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United Oil Manufacturing Co. v. National Labor Relations Board

decided: February 22, 1982.



Before Adams, Van Dusen and Sloviter, Circuit Judges.

Author: Sloviter


This case is before us on the petition of United Oil Manufacturing Co. (United Oil) for review of an order of the National Labor Relations Board (Board) directing it to cease and desist from the commission of certain unfair labor practices, restore past pay and benefits to certain employees, and recognize and bargain with the Union, and on the cross-application of the Board for enforcement of its order. United Oil challenges that portion of the order establishing a bargaining order remedy. For the reasons discussed below, we will deny the petition for review and grant the Board's cross-application for enforcement of its order.


United Oil operates a vehicle service complex on Interstate 80 in Kylertown, Pennsylvania, known as "Stop 21", consisting of a gasoline and diesel fuel station, a store, and a motel. In the same complex, but operated by independent lessees of United Oil's parent corporation, are a restaurant, barber shop, and truck repair facility.

In late October 1979, one of United Oil's employees, Julio Leid, contacted Amalgamated Food Employees Union Local 590, United Food and Commercial Workers International Union, AFL-CIO (Union), and arranged for an organizational meeting to be held at her home on the afternoon of October 28. Five employees attended the meeting with a union organizer and signed union authorization cards. By some time in early November, the Union had obtained signed authorization cards from 17 of the 29 employees in the unit. On November 3, November 5, and again on November 11, the Union sought recognition by the company. In response to the last of these requests, General Manager Cecil Felix declined to confer recognition and responded that he wanted a fair election. In the interval between the arrangements for the organizational meeting and the request for recognition, the company had engaged in conduct which formed the basis for some of the underlying unfair labor practice charges, including unlawful interrogation and the grant of wage increases and promotions for the purpose of discouraging union activity. The union representative told Felix that the company's conduct had made a fair election impossible, and convened a meeting of employees at which a decision to strike was adopted on account of the company's refusal to bargain and its alleged unfair labor practices in connection with the organizational campaign. The strike, which appears to have been completely effective, lasted from November 12, 1979 until March 10, 1980, when the employees were reinstated following their unconditional offer to return to work.

The Administrative Law Judge found that United Oil had committed three separate unfair labor practices. First, he found that the company, through General Manager Felix, had interrogated employee Eugene Zahuranec concerning the initial organizational meeting at Julio Leid's home on October 28 and had improperly instructed him to report on what transpired at the meeting. Before the meeting, Zahuranec had requested Felix for time off to attend the meeting. Felix asked who else would be in attendance and "opined that the Union was no good." Felix "told Zahuranec to go to the meeting and to call him at the conclusion thereof to report what had happened." The next morning Felix phoned Zahuranec and asked who had been at the meeting, what had transpired, and the identity of the instigator of the union activity. Zahuranec identified the participants and indicated that he believed that Julio Leid had initially contacted the Union. Based on Zahuranec's testimony, which the ALJ credited, the ALJ found that United Oil violated section 8(a)(1) of the National Labor Relations Act by "Felix questioning (Zahuranec) concerning union activity of co-workers, by instructing Zahuranec to report on the union activity of co-workers, and by his broad questioning of Zahuranec as to what transpired at the union meeting of October 28."

The second unfair labor practice found by the ALJ was based on evidence that following its knowledge of the Union's organizational effort, the company granted promotions and small wage increases to five employees, including Julio Leid and one other employee who had attended the October 28 meeting. Leid was first contacted by Felix about the promotion on October 29; the official notification of all five promotions and wage increases came on November 3 in the form of an announcement signed by Felix which was included with employee paychecks. The ALJ noted that United Oil's "evidence includes no explanation for this sudden upgrading of the ... employees and the grant of an increase, shortly after acquisition of knowledge that a union campaign was in progress." The ALJ found that United Oil violated section 8(a)(1) "by promising wage increases and promotions, and by granting same, for the purposes of discouraging union activity."

The third unfair labor practice related to the company's post-strike conduct. The ALJ credited the testimony of three reinstated strikers, including Leid and Zahuranec, that they were not accorded the same opportunity to earn overtime pay which they had enjoyed prior to the strike. The ALJ found that the failure to restore to the strikers the overtime benefits previously enjoyed was not justified by supervening economic considerations and, accordingly, violated sections 8(a)(3) and (1) of the Act.

Two additional unfair labor practice charges, involving alleged surveillance by Felix of the October 28 meeting and the discharge of an employee, were dismissed by the ALJ.

The ALJ ordered United Oil to cease and desist from the commission of the unfair labor practices found to have occurred, restore the overtime benefits enjoyed by the three employees prior to the strike, and post appropriate notices. The ALJ characterized the granting of the promotions and wage increases as "serious unfair labor practices." He acknowledged that whether a bargaining order was warranted was not "free from doubt," but rejected the request for a bargaining order on the ground that conventional remedies were adequate in this case to facilitate a fair election. Among the considerations referred to by the ALJ were that, with the exception of the denial of overtime benefits to the reinstated strikers, the company's unlawful conduct occurred prior to the first demand for recognition by the Union on November 3, and that the unlawful interrogation of Zahuranec occurred only after Zahuranec had initially volunteered information about the union activity of his fellow employees.

The Board adopted the ALJ's findings as to the commission of the unfair labor practices,*fn1 but modified the ALJ's order insofar as it concerned the necessity of a bargaining order. The Board found that the company had violated section 8(a)(5) of the Act and that the unfair labor practices committed were sufficiently serious to warrant a bargaining order.

United Oil challenges only that portion of the Board's decision which found a section 8(a)(5) violation and issued a bargaining order remedy.


As in all cases where a bargaining order is at issue, we start with the Supreme Court's decision in NLRB v. Gissel Packing Co., 395 U.S. 575, 89 S. Ct. 1918, 23 L. Ed. 2d 547 (1969). In our recent en banc opinion in Hedstrom Co. v. NLRB, 629 F.2d 305 (3d Cir. 1980), cert. denied, 450 U.S. 996, 101 S. Ct. 1699, 68 L. Ed. 2d 196 (1981), we summarized the teaching of Gissel as follows:

In Gissel, the Court declared that a bargaining order may appropriately be imposed in place of a new election not only in cases involving outrageous conduct (so-called Gissel I cases), but also in other than extraordinary cases that are "marked by less pervasive practices which nonetheless still have the tendency to undermine majority strength and impede the election processes" (so-called Gissel II cases). The Board's authority to issue a bargaining order on a lesser showing of employer misconduct is appropriate when there is also a showing that at one point the union had the support of a ...

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