Radio Television Technical School, Inc. v. NLRB

• Decision Date: 16 November 1973
• Docket Number: No. 73-1127.,73-1127.
• Citation: 488 F.2d 457
• Parties: RADIO TELEVISION TECHNICAL SCHOOL, INC., t/a Ryder Technical Institute, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent, Local 773, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Intervenor.
• Court: U.S. Court of Appeals — Third Circuit

488 F.2d 457 (1973)

RADIO TELEVISION TECHNICAL SCHOOL, INC., t/a Ryder Technical Institute, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent Local 773, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, Intervenor.

No. 73-1127.

United States Court of Appeals, Third Circuit.

Argued September 10, 1973.

Decided November 16, 1973.

James L. Price, Steinberg, Greenstein, Richman & Price, Philadelphia, Pa., for petitioner.

Peter G. Nash, Gen. Counsel, John S. Irving, Deputy Gen. Counsel, Patrick

Hardin, Associate Gen. Counsel, Elliott Moore, Acting Asst. Gen. Counsel, N. L. R. B., Robert A. Giannasi, Jonathan G. Axelrod, Washington, D. C., for respondent.

Richard H. Markowitz, Stephen C. Richman, Markowitz & Kirschner, Philadelphia, Pa., for intervenor.

Before McLAUGHLIN, VAN DUSEN and ROSENN, Circuit Judges.

OPINION OF THE COURT

McLAUGHLIN, Circuit Judge.

Petitioner, Radio Television Technical School, Inc., t/a Ryder Technical Institute, appeals from the October 10, 1972 order of the National Labor Relations Board which found that petitioner committed an unfair labor practice in violation of Section 8(a)(5) and (1) of the National Labor Relations Act, as amended (61 Stat. 136, 73 Stat. 519, 29 U.S.C. § 151 et seq.), herein called the Act. The Board has filed a cross-application for enforcement of its order and Local 773, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, herein called the Union, has been granted the right to intervene. We affirm the order of the Board.

Since 1950 petitioner has been presenting gifts to its employees at Christmas time. Initially, the gifts consisted of such items as sport jackets, wallets, trays, hams, turkeys, etc. In 1965 or 1966 (the precise year was not established in the proceedings below), petitioner began making money payments. At Christmas time in 1970, petitioner withheld making payments to the employees who had joined the Union in the summer of 1970.¹ However, all non-union employees received their Christmas payments.

The matter was submitted to arbitration and the arbitrator found that the payments were made at the discretion of petitioner and therefore legally could be discontinued without subjecting the matter to the collective bargaining process. Since petitioner refused to bargain over the matter, the Union also filed with the Board an unfair labor practice charge against petitioner. Following the outcome of the arbitration proceeding, the Board vacated the arbitrator's decision and ordered petitioner to make the 1970 and 1971 Christmas payments to the union employees.

The collective bargaining agreement between petitioner and the Union became operative on October 1, 1970. The agreement did not provide specifically for any Christmas payments, Christmas bonuses, or Christmas gifts. The absence of such a provision was the alleged justification for petitioner's decision to discontinue the payments. The Union, however, has taken the position that the Christmas payments were wages, and as such, could not be altered in view of the existence of the Maintenance of Standards provision² of the collective bargaining agreement.

A labor managment dispute involving the status and/or payment of a Christmas bonus is not novel. In 1952, the Second Circuit reviewed an order of the National Labor Relations Board which held that a Christmas bonus was a part of wages and therefore required bargaining pursuant to Section 9(a) of the Act. In affirming the Board's order, the Court held: "It does, of course, merely beg the question to call them Christmas bonuses `gifts' and to argue, however persuasively, that gifts per se are not a required subject for collective bargaining. But if these gifts were so tied to the remuneration which employees received for their work that they were in fact a part of it, they were in reality wages and so within the statute * * * Where, as here, the so-called gifts have been made over a substantial period of time and in amount have been based on the respective wages earned by the recipients, the Board was free to treat them as bonuses not economically different from other special kinds of remuneration like pensions, retirement plans or group insurance, to name but a few, which have been held within the scope of the statutory bargaining requirement." N.L.R.B. v. Niles-Bement-Pond Co., 199 F.2d 713, 714 (2d Cir. 1952). Accord, N.L.R.B. v. Wheeling Pipe Line, 229 F.2d 391 (8th Cir. 1956); N.L.R.B. v. Electric Steam Radiator Corporation, 321 F.2d 733 (6th Cir. 1963); N.L.R.B. v. Citizens Hotel Company, 326 F.2d 501 (5th Cir. 1964); N.L.R.B. v. United States Air Conditioning Corporation, 336 F.2d 275 (6th Cir. 1964).

Although each of the foregoing cases has held that a Christmas bonus is a wage, the particular facts of each case shall be determinative of whether a Christmas bonus is a wage or a gift. In making such a determination, the following factors shall be considered by the trier of fact: (1) the consistency or regularity of the payments; (2) the uniformity in the amount of the payments; (3) the relationship between the amount of the bonus and the remuneration of the recipient; (4) the taxability of the payment as income; and (5) the financial condition and ability of the employer. See, e. g. N.L.R.B. v. Wonder State Manufacturing Company, 344 F.2d 210, 214 (8th Cir. 1965).

The record before us reveals that Christmas bonuses were given consistently and regularly since 1950 and for at least four years prior to the execution of the 1970 collective bargaining agreement, all employees received cash payments at Christmas time. Notwithstanding petitioner's assertions and allegations to the contrary, the Board found that petitioner adhered to an established pattern or formula in calculating its Christmas payments to instructors and laboratory assistants at the Allentown institution. Although the record does not convince us that a precise mathematical formula had evolved, there is substantial evidence to show that petitioner's payments constituted a pattern to the extent that they were based upon the employees' length of service and the nature and scope of their employment responsibilities. Furthermore, the Board's decision is strengthened by the fact that the Christmas payments were admittedly based on such employment-related considerations as supervisory recommendations, work performance, work attitudes and longevity and the fact that petitioner subjected payments in excess of $25.00 to withholding and social security taxes.³ In light of these findings, petitioner's argument that its Christmas payments were unrelated to the employees' work, and thus not "wages" under Section 8(d) of the Act, must fail.⁴ Since these payments were in fact "wages", petitioner was under a statutory duty to submit the matter to the collective bargaining process. Petitioner's failure to do so constituted an unfair labor practice in violation of Section 8(a)(5) and (1) of the Act. N.L.R.B. v. Katz, 369 U.S. 736, 737, 82 S.Ct. 1107, 8 L.Ed.2d 230 (1962); Leeds & Northrup Company v. N.L.R.B., 391 F.2d 874, 877 (3d Cir. 1968).

Petitioner further alleges that the Board committed error by refusing to defer to the decision of the arbitrator. We cannot agree with this assertion. Although it is the well established policy of the Board to encourage settlement of labor-management disputes through the machinery of arbitration, the Board is not duty bound to defer to every decision of an arbitrator. Spielberg Manufacturing Company, 112 N.L. R.B. 1080 (1955); Flintkote Co., 149 N.L.R.B. 1561 (1964). However, the Board's deferral policy is strictly voluntary....