Judge.

The National Labor Relations Board (Board) seeks enforcement of its order ¹ against Montgomery Ward and Co., Incorporated (Wards), requiring Wards to cease and desist from unfair labor practices and directing Wards to bargain with the International Union of Electrical, Radio and Machine Workers, AFL-CIO-CLC (Union).

Wards operates a repair service facility in Oklahoma City, Oklahoma. On November 14, 1973, the Regional Personnel Manager for Wards sent a memorandum to the Repair Service Manager, Don McNutt (McNutt), directing: a wage survey to determine what Ward's competition was offering; whether adjustments in the wages Wards was paying were in order; that if wage adjustments were to be made they should be based upon time and service and performance; and that wage adjustments should be accomplished by March 1, 1974, to be granted in two one-month installments. McNutt announced thereafter at a November meeting of technicians that they would receive a wage increase by the end of 1973.

On January 18, 1974, McNutt submitted his recommended wage increases. On February 7, 1974, sixteen technicians from Wards repair facility attended a Union meeting, where a Union representative told the technicians that organizing a union would be difficult; that earlier attempts had proven fruitless; and that even if the employees won an election, it would probably be necessary for them to strike in order to get a contract. Twelve employees signed a set of cards (an authorization card, a membership card and a checkoff card) that evening. The following day McNutt denied Union's request for recognition, and Wards posted a no solicitation policy. Four days later, McNutt announced the wage increases which he stated had been effective since January 31. On February 15, the Assistant Service Manager informed an employee that talking about the Union would cost him his job and he cautioned him against it. On February 20, McNutt convened a meeting of technicians, a number of whom were displaying Union stickers on their uniforms, equipment, trucks and toolboxes. McNutt warned the technicians against further display of such stickers on company uniforms or property.

On April 26, an election was held. The Union was defeated by a vote of 17 to 12. On that election day, 16 out of the 31 employees in the unit held a set of Union cards. On May 3, the Union filed objections to the election. On May 8, Walter Cockrell (Cockrell), an employee actively engaged in Union activities, was fired.

The Board found: (1) that Wards had violated § 8(a)(1) of the National Labor Relations Act (NLRA), 29 U.S.C.A. § 158, by its no-solicitation rule, the ban on Union stickers, and by its wage increases; (2) that Wards violated § 8(a)(3) and (1) of the NLRA by firing Cockrell and; (3) that a bargaining order was the appropriate remedy because a majority of the employees were members of the Union and the unfair labor practices precluded a fair election. Wards challenges the validity of those findings.

In N.L.R.B. v. Central Machine and Tool Company, 429 F.2d 1127 (10th Cir. 1970), cert. denied, 401 U.S. 909, 91 S.Ct. 870, 27 L.Ed.2d 807 (1971), we stated the standard of our review:

. . . Our review is limited to searching the record to see if there is substantial evidence to support the fact findings. 29 U.S.C. § 160(e). We do not sit as a super trial examiner, and do not weigh the credibility of one witness against another nor do we search for contradictory inferences . . .

429 F.2d at 1129.

See also: N.L.R.B. v. Dover Corporation, Norris Division, 535 F.2d 1205 (10th Cir. 1976), U.S. Appeal Pending; N.L.R.B. v. Okla-Inn, 488 F.2d 498 (10th Cir. 1973); N.L.R.B. v. Gold Spot Dairy, Inc., 417 F.2d 761 (10th Cir. 1969).

I.

Wards contends that it did not violate the NLRA by its non-solicitation rule or its ban on Union stickers, and that the wage increases were permissible.

(a)

The same day that the Union first requested recognition, Wards posted a rule against solicitation or distribution. One week later, the assistant service manager told an employee that under the non-solicitation rule talking about the Union on company time would cost him his job.

The substantive validity of Ward's rule is not questioned, inasmuch as a non-solicitation rule which regulates employee activity during working hours is presumptively valid. Republic Aviation Corp. v. N.L.R.B., 324 U.S. 793, 803-805, 65 S.Ct. 982, 89 L.Ed. 1372 (1945); N.L.R.B. v. American Coach Company, 379 F.2d 699, 701 (10th Cir. 1967).

We hold, however, that the record establishes interference with the rights granted by § 7 of the NLRA, and sustains the Board's finding that Wards violated § 8(a)(1). The rule was promulgated within hours after Wards became aware of Union activity. The rule was not posted nor enforced before the Union requested representation; however, after the Union's demand was made, the rule was strictly enforced. This is indicative of Wards' attempt to interfere with Union organizational activities by the promulgation of the inhibiting non-solicitation rule.

(b)

On February 20, McNutt put into effect a ban on the wearing of Union insignia.

The rule in determining the validity of such a ban is set forth in Serv-Air, Inc. v. N.L.R.B., 395 F.2d 557 (10th Cir. 1968), cert. denied,393 U.S. 840, 89 S.Ct. 121, 21 L.Ed.2d 112 (1968):

The right to wear union insignia on the employer's premises during working hours is guaranteed by § 7 in the absence of special consideration.

395 F.2d at 563.

Wards alleges that the special consideration, i.e., that some of its employees come into contact with the public, justifies the ban. We hold that this is not a sufficient justification inasmuch as the ban applied to employees who did not come into contact with the public, thus rendering the ban invalid.

Wards also contends that there is no showing that the ban was employed to interfere with organizational activities and was, accordingly, valid. The Board need only show interference with organizational activities when solicitation is involved. The wearing of Union insignia is a form of expression protected by § 7, and not a form of solicitation. Serv-Air, Inc. v. N.L.R.B., supra. Since solicitation is not involved, the ban is invalid.

(c)

The Board found that Wards' wage increases interfered with, restrained and coerced the employees in violation of § 8(a)(1) of the NLRA, supra. Wards contends that the wage increases were decided upon before the advent of Union and were not in response to Union's efforts.

As previously noted, McNutt was directed to undertake a wage survey in November, 1973. He announced to the employees that they would receive a wage increase. On January 18, 1974, McNutt submitted his proposed pay increases, which were approved on February 5. Four days after the Union requested recognition, the wage increases were announced as planned.

The Board found that the wage increases violated § 8(a)(1), in that the totality of circumstances, including the nature and timing, indicate that the wage increases were not validly implemented.

The Board found that the wage increases did not conform to the amounts suggested by the memorandum directing the survey nor did they conform to McNutt's criteria. Employees who had achieved the highest grade and who had achieved working seniority, received the same amount or lower wages than those employees in lower grades and with less seniority. In addition, the wage increases became effective via a one-time increase, even though the memorandum dictated that they should be accomplished by two one-month increases. This nonconformity suggests that Union interference was intended in lieu of valid wage increases.

The announcement of the grant of the wage increases four days after the Union's request for recognition suggests interference with organizational efforts. The increases could have been announced as early as January 18 or as late as March 1. Further, the Board did not find an innocent explanation for the retroactive grant of the increases to date of January 31. This action likewise suggests Union interference.

In consideration of the above facts and findings, we hold that Crown Tar and Chemical Works, Inc. v. N.L.R.B., 365 F.2d 588 (10th Cir., 1966), controls:

If Crown had put its wage increase into effect in May of 1964, when the decision to raise wages was made, the picture here would be altogether different. It waited until the organizational effort was underway and then, while in a position to refrain from granting the increase, and with knowledge of union's activity and perhaps with knowledge of the union's claim to represent a majority, the increase was made effective. The granting of economic benefits by the unilateral action of an employer while union organizational efforts are underway, or while a representation election is pending, is a violation of Sections 8(a)(1) and 8(a)(5) of the Act, 29 U.S.C.A. §§ 158(a)(1), (a)(5). It follows that the employer must bargain with the Union.

365 F.2d at 590.

Accord: N.L.R.B. v. Tonkawa Refining Company, 434 F.2d 1041 (10th Cir. 1970); American Sanitary Products Co. v. N.L.R.B., 382 F.2d 53 (10th Cir. 1967); N.L.R.B. v. Albuquerque Phoenix Express, 368 F.2d 451 (10th Cir. 1966).

Wards should have postponed its...