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Marathon-Clark Cooperative Dairy Association v. National Labor Relations Board

March 27, 1963


Author: Hastings

Before HASTINGS, Chief Judge, DUFFY and SWYGERT, Circuit Judges.

HASTINGS, Ch. J.: This matter iative Dairy Association (petitioner) to review a decision and order of the National Labor Relations Board (Board). In its answer, the Board petitioned for enforcement of its order.

The Board found that petitioner failed to bargain in good faith with union,*fn1 in violation of § 8(a)(5) and (1) of the National Labor Relations Act (Act), 29 U.S.C.A. § 158(a)(5) and (1). The Board further found that petitioner's failure to bargain in good faith was a causative factor in a strike among its employees and that petitioner's failure to offer reinstatement to the strikers upon their application therefor violated § 8(a)(3) and (1) of the Act, 29 U.S.C.A. § 158(a)(3) and (1).

In accord with the Board's opinion, petitioner was ordered, inter alia, to reinstate those employees who so desired and to terminate the arrangement resulting in contracting out its operations to the extent necessary to accommodate the employees desiring reinstatement. The Board's decision and order are reported at 137 NLRB No. 91.

Petitioner is a small cooperative located at Abbotsford, Wisconsin, engaged in the manufacture and sale of cheese and other dairy products made from neighboring farmers' milk deliveries. At the time of the complaint, it had a total of six employees, a manager and a bookkeeper. The cooperative was financed by stock purchased by farm milk patrons. It had an unpaid board of seven directors, all milk patrons, of which non-salaried George A. Mathews was Chairman. No one received any pay other than the manager and the employees.

From 1950 to April 30, 1961, when its last collective bargaining contract expired, petitioner and union had maintained a collective bargaining relationship in which union represented petitioner's production and maintenance employees.

On February 23, 1961, under the contract then in force, union requested that the contract be reopened for negotiation. Negotiations started on March 24, 1961, after the parties had previously exchanged written demands in which union sought certain increases in benefits and petitioner sought what amounted to an across-the-board reduction in benefits. At the meeting, Mathews outlined in detail petitioner's financial plight and stated that changes, probably including contracting out the cheesemaking operations, were necessary. Discussion of the parties' demands proved fruitless.

Meetings were also held on April 21, May 12, June 5, June 9, July 18, August 21 and September 26, 1961. At all these meetings, petitioner's economic and operational problems were discussed. The possibility of contracting out was raised at all the meetings except the last three, which occurred during a subsequent strike. Union progressively retreated from its original position until eventually it offered to settle for the old contract.

The trial examiner found "that from the very beginning the Union was offered the chance to take over the operation of the plant on a contract basis of a cent and a half a pound." There was not much discussion on the matter, however, because union was not interested.

On June 6, 1961, Raymond Yessa, union's business agent, met with the employees, and in accord with a strike vote which had been taken on May 1 a letter was sent on June 7, 1961, to each of petitioner's board members, saying the employees had decided "there will be a strike." On June 8, 1961, Yessa called Board Member Bergman and informed him the strike had been called for the following day. Bergman secured a one day delay in the strike to permit another meeting on the matter.

At this meeting of June 9, 1961, union made its offer to settle for the old contract. Six of petitioner's board members were present and were evenly divided on accepting union's offer. A further postponement of the strike was agreed on to permit the full board to consider the proposal.

On June 16, 1961, petitioner's board voted 4 to 3 to reject the offer of the old contract. Union was notified, and the strike and picketing began the next morning.

Late in April or May, while negotiations were in progress, Mathews began discussions with Melvin Nelson concerning Nelson's taking over petitioner's cheesemaking operation on a contract basis in the event of a strike. On June 1, 1961, Melvin Nelson moved to Abbotsford from his leased farm, 9 miles away. On June 10, Donald Nelson, Melvin's son who had been contacted by Melvin with regard to cheesemaking at petitioner's factory, resigned from his job at Fremont, Wisconsin, and moved to Abbotsford, 90 miles away.

When the strike began, the Nelsons were called in to handle the cheesemaking. Initially they were employed on a salary basis, receiving less than the striking employees had been paid. After July 1, 1961, however, they undertook to operate ...

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