NLRB v. SOUTHERN MATERIALS COMPANY

• Decision Date: 09 July 1971
• Docket Number: No. 15176.,15176.
• Parties: NATIONAL LABOR RELATIONS BOARD, Petitioner, v. SOUTHERN MATERIALS COMPANY, Inc., Respondent.
• Court: U.S. Court of Appeals — Fourth Circuit

447 F.2d 15 (1971)

NATIONAL LABOR RELATIONS BOARD, Petitioner, v. SOUTHERN MATERIALS COMPANY, Inc., Respondent.

No. 15176.

United States Court of Appeals, Fourth Circuit.

Argued May 4, 1971.

Decided July 9, 1971.

Donald W. Savelson, Atty., National Labor Relations Board (Arnold Ordman, Gen. Counsel, Dominick L. Manoli, Assoc. Gen. Counsel, Marcel Mallet-Prevost, Asst. Gen. Counsel, Herman M. Levy and Kenneth Pearlman, Attys., National Labor Relations Board, on brief), for petitioner.

Charles F. Henley, Jr., Jacksonville, Fla. (O. R. T. Bowden and Hamilton & Bowden, Jacksonville, Fla., on brief), for respondent.

Before HAYNSWORTH, Chief Judge, and BOREMAN and WINTER, Circuit Judges.

WINTER, Circuit Judge:

The Board found that Southern Materials Company, Inc. violated § 8(a) (5) and (1) of the National Labor Relations Act by unilaterally discontinuing a practice of paying Christmas bonuses to employees without consulting the union. The Board's order, for which enforcement is sought, directed the company to cease and desist from this unfair labor practice and others of like nature, to post appropriate notices and to pay the bonus with interest. We decline enforcement of the order, but we remand the case to the Board for further proceedings.

I

Since 1961 the company has paid Christmas bonuses to its employees. The bonuses varied in amount from $10 to $100. During this period, the company was apparently not unionized but after an election, on December 29, 1967, unions were certified by the Board as the joint collective bargaining representatives for a unit of truck drivers at five of the company's Virginia locations. Bargaining on a contract later ensued.

Preparatory to contract negotiations, the unions asked the company, on January 12, 1968, to furnish data with regard to "wages, health and welfare, pension, holidays, vacation, bonus, now being paid to employees under bargaining unit * * *." The company furnished the requested data with regard to wages, health and welfare and life insurance programs, pensions, holidays and vacations; but with respect to "bonus," the company advised that "no bonus is paid to any employee."

Formal negotiations for a contract began March 19, 1968, and continued until August 30, 1968, when agreement was reached. During their course, the unions proposed a maintenance of standards clause which the company considered too lengthy and offered instead the language "no employee shall suffer a reduction in his hourly rate of pay by the execution of this agreement." When the union representative inquired about what employees were receiving, the company representative avoided a direct answer and said that the subject of discussion was "benefits. We are talking everything that the men will receive above what they are receiving now." The union representative then agreed to accept the company's proposed maintenance of standards clause "as the men could not lose anything that they were not sic receiving." Before the trial examiner, the testimony of whether Christmas bonuses or presents was ever referred to in these exchanges was conflicting. The union representative testified that no references were made; the company representative testified to the contrary. The trial examiner indicated that he would believe the union witness and discredit the company witness, although under his legal theory of how the case should be decided it was unnecessary for him to employ this credibility determination.

In addition to the maintenance of standards clause, the contract contained an article on waiver — the so-called "zipper clause" — which read:

The Company and the Union, for the life of this Agreement, each voluntarily and unqualifiedly waives the right, and each agrees that the other shall not be obligated to bargain collectively with respect to any subject matter referred to or covered in this Agreement, or with respect to any subject matter not specifically referred to or covered in this Agreement.

Late in November, 1968, the union filed a charge that since August, 1968, the company had unilaterally discontinued established practices as to sick leave, paid time during bad weather and employees' birthday cakes, claiming that these were unfair labor practices in violation of § 8(a) (5) of the Act. While the charge was under investigation, the company failed to pay its annual Christmas bonus, and this fact became known to the Regional Director. By letter dated March 12, 1969, the Regional Director informed the parties that no complaint with respect to the specific items in the union's charge would issue, but that the matter of the Christmas bonus would be given further consideration. On August 6, 1969, the Regional Director's complaint, alleging that the unilateral discontinuance of the Christmas bonus was a violation of § 8(a) (5), was issued.

II

At the outset, we reject the company's argument that, because the alleged unfair labor practice occurred more than six months prior to the issuance of the complaint, the Board lacked jurisdiction under § 10(b) of the Act to determine whether the unilateral discontinuance of a Christmas bonus constituted an unfair labor practice. The limitations provision of § 10(b) concerns itself with the period between the unfair labor practice and the charge, not between the unfair labor practice and the complaint. In pertinent part, it states "no complaint shall issue based upon any unfair labor practice occurring more than six months prior to the filing of the charge * * *." 29 U.S.C.A. § 160(b).

In NLRB v. Fant Milling Co., 360 U.S. 301, 79 S.Ct. 1179, 3 L.Ed.2d 1243 (1959), the Court held that a complaint could allege an unfair labor practice occurring after the filing of the charge if the subsequent act is "of the same class of violations as those set up in the charge." 360 U.S. at 307, 79 S.Ct. at 1183. This case is dispositive of the company's contention. The union's complaint charging unfair labor practices in violation of § 8 (a) (3) and (5) was filed in November, 1968, within ninety days after the acts complained of. Although notice was given on March 12, 1969, that the original charges would not be further considered, the unilateral discontinuance of the Christmas bonus had meanwhile allegedly occurred, and the right to consider it was specifically reserved for further consideration in the March 12, 1969, letter. Discontinuance of the bonus was an alleged violation of § 8(a) (5) of the Act, and it was of the same class of violations as those originally complained of. It follows that under Fant there was a timely charge with respect to discontinuance of the bonus, and the Board had jurisdiction to hear and determine a complaint alleging it.

III

On the merits, the Board, recognizing the general rule that § 8(d) of the Act imposed on the company a duty to bargain with the union "with respect to wages, hours, and other terms and conditions of employment," concluded that the union had not waived its right to require the company to bargain by the waiver paragraph of the contract between the parties. It, therefore, concluded that the failure to bargain constituted an unfair labor...