opinion: OUGHTON et al. v. NATIONAL LABOR RELATIONS BOARD.
  No. 7336.
  Circuit Court of Appeals, Third Circuit.
  Nov. 19, 1940.
  On Rehearing Feb. 26, 1941.
  GOODRICH and MARIS, Circuit Judges, dissenting in part.
  Charles A. Wqlfe and Montgomery & McCracken, all of Philadelphia, Pa., for petitioners.
  Frank E. Hahn, Jr., John F. E. Hippel, and Edmonds, Obermayer & Rebmann, all of Philadelphia, Pa., for intervening petitioners.
  Charles Fahy, Gen. Counsel, Robert B. Watts, Associate Gen. Counsel, Laurence A. Knapp, Asst. Gen. Counsel, Mortimer B. Wolf, William F. Guffey, Jr., and Ernest Gross, all of Washington, D. C., for National Labor Relations Board.
  Before MARIS, JONES, and GOODRICH, Circuit Judges.
  GOODRICH, Circuit Judge.
  This case comes before the court upon a petition to review and set aside an order of the National Labor Relations Board issued against the petitioners. In its answer to the petition the Board has requested enforcement of its order.
  The Conflict in Testimony.
  The first point made by the petitioners is that they did not, in fact, interfere with or restrain or coerce their employees in the exercise of rights guaranteed to the employees by Section 7 of the National Labor Relations Act. The petitioners complain that the trial examiner believed some witnesses and disbelieved other witnesses and that the witnesses disbelieved were those presented by the petitioners. This is clearly a situation where the determination of the Board on the facts controls. It is not the function of the court to determine from the confusion of conflicting testimony where the truth lies. Republic Steel Corp. v. National Labor Relations Board, 3 Cir., 1939, 107 F.2d 472.
  The Finding of Unfair Practices.
  The determination of credibility of witnesses being a Board function, is there sufficient evidence upon the record to justify the Board’s finding that the petitioners’ employees were restrained in the exercise of rights guaranteed to them by Section 7 of the Act ? Whether the conclusion is to be drawn or not is not for us to say. It is sufficient that there is evidence, which, if believed, supports the conclusion of the Board.
  There is evidence upon the record in support of the Board’s findings that, when the union attempted in May, 1937, to organize the production employees in the plant, Bertram Oughton, one of the partners, addressed the workers and stated that he would' never sign a contract with the union and that he would close the plant before he would do so; that several foremen of the company continually disparaged the union saying that it was composed of “a bunch' of communists and reds” and that those who joined the union were “mixed up with the wrong people”; that the foremen attempted to dissuade the workers from joining the union and threatened that if they did so the plant would shut down; that after John Ought-on, one of the partners had opened a plant in Athens, Ga., to which twenty-four looms were sent from the Philadelphia plant, threats were made by the foremen that the entire plant would move south if the union did not cease its activities; and that there was an abortive attempt to form a company-dominated union. These actions on the part of the company constituted an interference with the rights of its employees to bargain collectively and to choose freely their representative for that purpose.
  Our attention is called to evidence offered by the petitioners that the foremen were expressly ordered not to engage in anti-union activities. Petitioners contend that they are not bound by the action of the foremen, citing Cupples Co. Manufacturers v. National Labor Relations Board, 8 Cir., 1939, 106 F.2d 100 and National Labor Relations Board v. Swank Products, Inc., 3 Cir., 1939, 108 F.2d 872. But the supervisory employees in the instant case had definite indicia of authority. It is shown in the evidence that foremen had the power to hire and “lay off. It is inevitable that, under the circumstances, their remarks would carry to rank and file employees the impression that they were speaking for the management. Upon this point the language of the court in H. J. Heinz Co. v. National Labor Relations Board, 6 Cir., 1940, 110 F.2d 843, 847, is relevant: “Petitioner also contends that, even if its supervisory employees did engage in the aforesaid activities, there is no evidence that it expressly authorized or ratified those acts; on the contrary, when they were brought to its attention, it claims that all foremen were instructed to remain neutral and not discriminate against any employee because of union activities. But there was no evidence that petitioner directed any supervisory employee to communicate its alleged neutrality to the employees. If petitioner had really wanted its employees to know that they might with safety join whichever union they desired, the bulletin boards were the obvious and, because direct, the most effective means of assuring them of its impartiality. There was abundant evidence that the ordinary employees feared the disfavor of those from whom they were accustomed to taking orders. Since they were justified in believing that these supervisory employees were acting as petitioner’s representatives, petitioner is responsible for what they did.”
  Bargaining Agency and Intervention Petition.
  The next point made by petitioners is that they have not and do not refuse to bargain collectively with the representatives of the majority of their employees. Closely related to this question is the issue raised by the intervenors.
  The Textile Workers Union of America, C. I. O., had been designated as. bargaining agency of the employees under an election held January 19, 1938. The vote at that time was as follows: out of 221 ballots cast 123 voted in favor of this union, 85 against it,' 6 were held void and 7 challenged ballots were not counted. This election was held under the aegis of the Mayor’s Labor Board of the City of Philadelphia by agreement of the parties after a long drawn-out strike. During the year intervening between the election conducted by the Mayor’s Labor Board and the issuance of the complaint herein the management met many times with the union representatives. We deem it unnecessary to discuss the question whether there is support in the record for the Board’s finding that the company had failed to bargain in good faith. On February 13, 1939, the company wrote to the union, refusing to meet with it in the future on the ground that the union no longer represented the majority of its employees. The order of the Board requires the company to bargain with the union upon request. If the union does represent the majority, this is an obligation placed upon the employer by the act; if the union does not have that strength then there is no duty to bargain with it. The issue, therefore, with respect to sections 1(a) and 2(a) of the order is whether there is sufficient evidence to sustain the finding by the Board that the union does represent the majority.
  At the hearing held by the trial examiner the intervening petitioners herein filed a petition praying for leave to intervene in the proceedings. This petition alleged that the committee named represented approximately 75 per cent of the employees oi the Windsor Manufacturing Company and bore attached to it what purported to be the signatures of about 145 of the employees. The verification of this petition bears the date of March 9, 1939, which was the date of the opening of the hearing before the trial examiner. The trial examiner declined leave to intervene and this action was affirmed by the Board. The committee, however, was allowed to intervene before this court when the matter was brought here for review. It argues only the question of the propriety of the denial of the right to participate in the proceedings.
  The complaint in this case was issued February 28, 1939. The hearing was opened on March 9, 1939. This, it will be noted, was something more than a year after the election referred to. At the hearing before the trial examiner the manager of the Philadelphia Textile Workers joint board testified, on direct examination, that he thought his union no longer represented a majority of the workers and that he got this opinion from the records, of the union. On cross-examination he testified that he believed the union had a majority on the date of the filing of the complaint by the Board, which was nine days prior to the hearing. He was also allowed to testify, over objection, that he had been told by two employees that the attitude of the management was discouraging membership in the union. This last statement was, obviously, hearsay. While the Board is not bound by technical rules concerning the admission of evidence, unsubstantiated hearsay is not competent evidence of a fact. Consolidated Edison Company v. National Labor Relations Board, 1938, 305 U.S. 197, 59 S.Ct. 206, 83 L.Ed. 126. This is all the evidence that was presented concerning the union’s then representation of a majority of the employees. The verified petition of the intervenors, alleging that they represented 75 per cent of the employees, the Board refused to consider, although if the statement was true, obviously, the union did not represent a majority of the workers of the Windsor Manufacturing Company. In refusing to consider this intervening petition there was an abuse of discretion by the Board.
  The Board stated and here argues that, “the only evidence in the record indicates that the union’s majority status continued to the date of the complaint herein, and, except for the effect of the respondents’ unfair labor practices thereafter. As we have previously held, the unfair labor practices of the respondents cannot operate, to change the bargaining representatives previously selected by the untrammeled will of the majority.” With the general proposition that an employer cannot attack the status of a union whose majority has been dissipated by his own unfair labor practices we, of course, agree. National Labor; Relations Board v. Bradford Dyeing Ass’n, 1940, 310 U.S. 318, 60 S.Ct. 918, 84 L.Ed. 1226. Furthermore, it could well, as one of the courts has said, make a merry-go-round of the act, if after a hearing before an examiner is completed, the matter were referred back upon every allegation of a shift in membership. But it is to be noted that here the allegation of these intervening petitioners was made and verified at the time of the hearing by the trial examiner of the Board. In addition, the order to bargain with the union clearly affected the rights of apparently innocent absent parties, namely, the intervenors and the employees they represented. There is nothing expressed or implied in the evidence to show that the intervenors were in any way being prompted or directed by the management. If that had been the fact it could have been brought out in the hearing which the Board refused to allow.
  The Board contends that the committee’s request that the court order an election is foreclosed by the decisions of the Supreme Court of the United States. National Labor Relations Board v. Falk Corp., 1940, 308 U.S. 453, 60 S.Ct. 307, 84 L.Ed. 396; National Labor Relations Board v. Bradford Dyeing Ass’n, 1940, 310 U.S. 318, 60 S.Ct. 918, 84 L.Ed. 1226. We do not agree with that interpretation of these decisions. A situation quite similar to the one presented here was before the Eighth Circuit in Hamilton Brown Shoe Co. v. National Labor Relations Board, 8 Cir., 1939, 104 F.2d 49. The court said: “Having in mind that it is the fundamental policy of the Act to permit employees freely to choose their representatives, it follows that the employees have a right to change their choice, and when that fact has beeri brought sharply to the attention of the Board, as in this case, it was, we think, the duty of the Board to investigate the claim. * * * Yet the Board arbitrarily refused to consider or investigate this claim, but entered its order requiring the employer to recognize the Union as the exclusive bargaining representative of the employees.” 104 F.2d page 55.
  The court further said: “We are of the view that it would be arbitrary and unfair, and not in keeping with either the letter or the spirit of the Act, to require the employer and its employees to conduct their negotiations through an agency not fairly representing a majority of the employees. In the face of the record as it stands, it can not be assumed that the Union is now the accredited representative of the employees, but the showing made, and it stands without dispute, is at least sufficient to require investigation and to cause a court of equity to inquire whether an order requiring both the employer and the employees to recognize the Union as the bargaining agency should be enforced in the face of circumstances making such enforcement unwise, if not illegal.”
  The Seco'nd Circuit, likewise, had a similar problem in National Labor Relations Board v. National Licorice Company, 2 Cir., 1939, 104 F.2d 655. The affirmance of the order to bargain was conditioned upon the holding of an election. While this decision subsequently was reviewed by the Supreme Court of the United States this point was not passed upon.
  Since the argument in the principal case the Supreme Court has decided on November 12, 1940, the case of International Association of Machinists, etc., v. National Labor Relations Board, 61 S.Ct. 83, 85 L.Ed. -. We do not find in the opinion of the court in that case anything which throw's doubt about the soundness of the conclusion here reached. It is to be noted that in that case there was clear evidence of assistance by the employer to the petitioning union in its organizational drive, and therefore it was clear that if it did represent a majority, it was not an uncoerced majority. There is no such evidence in this case with respect to the position of the intervenors. Furthermore, in the International Association of Machinists case the contention that the petitioning union represented a majority was first made after the hearing had been held, although it had been allowed to intervene. As has been pointed out above, such a situation presents entirely different considerations from that here present.
  The language of the statute in providing for the selection of representatives of employees for collective bargaining allows ■ alternative methods for ascertaining such.representatives. One is by a secret ballot of employees; the other is to utilize “any other suitable method”. In view of this language and its application by the Supreme Court in National Labor Relations Board v. Falk Corporation, 1940, 308 U.S. 453, 60 S.Ct. 307, 84 L.Ed. 396, we believe it is within the Board’s and not the court’s, discretion to select the method for determining the bargaining representative. That part of the Board’s order requiring the company to bargain with the union will be affirmed and enforced therefore upon the condition that the Board first ascertain through an election or “any other suitable method" that the union is still the free and untrammeled choice of the employees as their bargaining agent.
  Notices to be Posted.
  The petitioners object to a portion of the Board’s order requiring the posting of notices on the ground that it requires them impliedly to admit that they have been .guilty of unfair labor practices. We do not understand the argument to go to the length of opposing the posting of any notices. ' It becomes unnecessary to consider the petitioners’ point in view of the Board’s willingness that the order be modified to the effect that the company post notices “stating that they will not engage in the conduct from which they are ordered' to cease and desist in paragraphs 1(a) and (b) and that they will take the affirmative action set forth in paragraph 2(a) of this Order.”
  We do, however, modify this provision by relieving the employer of the obligation to post notices stating it will not engage in conduct prohibited by paragraph 1(a) and that it will take the affirmative action set forth in 2(a) of the order, until the conditions upon which those parts of the order are to be enforced have been met. A decree will be entered enforcing the order of the Board upon the conditions and to the extent herein indicated.
  The order reads as follows:
  “Upon the basis of the above findings of fact and conclusions of law, and pursuant to Section 10 (c) of the National Labor Relations Act, [29 U.S.CC.A. § 100 (e)], the National Labor Relations Board hereby orders that the respondents, John J. Oughton, Charles T. Oughton, Bertram E., Oughton, and Robert B. Oughton, individuals and as co-partners trading as Windsor Manufacturing Company, their agents, successors, and assigns shall:
  “1. Cease and desist from:
  “(a) Refusing to bargain collectively with Textile Workers Union of America, C. I. O., as the exclusive representative of their employees engaged in production at their Philadelphia plant, exclusive of executives, supervisors, and clerical help;
  “(b) In any other manner interfering with, restraining, or coercing their employees in the exercise of their lights to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, or to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection as guaranteed in Section 7 of the National Labor Relations Act, [29 U.S.C.A. § 157].
  “2. Take the following affirmative action which the Board finds will effectuate the policies of the Act:
  “(a) Upon request bargain collectively with Textile Workers Union of America, O. I. O., as the exclusive representative of their employees engaged in production at their Philadelphia plant, exclusive of executives, supervisors, and clerical help, in respect to rates of pay, wages, hours of employment, and other conditions of employment, and, if an understanding is reached on any such matter, embody said understanding in a written, signed contract;-
  “(b) Post immediately in conspicuous places in and about their plant notices to their employees, and maintain said notices for a period of at ledst sixty (60) consecutive days from the date of posting, stating that the respondents will cease and desist in the manner set forth in paragraphs 1 .(a) and (b) and that they will take the affirmative action set forth in paragraph 2 (a) of this Order;
  “(c) Notify the Regional Director for the Fourth Region in writing within ten (10) days from the date of this Order what steps the respondents have taken to comply herewith.”
  The designation is in the following form:
  “We, the undersigned, all of whom are employees of the Windsor Manufacturing Company, Philadelphia, Pennsylvania, hereby designate and appoint
  “Thomas Gibbs
  “Catherine V. Kilmartin
  “Vincent Bolinski
  “John Weber
  “Mary Hassan
  as our representatives to appear before the National Labor Relations Board to represent us in the matter of the complaint filed by the Textile Workers Organizing Committee against the Windsor Manufacturing Company, hereby .ratifying and confirming all actions of the said Committee taken on our behalf.”
  Citing: National Labor Relations Board v. Bradford Dyeing Ass’n, 1940, 310 U.S. 318, 60 S.Ct. 918, 84 L.Ed. 1226; National Labor Relations Board v. Somerset Shoe Co., 1 Cir., 1940, 111 F.2d 681; National Labor Relations Board v. Remington Rand, Inc., 2 Cir., 1938, 94 F.2d 862; National Labor Relations Board v. Highland Park Mfg. Co., 4 Cir., 1940, 110 F.2d 632; Hartsell Mills Co. v. National Labor Relations Board, 4 Cir., 1940, 111 F.2d 291; National Labor Relations Board v. Brown Paper Mill Co., 5 Cir., 1940, 108 F.2d 867; National Labor Relations Board v. Louisville Refining Co., 6 Cir., 1939, 102 F.2d 678; M. H. Ritzwoller Co. v. National Labor Relations Board, 7 Cir., 1940, 114 F.2d 432; Bussmann Mfg. Co. v. National Labor Relations Board, 8 Cir., 1940, 111 F.2d 783; National Labor Relations Board v. Biles-Coleman Lumber Co., 9 Cir., 1938, 96 F.2d 197; International Association of Machinists, etc., v. National Labor Relations Board, 1939, 71 App.D.C. 175, 110 F.2d 29.
  Compare Consolidated Edison Company v. National Labor Relations Board, 1938, 305 U.S. 197, 59 S.Ct. 206, 83 L.Ed. 126 with National Labor Relations Board v. Pennsylvania Greyhound Lines, Inc., 1938, 303 U.S. 201, 58 S.Ct. 571, 82 L.Ed. 831, 115 A.L.R. 307 and National Licorice Company v. National Labor Relations Board, 1940, 309 U.S. 350, 60 S. Ct. 569, 84 L.Ed. 799.
  1940, 309 U.S. 350, 60 S.Ct. 569, 84 L.Ed. 799.
  § 9 (c), 29 U.S.C.A. § 159 (e).
choices: Benefits Review Board Civil Aeronautics Board Civil Service Commission Federal Communications Commission Federal Energy Regulatory Commission Federal Power Commission Federal Maritime Commission Federal Trade Commission Interstate Commerce Commission National Labor Relations Board Atomic Energy Commission Nuclear Regulatory Commission Securities & Exchange Commission Other federal agency Not ascertained or not applicable