N.L.R.B. v. Hendel Mfg. Co., Inc.
| Decision Date | 23 September 1975 |
| Docket Number | D,No. 1252,1252 |
| Citation | 523 F.2d 133 |
| Parties | 90 L.R.R.M. (BNA) 2505, 77 Lab.Cas. P 11,099 NATIONAL LABOR RELATIONS BOARD, Petitioner, v. HENDEL MANUFACTURING COMPANY, INC., Respondent. ocket 72-1932. |
| Court | U.S. Court of Appeals — Second Circuit |
Paul Elkind, N. L. R. B., Washington, D. C. (Peter G. Nash, Gen. Counsel, John S. Irving, Deputy Gen. Counsel, Patrick Hardin, Associate Gen. Counsel, Elliott
Moore, Deputy Associate Gen. Counsel, and Bert Bisgyer, Atty., N. L. R. B., Washington, D. C., on the brief), for petitioner.
Philip C. Schneider, Boston, Mass. (Edward Schneider, Brown, Rudnick, Freed & Gesmer, Boston, Mass., on the brief), for respondent.
Before LUMBARD and TIMBERS, Circuit Judges, and WYZANSKI, District Judge. *
The National Labor Relations Board moves to hold the respondent, Hendel Manufacturing Company, Inc. of New London, Connecticut, in civil contempt for its alleged disobedience of this Court's order of October 1, 1973, 1 which enforced the Board's order of June 28, 1972. 2 The matter was referred to Judge Blumenfeld of the District of Connecticut who, sitting as Special Master, found Hendel to have violated our mandate in only one minor respect. The NLRB is now pressing exceptions to the findings of fact and conclusions of law contained in the Master's Report. We overrule these exceptions, accept the Master's Report and deny the NLRB's motion to hold Hendel in contempt.
The Board's motion to hold Hendel in contempt is premised on its allegation that the Company violated its duty to bargain in good faith, as ordered by this Court, when it unilaterally imposed wage modifications during the pendency of the negotiations. Some background as to the wage structure at Hendel's plant is necessary to understand the Board's claims in this case.
Although Hendel's employees are paid on a piecework basis, there is a minimum wage floor established for each worker beneath which his wages cannot fall. The level at which the minimum is set is dependent upon the productivity of the individual worker but it is always set at a level substantially below the worker's average earnings and thus rarely applies. Its purpose is to serve as a security device in case unanticipated circumstances prevent the employee from working at full capacity.
During the period from 1971-1973, the minimum guarantees were reviewed approximately every six months. On October 1, 1973, after negotiations had begun by order of the Board and this Court, the Company conducted another such review and adjusted upward the guarantees of 39 out of 70 employees. No specific formula was applied in setting the guarantees a new level was set only if, in the discretionary opinion of the employer, the gap between the actual earnings and the guaranteed earnings of an individual had become too great. The Board strenuously maintains that this last adjustment represented a circumvention of the bargaining table and, consequently, an evasion of our order.
In addition, the Company hired three new employees in late 1973, guaranteeing them each a wage floor of $1.85/hour with the understanding that this would be increased if their work proved acceptable. These increases were in fact awarded, in each instance, with neither notification of nor approval by the Union. This too, the Board contends, was a failure on the part of the Company to bargain in good faith.
Finally, the Company offered two key employees an opportunity to participate in a reduced-rate insurance program. This benefit, as well, was granted unilaterally during the pendency of negotiations.
In a summary contempt adjudication, Judge Blumenfeld found that only the insurance benefits constituted a violation of our enforcement order. The Company concedes this point and stands ready to purge itself of contempt. As to the other wage increases, Judge Blumenfeld held that they represented merely a justifiable continuation of established Company policy and were, therefore, not contumacious. The Board takes exception to this latter finding.
i NLRB v. Katz, 369 U.S. 736, 742, 82 S.Ct. 1107, 1111, 8 L.Ed.2d 230 (1962), establishes the basic proposition that the duty to "meet . . . and confer in good faith with respect to wages, hours and other terms and conditions of employment," §§ 8(a)(5) and (d), 29 U.S.C. 158(a)(5) and (d), prohibits the Company from imposing unilateral changes in working conditions during the pendency of negotiations. At the threshold, Hendel argues that the increase in salary guarantees which it granted could not have violated its duty to bargain since it did not represent a benefit to the employees but merely an academic bookkeeping adjustment. While it is true that in the vast majority of cases the salary paid was substantially above even the revised wage floor, 3 we agree with the observation of the Special Master that any modification which reinforces the workers' sense of financial security must be considered a benefit for purposes of the Act.
Nevertheless, Katz, as interpreted by this Circuit in NLRB v. Patent Trader, 415 F.2d 190 (2d Cir. 1969), does not bar all such beneficial adjustments. The employer is not required to suspend normal company procedures which have become incorporated into the working conditions of the plant. This exception to the general rule is responsive to the paradox that would result if workers were forced to forfeit their justifiable expectations, nurtured by past practices, in order to secure future advance. Collective bargaining is a means to an end, not an end in itself. Indeed, any suspension by the employer of established patterns of practice may itself constitute a violation of Katz. Compare Int'l. Union UAW v. NLRB, 147 U.S.App.D.C. 289, 455 F.2d 1357 (1971) with J. J. Newberry Co. v. NLRB, 442 F.2d 897 (2d Cir. 1971). Our decision in Patent Trader upholding the validity of semi-annual wage increases although occasionally "the time intervals, as well as the amounts, varied," 4 eliminates the dilemma with which the employer might otherwise be faced: possible censure under 8(a)(5) for either continuing or...
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