Borden, Inc.

National Labor Relations Board - Board Decisions

Jul 31, 1992

308 N.L.R.B. 113 (N.L.R.B. 1992)

113
308 NLRB No. 25
BORDEN, INC.
1 The name of the Charging Party has been changed to reflect the
new official name of the Union.
2 The Charging Party has requested oral argument. The request is
denied as the record, exceptions, and briefs adequately present the
issues and the positions of the parties.
3 The term of the Meadow Gold contract ran from May 1, 1987,
to November 1, 1990. The Farmer Jack contract, which had been ne-
gotiated by a predecessor but was assumed by the Respondent (see
fn. 5 infra), was a 5-year agreement running from April 10, 1987,
to April 30, 1992.
4 We also adopt the judge’s findings that the Farmer Jack unit was
not an accretion to the former Meadow Gold unit; the Respondent,
through its general manager, Anthony Ward, violated Sec. 8(a)(5)
and, independently, Sec. 8(a)(1), by promising Meadow Gold clerical
employees increased benefits if they abandoned the Union; the Re-
spondent did not violate Sec. 8(a)(3) and (1) by the layoffs and
transfers to Farmer Jack of former Meadow Gold employees; and the
Respondent violated Sec. 8(a)(5), but not independently Sec. 8(a)(1),
by the threat to lay off or refuse to transfer employees unless the
Union accepted the Respondent’s last bargaining offer.
Member Devaney would delete the fourth paragraph of the notice
concerning the Respondent’s obligation to refrain from making
‘‘misstatements or mischaracterizations regarding negotiations’’ by
the Board. Accordingly, Member Devaney would also find it unnec-
essary to pass on the judge’s finding that the Respondent violated
Sec. 8(a)(5) by stating to employees that it would have no choice
but to lay off and/or refuse transfers to employees unless the Union
accepted its last bargaining offer, as this finding is cumulative of
other unfair labor practices found by the Board and would not affect
the remedy.
5 The judge found that these negotiations could be fairly character-
ized as either effects bargaining over the Meadow Gold cessation of
operations or bargaining concerning the new merged unit.
Borden, Inc. and Local 222, International Brother-
hood of Teamsters, AFL–CIO.1 Cases 27–CA–
10412, 27–CA–10412–2, and 27–CA–10412–3
July 31, 1992
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
DEVANEY AND RAUDABAUGH
At issue is whether the Respondent violated Section
8(a)(5) and (1) when, after consolidating two units rep-
resented by the Union, it, without bargaining, applied
the terms and conditions of one of the original units
to all of the employees in the consolidated unit.
On January 24, 1990, Administrative Law Judge
Clifford H. Anderson issued the attached decision. The
General Counsel, the Respondent, and the Charging
Party filed exceptions and supporting briefs, and the
Respondent filed an answering brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record2 in light of the exceptions and briefs and has
decided to affirm the judge’s rulings, findings, and
conclusions, as modified, and to adopt the rec-
ommended Order, as modified.
The complaint alleges that the Respondent violated
Section 8(a)(5) and (1) of the Act by unilaterally im-
posing terms and conditions of employment previously
in effect at its newly acquired Farmer Jack milk proc-
essing plant on represented employees transferred there
from its Meadow Gold milk processing plant. The
Union was the collective-bargaining representative of
employees at both the Farmer Jack plant and the
Meadow Gold plant, but the employees constituted
separate units with separate bargaining histories, and
the contracts covering the two groups of employees
differed. Before the two operations were consolidated,
the Meadow Gold transferees had worked under an
agreement with terms that were significantly more fa-
vorable for the employees.3
The judge found that the two units of employees be-
came a single, consolidated unit at some point after the
consolidation. He found no merit, however, to the
General Counsel’s contention that the Respondent had
violated Section 8(a)(5) because it had not preserved
the separate status of each portion of the new consoli-
dated unit and applied the Farmer Jack contract to em-
ployees who had worked at the Meadow Gold or at the
Farmer Jack plants.
We agree with the judge’s findings that a new unit
was created by the consolidation of the Meadow Gold
and Farmer Jack units, that the Meadow Gold employ-
ees were in fact transferred to the Farmer Jack plant,
and that the Respondent lawfully assumed the contract
in effect at Farmer Jack, at the Union’s request, after
it purchased that plant.4
We disagree, however, with the judge’s finding that
the Respondent had no obligation to preserve the
Meadow Gold transferees’ preexisting terms and con-
ditions of employment while the parties bargained in
good faith to agreement or impasse with respect to the
consolidated unit. The pertinent facts are as follows.
The Respondent acquired the Farmer Jack plant
from Borman’s Acquisition Corporation shortly after
Borman’s had obtained substantial monetary conces-
sions from the Union. It had purchased the Meadow
Gold plant the prior year when that plant’s employees
were covered by a collective-bargaining agreement that
had been negotiated with the Union by then-owner Be-
atrice Companies, Inc. Wages and benefits under Bea-
trice’s Meadow Gold contract were superior, from the
Union’s perspective, to those covering Borman’s Farm-
er Jack unit.
From the outset of negotiations on October 12,
1987, when the contemplated purchase of Meadow
Gold was announced,5 the Respondent told the Union
it intended to consolidate the plants, but that it would
initially operate them independently. The Respondent
stated that it would assume the Farmer Jack contract
at the Farmer Jack plant. The Union took the position
that, if the plants continued to operate independently,
114 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
6 The judge found that, by the November 12, 1987 letter, the
Union agreed unconditionally to the Respondent’s assumption of the
Borman’s Farmer Jack contract at that facility, including wage in-
creases scheduled under that contract. As noted in fn. 4, supra, we
adopt the judge’s dismissal of the 8(a)(5) complaint allegation that
the Respondent unilaterally assumed the Borman’s contract.
7 As noted above, we adopt the judge’s finding that these employ-
ees were effectively transferred from Meadow Gold to Farmer Jack.
8 See Martin Marietta Co., 270 NLRB 821 (1984). Because the
two preconsolidation units in Martin Marietta had been represented
by different unions, a question concerning representation arose, and
the Board accordingly directed an election on the employer’s RM
petition in the consolidated unit. Because both groups of employees
in the present case are represented by the same union, no such ques-
tion arises.
9 Globe Machine & Stamping Co., 3 NLRB 294 (1937); Armour
& Co., 40 NLRB 1333 (1942).
it expected the Respondent to honor both contracts,6
but that, in the event of consolidation, the Meadow
Gold contract should apply to employees from both
units thereafter. The parties discussed, but reached no
agreement over, the possibility of constructing a dual
wage and benefit system at the consolidated facility.
On November 6, 1987, the Respondent formally ac-
quired the Farmer Jack plant. The next day, it com-
menced operations, recognized the Union in the unit
covered by Borman’s Farmer Jack collective-bargain-
ing agreement, and began applying that contract at
Farmer Jack. On November 10, the Respondent again
met with the Union, announced its intention to proceed
with the consolidation, and offered to bargain over the
effects of the cessation of the Meadow Gold milk
processing operations. At further bargaining sessions
on January 5 and 6, the Respondent set July 1988 as
its projected date to terminate the Meadow Gold oper-
ations. After further bargaining, the Respondent agreed
to union proposals for transfer rights for Meadow Gold
employees choosing to work at Farmer Jack and reten-
tion of seniority for those employees. It consistently,
however, rejected the Union’s proposal to apply Mead-
ow Gold wage rates to employees transferred to Farm-
er Jack.
Ultimately, the Respondent accelerated the transfer
of operations and selectively employed Meadow Gold
unit employees at the Farmer Jack facility without se-
niority rights and at wage and benefit rates specified
in the Borman’s contract it had assumed at Farmer
Jack.7 When the consolidation was complete, October
7, 1988, there were 35 former Meadow Gold plant em-
ployees, 31 Farmer Jack employees previously covered
by the Borman’s contract, and 13 new hires. The
Borman’s contract was applied to all 79 of these em-
ployees.
As a result of the consolidation, a new merged unit,
different from either preexisting unit, was created at
the Farmer Jack plant.8 The judge found no obligation
for the Respondent to maintain the Meadow Gold
wage and benefit rates at the Farmer Jack plant on
consolidation and recommended dismissal of the cor-
responding and related allegations. The General Coun-
sel excepts, contending that the Respondent is obli-
gated to maintain the status quo terms and conditions
of employment of both previous units in effect at the
time of consolidation while the parties bargain for a
new agreement for the merged unit. The General
Counsel maintains that this entails no expansion of an
employer’s obligations under Section 8(a)(5) because
the requirement for a successor employer to preserve
the status quo during bargaining is well established. In
any event, the General Counsel argues, to require
maintenance of a bifurcated status quo ante in the case
of a consolidation, as here, fosters stability in collec-
tive bargaining. The General Counsel further contends
that certain former Meadow Gold production employ-
ees who accepted early retirement ‘‘as a direct result’’
of the Respondent’s unlawful unilateral action were
thereby constructively discharged.
The Respondent insists that the former Borman’s
contract in effect at Farmer Jack constitutes the status
quo for the combined unit of employees. First, the Re-
spondent argues that requiring two groups of employ-
ees to work alongside each other with dual wage and
benefit structures would work against the statutory ob-
jective of industrial stability because dissension in the
workplace would inevitably flow from decreased em-
ployee morale among the lower paid group. Second,
according to the Respondent, representation of both
groups of employees in negotiation of a new contract
presents the Union with a conflict of interest. Finally,
the Respondent points out that, if the Board finds merit
in the General Counsel’s theory of violation, ‘‘it would
be granting the Union the terms of its proposal to Bor-
den.’’
Our rejection of the Respondent’s contention that
the Meadow Gold employees should automatically be
brought under the terms of the Farmer Jack contract is
substantially consistent with the manner in which the
Board has treated the obligation of an employer re-
specting the terms and conditions of previously unrep-
resented employees who are added to a bargaining unit
as a result of an Armour-Globe election9 during the
term of a collective-bargaining contract covering the
larger unit. The newly added, or ‘‘fringe group,’’ em-
ployees are not automatically swept under the terms of
the agreement covering the existing unit. Federal-
Mogul Corp., 209 NLRB 343 (1974). Accord: Wells
Fargo Armored Service Corp., 300 NLRB 1104
(1990); Bay Medical Center, 239 NLRB 731, 732
(1978). Rather, the union and the employer bargain
over the terms and conditions under which the fringe
group will work until the contract in the larger unit ex-
pires, and the status quo from which they bargain is
the current working conditions of those employees.
Federal-Mogul, 209 NLRB at 344. See also NLRB v.
115BORDEN, INC.
10 In NLRB v. Abex Corp., 543 F.2d 719 (9th Cir. 1976), the court
of appeals declined to apply the Federal-Mogul holding in a case in
which the fringe group performed work that was ‘‘functionally simi-
lar’’ to that performed by employees in the preexisting unit. The
Board, however, has continued to apply the doctrine even when both
groups of employees perform the same type of work. Bay Medical
Center, 239 NLRB 731 (1978) (‘‘Mercy Division’’ LPNs did not
automatically come under contract of ‘‘General Division’’ LPNS fol-
lowing Armour-Globe election).
11 See Superior Sprinkler, 227 NLRB 204, 210 (1976).
12 We leave to compliance the determination of the number and
identity of former Meadow Gold employees who took early retire-
ment rather than accept employment under unlawfully changed con-
ditions at the Farmer Jack plant.
Henry Vogt Machinery Co., 718 F.2d 802, 809 (6th
Cir. 1983) (employer permitted laboratory employees
who had voted to join existing unit to retain cafeteria
privilege during bargaining over whether that privilege
should be retained now that they were in unit of others
who did not enjoy it). Admittedly, the present case dif-
fers in that we have determined that the consolidated
operation at Farmer Jack was a new unit and not a
mere continuation of an existing unit with a newly
added contingent. Therefore, unlike in Federal-Mogul
and its progeny, we have concluded that a new agree-
ment should be negotiated for the entire new operation.
But, here, as in Federal-Mogul, we see no ‘‘legal or
practical justification for permitting either party to es-
cape its normal bargaining obligation,’’ which is to
bargain with the employees’ previous conditions of
employment as the starting point. 209 NLRB at 344.10
We agree with the General Counsel that, where two
separate units of the same employer represented by the
same union contribute substantial proportions of em-
ployees to a new unit, an employer is obligated to pre-
serve the status quo with respect to each of the two
groups until it reaches either a new agreement or a
bargaining impasse. Maintaining the status quo by re-
quiring the terms of both contracts to remain in effect
after a consolidation, such as the one that occurred
here, promotes the statutory interest of stability in col-
lective bargaining. Maintaining the status quo ensures
that both portions of the merged unit begin from the
same relative point. Like any employees in a
prebargaining posture, they both enter negotiations
with their respective preexisting terms and conditions
of employment intact.
Contrary to the Respondent’s argument that a bifur-
cated status quo would promote industrial unrest, our
experience and judgment leads us to conclude that it
is more likely to prompt both parties to negotiate an
agreement expeditiously. Thus, each will be motivated
to reach agreement to forestall the continued applica-
tion of the contract that each party views as the less
desirable one. As to the Respondent’s contention that
the Union faces a conflict of interest where different
portions of a unit enjoy different wages and benefits
even temporarily, we find this situation at least com-
parable to the dual-tier bargaining structures which
have been routinely advanced as employer proposals in
numerous industries and have frequently thereafter
been agreed to and administered by unions without
disqualifying conflicts of interest. There may be cir-
cumstances in which there is practical justification for
not requiring an employer to adhere to two different
sets of employment terms and conditions covering, re-
spectively, two different groups of employees newly
joined in a single unit, until the employer negotiates a
new single contract for the unit. We find, however,
that the Respondent has presented no justification here
for unilaterally terminating the Meadow Gold employ-
ees’ terms and conditions before bargaining for a new
agreement.
Accordingly, we find that the Respondent violated
Section 8(a)(5) and (1) by unilaterally changing the
terms and conditions of employment of Meadow Gold
employees transferred to the Farmer Jack facility and
compensating them at Farmer Jack contract rates. Cor-
respondingly, we find that those former employees of
the Meadow Gold plant, who declined employment at
Farmer Jack and retired because of those changes,
were constructively discharged. Those employees, fac-
ing the prospect of reduced pensions through lower
employer pension-benefit contributions and loss of se-
niority working under the Borman’s Farmer Jack
agreement, were offered a Hobson’s choice between
continued employment by the Respondent or abandon-
ment of rights guaranteed them under the Act.11 We
agree with the General Counsel that the issue of these
constructive discharges was fully and fairly litigated
and find that they violated Section 8(a)(3) and (1) of
the Act.12
THE REMEDY
Having found that the Respondent engaged in cer-
tain unfair labor practices, we shall order that it cease
and desist and take certain affirmative action designed
to effectuate the policies of the Act. We shall order the
Respondent to make employees whole for losses they
suffered as a result of the Respondent’s failure to
apply terms and conditions of the contract in effect at
the Meadow Gold plant for the term May 1, 1987, to
November 1, 1990. The loss of wages shall be com-
puted as in Ogle Protection Service, 182 NLRB 682
(1970), enfd. 444 F.2d 502 (6th Cir. 1971), plus inter-
est as prescribed in New Horizons for the Retarded,
283 NLRB 1173 (1987). The Respondent shall remit
all payments owed to the employee benefit funds and
reimburse their employees in the manner set forth in
Kraft Plumbing & Heating, 252 NLRB 891 fn. 2
(1980), enfd. 661 F.2d 940 (9th Cir. 1981), for any ex-
penses resulting from the Respondent’s failure to make
these payments. Any amounts that the Respondent
116 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
13 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
must pay into the benefit funds shall be determined in
the manner set forth in Merryweather Optical Co., 240
NLRB 1213 (1979). Nothing in our order, however,
should be construed as requiring the Respondent to
cancel any wage increase without a request from the
Union. See Taft Broadcasting Co., 264 NLRB 185 fn.
6 (1982).
Having found that the Respondent violated Section
8(a)(3) and (1) of the Act by constructively discharg-
ing employees who accepted early retirement from its
Meadow Gold facility, rather than be transferred to its
Farmer Jack facility, we shall order the Respondent to
offer them positions at the Farmer Jack plant and make
them whole for any loss of earnings and other benefits,
computed on a quarterly basis from the date of dis-
charge to the date of a proper offer of reinstatement,
less any net interim earnings, as prescribed in F. W.
Woolworth Co., 90 NLRB 289 (1950), plus interest as
computed in New Horizons for the Retarded, supra.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge, as
modified and set out in full below, and orders that the
Respondent, Borden, Inc., Salt Lake City, Utah, its of-
ficers, agents, successors, and assigns shall
1. Cease and desist from
(a) Offering employees increased benefits if they
abandon union representation.
(b) Dealing directly with employees concerning
terms and conditions of employment of unit employ-
ees, thereby undermining the role of the Union as the
exclusive representative of unit employees for the pur-
pose of collective bargaining.
(c) Failing to bargain in good faith with Teamsters
Local 222, AFL–CIO as the exclusive representative of
employees in the following unit:
All employees of Respondent as described in Sup-
plements to the May 1, 1987 through November
1, 1990 collective bargaining agreement between
Respondent and Central and Southern Conference
of Teamsters and Local Union Nos. 222 and 976
of the Western Conference of Teamsters and all
employees of Respondent as described in Appen-
dix ‘‘A’’ of the Milk/Ice Cream/Cultured Products
Plants Agreement Between Borman’s Acquisition
Corp. and the Union which agreement contains an
expiration date of April 30, 1992, employed at
Respondent’s Farmer Jack facility.
(d) Unilaterally altering the status quo of unit em-
ployees transferred between plants.
(e) Terminating employees or otherwise discriminat-
ing with regard to their wages and terms and condi-
tions of employment because of their union activities.
(f) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of
rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Offer the Meadow Gold plant employees who
accepted early retirement, rather than work under the
terms and conditions of employment of the Borman’s
Farmer Jack collective-bargaining agreement, imme-
diate and full reinstatement to their former jobs or, if
those jobs no longer exist, to substantially equivalent
positions, at the Farmer Jack plant, without prejudice
to their seniority or any other rights or privileges pre-
viously enjoyed, dismissing, if necessary, any persons
hired after the transfer of operations from the Meadow
Gold plant. If there are not a sufficient number of jobs
for all the employees to be offered reinstatement, the
Respondent shall place the names of those for whom
jobs are not available on a preferential list in the order
of their seniority, and thereafter offer them reinstate-
ment before other persons are hired. Employees of-
fered reinstatement shall be allowed a reasonable time
to accept such offers.
(b) Make the Meadow Gold transferees and early re-
tirees whole for any loss of earnings and other benefits
suffered in the manner set forth in the remedy section
of this decision.
(c) On request of the Union, rescind any departures
from terms and conditions of employment affecting
former Meadow Gold employees that existed imme-
diately before the Respondent’s transfer of operations
to the Farmer Jack plant, retroactively restoring pre-
existing terms and conditions of employment, includ-
ing wage rates and benefit plans.
(d) Recognize and bargain in good faith with the
Union as the exclusive representative of the employees
in the unit set forth above.
(e) Preserve and, on request, make available to the
Board or its agents for examination and copying, all
payroll records, social security payment records, time-
cards, personnel records and reports, and all other
records necessary to analyze the amount of backpay
due under the terms of this Order.
(f) Post at its Meadow Gold and Farmer Jack plants
and mail to the last known address of all former em-
ployees of the Meadow Gold plant in the appropriate
bargaining unit represented by Local 222, International
Brotherhood of Teamsters, AFL–CIO, copies of the at-
tached notice marked ‘‘Appendix.’’13 Copies of the
notice, on forms provided by the Regional Director for
Region 27, after being signed by the Respondent’s au-
117BORDEN, INC.
thorized representative, shall be posted and mailed by
the Respondent immediately upon receipt and main-
tained for 60 consecutive days in conspicuous places
including all places where notices to employees are
customarily posted. Reasonable steps shall be taken by
the Respondent to ensure that the notices are not al-
tered, defaced, or covered by any other material.
(g) Notify the Regional Director in writing within
20 days from the date of this Order what steps the Re-
spondent has taken to comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this Notice.
WE WILL NOT promise, directly or implicitly, im-
proved terms and conditions of employment if employ-
ees abandon Local 222, International Brotherhood of
Teamsters, AFL–CIO as their representative for collec-
tive bargaining.
WE WILL NOT bypass the Union and deal with em-
ployees directly concerning terms and conditions of
employment or other matters properly the responsibil-
ity of the Union.
WE WILL NOT make misstatements or mischarac-
terizations regarding negotiations or the consequences
of agreements or disagreements with the Union. More
specifically WE WILL NOT tell employees that unless
the Union accepts our last offer regarding employee
transfers to the Farmer Jack facility, we will be forced
to deny employees transfers and will further be forced
to lay off employees at the Meadow Gold plant and
hire new employees ‘‘off the street’’ at the Farmer
Jack facility.
WE WILL NOT unilaterally alter terms and conditions
of employment of unit employees transferred between
plants.
WE WILL NOT terminate employees or otherwise dis-
criminate against them with regard to their wages and
terms and conditions of employment because of their
union activities.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce our employees in the exercise
of the rights guaranteed them by Section 7 of the Na-
tional Labor Relations Act.
WE WILL recognize and bargain in good faith with
the Union as the exclusive representative of our em-
ployees in the following unit which resulted from the
merger of the represented units at the Meadow Gold
and Farmer Jack facilities.
All employees of Respondent as described in Sup-
plements to the May 1, 1987 through November
1, 1990 collective bargaining agreement between
Respondent and Central Southern Conference
Teamsters and Local Union Nos. 222 and 976 of
the Western Conference of Teamsters and all em-
ployees of Respondent as described in Appendix
‘‘A’’ of the Milk/Ice Cream/Cultured Products
Plants Agreement Between Borman’s Acquisition
Corp. and the Union which agreement contains an
expiration date of April 30, 1992, employed at
Respondent’s Farmer Jack facility.
WE WILL offer Meadow Gold plant employees who
accepted early retirement, rather than elect to work
under the terms and conditions of employment of the
Borman’s Farmer Jack collective-bargaining agree-
ment, immediate and full reinstatement to their former
jobs or, if those jobs no longer exist, to substantially
equivalent positions, at the Farmer Jack plant, without
prejudice to their seniority or any other rights or privi-
leges previously enjoyed, dismissing, if necessary, any
persons hired after the transfer of operations from the
Meadow Gold plant. If there is an insufficient number
of jobs for all the employees to be offered reinstate-
ment, WE WILL place the names of those for whom
jobs are not available on a preferential hiring list in the
order of their seniority, and thereafter offer them rein-
statement before other persons are hired.
WE WILL make Meadow Gold plant transferees and
early retirees whole for any loss of earnings and other
benefits they have suffered.
BORDEN, INC.
William J. Daly, Esq., for the General Counsel.
William F. Schoberlein, Esq. (Sherman and Howard), of
Denver, Colorado and Keith King, Esq., Corporate Labor
Counsel, of Columbus, Ohio, for the Respondent.
Stephen W. Cook and Reid Davis, Esqs. (Cook and Wilde),
of Midvale, Utah.
DECISION
STATEMENT OF THE CASE
CLIFFORD H. ANDERSON, Administrative Law Judge. I
heard the above-captioned case in trial at Salt Lake City,
Utah, on September 13, 14, and 15, 1989. Posthearing briefs
were filed on November 13, 1989. The matter arose as fol-
lows.
On February 26, 1988, International Brotherhood of Team-
ster, AFL–CIO (the Charging Party or the Union) filed a
charge against Borden, Inc. (Respondent) docketed as Case
27–CA–10412. On March 11, 1988, the Union filed a second
charge against Respondent docketed as Case 27–CA–10412–
2 and on April 7, 1988, a third charge docketed as Case 27–
CA–10412–3. Following an investigation, on June 15, 1989,
the Regional Director for Region 27 of the National Labor
Relations Board issued an order consolidating cases, consoli-
118 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 As a result of the pleadings, the stipulations of counsel at trial
and the submission of a substantial number of joint exhibits, there
were few disputes of fact concerning events. Where not otherwise
noted, the findings herein are based on the pleadings, the stipulations
of counsel, or unchallenged credible testamentary and documentary
evidence.
dated complaint, and notice of hearing concerning the three
cases.
The complaint alleges and the answer admits that Re-
spondent acquired two dairy plants in Salt Lake City, Utah—
the Meadow Gold facility and the Farmer Jack facility, ulti-
mately closing the Meadow Gold facility and merging oper-
ations into the Farmer Jack facility. The complaint further al-
leges and the answer admits that the Union represented cer-
tain employees at each plant during relevant times.
The complaint alleges and the answer denies that Re-
spondent violated Section 8(a)(1) of the National Labor Rela-
tions Act (the Act) by telling employees at the Meadow Gold
facility that they could not be transferred to the Farmer Jack
facility unless the Union accepted Respondent’s contract pro-
posals. The complaint further alleges and the answer denies
that Respondent violated Section 8(a)(3) and (1) of the Act
by discharging Meadow Gold employees and rehiring certain
of these employees as new hires at the Farmer Jack facility.
Finally, the complaint alleges and the answer denies that Re-
spondent violated Section 8(a)(5) and (1) of the Act by fail-
ing and refusing to bargain collectively with the Union by
the following acts and conduct: (1) by unilaterally imple-
menting the predecessor’s collective-bargaining agreement at
the Farmer Jack facility in and after November 1987, (2) by
unilaterally changing the terms and conditions of Meadow
Gold employees by applying the Farmer Jack terms and con-
ditions of employment to Meadow Gold employees em-
ployed at the Farmer Jack facility, and (3) by bypassing the
Union and dealing directly with Meadow Gold clerical em-
ployees by offering them improved wages and benefits if
they agreed to work without union representation at the
Farmer Jack facility.
All parties were given full opportunity to participate at the
hearing, to introduce relevant evidence, to call, examine and
cross-examine witnesses, to argue orally, and to file post-
hearing briefs.
On the entire record herein, including helpful briefs from
all parties, and from my observation of the witnesses and
their demeanor, I make the following
FINDINGS OF FACT1
I. JURISDICTION
At all times material, Respondent, a corporation with an
office and place of business in Salt Lake City, Utah, has
been engaged in the production and wholesale sale of milk
products. Respondent in the course and conduct of its busi-
ness operations in Utah annually sells and ships as well as
purchases and delivers goods and services valued in excess
of $50,000 directly to and from locations outside the State
of Utah. The complaint alleges, the answer admits, and I find
that Respondent is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
II. LABOR ORGANIZATION
The Union is, and at all times material has been, a labor
organization within the meaning of Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Background
Corporate America has been experiencing a restructuring
resulting from the acquisition of, subsequent reorganization
and in some cases dismemberment of corporations through
mergers, acquisitions, sales, and divestures. The instant case
involves the consequences of this process in the dairy indus-
try in the State of Utah. A brief history of the industry in
Utah and the two facilities involved herein is appropriate.
1. The milk production and distribution process in Utah
Until the events described herein, three entities produced
and distributed the bulk of dairy products in the State of
Utah: Safeway Stores, Inc., Beatrice Foods, Inc., and West-
ern General Dairies, Inc. The production employees of each
entity were represented by the Union. Respondent, a national
corporation principally engaged in the processing, preparation
and sale of food and other consumer products, was not a fac-
tor in the Utah dairy industry.
2. History of the Meadow Gold facility
The Meadow Gold facility is a dairy products processing
and distribution facility located in Salt Lake City, Utah. Until
1986, the Meadow Gold facility was owned and operated by
Beatrice Companies, Inc. (Beatrice) as one of many facilities
in its Meadow Gold Dairy Division. The facility’s employees
were represented by the Union and were covered by: (1) a
master agreement covering various Meadow Gold Dairy Di-
vision facilities nationwide between Beatrice and the Inter-
national Brotherhood of Teamsters, AFL–CIO (the Inter-
national), and (2) by regional and subregional contract ad-
denda covering smaller geographical areas negotiated by the
employer and various sub organizational units of the Inter-
national including the Union.
In 1986, Beatrice was acquired by investors in a leveraged
buyout through the offices of the firm of Kohlberg, Kravis,
and Roberts and certain of Beatrice’s assets and divisions
were put up for sale. Respondent contemplated the purchase
of Beatrice’s Meadow Gold Dairy Division but determined
that its collective-bargaining structure was unsatisfactory. Re-
spondent met with the International and entered into an in-
terim labor agreement on October 9, 1986, which was to re-
place the Beatrice master contract. The parties further agreed
that new local addenda would be negotiated as existing local
agreements expired with a pattern agreement to be negotiated
at the first opportunity.
Respondent thereafter acquired the Meadow Gold Division
including the Meadow Gold facility. At the time of acquisi-
tion Beatrice was negotiating the State of Utah addendum to
the former master contract with the Union. The Meadow
Gold facility was covered by the agreement. Respondent took
over the negotiations and, after an initial rejection by em-
ployees, an agreement was reached and ratified by the mem-
119BORDEN, INC.
2 The contract had not been signed as of the time of the hearing
in the instant case. There was no dispute, however, respecting the
terms of the agreement relevant herein.
3 The purchased agreement provided for the long-term sale of dairy
products by Respondent to Borman’s Salt Lake Division retail facili-
ties from the Farmer Jack plant. Product prices were established in
accordance with a formula which included, inter alia, labor costs at
the Farmer Jack plant.
4 The pleadings establish the following unit as appropriate for bar-
gaining under Section 9 of the Act and as the relevant Farmer Jack
unit at least until the time of the merger:
All employees of Respondent as described in Appendix ‘‘A’’
of the Milk/Ice Cream/Cultured Products Products Plants Agree-
ment Between Borman’s Acquisition Corp. and the Union which
agreement contains an expiration date of April 30, 1992.
bership in May 1987.2 The contract covers the period May
1, 1987, through November 1, 1990.
3. History of the Farmer Jack facility
In late 1986, Safeway Stores, Inc. was also acquired by in-
vestors in a leveraged buyout with the assistance of
Kohlberg, Kravis, and Roberts and certain of its assets put
up for sale. The International and its locals represented var-
ious Safeway employees nationwide and were signatory to
various collective-bargaining agreements. The experience of
the International on at least one occasion prior to the events
in question herein was that, if the unions representing
Safeway employees resisted granting substantial contractual
concessions to potential purchasers, Safeway’s operations
were not necessarily purchased and operated in divisional
units, but were rather either simply closed down or sold on
a piecemeal basis with a concomitant loss of represented em-
ployees’ jobs.
Safeway’s Utah Division—including plants, retail outlets,
distribution center, warehousing, and trucking operations
were for sale and, if not sold as an operating unit, were, in
the International’s view, at risk of closure. In this setting,
Borman’s Acquisition Corporation (Borman) approached the
International and told them that Borman was considering the
purchase and continued operation of the Utah Division as a
unit but that substantial contractual concessions from the rep-
resenting labor unions would be necessary to make the pur-
chase practicable. Very substantial monetary concessions ex-
ceeding $2000 per worker year were obtained by Borman
from the Union in a new 5-year agreement entered into on
April 10, 1987, and expiring on April 30, 1992. Thereafter,
Borman acquired and operated the Utah Division facilities
including the Farmer Jack facility in Salt Lake City, Utah.
Borman began to experience financial difficulties and con-
sidered the sale of its Farmer Jack plant. In July 1987, Re-
spondent contemplated the acquisition of the Farmer Jack fa-
cility, an equivalent but more modern plant than its Meadow
Gold facility which would better allow expansion. Such an
acquisition would allow eventual consolidation of the Mead-
ow Gold and Farmer Jack operations at the Farmer Jack fa-
cility. In late September 1987, Respondent and Borman
signed a letter of intent respecting Respondent’s purchase of
the Farmer Jack facility.
At a meeting held on October 12, 1987, between rep-
resentatives of Respondent, Borman and the Union, Respond-
ent notified the Union of its intent to acquire the Farmer Jack
plant and to assume its collective-bargaining agreement. Re-
spondent further indicated that, at least for a period, the
Farmer Jack and Meadow Gold plants would operate inde-
pendently, but would ultimately be consolidated at the Farm-
er Jack facility.
Union representatives took the position that, if the facili-
ties were run independently, their contracts could be sepa-
rate. If, however, the plants were to be consolidated, the
Meadow Gold contract—which was superior from the labor
organization’s perspective—should apply. Borman’s rep-
resentative expressed concern that such an arrangement could
cause problems under the purchase agreement between Re-
spondent and Borman.3 The possibility and difficulties of
maintaining dual wage and benefit rates at the consolidated
facility were also discussed without agreement. The meeting
ended with the parties agreeing that they were at a purely ex-
ploratory stage and that Respondent would submit a proposal
to the Union.
On November 6, 1987, Respondent formally acquired the
Farmer Jack plant. On November 7, 1987, it began oper-
ations retaining all Borman employees and recognizing the
Union as representative of unit employees.4 At all times ma-
terial herein, Respondent has applied the terms of the April
10, 1987 Borman agreement to the Farmer Jack facility em-
ployees including the granting of scheduled increases in
wages, pension contributions and other benefits which fell
due under terms of the contract after November 6, 1987. The
pension trusts, however, are not accepting the increased pay-
ments tendered by Respondent.
B. Initial Negotiations Following Acquisition of the
Farmer Jack Plant
On November 10, 1987, Respondent’s corporate director
of labor relations, Jack McInerney, and assistant director of
labor relations, Neil Finnerty, met with representatives of
both the Union and the International. Respondent’s represent-
atives confirmed its acquisition and operation of the Farmer
Jack facility, its retention of Borman Farmer Jack unit em-
ployees, its recognition of the Union, its intention to assume
and apply the Borman contract and its intention to consoli-
date the Meadow Gold and Farmer Jack operations at the
Farmer Jack facility. Respondent also expressed a willingness
to negotiate respecting the effects of the closure of the Mead-
ow Gold plant. No agreement of any kind was reached at
this meeting.
On November 12, 1987, the Union sent Respondent’s rep-
resentatives a letter with the following language:
The purpose of this letter is to request an immediate
meeting to negotiate the wages, hours, and working
conditions of all employees (all Farmer Jack and Mead-
ow Gold) affected by this sale. Further, this letter is to
request that the present Farmer Jack Labor Agreement
not be unilaterally altered by your company pending
completion of these negotiations.
Respondent and the Union held negotiations respecting the
two plants on January 5 and 6, 1988. At these meetings, Re-
spondent announced that the consolidation of the two plants
at the Farmer Jack facility and the closure of the Meadow
Gold facility were to take place by July 1988. Respondent’s
position respecting the Farmer Jack unit was that, when Re-
120 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
5 The Borman Farmer Jack rates, which were being followed by
Respondent, were significantly lower than the Meadow Gold rates.
Thus, if the Union’s proposal had been implemented, the Meadow
Gold transferees would enjoy higher, if frozen, wage rates than the
original Farmer Jack employees until the scheduled increases under
the Farmer Jack contract raised the Farmer Jack wages to the level
of the Meadows Gold transferees.
6 Not including driver sales employees who were still covered by
the Meadow Gold Contract.
spondent had acquired the plant, it had also ‘‘purchased the
contract.’’ Discussion of provisions for the transfer of Mead-
ow Gold unit employees to the Farmer Jack facility and the
dovetailing of the seniority of employees in the two units
took place.
The Union submitted a written proposal at the end of these
negotiations which included in its provisions the proposed
freezing or ‘‘red circling’’ of Meadow Gold employee con-
tract wage rates as of the time of their transfer and the incor-
poration within the Farmer Jack contract of these red circled
rates for the transferred Meadow Gold unit employees.5 This
proposal was not acceptable to Respondent and negotiations
ended with an agreement to meet on January 13, 1988.
At the January 13, 1988 negotiations, Respondent pro-
posed to accept the Union’s proposals respecting dovetailing
of seniority and transfer of Meadow Gold employees to the
Farmer Jack plant and further proposed increased transfer
and severance payments to Meadow Gold employees. Re-
spondent, however, specifically rejected the Union’s proposal
to carry Meadow Gold wage rates along with Meadow Gold
employees to the Farmer Jack plant even if only in the form
of red circled rates. Respondent indicated it was determined
to preserve the wage structure at the Farmer Jack Plant.
Agreement was not reached. At no time thereafter did the
Union submit Respondent’s offer to employees for consider-
ation.
On January 27, 1988, Respondent announced to employees
its intention to consolidate the facilities at the Farmer Jack
facility. An employee grievance was filed thereafter challeng-
ing the action. Thereafter, in February and March, meetings
were held with unit employees in which the move and its
consequences were discussed, see separate discussion infra.
On March 29, 1988, the parties met again. The Union sub-
mitted a new proposal which would freeze Meadow Gold
wage rates and accelerate Farmer Jack rates so that they
reached a common level at the contract expiration date in
1992. Respondent did not accept the proposal retaining its
position that the Borman contract rates would control at the
Farmer Jack facility, with transfer and severance payments
being paid to Meadow Gold employees without modification
of the Farmer Jack wage structure. Respondent proposed in-
creases in Meadow Gold employee transfer payments without
union acceptance.
The parties met again in May and October 1988, and in
the period immediately before the trial herein. No agreement
has been reached on the issues concerning Meadow Gold
employees or on a contract covering the Farmer Jack facility.
To the time of the hearing employees at the Farmer Jack
plant6 were compensated at the rates provided under the
Borman Farmer Jack contract.
C. Respondent’s Meetings with Employees
In February 1989, Respondent held two meetings with
Meadow Gold unit office employees in the office of the con-
troller, Robert Lake. Respondent’s then general manager, An-
thony Ward, discussed the specifics and timing of the up-
coming consolidation and its consequences. Employees Cath-
erine Joan Cherti and Wildea McDonald and General Man-
ager Ward testified concerning the meetings.
There is no dispute that after the announcement of the
move, discussion was held, questions were posed by employ-
ees and answered by management. The fact that the Meadow
Gold clerical staff was part of the represented Meadow Gold
bargaining unit and the fact that the Farmer Jack clerical em-
ployees were not part of the represented Farmer Jack bar-
gaining unit and the implications of those facts were dis-
cussed. Ward told employees that when they moved they
would not be covered by the union contract. Terms and con-
ditions of employment of clerical employees at the two fa-
cilities was discussed. Ward testified:
As I recall, I expressed my personal opinion that I
don’t feel the Union plays a constructive part in an of-
fice. And I felt that there would be more flexibility for
the Company, more flexibility for the employees with-
out a union office. And I expressed the feeling that a
person may get or be rewarded more, based on their
abilities, without a union office; or, again, it may be
different. Union versus non-union, more flexibility, both
ways, benefits for the Company, benefits for the em-
ployees. That was my personal opinion . . . I said a
person could get higher benefits—higher pay. I didn’t
say a person or they will get higher pay. I said there’s
the flexibilities [sic] for reward more for performance.
Cherti testified that Ward
said as far as the office was concerned the Company
didn’t believe in office being union. He himself didn’t
believe in a union office. And if we didn’t have a union
office that we would have more benefits, we would get
more raises, the promotions would be better, and each
one would be able to earn on their own merits rather
than what the Union contract said that we would get.
McDonald generally corroborated the other’s testimony.
She described Ward’s statements about wages as follows:
Mr. Ward himself did not see any need for a union, that
we could have better pay—or not necessarily better
pay, but—how was it he put it?—that we would receive
more pay for our work if we did good work, you know,
additional, like merit raises type. And where it is now
with the union contract you have to wait until such and
such date for your 25-cent or 50-cent, whatever the
raise happens to be. And then you would also be ad-
vanced according to your work, you[r] skills and your
interest in working, you know, showing that you are
doing well.
Respondent’s January 1988 offer to the Union provided,
inter alia, for the transfer of Meadow Gold employees to the
Farmer Jack facility upon closure and the dovetailing of
those employees’ seniority with Farmer Jack employees. As
noted supra, the Union did not accept the proposal nor did
121BORDEN, INC.
the Union submit the proposal to the unit employees for con-
sideration. On February 29, 1989, the Union filed Case 27–
CA–10412. A regular union membership meeting was sched-
uled for the evening of March 10, 1988. In this context, on
March 9 and 10, 1989, Respondent convened two meetings
of Meadow Gold unit employees.
The parties stipulated that at these meetings Respondent’s
representatives explained that they were not seeking to bar-
gain with the employees. They explained Respondent’s out-
standing January 13, 1988 proposal and urged the employees
to seek a vote on the proposal. They told the employees that
the Union had informed Respondent that it did not accept the
proposal and did not intend to submit it to the membership.
Respondent’s representatives told the employees that the pro-
posal was Respondent’s final proposal and, if agreement
could not be reached with the Union on the proposal, Re-
spondent would have ‘‘no choice but to layoff the employees
at Meadow Gold, and hire from the street’’ at Farmer Jack.
The parties further stipulated that employees learned at the
meetings that, if the proposal was not ratified, or was not
voted upon, then the employees would not be transferred,
and they would have to apply as new employees at the Farm-
er Jack operation.
Also introduced into evidence was a detailed summary of
the two meetings prepared by Respondent’s agent. That
memorandum indicated that Neil Finnerty, Respondent’s as-
sistant director of labor relations, told the assembled employ-
ees, inter alia, that:
[T]he proposal was still out there, and that the closing
[of Meadow Gold] was coming and it would be nec-
essary to hire off the street if some resolution of this
problem was not forthcoming in the very, very, near fu-
ture. [Finnerty] indicated that it would be impossible to
transfer these individuals or pay them any severance
without that being agreed upon by the Union. He fur-
ther indicated that court battles were long-term propo-
sitions and that lawyers basically only fought over little
words and that it was the people who would lose if
they didn’t transfer.
The memorandum further indicated that Finnerty, in answer
to questions from employees, made the following statement
respecting the Farmer Jack contract.
Remember that under the Farmer Jack contract we
are duty bound to honor at that location there are some
give backs of both the wages and benefits over the
course of time.
. . . .
We are honoring the Borman contract at that location
and because that was an essential part of the purchase
of the Borman facility we need in order to effectuate
the bargain period.
In answer to the question ‘‘Why don’t you honor both
contracts,’’ the memorandum indicates Finnerty responded:
When we move we can’t say both contracts are applica-
ble to the location. We can’t give you a job without
this particular agreement being ratified [by the Union]
and we’ll have to hire off the street.
The circumstances of the union membership meeting of
the evening of March 10, 1988, were not placed in evidence
but, apparently, no vote on Respondent’s proposal occurred.
On March 13, 1988, an employee petition was filed with the
International seeking a vote on Respondent’s offer based on
expressed employee concern for ‘‘our welfare and continu-
ance of employment.’’ On March 14, 1988, the Union filed
Case 27–CA–10412–2.
D. The Consolidation of Operations at Farmer Jack
and the Closure of Meadow Gold
The Union’s statewide bargaining unit covered by its
Meadow Gold contract with Respondent contained 135 em-
ployees just prior to November 7, 1987. The Farmer Jack
bargaining unit on November 7, 1987, contained 35 employ-
ees. During the initial postacquisition period, because of the
supply agreement negotiated as part of the purchase of the
Farmer Jack facility, each facility operated much as before
before supplying its existing customer base. In early 1988,
however, Borman sold the remaining portions of its Salt
Lake Division and the Farmer Jack plant lost a significant
portion of its sales volume. This loss of volume made it im-
practical to operate both the Farmer Jack and the Meadow
Gold facilities and a decision was taken in March 1988 by
Respondent to accelerate the consolidation of the two facili-
ties.
By March the move had been announced to employees and
new supervisory appointments were made for the merging
enterprises—in some cases placing one person in charge of
a given position at both facilities. Equipment was moved
from the Meadow Gold plant to the Farmer Jack plant over
the period May to October 1988, in such a manner that var-
ious functions or processes were shut down, transferred and
put back in operation independently of other processes. By
October 7, 1988, the consolidation was complete and all pro-
duction ceased at the Meadow Gold facility. As noted,
clericals have remained at the Meadow Gold plant on an in-
terim basis.
Respondent did not formally transfer its Meadow Gold
employees to the Farmer Jack facility. Nor were seniority
rights honored or any of Respondent’s proposals respecting
the transfer put into effect. With respect to at least selected
employees, however, transfers were in fact made. Meadow
Gold employees were solicited to contact a state employment
officer as their work at Meadow Gold came to an end. Fol-
lowing a state interview, physical examination and pro forma
Farmer Jack application process, the employees resumed em-
ployment, now at Farmer Jack, at their same or similar jobs
utilizing the same equipment used at the Meadow Gold facil-
ity. Virtually no compensated time was lost by the employ-
ees transferring in this manner. The employee transfers, as
with the equipment, occurred over the period in organiza-
tional units as particular parts of the operation at Meadow
Gold were stopped, moved to Farmer Jack and then returned
to operation. The transferred employees were formally classi-
fied and paid as new employees under the terms of the
Borman Farmer Jack contract although they were credited
with having had outside experience.
As of October 7, 1988, the Farmer Jack unit was com-
prised of 35 former Meadow Gold unit employees, 31
Borman Farmer Jack employees, and 13 employees—hired
‘‘off the street’’ since the acquisition from Borman. Nine su-
122 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
7 Apparently a significant number of supervisory employees re-
turned to their former employer in the period following the acquisi-
tion of the Farmer Jack plant allowing for the ready placement of
the Meadow Gold supervisory team at Farmer Jack.
8 The lower pension contributions under the Borman contract had
the potential effect of reducing the pensions of employees with long
service under the higher contribution rates of the Meadow Gold con-
tract.
pervisors—at various levels of supervision—transferred from
the Meadow Gold facility to the Farmer Jack facility.7 Other
Meadow Gold production employees took early retirement
rather than transfer to the Farmer Jack facility.8 Respondent
continues to apply the Borman contract terms to all produc-
tion employees at the Farmer Jack facility. Twenty-two cleri-
cal employees as of the time of the hearing remained at the
Meadow Gold facility on an interim basis and 32 route driver
salesmen were transferred to the Farmer Jack facility. These
latter two groups of employees are still covered by the terms
of the Meadow Gold contract.
E. Analysis and Conclusions
The General Counsel’s pleadings do not allege broad bad-
faith bargaining by Respondent with respect to either the
Meadow Gold or the Farmer Jack units. Rather the General
Counsel has alleged specific, narrow acts and conduct as vio-
lative of the Act. Further, the Charging Party contends that
the Farmer Jack unit is an accretion to the Meadow Gold
unit. In resolving the allegations it is appropriate to deal with
the accretion issue first and thereafter to turn to the individ-
ual allegations of the General Counsel’s complaint.
1. The accretion allegation
The Charging Party argues that under either a theory of
accretion or relocation, or both, the Farmer Jack unit merged
with and became a part of the Meadow Gold multifacility
unit as of the November 1987 date of Farmer Jack’s acquisi-
tion by Respondent. The Charging Party argues further that
the Meadow Gold contract, by virtue of the accretion, applies
to all Farmer Jack unit employees. Respondent opposes the
Charging Party’s arguments. The General Counsel does not
directly address the issue.
The Board finds an accretion, the automatic inclusion of
one group of employees in an existing bargaining unit with-
out consideration of the sentiments of the accreted group,
where two circumstances exist. First, the employees to be in-
cluded must be a relatively small number of employees com-
pared to the group into which it is being subsumed. Second,
the employees to be accreted must lack a sufficiently sepa-
rate identity to exist independently as an appropriate bargain-
ing unit and must have a sufficient community of interest
with the accreting group so as not to render the new com-
bined bargaining unit inappropriate. Melbet Jewelry Co., 180
NLRB 107 (1969), Safeway Stores, 256 NLRB 918 (1981).
These requirements flow naturally from the Board’s pref-
erence for allowing employees the opportunity to express
their sentiments concerning union representation. Where a
unit of employees could under Board representational deci-
sions stand independently of other bargaining units, it is not
appropriate to include that potentially independent unit of
employees in another bargaining unit without testing em-
ployee sentiment. Even where no independent bargaining unit
is appropriate under Board standards for the employees to be
accreted, an accretion will not be found where the number
of new employees is not sufficiently small relative to the
number of employees in the existing unit so that the senti-
ments of the group to be accreted need not be fairly consid-
ered in determining the wishes of the overall unit.
An accretion normally occurs as of the creation of the new
group of employees at issue. The Charging Party argues the
accretion herein occurred as of the acquisition by Respondent
of the Farmer Jack facility and retention of Borman’s Farmer
Jack employees on November 7, 1987. The Farmer Jack em-
ployees were certainly new to Respondent as of that date.
The Charging Party argues that as of the time of the acquisi-
tion the Farmer Jack unit complement was 35 and the Mead-
ow Gold 135. Thus, argues the Charging Party, the Farmer
Jack employees were a relatively small proportion of the
Meadow Gold unit.
The Charging Party further contends that the Farmer Jack
unit had a close community of interest with the Meadow
Gold unit and an insufficient independent community of in-
terest to stand alone as a separate bargaining unit. Respond-
ent argues to the contrary on brief at 33:
The Farmer Jack plant, which was of course a pre-ex-
isting bargaining unit, has little in common with the re-
maining parts of the Meadow Gold Unit. There is noth-
ing in evidence to support the integration or com-
monalty of conditions necessary to argue an accretion.
The Union is arguing for lumping together operations
which ordinarily would be treated separately under bar-
gaining unit rules.
I have considered the evidence and arguments respecting
the purported inability of the Farmer Jack unit to stand alone
as an appropriate unit for bargaining under Section 9 of the
Act. I agree with the Charging Party that the time of testing
the appropriateness of the accretion is the date of acquisition.
At this time both dairy facilities were in operation and it was
foreseen that each would continue in operation at least for
a reasonable period. I have also considered the Charging Par-
ty’s skilled marshalling of evidence regarding the similarity
of the work done at the two plants, their physical proximity
and their place in Respondent’s organizational structure. To
the extent the Charging Party relies on developments caused
by or occurring during the consolidation process, I have dis-
counted such evidence as not relevant to the issue of accre-
tion as of the date of the acquisition. Having considered the
arguments of the parties and the record as a whole on the
issue, I disagree with the Charging Party and find that the
Farmer Jack unit could stand alone as a separate bargaining
unit as of the time of the acquisition. I so find primarily be-
cause the Farmer Jack unit was not simply a new unit of em-
ployees without a history of collective bargaining or a sepa-
rate identity of its own. While new to Respondent, the Farm-
er Jack facility was, as noted above, an existing operation
which had been owned by two previous entities and was
taken over by Respondent as an independent operating facil-
ity with all its equipment, supervisory staff, markets and pro-
cedures in place and operating. I do not believe that such a
long operating entity may be easily held unable to exist inde-
pendently as a separate bargaining unit. Given this finding,
123BORDEN, INC.
9 The Charging Party does not argue the accretion was effective
at the time of the consolidation. Were the Charging Party to have
done so, other factors, such as the significant changes in the cir-
cumstances of the dairy production employees in the Meadow Gold
unit and the differing community of interests inherent in two groups
of employees facing a consolidation of bargaining units would have
defeated any accretion argument.
I reject the Charging Party’s contention that the Farmer Jack
unit was an accretion to the Meadow Gold unit.9
The Charging Party also argues the accretion doctrine ap-
plies treating the instant case as a consolidation citing Cen-
tral Soya Co., 281 NLRB 1308 (1986). In that case, how-
ever, the Board looked to the consolidated facility, upon
completion of the consolidation, to determine if a majority
of employees came from the unit at issue. Such an analysis
is also necessary here in light of my finding, supra, that the
Farmer Jack unit may stand as a separate appropriate unit.
In the instant case the Meadow Gold transferees never con-
stituted a majority of the consolidated Farmer Jack unit. Ac-
cordingly, no accretion of the Farmer Jack unit into the
Meadow Gold transferee unit under the Central Soya line of
cases is possible.
The Charging Party also likens the instant case to a reloca-
tion citing Marine Optical, 255 NLRB 1241 (1981), enfd.
671 F.2d 11 (1st Cir. 1982); Westwood Import Co., 251
NLRB 1213 (1980), enfd. 681 F.2d 644 (9th Cir. 1982); and
Harte & Co., 278 NLRB 947 (1986). The Board in Harte,
at 948, set forth the following:
In relocation cases such as this one, our task is to dis-
tinguish situations where the new facility is basically
the same operation, simply removed to a new site, from
those where the new facility is somehow a different op-
eration from the original. In the former case, a collec-
tive-bargaining agreement in effect at the old location
is logically applied at the new one. In the latter, the old
agreement has no place at the new facility. Given the
complexity of modern business transactions, the deter-
mination of exactly what relationship the new plant
bears to the old is not always easy to make. Nonethe-
less, we have developed standards in our contract-bar
and failure-to-bargain cases to determine when there is
a sufficient continuity of operations to justify applying
an existing agreement to a new location. These cases
hold that an existing contract will remain in effect after
a relocation if the operations at the new facility are sub-
stantially the same as those at the old and if the trans-
ferees from the old plant constitute a substantial per-
centage—approximately 40 per cent or more—of the
new plant employee complement.
The difficulty with the Charging Party’s argument here is
that the Board in Central Soya Co., 281 NLRB 1308 fn. 6,
held ‘‘exclusively relocation’’ cases distinguishable from re-
locations which also, as here, involve consolidations. Given
this distinction, I find that the instant case presents the test
established in the quoted language immediately above. Ap-
plying that test, I find the new arrangements at Farmer Jack
are not the same operations but are ‘‘somehow different’’
from either preconsolidation operation. Accordingly, I find
the relocation arguments of the Charging Party are not con-
trolling of the result herein.
2. Complaint paragraph 12(a): The assumption of the
Borman Farmer Jack contract
a. The positions and arguments of the parties
There is no dispute that Respondent was a successor to
Borman at the Farmer Jack facility and under Board doctrine
was obligated to recognize the Union and maintain the status
quo ante respecting employees’ terms and conditions of em-
ployment pending agreement with or impasse in bargaining
with the Union. There is also no dispute that Respondent had
neither a right nor an obligation to assume the predecessor’s
contract with the Union. Further, it is undisputed that Re-
spondent has, in effect, followed the Borman Farmer Jack
contract’s terms since its acquisition of the facility and, rath-
er than simply freezing conditions as of the time of the ac-
quisition, has made changes in employees’ wages and fringe
contributions after the acquisition to the extent these were
scheduled in the Borman contract.
The General Counsel and the Charging Party contend that
all changes in employee terms and conditions made after the
acquisition were unilateral changes violative of Section
8(a)(5) and (1) of the Act and that Respondent has not sim-
ply preserved the status quo ante but rather improperly as-
sumed the Borman contract. Respondent asserts three sepa-
rate defenses. First, Respondent contends its following of the
contract was no more than the maintenance of the status quo
and that withholding the scheduled contract increases would
have been itself a change in existing conditions. Second, to
the extent its compliance with the contract is regarded as a
change in the status quo, the changes were justified as post
impasse last offer implementations. Finally, Respondent as-
serts that its actions were consistent with the Union’s ex-
pressed desire that it follow the Borman contract.
The Charging Party argues that the Union’s November 12,
1988 request that Respondent not alter the contract did not
last forever and was retracted in subsequent bargaining.
Thus, the Charging Party asserts that its subsequent conten-
tion that the Farmer Jack unit was an accretion to the Mead-
ow Gold unit and was therefore covered by the Meadow
Gold contract was inconsistent with and superseded the No-
vember 12 request. Respondent argues, however, that the
Union in effect took inconsistent positions in bargaining,
making accretion claims in its unfair labor practice charges
and in the grievance process but not seeking changes in the
Farmer Jack agreement for Farmer Jack employees and gen-
erally agreeing with the continuation of the predecessor
agreement at the bargaining table with respect to those em-
ployees.
The General Counsel and the Charging Party also point
out that Respondent during virtually all the negotiations
maintained its position that it had ‘‘bought the contract’’
when it acquired the Borman facility. They note further that
this same position was taken in Respondent’s meetings with
employees. This repeated assertion by Respondent’s agents,
argue the General Counsel and the Charging Party, should be
credited and supports their position that the contract was in
fact improperly assumed by Respondent.
b. Analysis and conclusion
There is no dispute that Respondent was obligated to
maintain the status quo and could not, without the agreement
124 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
10 The Union’s February 1988 charge alleges unilateral changes at
the Farmer Jack facility without greater specificity. The charge is not
in and of itself a retraction of the letter of November 12, 1987. Nor
does the fact that at some point the pension trusts no longer accepted
pension contributions from Respondent convince me otherwise. It
was up to the Union, in light of its clear request of November 12,
1987, to explicitly retract that request.
11 In determining whether changes in working conditions violate
Sec. 8(a)(5) and (1) of the Act, the employer’s subjective good or
bad faith is not relevant, NLRB v. Katz, 369 U.S. 736 (1962).
of the Union, assume the Borman contract. There is also no
doubt that Respondent has followed the contract’s terms. I
reject at the outset, the argument of Respondent that the hon-
oring of the contract terms, including all in futuro scheduled
changes in wages, pension trust payments, and other terms
and conditions of employment, was simply maintenance of
the status quo. Respondent’s cited cases are inapposite for
they do not address the assumption of a contract in its en-
tirety, rather they address the different and subtler issue of
the continuance of a practice of granting wage increases. The
changes made in terms and conditions of employment after
acquisition were in fact changes in the status quo ante. I also
reject Respondent’s second claim that the contract changes
were justifiable as a post impasse implementation of its last
offer. This defense is not viable since Respondent’s imple-
mentation of the contract was a course of conduct undertaken
from the time of its acquisition of the facility and was not
initiated after some later argued impasse in bargaining.
That Respondent’s conduct was agreed to by the Union or
even done at the Union’s request is a more substantial de-
fense. As quoted, in its entirety, supra, the Union’s Novem-
ber 12, 1987 letter to Respondent included the following:
Further, this letter is to request that the present Farmer
Jack Labor Agreement not be unilaterally altered by
your company pending completion of these negotia-
tions.
The letter asks that Respondent apply the contract without al-
teration. This request is clearly different from a request—
consistent with Respondent’s admitted legal obligation—to
maintain the status quo. It is also true that Respondent in ef-
fect simply took the action requested of it in the letter.
I find that this union request, whether viewed as an initial
request which justifies Respondent’s conduct from its initi-
ation or as a subsequent agreement which waives the Union’s
right to later object, is a valid defense to the General Coun-
sel’s allegation that unilateral changes were made when the
contract was followed. While the status quo was not in fact
maintained by Respondent and therefore changes were made
in employees’ working conditions, the changes were consist-
ent with the Union’s request and were therefore neither uni-
lateral nor violative of the Act.
The Charging Party’s contention that the Union request
was withdrawn by the Union’s subsequent conduct does not
fail as a matter of law, but rather as a matter of fact. I agree
that the Charging Party could have at anytime withdrawn its
request that Respondent follow the terms of Borman’s con-
tract and that Respondent would thereafter have made any
changes in working conditions at its peril. Such a retraction
or withdrawal must in my view, however, be explicit to
thereafter charge Respondent with knowledge that the
Union’s earlier request had been withdrawn. The Union
could have specifically by letter or statement in bargaining
withdrawn its earlier request. It never did so. The Union ar-
gues its later behavior made its new position clear. I do not
believe the Union’s overall conduct may be found to have
retracted its letter of November 12, 1988. It would require
a very strong and consistent course of conduct by the Union
to support a finding that this later conduct withdrew the ear-
lier written request that the contact be followed. Such clarity
would be necessary to support a finding that Respondent at
some later point in the bargaining process violated the Act
by continuing to apply the contract when it should have real-
ized the Union’s November 12, 1987 request was withdrawn
by circumstances. Such clarity is lacking here.10
This finding is not modified by the fact that Respondent
in its purchase agreement with Borman, and virtually
throughout the course of bargaining and in meetings with
employees, asserted the Borman contract had been ‘‘bought’’
with the facility and was in effect assumable as a matter of
right by Respondent. This evidence supports a finding that
Respondent was in fact acting as if the contract had been as-
sumed, but this is not inconsistent with my findings above.
Evidence of Respondent’s assertions, assumptions or even
motives does not address the issue of whether the conduct
of Respondent was rendered not improper by the Union’s re-
quest of November 12, 1987.11 I have found changes were
made. I have also found they were not unilateral because of
the Union’s request. Respondent’s conduct is not relevant to
this critical aspect of the case. Accordingly, based on all the
above and the record as a whole, I find the General Coun-
sel’s allegation is not sustained by the evidence and I shall
dismiss paragraph 12(a) of the complaint.
3. Complaint paragraph 12(b): The unilateral
implementation of Farmer Jack terms and conditions on
Meadow Gold employees working at Farmer Jack
There is no dispute that production employees from the
Meadow Gold unit came to work at the Farmer Jack facility
and that Respondent applied the terms and conditions of the
Farmer Jack unit to them. Respondent contends that these
transfers occurred simply as a result of the layoff of Meadow
Gold unit employees and the subsequent and legally inde-
pendent act of hiring those same individuals as Farmer Jack
unit new hires. I find, based on the facts set forth, supra, that
the moves were rather Respondent initiated transfers of em-
ployees, who, in effect, transferred along with their equip-
ment and their work to the Farmer Jack facility as part of
the consolidation of the Meadow Gold and Farmer Jack oper-
ations.
The General Counsel agrees with Respondent that the
Meadow Gold and Farmer Jack units were separate until the
time of employee transfers from Meadow Gold to Farmer
Jack. Respondent contends that the now consolidated Farmer
Jack unit remains conceptually unchanged and legally unaf-
fected by the Meadow Gold closure and transfer of employ-
ees. The General Counsel argues that the substantial number
or Meadow Gold transferees, both unit and supervisory, as
well as the increased market for product at the Farmer Jack
plant resulting from the Meadow Gold-Farmer Jack consoli-
dation created a new and different third unit from the com-
bination of the two older Meadow Gold and Farmer Jack
units citing Martin Marietta Co., 270 NLRB 821 (1984).
125BORDEN, INC.
12 This theory may perhaps be characterized as one requiring the
preservation of the status quo ante of origin.
13 There would be additional important implications. For example,
if the transferees should have been offered their previous terms and
conditions of employment, might not all those Meadow Gold unit
employees who choose not to transfer to Farmer Jack because of the
lower wages and benefits be constructive discharges under traditional
Board law?
14 The parties disputed the applicability of a decision of an admin-
istrative law judge adopted by the Board in the absence of excep-
tions to the case at hand. The parties agree, however, that the deci-
sion is not binding precedent.
I agree with the General Counsel that the separate units of
dairy production employees became a single unit, different
from the two earlier units at some point in the consolidation.
The General Counsel is not contending that either the Mead-
ow Gold contract or the Farmer Jack contract under Borman
applies to the new unit. There is no dispute that the Union
represented the two former units and represents the current
unit howsoever characterized. Accordingly, the question
arises as to what possible consequence is the question of
whether the current unit is the old Farmer Jack unit simply
continuing on or a new unit resulting from a consolidation
of the two older units?
The General Counsel’s argument in support of a violation
of paragraph 12(b) of the complaint is a novel one based on
an interesting and apparently unprecedented analysis respect-
ing the requirement of preservation of a bifurcated status quo
ante in consolidated unit cases. The General Counsel con-
tends that the fact that a new unit was created by the consoli-
dation of the two previous units, as opposed to the unaltered
continuation of the Farmer Jack unit at the Farmer Jack facil-
ity and the simple elimination of the Meadow Gold unit,
means that Respondent was required to preserve the separate
status quo ante of each portion of the new unit.12 The Gen-
eral Counsel argues that since the new unit is a consolidation
of two other units, the terms of employment applicable to
each unit at the time of consolidation must be continued as
would be the status quo ante in other more traditional situa-
tions. Thus, the ‘‘old’’ Farmer Jack unit employees and, pre-
sumably new ‘‘off the street’’ hires, should receive old
Farmer Jack terms and conditions of employment and Mead-
ow Gold unit transferees should receive their old Meadow
Gold terms and conditions. If the General Counsel’s theory
is correct respecting Respondent’s obligation to maintain the
status quo ante of origin for Meadow Gold unit transferees,
argues the General Counsel, then Respondent unilaterally
changed Meadow Gold unit transferees’ conditions of em-
ployment when it applied the Farmer Jack terms and condi-
tions to them and, in so doing, violated Section 8(a)(5) and
(1) of the Act.13
Respondent argues on brief that the General Counsel’s the-
ory in this regard is simply without binding precedent14 and
produces the anomalous result of a single unit represented by
a single union in which there are two classes of employees
each receiving completely different terms and conditions of
employment. The General Counsel seeks to meet Respond-
ent’s arguments on brief at pages 29–30:
The parties should negotiate a new contract for the
merged unit. And while the parties bargain, it is also
reasonable that Respondent maintain the pre-existing
terms and conditions of employment of the employees.
It was not the employees’ decision to close the Meadow
Gold plant and merge the operations. It was Respond-
ent’s decision. The employees should not be required to
suffer different wages and terms and conditions of em-
ployment while the parties fulfill their statutory obliga-
tion to bargain in good faith. It is anticipated that the
Respondent will argue that this result will require it to
have employees in the same plant working under dif-
ferent terms and conditions of employment. However,
this is not a situation designed to go on in perpetuity.
These conditions would be maintained only while the
parties bargain in good faith to agreement or impasse.
Moreover, two-tier wage scales are not a concept for-
eign to labor relations. Nor are merit wage systems
which result in employees working side-by-side but re-
ceiving different compensation. Respondent itself is not
unfamiliar with situations where employees work under
different, but simultaneous pension contribution rates
[transcript citation omitted]. Thus, this is no justifica-
tion for Respondent’s avoidance of its statutory obliga-
tion to maintain pre-existing terms and conditions of
employment.
I admit to being well taken with the General Counsel’s
theory and analysis. As noted, supra, in the analysis of the
Charging Party’s relocation arguments, see, e.g., Harte &
Co., 278 NLRB 947 (1986), if 40 percent or more of a new
unit comes from an originating location, the old contract will
be applied to the new unit. Consolidation cases, see, e.g.,
Central Soya Co., 281 NLRB 1308 (1986), require majority
transfer. Where two separate units of the same employer rep-
resented by the same union each contribute substantial pro-
portions of the employees in a new unit, why should the em-
ployer not be obligated to preserve the status quo as to each
group within the new unit until an agreement with the Union
or an impasse in bargaining is reached?
I shall not, however, sustain the General Counsel’s argu-
ment here. Howsoever a new argument or construction of
law may appeal to an administrative law judge, it is the
Board and courts which must fashion new law. What the
General Counsel advances here is not mere judicial interpola-
tion within the developing web of the law. The General
Counsel seeks in my view the extrapolation of current bar-
gaining unit doctrine to produce a new conceptual and defini-
tional analysis which in turn creates new obligations on the
parties in bargaining. The General Counsel seeks, through
analysis however able and compelling, to expand the obliga-
tions of Section 8(a)(5) and (1) of the Act. The General
Counsel must go to the Board, in my judgment, with such
arguments for it is the Board and not its administrative law
judges who is charged with the duty to interpret the Act and,
as appropriate, expand its reach.
Having rejected the General Counsel’s argument for obli-
gating Respondent to maintain the status quo of Meadow
Gold unit employees transferred to Farmer Jack positions, I
find there was no obligation on Respondent to maintain
Meadow Gold conditions for Meadow Gold production em-
ployees at the Farmer Jack plant. Accordingly, Respondent
did not improperly change Meadow Gold employees’ terms
and conditions of employment when it transferred those em-
ployees to the Farmer Jack plant and compensated that at
126 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
Farmer Jack rates. The General Counsel has therefore failed
to sustain his burden of proof with respect to this allegation
and I shall dismiss paragraph 12(b) of the complaint.
4. Complaint paragraph 12(c): The statements of
General Manager Ward in February 1988 to Meadow
Gold employees
There was little dispute concerning Ward’s statements to
employees as described above. Unless specifically noted, to
the extent differences exist, I credit the two employees where
they corroborate one another or Ward, but do not credit ei-
ther employee witness where not so corroborated. It is clear
that Ward’s remarks were made to clerical employees in the
controller’s office—a locus of managerial authority—at a
time when the clerical employees were contemplating the
possible loss of union representation and the further loss of
existing contract terms and conditions of employment. In
such a setting the fact that the general manager’s statements
were labeled as his personal opinion does not shelter them
from scrutiny nor ameliorate otherwise violative statements.
To the extent that Ward simply compared and contrasted
the leveling and standardizing effect of the existing union
contract’s wages and benefits with a hypothetical flexible,
merit based compensation system which would exist without
union representation, Ward was not violating the Act. The
General Counsel contends, however, that Ward promised em-
ployees ‘‘that Respondent would reward them with better
wages and benefits if they were not represented by the Union
after their move to the Farmer Jack Plant.’’ (G.C. Br. at 16.)
Such conduct, the General Counsel correctly notes, interferes
with employees’ Section 7 rights, thereby violating Section
8(a)(5) and (1) of the Act, and constitutes an attempt to di-
rectly deal with employees respecting matters properly the
province of the Union thereby violating Section 8(a)(5) and
(1) of the Act. Bay Area-Los Angeles Express, 275 NLRB
1063 (1985).
The issue in this aspect of the case then is one of fact.
Indeed, the question is close. Clearly, if Cherti’s version of
events is credited, the General Counsel’s burden of proof is
sustained and a violation should be found. This is so because
her version of Ward’s remarks attributes to him direct prom-
ises of increased wages and benefits conditional only on the
employees abandoning their union representation. McDonald,
however, tended to corroborate Ward’s testimony that he
dealt with wage increases, only in the sense that rates with-
out a union would be merit based rather than standardized
and that some individuals could obtain increased wages
under such a system.
Having considered the testimony of the three witnesses on
the meeting and the record as a whole concerning its context
and circumstances, I find that Ward went beyond the area of
permissible employer statements and made impermissible
promises of improved benefits to employees, if the Union
and the contract were abandoned. I so find primarily based
on the uncontested fact that Ward told the employees ‘‘a per-
son could get higher benefits,’’ absent union representation.
While it may be fairly argued that Ward’s statements about
improved wages were merely a benign description of a dif-
ferent distribution of wages among employees of varying de-
grees of merit, such a defense does not reasonably lie as to
promises of increased benefits. Employees could reasonably
have been expected to conclude—as is customary in the
United States and was apparently true respecting Respond-
ent’s existing benefit system—that all employees, irrespective
of merit, receive equal fringe benefits and, therefore, all em-
ployees would receive benefit increases if the Union were
abandoned. Such a promise, given the increasing importance
of nonwage benefits in employee compensation plans is nei-
ther subtle nor elusive nor deminimus. Indeed, the promise
of an equal or superior health and welfare plan, if they
would reject the union, by the employer to employees was
one aspect of employer conduct violative of the Act in Bay
Area-Los Angeles Express, supra.
Given all the above, I sustain paragraph 12(c) of the com-
plaint. More particularly, I find that Respondent, through
Ward in February 1988, violated Section 8(a)(5) and (1) and
independently violated Section 8(a)(1) of the Act, by promis-
ing employees increased benefits if they abandoned the
Union as described above.
5. Complaint paragraphs 5 and 6: The statements of
Assistant Labor Relations Director Finnerty to
employees in March 1988 that transfers could not be
granted absent union agreement and the withholding of
Farmer Jack transfers to Meadow Gold employees
Respondent announced at meetings with Meadow Gold
employees that unless the Union agreed with its last pro-
posal, Meadow Gold employees would not be able to transfer
to the Farmer Jack unit, but would rather be laid off when
their positions were abolished at Meadow Gold. Thereafter
Respondent in fact refused to transfer employees in any for-
mal sense. The meetings and the refusal to transfer employ-
ees were challenged by the General Counsel. Since the pro-
priety of the refusal to transfer employees is relevant to the
propriety of the earlier statements concerning it, the transfer
issue is addressed initially below.
a. Complaint paragraph 6: The layoffs and transfers
As described above, when Respondent and the Union
failed to reach agreement on terms and conditions of employ-
ment respecting the closure of the Meadow Gold production
unit and the consolidation at the Farmer Jack facility, Re-
spondent did not implement its final offer but rather simply
laid off employees in the Meadow Gold unit when their work
was concluded at the Meadow Gold facility. The exception
to this process was that a significant number, although not
necessarily all Meadow Gold production employees, were
given the opportunity to transfer to the Farmer Jack unit by
following the procedures described, supra. I have found the
layoff and rehire procedures were tantamount to a transfer of
employees. I reject any contrary characterization by Re-
spondent. These transfers were treated as new hires at the
Farmer Jack facility with respect to their terms and condi-
tions of employment. The terms of Respondent’s last offer
were not applied to them. The transferees received no trans-
fer payments, carried no seniority and received no credit for
Meadow Gold service in establishing their Farmer Jack
wages—save in that they were considered to have nonunit
experience in the industry. In this sense, they were denied
specific benefits of transfer which they would have received
if Respondent’s last offer had been implemented.
The General Counsel alleges Respondent’s failure to trans-
fer the Meadow Gold employees, consistent with its last
127BORDEN, INC.
15 In the typical situation wherein a union has proposed substantial
wage increases in bargaining and the employer has agreed to those
Continued
offer to the Union, is a violation of Section 8(a)(3) and (1)
of the Act. The General Counsel concedes on brief that Re-
spondent ‘‘was neither contractually nor statutorily obligated
to transfer the Meadow Gold employees to the Farmer Jack
plant.’’ The thrust of the General Counsel’s argument is that
Respondent’s conduct herein was part of an illegal course of
conduct designed to coerce the Union into consenting to Re-
spondent’s wrongful assumption of the Borman Farmer Jack
contract. When the Union would not agree, argues the Gen-
eral Counsel on brief at 21:
[Respondent] attempted to force the Union to grant this
consent by threatening the Meadow Gold employees
with layoff. In effect, Respondent was holding the
Meadow Gold employees hostage to its intransigent de-
mand that it be allowed to assume the old Farmer Jack
agreement.
Respondent argues that there is no evidence of animus re-
specting this conduct and, absent such a finding, no violation
of Section 8(a)(3) of the Act may be found. Respondent fur-
ther argues that its conduct resulted from the lack of agree-
ment during effects bargaining concerning the Meadow Gold
closure and that both its bargaining and its actions respecting
Meadow Gold unit employees at the Farmer Jack plant were
proper under the Act.
I have found, supra, that Respondent did not violate the
Act as alleged in paragraph 12(a) of the complaint by assum-
ing the Borman Farmer Jack contract. The General Counsel
did not separately allege a failure to bargain respecting the
new Farmer Jack unit but that broad allegation may be fairly
held to be implicit in the other allegations of the complaint.
Has the General Counsel met its burden of proof that Re-
spondent bargained in bad faith respecting the new consoli-
dated Farmer Jack unit?
No contention has been made that Respondent failed to
satisfy the procedural obligations of good-faith bargaining
such as meeting with the Union on demand. Respondent pro-
posed both initially and virtually throughout the bargaining,
that the parties, in effect, sign a new contract which mirrored
the Borman contract save in certain noneconomic matters
which were designed to accommodate the Meadow Gold unit
transferees. The Union however, especially in the bargaining
preceding the transfers, proposed few if any changes in the
terms and conditions of original or non-Meadow Gold Farm-
er Jack unit employees. I find no real dispute that, leaving
out the category of employees discussed below and charac-
terized here as Meadow Gold unit transferees, there was no
significant dispute between the parties about the Farmer Jack
unit at least until late in bargaining and no sustainable con-
tention that Respondent’s bargaining was in violation of the
Act respecting that unit.
The strong and continuing differences between the Union
and Respondent concerned the Meadow Gold employees and
the contract terms and conditions they would carry with them
to the Farmer Jack facility in the form of changes to that
contract. This bargaining may be characterized with some ac-
curacy as either effects bargaining respecting the Meadow
Gold unit or perhaps bargaining concerning the new merged
unit. It was not bargaining concerning the old Farmer Jack
unit employees except indirectly to the extent that those em-
ployees’ conditions would be modified to combine seniority
and other rights with Meadow Gold transferees. The Union
sought in bargaining to carry over the Meadow Gold contract
terms, at least for the transferees from the Meadow Gold
unit, into a new Farmer Jack contract—via ‘‘red circled
rates.’’ Respondent, while willing to accede to the Union’s
proposals respecting seniority, sought to preserve the very fa-
vorable economic terms of the Borman contract in any new
contract by refusing to make any economic concessions re-
garding Meadow Gold transferees once working in the Farm-
er Jack unit. Respondent sought to achieve its goal—setting
aside the noneconomic concessions respecting seniority—by
limiting its proposals and concessions in the effects bargain-
ing concerning the Meadow Gold employees to one-time
transfer and separation payments for Meadow Gold employ-
ees which would not effect transferee’s terms and conditions
of employment once at the Farmer Jack plant.
The General Counsel’s allegation that Respondent bar-
gained in bad faith respecting the Farmer Jack unit must then
be considered as a more general allegation that Respondent
bargained in bad faith concerning the new merged unit. In
considering that allegation Respondent’s position and conces-
sions respecting the Meadow Gold effects bargaining must
also be considered for, as noted above, these proposals are
part and parcel of the merged unit bargaining. Considering
the bargaining as a whole, including the proposals of Re-
spondent for Meadow Gold severance and transfer payments,
I find that the General Counsel has failed to sustain his bur-
den of proof that Respondent bargained in bad faith. Re-
spondent actively sought to preserve for itself the conces-
sions earlier granted to Borman. It sought to do so in the
merged unit by its limiting concessions to one-time payments
which would not raise the wage rates of any employee once
working at the Farmer Jack facility. Neither Respondent’s
goal nor its chosen means of achieving that goal are evidence
of bad faith. Since neither Respondent’s means nor ends in
bargaining were improper and since it met the procedural re-
quirements for bargaining, no violation of Section 8(a)(5)
and (1) of the Act may be found. As noted elsewhere in this
decision, Respondent violated Section 8(a)(1) and (5) and (1)
of the Act by making improper and illegal statements to em-
ployees respecting bargaining and union representation. The
totality of this conduct away from the bargaining table, how-
ever, does not rise to a level sufficient to independently sus-
tain a general failure to bargain in violation of Section
8(a)(5) of the Act.
Having found no violation of Section 8(a)(5) of the Act
in Respondent’s bargaining, it follows that the General Coun-
sel’s allegation that Respondent violated Section 8(a)(3) and
(1) of the Act by laying off some Meadow Gold employees
and transferring others must fail. The General Counsel does
not contend Respondent had an obligation, statutory or con-
tractual, to transfer Meadow Gold employees to the Farmer
Jack facility. The allegation turned on the further allegation
that Respondent took the action in furtherance of a course of
conduct violative of the Act. Having found the underlying
bargaining not illegal, it follows the General Counsel’s prima
facie case as to the transfers fails and I so find.15 Accord-
ingly, I shall dismiss this allegation of the complaint.
128 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
increased wages or proposed increases of a different level, the em-
ployer often refuses to implement the increases until an entire new
contract is agreed to. The motivation is, of course, to withhold the
wage increase to employees as a bargaining tactic to pressure the
union to quickly come to agreement and thus obtain the increases.
This rather common bargaining strategy is not a violation of the Act.
In the instant case, Respondent’s conduct may be similarly seen as
an attempt to withhold the benefits of a proposal until complete
agreement is reached in order to induce pressure for union accept-
ance. The Board finds no violation in such cases.
16 Counsel for the General Counsel (G.C. Br. at 22 fn. 2) concedes
this conduct was not specifically alleged in the complaint as a viola-
tion of Sec. 8(a)(5) and (1) of the Act, but argues it was ‘‘unlawful
activity . . . related to and intertwined with the allegations of the
complaint’’ and was fully litigated and may therefore be found to
be a violation of Sec. 8(a)(5) and (2) of the Act as well as a viola-
tion of Sec. 8(a)(1) of the Act as specifically alleged in the com-
plaint citing Doral Hotel & Country Club, 240 NLRB 1112 fn. 2
(1979); Bay Area-Los Angeles Express, 275 NLRB 1063, 1081
(1985). The General Counsel’s cited cases are persuasive on the
issue and I shall consider the direct dealing allegation as if pled.
b. Complaint paragraph 5 as a violation of Section
8(a)(1) of the Act and a direct dealing violation of
Section 8(a)(5) and (1) of the Act: The threat to lay off
and/or refuse to transfer employees unless the Union
accepted Respondent’s last offer
There is essentially no dispute that the employee meetings
held on March 9 and 10, 1988, were intended by Respondent
to generate employee pressure on the Union to accept Re-
spondent’s last proposal concerning the Meadow Gold clo-
sure and the consolidation of operations at the Farmer Jack
facility. More specifically, Respondent’s agents sought to in-
duce employee attempts to obtain a ratification vote and rat-
ify Respondent’s offer at the forthcoming union meeting
scheduled for the evening of March 10, 1988.
The inducements to employees to act with alacrity were
both carrot and stick. Respondent’s agents described their
proposal which included substantial employee transfer and
severance payments—carrots with an immediate cash value.
They also stated that, unless the proposal was accepted by
the Union ‘‘very, very soon,’’ Respondent would be forced
to lay off the Meadow Gold employees without transfer
rights or severance pay and to hire new employees ‘‘off the
street’’ for the Farmer Jack positions—the stick of seniority
loss and the threat of unemployment. Respondent clearly told
employees that Respondent could not do otherwise, i.e., it
had no choice in the matter unless and until its proposal was
accepted by the Union. There is also no dispute, and I find,
that these statements to the employees were false in that Re-
spondent was under no compulsion to take the actions that
it claimed it would be forced to take.
The General Counsel argues that Respondent’s conduct
constitutes an unlawful threat in violation of Section 8(a)(1)
of the Act and, further, was an attempt to bypass the Union
and deal directly with unit employees in violation of Section
8(a)(5) and (1) of the Act.16 The two allegations depend on
the same facts but different legal analysis and deserve sepa-
rate treatment.
(1) Respondent’s conduct as an independent violation
of Section 8(a)(1) of the Act
The General Counsel argues, in parallel with his argument
in support of the 8(a)(3) contentions described above, that
Respondent’s threats to deny transfer rights to Meadow Gold
employees were undertaken to frustrate the bargaining proc-
ess and avoid its bargaining obligation. The General Counsel
argues on brief that Respondent ‘‘attempted to substitute a
threat of termination for good faith negotiations. In doing so,
Respondent violated Section 8(a)(1) of the Act.’’
Respondent argues that its ‘‘threat,’’ that employees would
be laid off unless the Union accepted Respondent’s final
offer, was not improper unless the layoffs themselves were
improper. Respondent argues on brief: ‘‘[I]t is not unlawful
to threaten to do what one can, in fact, lawfully do.’’ I agree.
I have found, supra, that Respondent did not in fact violate
Section 8(a)(3) and (1) of the Act in refusing to transfer the
Meadow Gold employees as alleged in the complaint. It fol-
lows, therefore, that Respondent’s statements to employees
do not violate Section 8(a)(1) of the Act as alleged in the
complaint. I shall therefore dismiss paragraph 5 of the com-
plaint.
(2) Respondent’s conduct as a violation of Section
8(a)(5) and (1) of the Act
The General Counsel contends that Respondent’s conduct
was also an attempt to bypass the Union and deal directly
with Meadow Gold employees. The law in this area was
aptly summarized by Judge Pollack, with Board approval, in
Ad-Art, Inc., 290 NLRB 590, 606 (1988), as follows:
Section 8(a)(5) creates an obligation on the part of
an employer to bargain with an incumbent union as the
exclusive bargaining representative of its employees in
the matter of wages, hours, terms and conditions of em-
ployment. It may not attempt to circumvent the exclu-
sive status of the bargaining agent by attempting to deal
directly with its represented employees. Medo Photo
Supply v. NLRB, 321 U.S. 678 (1944). An employer
must deal in bargaining negotiations with the statutory
representative and cannot bargain directly or indirectly
with the employees. NLRB v. Insurance Workers, 361
U.S. 477, 484–485 (1960). ‘‘The employer’s statutory
obligation is to deal with the employees through the
union, and not with the union through the employees.’’
General Electric Co., 150 NLRB 192, 195 (1964).
In Ad-Art the Board found a violation of Section 8(a)(5)
and (1) of the Act when the employer ‘‘sought to exert pres-
sure on the Union by offering a wage increase to the em-
ployees and by threatening the employees with a loss of
work opportunities if the Respondents’ offer was not accept-
ed,’’ 290 NLRB at 606. In the instant case in order to exert
pressure on the Union to accept its final offer, Respondent
sought to stimulate employee efforts to bring the proposal
before the membership for ratification. Respondent accom-
plished this by falsely telling employees that, unless the
Union accepted the offer, Respondent was powerless to do
other than lay off the Meadow Gold employees and hire
129BORDEN, INC.
other new employees ‘‘off the street’’ for the vacancies at
the Farmer Jack plant.
Respondent’s goal and its means were improper and to-
gether constitute a violation of Section 8(a)(5) and (1) of the
Act. As the cases cited indicate, Respondent was obligated
to deal with the Union, not employees, in bargaining. Indeed,
a union’s submission of contracts for ratification by its mem-
bers is a matter of internal union business, a nonmandatory
subject of bargaining and a matter of legitimate concern to
the Union and its members only. Respondent could not prop-
erly insist that its proposal be submitted to the union mem-
bership for consideration nor could Respondent properly seek
to achieve such a result through pressure on the employees.
Second, Respondent’s statements to employees were im-
proper. As the General Counsel concedes on brief with case
citation, ‘‘an employer has a fundamental right to commu-
nicate with its employees concerning its position in collec-
tive-bargaining negotiations.’’ Rather, than simply inform
employees of the positions of the parties, however, Respond-
ent, through Finnerty, Respondent’s assistant director of
labor relations, falsely stated that unless the Union accepted
its last offer, Respondent had no choice but to lay off em-
ployees, omit severance and transfer payments and hire new
job applicants for Farmer Jack vacancies. These statements,
exactly like those of the employer found violative in Ad-Art,
supra, falsely tell employees that actions adverse to employ-
ees may be avoided only by the Union agreeing with the em-
ployer’s demands. The obvious truth, however, and one
which must reasonably have been known to Finnerty and Re-
spondent’s other officials, but clearly was not so understood
by the employees, was that a variety of options were avail-
able to Respondent whether the Union accepted Respond-
ent’s last offer or not.
I find that Respondent’s false statements to employees
were designed to create and did create the mistaken belief
among the employees that, absent union agreement with Re-
spondent’s last offer, Meadow Gold unit employees would,
of necessity, be laid off and lose both severance and transfer
payments and job opportunities. I further find that these false
impressions were created by Respondent in order to induce
employee efforts to bring Respondent’s last offer before the
union membership for approval and/or to create further em-
ployee efforts with the International to induce union agree-
ment. In the event Respondent’s efforts were successful inso-
far as employee actions, as noted above, were induced. Re-
spondent’s conduct, involving first, the communication of
willful falsehoods to employees concerning the consequences
of the Union’s refusal to accept Respondent’s last offer and,
second, involving the inducement of employee efforts con-
cerning ratification of the proposal and subsequent efforts to
cause the International to pressure the Union to accept the
employer’s proposal, constitute an improper attempt to bar-
gain with the Union through the employees in violation of
Section 8(a)(5) and (1) of the Act. I so find.
6. Summary
As set forth above, I have considered the allegations of the
complaint as well as the additional allegation that the con-
duct alleged in paragraph 5 violated Section 8(a)(5) and (1)
of the Act. I have sustained the General Counsel’s allega-
tions as to the 8(a)(5) and (1) aspect of complaint paragraph
5 as well as paragraph 12(c) of the complaint. I have other-
wise found without merit paragraphs 5, 6, and 12(a) and (b)
of the complaint and shall dismiss these paragraphs. No other
action paragraphs remain to be resolved. Further, I have re-
jected the argument of the Charging Party that the Farmer
Jack unit accreted into the Meadow Gold unit and hence was
covered by the Meadow Gold collective-bargaining agree-
ment.
More specifically, I have found that Respondent in meet-
ings in February and March 1988, attempted to bypass the
Union and undermine its representational role among Mead-
ow Gold unit employees by dealing directly with unit em-
ployees concerning terms and conditions of employment as
described in greater detail above. This conduct violates Sec-
tion 8(a)(5) and (1) of the Act and shall be remedied as set
forth infra. I have also found that the February offer of im-
proved benefits to the Meadow Gold clerical employees, if
they abandoned the Union, also violated Section 8(a)(1) of
the Act.
I have found that Respondent did not improperly threaten
to deny transfer rights to unit employees in violation of Sec-
tion 8(a)(1) of the Act and did not improperly withhold the
transfer of employees in violation of Section 8(a)(3) and (1)
of the Act as alleged. Further, I have found that Respondent
did not improperly assume the Borman Farmer Jack agree-
ment or improperly apply the Farmer Jack working condi-
tions to Meadow Gold unit transferees in violation of Section
8(a)(5) and (1) of the Act as alleged.
IV. REMEDY
Having found that Respondent has engaged in certain un-
fair labor practices, I shall recommend that it be ordered to
cease and desist therefore and take certain affirmative action
designed to effectuate the policies of the Act.
Respondent shall be required to cease and desist from bar-
gaining directly or attempting to bargain directly with em-
ployees during negotiations with the Union which conduct
results in bypassing the Union and/or undermining its role as
the exclusive representative of unit employees. Further, Re-
spondent shall be ordered to cease and desist from offering
improved benefits to employees if they will abandon the
Union. More specifically, Respondent shall cease and desist
from telling unit employees that terms and conditions of em-
ployment will be improved if the Union no longer represents
employees. Respondent shall also cease and desist from mak-
ing misrepresentations of fact or law to employees concern-
ing negotiations which falsehoods tend to undermine the
Union’s representational role. Finally, since the violations
found involve clerical employees at the Meadow Gold site
and employees now at the Farmer Jack site, posting shall be
directed at both locations.
CONCLUSIONS OF LAW
1. Respondent is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
2. The Union is a labor organization within the meaning
of Section 2(5) of the Act.
3. The Union has been, until the unit consolidation occur-
ring over a period of months ending in October 1988, the ex-
clusive representative of Respondent’s employees in two
units as described below.
(a) The Meadow Gold Unit
130 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
All employees of Respondent as described in Supple-
ments to the May 1, 1987 through November 1, 1990
collective-bargaining agreement between Respondent
and the Central and Southern Conference of Teamsters
and Local Union Nos. 222 and 976 of the Western
Conference of Teamsters.
(b) The Old Farmer Jack Unit
All employees of Respondent as described in Appen-
dix ‘‘A’’ of the Milk/Ice Cream/ Cultured Products
Plants Agreement between Borman’s Acquisition Corp.
and the Union which agreement contains an expiration
date of April 30, 1992.
4. The Union since the consolidation of units described
above has been and is now the exclusive representative of
Respondent’s employees in the unit described below (the
New Consolidated Farmer Jack unit).
All employees of Respondent as described in Supple-
ments to the May 1, 1987 through November 1, 1990
collective-bargaining agreement between Respondent
and Central and Southern Conference Teamsters and
Local Union Nos. 222 and 976 of the Western Con-
ference of Teamsters and all employees of Respondent
as described in Appendix ‘‘A’’ of the Milk/Ice Cream/
Cultured Products Plants Agreement Between Borman’s
Acquisition Corp. and the Union which agreement con-
tains an expiration date of April 30, 1992, employed at
Respondent’s Farmer Jack facility.
5. The units described above are and each of them is ap-
propriate for purposes of collective bargaining within the
meaning of Section 9(b) of the Act.
6. By offering employees increased benefits if they aban-
doned union representation, Respondent violated Section
8(a)(1) of the Act.
7. By attempting to deal directly with unit employees in
February and March 1988 by promising them better terms
and conditions of employment, if they abandoned the Union,
and by making material misrepresentations of the necessity
of withholding employee rights to transfer to another facility
unless the Union accepted Respondent’s last offer, in order
to induce employee pressure on the Union to accept Re-
spondent’s last offer, Respondent attempted to bypass the
Union, thereby undermining its role as the exclusive rep-
resentative of employees in collective bargaining and, in so
doing, Respondent violated Section 8(a)(5) and (1) of the
Act.
8. The above unfair labor practices affect commerce within
the meaning of Section 2(6) and (7) of the Act.
9. Respondent has not otherwise violated the Act as al-
leged in the complaint.
[Recommended Order omitted from publication.]