NLRB Cases Archive 1960 - 1995, LABOR-RELATIONS 1993-94 CCH-NLRB ¶15,512, ACME DIE CASTING, DIVISION OF LOVEJOY INDUSTRIES INCORPORATED and UNITED ELECTRICAL, RADIO & MACHINE WORKERS OF AMERICA (UE)., (Sep. 30, 1994), National Labor Relations Board, (Sep 30, 1994)

ACME DIE CASTING, DIVISION OF LOVEJOY INDUSTRIES INCORPORATED and UNITED ELECTRICAL, RADIO & MACHINE WORKERS OF AMERICA (UE).

315 NLRB No. 30.Case No. 13-CA-30006. September 30, 1994 Walter H. Maloney, Administrative Law Judge..

Before Stephens, Devaney and Cohen.

Richard Kelliher-Paz, for General Counsel. Larry G. Hall, Chicago, Illinois, for Respondent. Terry Davis, Chicago, Illinois, for Charging Party.

Unilateral Changes by Employer--Work Conditions--Subcontracting and Wages.--An employer’s demonstrated antiunion animus supported a finding that it had violated its bargaining duty by unilaterally subcontracting work, relocating a machine to the premises of a subcontractor, implementing pay increases to unit employees and granting discretionary wage increases. Although the employer attempted to justify its unlawful actions on the basis of past practice or economic necessity, those defenses were found to be pretextual. Further, the changes were made without notice to the employees’ bargaining representative, the parties were not at impasse and the changes made differed from the employer’s last contract proposal. Section 8(a)(5).

Back reference: ¶3145.702.

From Text of Board’s Decision

The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge’s rulings, findings, [1] and conclusions as modified and to adopt the recommended Order as modified.

We agree with the judge that the Respondent violated Section 8(a)(1) and (5) of the Act by unilaterally granting a general wage increase, but we do so for the following reasons.

The Respondent and the Union were engaged in protracted negotiations for an initial collective-bargaining agreement when, in early November 1990, the Union proposed, as a separate matter, that the Respondent grant a three-tiered “interim” wage increase while negotiations continued. Although the Respondent initially rejected the Union’s proposal, in late November 1990 it offered to consider implementing “a negotiated interim wage increase” in return for certain promises by the Union. The Union rejected that proposal and, in late December, the Respondent offered what it called an “annual” increase ranging from 15 cents per hour for lowest paid employees, to 20 and 25 cents per hour for higher paid employees. The Union made a counterproposal on wage amounts, that was slightly reduced from its initial demand, although greater than the Respondent’s offer; and the Union also insisted that it be deemed an “interim” increase. The Respondent agreed in concept with distributing an annual increase to narrow the disparate pay levels within labor grades but held to its proposed amount of 15-20-25 cents.

On January 15, 1991, the Respondent informed the Union that it intended to implement its late-December offer (which it then had characterized as an “annual” increase) retroactive to January 3. The Union did not agree to this because it regarded the amounts as still too low, but it sought further information about which particular employees would be included in which of the three pay-increase groups. Nonetheless, on January 16 the Respondent announced to employees the grant of an “interim” wage increase. It also announced that employees having less than 90 days of employment with the Respondent would not receive the increase.

The judge found that there was no evidence that a 90-day exemption from the interim increase had ever been proposed or discussed during the parties’ negotiations. Further, the judge rejected the Respondent’s contentions that the Union had consented to the increase or, in the alternative, that the parties were at impasse when the Respondent implemented the increase. Based on the foregoing, he found that the Respondent violated the Act by unilaterally granting the January across-the-board increase.

In its exceptions regarding the 1991 general wage increase, the Respondent characterizes that increase as being in keeping with a “pattern” of January increases, and observes that in Acme Die Casting, [2] it was found “to have violated the Act by discontinuing this practice.” By implication, the Respondent seems to be suggesting that we are now unfairly finding a violation on the basis of an action that the Respondent earlier was found in breach of the law for failing to take. The Respondent also repeats its contentions that its implementation of the increase was lawful because the Union consented to it or at least that the parties were at impasse when the Respondent implemented it. We agree for the reasons stated by the judge that the Union had not consented to the particulars of this increase. Because the judge did not discuss the impact of the order in the earlier case, however, and because, with respect to the impasse issue, we do not agree with the suggestion in the judge’s opinion that, given the Respondent’s “history” of 8(a)(5) violations in the earlier cases, it would have been impossible for the Union and the Respondent to reach impasse on any interim wage increase, we provide the following reasons for adopting the finding that implementation of the January 1991 increase violated Section 8(a)(5) and (1) of the Act.

The Respondent is correct in its suggestion that granting an across-the-board wage increase in 1991 was consistent with boths its past practice and with the Board’s Order in Acme III; and our finding of a violation is in no way predicated on the mere fact that the Respondent granted an increase. The violation lies in the Respondent’s abrupt implementation of the increase at a time when there was neither agreement nor genuine impasse, and in the fact that the increase the Respondent granted differed from the last proposal that was on the table before implementation.

The Respondent does not dispute the proposition that it had a statutory obligation to bargain over the amounts and distribution of the wage increases it proposed to grant to all the unit employees. Indeed, it was proceeding to fulfill this obligation during the winter of 1990-91, and the parties’ positions were gradually moving towards each other. By January 9, the parties had agreed on the concept of a three-tiered wage increase structure; the Respondent had finally agreed that this would be an interim increase, with bargaining open as to wage levels to be set in the ultimate collective-bargaining agreement on which the parties were meeting; and the Union had slightly reduced the level of the highest of three increases it sought. As noted above, at the January 15 meeting, the Union indicated it still viewed the Respondent’s proposed amounts as too low, and it sought information on which employees would be within which of the three pay raise groups under the Respondent’s plan. On January 16, the Respondent abruptly implemented its own plan with a notice to employees that the increase was retroactive to January 3.

In arguing its “alternative” theory that, if the Union cannot be deemed to have consented to the Respondent’s wage increase proposal on January 15, then the parties must have been at impasse, the Respondent states a correct legal standard for impasse, i.e., whether under all the circumstances it is clear that further bargaining on the issue would be “futile.” But the facts, even as recited by the Respondent, show no such state of affairs on that date. The Respondent points to no statements from union negotiators that there was no possibiity of any further movement on the Union’s part, and, indeed, the Union’s request for information about how particular employees would be affected by the Respondent’s plan indicated that the Union would give it consideration. Furthermore, the Respondent has presented no evidence that the announcement and grant of an increase could not wait even a week or two longer. The Respondent’s proffered business reason for raising its employees’ wage rates at this time--that it “had learned of considerable unrest among the employees with respect to a 1991 wage increase,” and it had reason to believe that the employees “had grown accustomed to a regular January increase” certainly does not establish any emergency circumstances that would warrant effectively calling a halt to negotiations on this issue and proceeding with implementaion. [3] In sum, the Respondent has not established its impasse defense, and its implementation thus violates Section 8(a)(5) and (1) on a theory of unilateral action in the absence of a bargaining impasse.

As noted above, we also agree with the judge that implementation of the increase was unlawful because it was not consistent with the Respondent’s last proposal, in that the increase announced to the employees came with the caveat that “this does not apply to those employees with less than 90 days of employment at Acme Die Casting”--an exemption that was never part of the proposal that the Respondent put on the bargaining table. It is settled that even when impasse is reached on a subject, an employer’s subsequent implementation cannot vary from its final preimpasse proposal. [4]

The Respondent’s contention that the 90-day exemption was in fact included in its proposal rests on two separate theories, neither of which has merit. First, the Respondent suggests that the proposal implicitly included the 90-day exemption because such an exemption represented the “past practice” from which changes were to be measured. In support of this claim, the Respondent put in evidence a memorandum to employees dated December 4, 1989, in which it had announced a general wage increase with a 90-day employee exemption, which was thereafter implemented on January 4, 1990. But that increase was part of a long pattern of usually semiannual, sometimes annual, general wage increases; and that one-time feature of the 90-day exclusion no more established a past practice than did the particular amounts that were given on that occasion.

Second, the Respondent contends that the 90-day exemption was in fact a component of its interim wage increase proposal because a proposal for a 90-day probationary period was on the table at the same time and had been the subject of negotiations, although the parties had not reached agreement on a probationary period clause. [5] The Respondent therefore contests the judge’s finding that there “is no record evidence that any exemption from [the interim wage] increase pertaining to employees with less than 90 days of service had ever been proposed or was ever discussed at any bargaining session.” We see no conflict between the judge’s finding and the evidence of negotiations on the probationary clause. There is no evidence whatsoever of any expression by the Respondent’s negotiators of an intent to link the probationary period in the proposed collective-bargaining agreement to the interim wage increase that was given before any such agreement was executed or even reached. This would have been an easy linkage to make: In the Respondent’s announcement of the increase to employees, it was accomplished in a single sentence.

In sum, we find that because the January 1991 wage increase was implemented in the absence of a bargaining impasse and in a form that diverged from the Respondent’s last proposal prior to implementation, it violated Section 8(a)(5) and (1) of the Act.