Labor Law – LMRA – Stock Purchase Plan as Subject of Compulsory Collective Bargaining

An employer unilaterally instituted a stock purchase plan, membership in which was voluntary and open to regular employees who had at least one year of service and were at least thirty years of age. Members, through authorized payroll deductions, were to contribute monthly not less than five dollars but not more than five percent of their earnings. The employer contributed monthly an amount equal to fifty percent of each member contribution and annually an amount dependent upon the ratio of profits to invested capital, up to a combined total of seventy-five percent of the members’ contributions. Member contributions were kept in individual member accounts and employer contributions in individual trusteed accounts. A trustee was to use both accounts to purchase shares of stock of the employer privately or in the open market and to credit purchases to the respective accounts. Stock was to be distributed to a member at age fifty-five if a man or fifty if a woman, or in event of total disability or death, to the member or his beneficiary respectively. Nothing was to be distributed to anyone while a member of the plan, but if a member left the company’s employ before reaching the required age he received all his member account and a specified percent of his trusteed account, the amount depending upon the length of time he had participated. One week after the announcement of the plan, the certified union requested the employer to bargain concerning it, but the employer refused, contending that the plan was not subject to compulsory collective bargaining. Held, the plan concerns “wages” and “conditions of employment” within the meaning of section 8 (d) of the amended National Labor Relations Act, and therefore the employer violated sections 8 (a) (5) and 8 (a) (1) of the act in refusing to bargain. The Board expressly refrained from deciding whether the unilateral promulgation of the plan per se was a violation of the act. Richfield Oil Co., (N.L.R.B. 1954) CCH Lab. Cas. ¶52,345.