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Wausau Steel Corp. v. National Labor Relations Board

April 11, 1967

WAUSAU STEEL CORPORATION, PETITIONER
v.
NATIONAL LABOR RELATIONS BOARD, RESPONDENT



Hastings, Chief Judge, Schnackenberg, and Kiley, Circuit Judges.

Author: Hastings; Schnackenberg

HASTINGS, C. J.:

The Wausau Steel Corporation, a Wisconsin corporation, has petitioned this court to review and set aside an order of the National Labor Relations Board issued against it on August 19, 1966 and reported at 160 NLRB No. 47. The Board has requested enforcement of its order.

The trial examiner found that Wausau violated § 8(a)(1) of the Labor Management Relations Act, 29 U.S.C.A. § 158 (a)(1), by promising benefits to its employees and by threatening reprisals and that Wausau violated § 8(a)(5), 29 U.S.C.A. § 158(a)(5), by refusing to bargain in good faith with a majority union. The Board affirmed and generally adopted the report of the trial examiner and ordered Wausau to cease and desist from its unfair labor practice violations and to bargain with the union on request.

Wausau contends that the evidence against it was insufficient to prove that it lacked good faith in refusing to bargain and that the evidence was insufficient to establish that it engaged in unfair labor practices prior to a representation election held at its plant. Wausau urges that even if it did engage in unfair labor practices, it was not precluded by such conduct from asserting a good faith doubt concerning the union's majority status. It further contends that the union involved, Shopmen's Local Union No. 811, International Association of Bridge, Structural and Ornamental Iron Workers, AFL-CIO, was guilty of misrepresentation or fraud in its card solicitation and electioneering, thus nullifying its claim of bargaining status.

The trial examiner found the following facts. The union received cards from 29 of 38 employees of Wausau authorizing it to act as their bargaining representative. On November 2, 1966, the union wrote Wausau, claiming majority status and requesting recognition. Wausau replied two days later, declining to recognize the union on the ground that the union had supplied no proof of majority status and that Wausau had reason to doubt the union's claim. Shortly thereafter, Wausau and the union agreed to a consent election, which was held on November 22, and which the union lost 21-17.

During the period prior to the election, Theodore Wallach, Wausau's president, communicated with his employees by letters and through speeches. While Wallach was generally guarded in his statements, he did suggest that if the union won the election, overtime work might be reduced or eliminated. He also stated that increased expenses due to unionization might make it necessary to sell trucks, and to close the new steel department, and that if the union obtained a 22 or 221/2 cent raise for the employees, Wausau would be forced out of business. He noted that certain wage inequities had come to his attention and that he planned to correct them. He further said:

"No union can supply you with overtime or force the company to provide overtime. Our margin of profit is so small that any substantial increase in our costs would mean that we would operate at a loss and be forced to drop major parts of our operations. We don't want this - and you don't either.

"We intend, when this union matter is settled, to make proper adjustments in wages and to establish a reasonable insurance program."

This theme was stressed a number of times in Wallach's various communications.

Wallach made similar statements to employee Larry Hill, an active union organizer, after summoning Hill to his office and inquiring into any complaints Hill and any other employees had and why they wanted a union.

To Kenneth Thomas, another employee Wallach asked to his office on another occasion, Wallach stated that Thomas, who had been employed only a few months, "might have been here long enough to have received * * * [a] raise with the rest of the men." He further said that if the union won the election, he would have to cut working hours to 40 and hire more employees.

Finally, Wallach stated to another employee, Ronald Martin, that if the union came in, Martin would be one of the first to go, evidently because of a lack of seniority. Wallach repeated his suggestion that if the union came in and expenses were too high, Wausau would shut down operations.

The trial examiner found that Wallach's remarks in his letters and speeches exceeded permissible free speech limits, amounting instead to promises of benefits and threats of reprisals violative of the Labor Management Relations Act.

The trial examiner also found § 8(a)(1) violations in Wallach's interviews with employees Hill and Thomas. The interview with Martin was found to be violative of the Act to the extent that Wallach repeated the promises and threats of his speeches.

The trial examiner concluded that Wausau was also guilty of a § 8(a)(5) violation of the Act, that is, failure to bargain in good faith with a majority union. His principal reason for finding this violation was an application of the rule that where a union has obtained authorization cards from a majority of employees and the employer thereafter engaged in unfair labor practices which prevented the holding of a fair election, the employer will not be heard to say that he had a good faith doubt of the union's majority.

In addition to a cease and desist order based on the § 8(a)(1) and § 8(a)(5) violations, the trial examiner recommended that Wausau be required to bargain with the union on request.

We find no merit in Wausau's attack upon the union's authorization cards. Wausau introduced evidence tending to show that six authorization cards were solicited through the union's misrepresentations. Even if all six authorization cards were not counted, the union yet had a majority of Wausau's employees who had authorized it to act as their bargaining representative. Such evidence as Wausau did present, when coupled with the fact that no other cards were attacked, did not demonstrate a pervasive misrepresentation by the union sufficient to cast doubt upon the ...


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