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Hotpoint Co. v. National Labor Relations Board

May 5, 1961


Author: Schnackenberg

Before DUFFY, SCHNACKENBERG and MAJOR, Circuit Judges.

SCHNACKENBERG, C.J.: Hotpoint Co., a division of General Electric Company, a New York corporation, herein called the Company, asks us to review and set aside an order*fn1 of the National Labor Relations Board, issued against the Company, pursuant to § 10(c) of the National Labor Relations Act, 29 U.S.C.A. § 151, et seq . The Board requests enforcement of its order.*fn2

The proceeding before the Board was initiated by one Peter J. Kornewich, an employee, who states in his charge that there were 1500 workers employed at the plant involved.

The order directed the Company to cease and desist from assisting, dominating and contributing financial or other support to the Joint Shop Council, herein called Council, found by the Board to be an organization within the meaning of § 2(5) of the Act,*fn3 and from recognizing the Council as the representative of its employees for the purpose of dealing with the Company concerning grievances, labor disputes, wages, rates of pay, hours of employment, or other terms or conditions of employment. The Company was further directed to withdraw and withhold all recognition from and completely disestablish the Council or any successor thereto.*fn4

The basic issue as posed by the Board is whether the Company has dominated, assisted and supported an organization of its employees in violation of § 8(a)(2) and (1) of the Act.*fn5

The Council, the structure and operation of which is governed by bylaws, is an employee's representative organization which has existed in all the Company's Chicago-Cicero plants for over 30 years to consider and make recommendations to management on all questions of employee interest, including wages, hours and conditions of employment. According to the bylaws its object is to provide a medium for exchange of ideas and suggestions between employees and management, and give to each employee, through representatives in the Council, access to an impartial hearing on suggestions, requests or complaints he or she may wish to make.

The Council consists of employee-representatives elected from voting divisions consisting of approximately 100 employees each. All hourly-rated employees, except section leaders, who are supervisors, plant guards, tool and die makers and machinists, are automatically members of the Council and eligible to vote for their respective employee-representative. The employee-representatives elect from their numbers a chairman, a secretary and a sergeant-at-arms. If a representative by reason of departmental change or resignation "is no longer able to maintain satisfactory contact with a portion of his constituents", the Council may conduct a special election to select a temporary representative. All voting is by secret ballot and is conducted by the employee-representatives. Employees do not pay fees and dues to the Council, although they are asked to contribute funds necessary for Council activities, and Council representatives and officers pay certain expenses from their own pockets.

The Council holds "solo" meetings on the second and fourth Wednesday of each month, at which time representatives discuss problems which have arisen in their respective divisions, and an agenda is prepared of matters to be presented at a joint meeting with management. Minutes are kept of items brought up for discussion and subsequently reproduced and distributed to Council representatives and posted on bulletin boards.

Joint meetings with management, presided over by a management representative and the Council chairman, are normally held at stated times, at which meetings matters of mutual interest are discussed along with those presented on the Council agenda. Minutes are kept of these meetings by a management representative, typed and duplicated for distribution to all Council representatives and management personnel. Meetings at the departmental level between members of management and Council representatives, described as "little joint meetings", are also conducted. Here problems of common interest are discussed, including employee complaints. If not there resolved, they may be brought to the full Council at a solo meeting or otherwise discussed with management by Council representatives.

The chairman and the secretary of the Council spend substantially all their time in meeting with management and in the conduct of other Council business. Both, as well as Council representatives, suffer no loss of compensation for Council activities. The Company provides the Council with an "office" located near the cafeteria between two washrooms in plant 2; furniture consisting of four old chairs, an old wooden desk and a box; a telephone; some paper supplies; and printing, duplicating, and typing services.

Prior to May 1959, a number of informal methods were followed in handling employee problems and complaints. Council bylaws outline one procedure by which employee or Council representatives could process the grievance; however, both employees and Council representatives frequently bypassed these procedures and went directly to personnel in Labor Relations or to other management representatives to discuss their problems. No formal procedure for handling employee complaints was recognized. Effective May 18, 1959 the Company established a "Company Procedure for Hourly-Rated Personnel" to provide "a media for handling individual employee complaints" without replacing or taking away from "the present practices for considering and discussing group requests, complaints, and questions on Division policies and practices." By this new procedure an employee was permitted to present his complaint, "alone or in the company of an elected Representative for his area * * * to his Foreman or other immediate supervisor." The new procedure further provided that, if the complaint was not settled at this management level, the employee could carry his complaint successively to four higher levels, accompanied if he wished, by his representative and Council chairman.

The bylaws may be amended "by a vote of two-thirds of all employee representatives." In 1957, the Council voted to amend the bylaws and the Council secretary noted in the minutes of the solo Council meeting on January 9, 1957 that "Council awaits management's disposition of proposed changes in Shop Council Bylaws." The Council president further announced that the amendments "would be submitted for Management's approval."

Although no written contract has been executed reflecting the agreements reached between management and the Council, the minutes of joint meetings, published by the Company, are regarded as reflecting in writing the agreements reached.

On the basis of the foregoing facts, the Board, in agreement with the trial examiner, found that the Company, since October 17, 1958, within the six-month statutory period, dominated, assisted, and supported the Council, in violation of § 8(a)(2) and (1) of the Act.

We learned in oral argument that for upwards of 30 years there has been no industrial unrest or work stoppage at the Company's plant.

Kornewich, whose signing of a charge initiated the present proceeding, testified.Neither in the charge nor in his testimony did he claim that he individually was wronged as an employee of the Company. In general his testimony tended to conform to the facts hereinabove stated.

It is the Company's primary contention that the Board's finding of domination, assistance, and support of the Council in violation of § 8(a)(2) and (1) is unsupported by substantial evidence in the record considered as a whole and contrary to law.

However, the Board seeks to support its order by asserting that the domination of the Council is written into its bylaws, that management representatives vote with Council representatives in making up the Council agenda, that the Council may consider a matter presented by an employee only after it has been taken up with the foreman and, if necessary, discussed at departmental meetings and submitted to the superintendent, that the Council is "fettered" in its powers to "follow through" on its recommendations, that the Company has power to cause councilmen to lose their elected status by reorganization or transfer, that an amendment of Council bylaws requires Company approval, that the bylaws give power to management to make amendments thereto insofar as they impose duties on departmental foremen, and that the Company in 1959 unilaterally issued a statement of complaint procedures which in effect amended the bylaws.

The Board also found that the internal administration and operation of the Council was dependent upon Company support in violation of 8(a)(2).

We find no merit in these contentions of the Board.

1. Having inspected the bylaws, we are of the opinion that they provide for the agenda to be made up at so-called "solo" meetings of the Council, and that such action is not participated in by management representatives.

2. As to the Board's argument that the Council may consider a matter presented by an employee only after it has been taken up with the employee's foreman, and, if necessary, discussed at departmental meetings and submitted to the departmental superintendent, we agree with petitioner that it is the intent of the bylaws that an employee's discussion of a problem with his foreman ...

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