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National Labor Relations Board v. Adam & Eve Cosmetics Inc.

decided: December 12, 1977.

NATIONAL LABOR RELATIONS BOARD, PETITIONER
v.
ADAM & EVE COSMETICS, INC., RESPONDENT



On Application for Enforcement of an Order of the National Labor Relations Board.

Bauer, Wood, Circuit Judges, and James L. Foreman, District Judge.*fn*

Author: Bauer

BAUER, Circuit Judge.

The Board here applies for enforcement of its order directing the respondent company to offer reinstatement to an ex-employee and to cease and desist from engaging in unfair labor practices found violative of the National Labor Relations Act. In its final decision accompanying its order, the Board, Member Kennedy dissenting, found that the company had violated Sections 8(a)(1) and (3) of the Act by coercively interrogating an employee about his union activities, by threatening the same employee that the company would shut down its plant in the event of unionization, and by discharging him allegedly because of his pro-union sympathies. Additionally, the Board, Member Kennedy again dissenting, found that the company had violated Section 8(a)(1) of the Act by unlawfully promising its employees certain benefits to induce them to vote against unionization. We find Member Kennedy's dissent to the Board's decision persuasive and deny enforcement of its order for the reasons noted below.

I.

The result in this case turns principally on the issue of whether Oscar Schwartz was an employee of the respondent within the meaning of Section 2(3) of the Act or a supervisor within the meaning of Section 2(11). If Schwartz was a supervisor, the company could not have violated Section 8(a)(1) by coercively interrogating him and threatening him that it would close its plant if he succeeded in organizing its employees. Nor could the company have violated Section 8(a)(3) by discharging him allegedly for his pro-union activities. We thus turn our attention to a review of the evidence supporting the Board's finding that Schwartz was an employee rather than a supervisor.

Respondent operates a small factory in which it manufactures boxes and windshield washer solvents. The plant consists of a production line, a warehouse and an office, in which 10 to 12 employees worked during the relevant period. At the time of the hearing held by the administrative law judge, the plant had been in operation about a year. Serious production problems frequently had occurred due to persistent difficulties in obtaining sufficient quantities of methanol, an essential ingredient of the company's product. Accordingly, the company's employees were periodically laid off, and turnover among both supervisory and nonsupervisory personnel was high.

Oscar Schwartz was hired in September 1973 as a truck loader at $1.90 an hour. In March of 1974 he was promoted to the position of production line supervisor and placed in charge of the 7 to 8 employees working on the assembly line. In that supervisory capacity Schwartz initially received $2.10 an hour. By June his wage had been increased to $2.50 an hour. Like the plant manager Russell Roush, who supervised the warehouse, Schwartz received overtime pay and engaged in manual labor alongside his fellow employees. As a supervisor, however, Schwartz was assured of being paid on days when other production personnel were sent home because of a shortage of methanol.

Near the end of July, the company's president, Charles Clark, expressed dissatisfaction with Schwartz's performance as production supervisor and told him that he would be fired. Schwartz pleaded to be transferred back to the warehouse rather than fired. Clark said he would consider doing so, and he then began advertising for a production line supervisor to replace Schwartz. In early August, Clark hired Danny Smith to replace Roush as plant manager and Schwartz as production line supervisor. When Smith reported for work on August 14th, Schwartz was put in charge of the warehouse. Roush remained on the payroll for a few days, during which time he trained Smith in his duties as plant manager and production supervisor.

After his transfer to the warehouse, Schwartz handled the company's shipping and receiving, was involved in inventory control and directed the one to four other employees periodically assigned to the warehouse. Schwartz, however, retained responsibility for setting up the production line and mixing the ingredients that went into the company's product. He received the same salary he had as production supervisor and continued to be paid on the days the production line was shut down for lack of methanol. Schwartz's supervision of the other warehouse employees, according to his own testimony, consisted of the following:

"If they were back there with me, a truck came in to be loaded, I would tell them who I wanted up in the truck, from there we would figure out what we was going to move into the truck. If there wasn't no truck there, just working in the warehouse, moving stuff, I would instruct them as to what I wanted moved and how I wanted it placed back, the spot where we was moving it to."

Schwartz estimated that he spent about 50% of his time in physical labor and the rest of the time he would

"instruct the boys what I wanted them to do, and I would just walk back and forth between the two spots to make sure they went into the spots where we wanted it. Where it was to go."

The administrative law judge found on the basis of the above facts that Schwartz was not the warehouse supervisor but a team leader who exercised no independent judgment in directing the loading of trucks and the moving of finished products about the warehouse. In so finding, the administrative law judge was influenced by the fact that, if Schwartz were to be found a supervisor, there would be two supervisors for a work force that ...


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