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NASA found that TWA's proposal was technically superior to Boeing's, but it selected Boeing because its proposed labor costs were substantially below the existing wage rates and fringe benefits presently enjoyed by the incumbent work force. NASA stated that: “Under the circumstances of this procurement, which contemplates the award of a cost plus award fee type contract for support services, the labor costs to be incurred will compose a preponderance of the total cost" (ex. 5, p. 1). It explained that (ex. 5, p. 3):
Boeing's Cost and Fee Business Proposal offered composite labor rates which, in many cases, were lower than the labor rates proposed by the incumbent, TWA, whose rates for mechanical and clerical workers were premised upon continuing in effect in its present labor agreement with ... (IAMAW]. To achieve its proposed reduction in KSC labor rates. Boeing stated that the labor force it employed would be represented under its company-wide labor agreement with the IAM presently in effect in the KSC
area . . . for employes working under another Boeing contract at KSC. NASA illustrated the sharp cut in existing wages entailed in Boeing's proposal as follows (ex. 5, pp. 48–49).
Under TWA bargaining agreement, a maintenance mechanic, painter, carpenter or electrician is classified as a mechanic with a labor rate of $5.79 per hour. A maintenance mechanic, when hired under the Boeing agreement would be classified as a maintenance mechanic A, Grade 9, or maintenance mechanic B, Grade 5, or maintenance mechanic learner Grade 1. Those in a Grade 9 would receive $5.24 per hour, B-Grade 5 $4.01,-Learner Grade 1 $3.40.
A painter or carpenter (both classified as a mechanic under TWA) would he classified as a painter or carpenter A Grade 8 or B Grade 5 or learner Grade 1 under Boeing. The rates would be:
Carpenter or painter A Grade 8 $5.06 per hour.
Carpenter or painter learner Grade 1 $3.10 per hour.
Grade 9 $5.24.
Grad 1 learner $3.40
for employees covered by bargaining agreements. NASA repeatedly emphasized the factor of reduced labor cost : "Boeing proposes to absorb a large portion of the TWA work force and cover these people under their existing agreement with the IAM. The Boeing agreement has lower labor rates than the TWA agreement which basically accounts for a significant portion of the difference in cost between TWA and Boeing's proposal" (ex, 5, p. 18). "Boeing proposes to extend its existing agreement to cover its operations at KSC, and to pay at a wage scale applicable to the Boeing agreement; these rates of pay are generally lower than those under the TWA agreement” (ex. 5, p. 44).
18. Shortly after NASA's announced selection, Boeing stated it intended to employ approximately 90 percent of the TWA and subcontractor labor force now performing the work and that it expected to bring on site only a small management group.
19. On November 23, 1970, TWA protested to NASA its selection of Boeing as the company with which to negotiate a support service contract covering NASA's operation at KSC. Its telegram to NASA stated that:
Pursuant to NASA Procurement Regulation 2.407-8, Trans World Airlines, Inc. does hereby protest the prospective award to The Boeing Company of a contract to provide installation and technical support services at John F. Kennedy Space Center on the grounds that the anticipated first year cost of the contemplated contract with Boeing estimated by NASA at twenty million dollars when compared with the first year cost of TWA's bid, namely approximately twenty-four million dollars, shows either that TWA and Boeing were not binding on the same work and that one or both bids were, therefore, non-responsive, or that an award is being contemplated principally on anticipated differences in wages to be paid individual non-management workers; an award on the latter basis is not advantageous to the government and cannot lawfully be made in that the purchasing power of the government would thereby be used as an instrument to deprive organized employees
of an incumbent contractor of the wages and other benefits gained through collective bargaining, a result contrary to national labor policy and gov
ernment procurement policy. A copy of this telegram is enclosed as exhibit 6.
20. On February 26, 1971, the Comptroller General of the United States, United States General Accounting Office, rejected TWA's protest. His letter to TWA rejecting the protest is enclosed herewith as exhibit 7. In his letter the Comptroller General noted that (ex. 7, p. 7);
... [T]he Acting Administrator of NASA directed that negotiations be conducted with Boeing on the basis of the labor plan reflected in Boeing's proposal, with the condition that Boeing show firm agreements with the appropriate unions providing coverage for the work to be performed under the
procurement before approval of the contract. And he similarly noted that (ex. 7, p. 10):
.. [T]he Acting Administrator of NASA has conditioned the award to Boeing on a showing by Boeing of firm agreements with the appropriate unions providing coverage for the work to be performed under the proposed contract. It is our opinion that Boeing's proposal, when supported by such agreements, may properly be considered reasonable as to anticipated costs. The condition noted by the Comptroller General reflected NASA's representations (ex. 5, pp. 46-47):
We were satisfied that the selection of Boeing's basic proposal would give the Government the best promise of good technical performance and reasonable cost. Final negotiations would give Boeing an opportunity to demonstrate that it can achieve the cost upon which it has based its proposal, by obtaining agreements with the labor unions representing the employees concerned. For these reasons we selected the Boeing Company for award of the contract. I directed that negotiations be conducted with Boeing to reach full agreement on a contract signed by the Company and ready for acceptance by the Government, the negotiations to be based on the labor plan reflected in the Boeing proposal. I also directed that Boeing be requested to show firm agreements with the appropriate unions providing coverage for work to be performed at KSC under this procurement. Upon conclusion of the negotiations, the SEB is to report again on the results obtained so that my final approval can be given prior to contract award. [Emphasis supplied) 21. Throughout the proceedings, orally and in writing, IAMAW repeatedly protested to Boeing, NASA, the Comptroller General and others the selection of any cotractor to provide base support services for NASA at KSC which was not based on the continuation by that contractor of the existing wages, hours, and working conditions presently enjoyed by the incumbent work force.
(a) On November 23, 1970, the president of the IAMAW wired NASA as follows:
Information reaching my office indicates that NASA now has pending a determination with respect to the continuation of Trans World Airlines, Inc., as a subcontractor for certain so-called housekeeping functions at the Kennedy Space Center, Cape Kennedy, Florida, and particularly, that portion of same identified as Merritt Island. The employes of TWA in this case are represented by the International Association of Machinists and Aerospace Workers, AFL-CIO, and we are seriously disturbed by the content of the information on hand. The employment in question is governed by the provisions of the Railway Labor Act as amended and the International Association of Machinists is the duly authorized and certified employe representative. As such, we have a collective bargaining agreement-reached under and through the auspices of the National Mediation Board—which ordains that the work in question will be performed by appropriately classified employes under the coverage of that agreement. The "scope rule" contained therein effectively and lawfully asserts that IAM members—in addition to enjoying representation as employes for the purpose of establishing wages, hours and working conditions-in effect "own" the work currently contracted for by TWA. That same agreement embodies a “successor and assigns" clause which preserves all rights accuring thereunder whether or not any change in employers occurs. It is also noteworthy that a well established principle of law with respect to the application of the Railway Labor Act is that any collective bargaining agreement executed under the Act's coverage survives to infinity and is a contract which uniquely enjoys coverage under Federal statutes only and is concellable only by the mutual consent of the signatories. We regard the rights enumerated herein as inalienable and this wire may be contrued as notice by the IAM that we will do all in our power to preserve them intact including recourse to the appropriate Federal Courts should that become necessary. Any information that you may be able to provide would be appreciated and may serve to
clear the air and avoid any untoward developments. A copy of this telegram is enclosed as exhibit 8. (b) On December 16, 1970, the president of IAMAW wired NASA as follows:
Understand that negotiations pursuant to recent NASA contract award began with Boeing Company on December 14. So that there may be no misunderstanding, it is position of IAM as representative of TWA employes currently performing work in question that any successor employe[r] must assume wages, hours, and working conditions as currently enbodied in Collective Bargaining Agreement between IAM and TWA. No other labor agreement has applicability in these circumstances and we hold firmly to the view that any deviation from existing wages, hours and working conditions would be contrary to both national labor policy and the U.S. Gorernment Procurement policies. Boeing Company has been advised of this position and any assertions to the contrary may be regarded as unfounded
rumors. A copy of this telegram is enclosed as exhibit 9.
(c) On January 8, 1971, the president wired the Comptroller General and NASA as follows:
Our organization has been informed that protests of interested bidders regarding the selection of the Boeing Company to provide installation and technical support services at the Kennedy Space Center have been forwarded to your office for review and decision. Certain work functions involved are covered by a collective bargaining agreement between the International Association of Machinists & Aerospace Workers and the incumbent employer and, therefore, clearly demand proper recognition and continuation of wages, hours and other conditions of employment as now provided for in that contract. Notwithstanding the established national labor laws and government procurement policy NASA and the prospective successor have entered into negotiations which, in the end result, will arbitrarily reduce current employee wages and fringe benefits and thereby void the welfare and protection of effected employees as established through collective bargaining under federal law. The only valid and effective terms of employment are now and should continue to be in full force and effect. The present situation is especially alarming to our organization and to those employees we represent at the Kennedy Space Center who over the years have maintained a harmonious and productive relationship with NASA in advancing the space program of our country. A copy of this telegram is enclosed as exhibit 10.
(d) On March 1, 1971, the president of the IAMAW wired the Comptroller General, NASA, Boeing, TWA and others as follows:
The letter of February 26, 1971 of the Comptroller General to Trans World Airlines concerning NASA's selection of The Boeing Company for negotiation of a contract to perform installation support services at Kennedy Space Center states at Page 7 that:
... the Acting Administrator of NASA directed that negotiations be conducted with Boeing on the basis of the labor plan reflected in Boeing's proposal, with the condition that Boeing show firm agreements with the appropriate unions providing coverage for the work to be per
formed under the procurement before approval of the contract. It similarly stated at Page 10 that:
... the Acting Administrator of NASA has conditioned the award to Boeing on a showing by Boeing of firm agreements with the appropriate unions providing coverage for the work to be performed under
the proposed contract. This is to inform you that the IAMAW has no agreement, much less a firm agreement, with Boeing providing coverage for the work proposed to be performed by Boeing for NASA at the Kennedy Space Center. The only agreement between Boeing and the IAMAW covers units other than the one presently at issue. The unit presently at issue is covered by an agreement between Trans World Airlines and IAMAW not due to expire until December 31, 1971. The IAMAW could not, and did not, enter into an agreement with Boeing covering a unit which it had under contract with another employer. The only agreement that IAMAW will enter into with Boeing covering the Kennedy Space Center unit presently under contract with Trans World Airlines is one by which Boeing adopts the essential terms of IAMAW's agreement with Trans World Airlines for its present duration.
Accordingly, Boeing has no agrement with IAMAW covering the work to be performed by Boeing under the proposed contract with NASA. All Boeing has is a legal theory by which it asserts, but IAMAW denies, that an agreement exists between it and the IAMAW covering the work in issue. Boeing cannot pass off, and NASA cannot accept, a legal theory as the equivalent of a “firm agreement” between Boeing and IAMAW. Therefore, in accordance with the February 26, 1971 letter of the Attorney General, NASA can
not consummate the proposed contract with Boeing. A copy of this telegram is enclosed as exhibit 11.
22. On March 11, 1971, NASA entered into a contract with Boeing to provide base support services at KSC. Contrary to the condition noted by the Comptroller General and NASA's representations on which the Comptroller General acted, NASA contracted with Boeing despite the absence of any agreement, much less a "firm agreement,” with IAMAW covering the work comprised by Boeing's contract to furnish base support services.
23. On March 12, 1971, IAMAW wrote to Boeing requesting (1) that Boeing recognize it as the representative of the employees to perform the base support services work, (2) that Boeing refrain from unilaterally changing the existing employment terms, and (3) that Boeing adopt and observe the employment terms of the IAMAW-TWA agreement as it applies at KSC. The letter reads as follows:
In view of the execution of a Base Support Services Contract between The Boeing Company and National Aeronautics and Space Administration by which Boeing undertakes to provide NASA with support and housekeeping services at the John F. Kennedy Space Center, Florida, I am writing to you concerning the representation and employment terms of the nonsupervisory employees to be employed by Boeing to do the support and housekeeping work requisite to performing the Base Support Services Contract. As you know, the employees now performing this work are represented by the International Association of Machinists and Aerospace Workers, AFL-CIO, and their wages, hours and other terms and conditions of employment are presently governed by the collective bargaining agreement between IAMAW and Trans World Airlines, Inc., entered into on January 28, 1970 and not due to expire until December 31, 1971.
1. The IAMAW requests that Boeing recognize it as the exclusive bargaining representative of the foregoing unit of employees.
2. The IAMAW requests that Boeing refrain for unilaterally, without prior notification of and negotiation with the IAMAW, changing the existing wages, hours, and other terms and conditions of employment of the foregoing unit of employees.
3. The IAMAW requests that Boeing adopt and observe the terms of the collective bargaining agreement between IAMAW and TWA as it applies to the foregoing unit of employees. If Boeing believes that particular terms of that agreement are inappropriate in their application to Boeing's forthcoming operation at the Kennedy Space Center under its Base Support Services Contract, the IAMAW requests that Boeing identify those particular terms which in its view are inappropriate. The IAMAW will negotiate with Boeing concerning those identified terms to the end that mutual agreement upon the deletion, modification, or continuance of those terms shall be sought. I enclose for your convenience a copy of the current agreement between IAMAW and TWA.
I would appreciate your reply to this letter within five days. A copy of this letter is enclosed as exhibit 12
24. Boeing replied to the IAMAW's letter under date of March 19, 1971. Boeing stated in part that (pp. 3,4-5):
... Boeing does intend to abide by its current nationwide agreement with the IAMAW. It is the opinion of Boeing that the employees employed by Boeing April 1, 1971, on the project, will accrete to the group of employees covered by the nationwide Boeing-IAMAW agreement and, therefore, both Boeing and IAMAW will be bound by the terms and conditions of such nationwide agreement which now covers over 21,000 employees.
As to the specific request contained in your letter of March 12, Boeing agrees, on the accretion principle, that the IAMAW is the exclusive bargaining representative of the appropriate Boeing employees on the Installation Support Services Project. Further applying the accretion rationale, both Boeing and the IAMAW are bound by the terms of the existing nationwide agreement between Boeing and the IAMAW and there will be no unilateral changes made by Boeing in its terms and conditions of employment. We do not regard Boeing as a "successor" to the bargaining relationship as that relationship existed between the IAMAW and TWA. Moreover, TWA and the IAMAW have negotiated contracts with terms and conditions of employment which are not applicable to Boeing.
Consistent with our view that the employees on the Installation Support Services project are an accretion to the employees covered by the nationwide Boeing-IAMAW agreement, IAMAW is to be regarded as representing those employees.
Boeing is of the opinion that all terms and conditions of the BoeingIAMAW contract are appropriate and applicable to such employees. Boeing is ready to meet with you for the purpose of clarifying the position of either party and the basis therefor. Boeing further stated that it has "already processed some 860 employees" to be employed to perform the base support services work, and that "[o]f this figure, 235 are current TWA employees. The remaining 625 are either current or former Boeing employees, or are from outside sources” (p. 2).
It further states that "with the knowledge that at least 625 of the approximately 1,000 employees of the type mentioned above will be nonincumbent, Boeing is of the opinion for these and other reasons that it cannot be a successor to the TWA-IAM collective bargaining agreement” (p. 3). Accordingly, Boeing not only unilaterally reduced the existing wages and fringe benefits, but deci.mated the incumbent work force.
A copy of this letter is enclosed herewith as exhibit 13.
REASONS FOR ISSUING A COMPLAINT We now show that the charge plainly presents issues which require the speedy issuance of a complaint to vindicate the rights protected by the National Labor Relations Act.
1. REFUSAL TO RECOGNIZE THE IAMAW AS THE REPRESENTATIVE OF THE UNIT OF
NONSUPERVISORY EMPLOYEES PERFORMING BASE SUPPORT SERVICES WORK
Boeing states that it will recognize the IAMAW as the representative of the employees performing base support services work under its contract with NASA to provide these services, but only as an accretion to the Atlantic Missile Test Section Unit defined in the Boeing IAMAW agreement, and not as a separate unit of employees. We show hereafter that a group of 1,100 employees performing base support services work cannot accrete to a unit of 340 employees performing launch support services work (infra, pp. 21-24). Accordingly, Boeing is required to recognize the IAMAW as the representative of the base support service employees, not as an accretion to another unit, but as a unit unto themselves.
The IAMAW has majority status within that separate unit even if we assume, contrary to the fact (infra, pp. 3445), that Boeing may refuse to hire a majority of the incumbent work force. For the separate unit would still be made up in the main of the incumbent work force and "current or former Boeing employees. * * *” Since Boeing employees, like TWA employees, are represented by IAMAW, that representation would attach, and the designation of the IAMAW as their representative would be naturally inferred, regardless of the unit placement of the employees. Furthermore, since the consequence of representation of these employees in a separate unit would be at minimum to safeguard them from unilateral reduction of existing wages and fringe benefits, and at maximum to require observance of the superior terms of the TWA-IAMAW agreement for its duration, it is obvious that the self-interest of the employees dictates their choice of the IAMAW as the representative in a separate unit.
II. UNILATERAL. ALTERATION OF EXISTING EMPLOYMENT TERMS
The existing employment terms of the nonsupervisory employees providing base support services which were in being on March 31, 1971 were established at