Good N' Fresh Foods, Inc.

National Labor Relations Board - Board Decisions

Feb 24, 1988

287 N.L.R.B. 1231 (N.L.R.B. 1988)

GOOD N' FRESH FOODS 1231
Good N' Fresh Foods , Inc. and United Food and
Commercial Workers Union , Local 37, a/w
United Food & Commercial Workers Interna-
tional Union, AFL-CIO, CLC. Case 25-CA-
18316
24 February 1988
DECISION AND ORDER
By CHAIRMAN STEPHENS AND MEMBERS
JOHANSEN AND BABSON
On 30 June 1987 Administrative Law Judge
Marvin Roth issued the attached decision. The Re-
spondent filed exceptions, and the General Counsel
filed a brief in response to the Respondent's excep-
tion's
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a 'three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and brief and has
decided to affirm the judge's rulings, findings,' and
conclusions and to adopt the recommended Order.
mercial Workers Union, Local 37, a/w United Food &
Commercial Workers International Union, AFL-CIO,
CLC (the Union) on 27 October 1986 ' The complaint,
which issued on 31 December, alleges that Good N'
Fresh Foods, Inc (Respondent or the Company) is a
successor to the Cocoa's Bakery, Inc (Cocoa's), and that
the Company has violated and is violating Section 8(a)(1)
and (5) of the Act The gravamen of the complaint is
that the Company solicited an employee to circulate, for
employees' signatures, a petition stating that the employ-
ees no longer supported the Union, and since 10 October
has failed and refused to recognize and bargain with the
Union as the representative of its production employees
at its Fort Wayne, Indiana facility The Company by its
answer denies the commission of the alleged unfair labor
practices The principal issue in this case is whether the
Company has continued the employing entity and is a
successor of Cocoa's
All parties were afforded full opportunity to partici-
pate, to present relevant evidence, to examine and cross-
examine witnesses, to argue orally, and to file briefs On
the entire record in this case2 and from my observation
of the demeanor of the witnesses, and having considered
the briefs submitted by the General Counsel and the
Company, I make the following
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge and orders that the Respondent, Good N'
Fresh Foods, Inc., Fort Wayne, Indiana, its offi-
cers, agents, successors, and assigns, shall take the
action set forth in the Order.
1 The Respondent excepts to the judge's finding that the appropriate
unit includes both production and maintenance employees The Respond-
ent argues that the composition of the unit was neither raised as an issue
nor litigated by the parties and that its bargaining obligation should be
confined to a unit consisting of production employees only Contrary to
the Respondent's assertions, the record reveals that the composition of
the unit question was placed in issue by the Respondent's answer and
thereafter was fully litigated before the judge to whom the Respondent
argued that the unit should consist of production and maintenance em-
ployees We find that the judge's determination on the composition of the
unit is fully supported by the evidence In adopting the judge's unit find-
ings, we particularly note that the duties of the two maintenance employ-
ees have significantly changed since the business was under the predeces-
sor employer's control and that they now function as part of a small inte-
grated operation with the production employees Cf Matlack, Inc, 278
NLRB 246 (1986)
Steve Robles, Esq., for the General Counsel.
Philip J Ripani, Esq and Keith Shake, Esq, of Indianapo-
lis, Indiana, for the Respondent
Mr. William J. Ross, of Fort Wayne, Indiana, for the
Charging Party.
DECISION
STATEMENT OF THE CASE
MARVIN ROTH, Administrative Law Judge This case
was heard at Fort Wayne, Indiana, on 26 and 27 March
1987. The charge was filed by United Food and Com-
FINDINGS OF FACT
1. THE BUSINESS OF RESPONDENT
The Company, an Indiana corporation with its princi-
pal office and place of business at Indianapolis, Indiana,
has since 27 September operated a bakery at its Fort
Wayne facility, where it is engaged in the manufacture,
sale, and distribution of bakery products. In the course of
its business, the Company annually ships from its Indiana
facilities goods valued in excess of $50,000 directly to
points outside of Indiana, and annually derives gross rev-
enues in excess of $500,000. I find, as the Company
admits, that it is an employer engaged in commerce
within the meaning of Section 2(6) and (7) of the Act
Ii. THE LABOR ORGANIZATION INVOLVED
The Union is a labor organization within the meaning
of Section 2(5) of the Act
III THE ALLEGED UNFAIR LABOR PRACTICES
A. The Facts
For some 20 years, until 27 September, the Union was
the recognized collective-bargaining representative of the
production employees at the Ft Wayne bakery. At one
time the Union also represented the maintenance person-
nel, however, in recent years the bargaining unit has
consisted only of production employees During the 20-
year period, the bakery underwent several changes in
ownership The most recent owner was Cocoa's, which
ran the bakery for slightly over 1 year Vic Seibert was
president and an owner of Cocoa's The most recent col-
i All dates are for 1986 unless otherwise indicated
2 Errors in transcript have been noted and corrected
287 NLRB No. 134
1232 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
lective-bargaining contract was executed between
Cocoa's and the Union, effective from 31 August 1985
through 31 August 1988, and defined the bargaining unit
as follows-
All production Employees employed in the Em-
ployer's bakery products manufacturing establis-
ment in Allen County, Indiana, including bakers,
wrappers and general bakery workers; BUT EX-
CLUDING delivery personnel , maintenance and
janitorial employees , and office clerical employees,
all professional employees and all guards and super-
visors as defined in the Act.
The contract also contained a union-security clause and
provided for checkoff of union dues.
As of the close of business on 26 September, Cocoa's
ceased operating the bakery. On 29 September Cocoa's
and the Company executed an "asset sale agreement,"
whereby the Company purchased certain assets of
Cocoa's including all owned machinery and equipment
and raw materials (but not finished goods) and assumed
Cocoa's sublease of the premises and vehicle lease. The
Company also acquired the right to use Cocoa's name,
although it chose not to exercise this right. The Compa-
ny did not purchase Cocoa's accounts receivable or cus-
tomer list, although Vic Seibert solicited former Cocoa's
customers on behalf of the Company The Company did
not assume Cocoa's liabilities, and specifically did not
assume its obligations under the contract between
Cocoa's and the Union. It is undisputed that the Compa-
ny owns no interest in and is not affiliated with Cocoa's,
and has never been an alter ego of Cocoa's, and that
Cocoa's continues to exist as a separate corporation.
Prior to 27 September the Company distributed em-
ployment applications all working and laid-off Cocoa's
employees, and also placed newspaper advertisements for
help. As of 26 September the supervisory personnel of
Cocoa's consisted of President Seibert, Production Su-
pervisor Donald Schwerin, and Supervisor Mark Good-
speed. When the Company took over, Company Presi-
dent Phillip Littell assumed overall charge of its oper-
ations in Indianapolis and Fort Wayne. Seibert remained
with the Company until late January 1987 in the capacity
of plant manager at Fort Wayne On Seibert's recom-
mendation, Littell retained Schwerin and Goodspeed,
and also retained Office Manager Cynthia Elick.
Schwerin was given the title of superintendent until Sei-
bert left, when he assumed the title of plant manager
Schwerin and Goodspeed continued to perform the su-
pervisory functions, which they performed for Cocoa's,
with Goodspeed acting in a subordinate capacity to
Schwerin. The Company did not add any supervisory
personnel. On 27 September Littell, in consultation with
Seibert and Schwerin, interviewed some 20 to 30 appli-
cants. Littell initially hired nine production employees
and two maintenance personnel (Dana Hullinger and
Tim Gibson), all of whom began work when the Compa-
ny commenced operations on Monday, 29 September,
and all of whom, except for production employee Antho-
ny Bloom, who left on 2 October, were former Cocoa's
employees.3 On I and 6 October respectively the Com-
pany hired two additional former Cocoa's production
employees.
By letter dated 7 October from the Union to Littell,
the Union asserted that the Company was a successor
employer to Cocoa's, and requested that the Company
either accept the Cocoa's contract or bargain with the
Union over terms and conditions of employment for the
"appropriate bargaining unit " As of that date, the Com-
pany employed 11 production employees, of whom 10
were former Cocoa's bargaining unit employees who
were union members, and two maintenance employees
who were both former Cocoa's employees. All of the
former unit employees were still in the Company's
employ as production employees at the time of the
present hearing. By letter dated 17 October to the Union,
Company President Littell stated as follows.
This is in response to your letter of October 7,
1986 We disagree with your characterization of
Good N' Fresh Foods, Inc as a successor to Cocoa
Bakery. Since we are not a successor, we are not
required to bargain with you or to accept the con-
tract which you have with Cocoa Bakery. In addi-
tion, we do not concur in your contention that you
represent any of our employees. Our current em-
ployment level is not representative of our staffing
needs as we will be continually adding employees
to meet our expanded production requirements.
This complement will be attained during the ensu-
ing weeks
In this interim period between 7 and 17 October, the
Company hired three production, one maintenance, and
one production-maintenance employee, who had not pre-
viously worked for Cocoa' s It is undisputed that during
this interim Vic Seibert, acting on instructions from
President Littell, asked machine operator Deloris Larkey
to circulate a petition among the employees rejecting
union representation. Larkey refused, and Seibert report-
ed back to Littell, in Littell's words, that he had " evalu-
ated all of the employees" and "there wasn 't any over-
whelming lack of support for the Union." By 2 Novem-
ber the Company reached a peak complement of 18 pro-
duction, 3 maintenance , and 1 production-maintenance
employee. Thereafter the complement declined by attri-
tion until by 15 February there were 15 production and
2 maintenance employees. In late February and March
1987, the last reported date before the present hearing,
the Company had 19 production and 4 maintenance em-
ployees. President Littell testified that as of the time of
the present hearing, the Company was interviewing ap-
plicants only for the purpose of replacing employees.
Littell, who was presented as an adverse witness for
the General Counsel, testified that when the Company
commenced operations , the employees performed the
same type of duties as they did for Cocoa's. In his inves-
s The Company has employees in the categories of "Maintenance" and
"Sanitation-warehouse " In the interest of simplicity I have generally re-
ferred to these employees as "maintenance " The distinction will be dis-
cussed further in connection with the question of appropriate unit
GOOD N' FRESH FOODS 1233
tigatory affidavit, Littell stated that "Good N' Fresh em-
ployees who were former Cocoa employees are doing es-
sentially the same type of work that they had done at
Cocoa's."4 Littell further testified that he did not know
of any significant changes in the duties of the employees
up to 19 November. The Company initially sold its prod-
ucts both to former Cocoa's customers and to new cuS-
tomers, principally Maplehurst, an affiliated firm Littell
testified that the Company hoped to achieve a weekly
volume of business "in the high teens to low twenties"
within the first 60 days of operation, and thereafter sub-
stantially maintained that level The Company had a
sales volume of $10,313 during the first week of oper-
ation , reached a volume of $17,547 during the week
ending 2 November, and thereafter never had a weekly
volume of sales exceeding $25,000 (The highest volume
was $24,250 for the week ending 7 December) In the
meantime the Company gradually lost all of Cocoa's
former customers. The Company had a weekly sales
volume of about $3000-$4000 per week to Perfection
until the week ending 23 November, when the volume
dropped by about 90 percent By February 1987 the
Company had only two regular customers; Maplehurst,
which accounted for most of its business, and Chart
House, a group of stores As a result of these develop-
ments, the Company's output gradually shifted from pre-
dominant production of fresh products to predominant
production of frozen products. The Company still pro-
duces fresh dinner rolls Cocoa's had also produced
frozen products, e g., it produced frozen coffeecakes for
Marsh However, most of Cocoa's output consisted of
fresh goods, including bread This shift in output was not
planned The Company initially hoped to retain Cocoa's
customers and Maplehurst's emergence as the Company's
primary customer. The Company went through these
changes without any significant change in equipment
The Company substantially continued to operate with
the same equipment that it purchased from Cocoa's.
Much testimony was presented concerning the purchase
of new equipment. In fact, as of the time of this hearing,
only one significant piece of new equipment, namely, a
freezing tunnel, was actually being utilized, and the
freezing tunnel was not operational until February 1987.
The freezing tunnel is used for quick freezing Cocoa's
and the Company previously used a walk-in freezer. In
November the Company also installed an icer for the
purpose of icing coffeecakes and similar products As
Production Supervisor Goodspeed (the Company's only
witness) admitted in his testimony, these were the only
items of new equipment that were operational at the time
of the present hearing President Littell testified concern-
ing other equipment that was acquired by the Company.
However, this equipment, consisting of an 80-pan oven, a
large donut fryer, a #10 mixer, and a high-speed wrap-
ping machine, were unusable because the Company's
volume of business was not sufficiently large to warrant
their use even as of the time of the present hearing, i e., 6
months after the Company commenced operations As
4 The record does not indicate the date of Littell's affidavit However,
as the present charge was filed on 27 October, it is evident that the affi-
davit was furnished after that date
the evidence fails to indicate that the Company's volume
of business will significantly expand in the foreseeable
future, it is also evident that the Company lengthened a
conveyor line, converted a decorating room into a stor-
age area (as the Company did little cake decorating),
stored away a cookie-making machine (as the Company
did not make cookies), and transferred the shipping de-
partment to a former storage area However, the Compa-
ny remained in the same facility and did not significantly
alter or enlarge that facility As President Littell admit-
ted in his testimony, the employees were not required to
learn new skills According to Littell, the employees
now perform more varied tasks. In fact, under Cocoa's
some employees (like Debris Larkey) regularly worked
at one job, but worked elsewhere as needed, while
others, like Debris Schwerin and Becky Barker, worked
at various tasks, where they were needed The principal
difference between work with the Company and that
under Cocoa's was that after the Company took over the
operation the employees worked increasingly with frozen
dough This meant that to an increasing degree the em-
ployees worked with bag mixes rather than scratch
dough, used fewer formulas, and did not have to exercise
the same sense of timing as was needed for baking fresh
bread. However, the frozen dough was "runnier" and
therefore more unpleasant to work with than dough for
fresh products. There were no formal training sessions.
When the employees were required to work on new
products or with new equipment, the supplier gave ap-
propriate instructions to the supervisors, who passed
along the instructions to the employees. The freezer
tunnel involved nothing more than a start-and-stop oper-
ation on which frozen products were loaded on one end
and boxed at the other, and no employee was regularly
assigned to that operation As Littell admitted, the
former Cocoa's employees had the required level of ex-
perience to perform the Company's work. His testimony
in this regard is particularly significant. In Littell's
words-
Well, if you're asking me did these people need
to be retrained like somebody who goes from a
steel mill to a bakery or something like that, no, we
did not do that. These people had certain levels of
experience which we brought along to doing the
product the way we wanted it made.
As indicated, after the Company took over the em-
ployees continued to work under the same supervision.
The supervisors verbally give out assignments at the be-
ginning of each workday, whereas under Cocoa's they
prepared a written daily work schedule. Under Cocoa's
the plant worked a traditional bakery workweek, with
Tuesdays and Saturdays off Under the Company the
plant operates on a Monday through Friday workweek.
The plant still operates with one staggered shift, with
employees reporting to work as needed in the production
process Under Cocoa's, the mixers, who began the proc-
ess, reported at 3 or 4 a m , and the last group reported
at 7 or 8 a m. The Company has gradually increased the
operating hours so that the initial group reports at mid-
night, and the last employees sometimes report as late as
1234 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
noon. However, the Company continued to use the
Cocoa's schedule until mid-November The Company
has wage classifications for production employees in
three categories- bakers, machine operators and leadper-
sons, and general bakery labor Maintenance-lead person-
nel have a separate wage classification, and other mainte-
nance personnel have the same wage rates as (produc-
tion) machine operators and leadpersons The collective-
bargaining contract between Cocoa's and the Company
established a two-tier wage schedule For wage purposes
incumbent employees were classified in six categories-
bakers, bakers' apprentice, shippers, decorators, wrap-
pers, and general. New employees were classified as
baker apprentice, baker, decorator, general bakery, or
wrapper and shipper. In fact, both the contract and
Company categories represented classification for wage
purposes based on acquired skill level rather than a strick
division of labor. Former Cocoa's employees generally
performed the same type of work under the Company,
except insofar as the Company's needs were modified by
the shift from predominantly fresh to predominantly
frozen products. Thus employees who worked at baking
and mixing (the two tasks sometimes being combined),
such as Michael Gorman, Jerry Pence, and Bobby
Owens, continued to do the same work under the Com-
pany. Deloris Larkey, a machine operator, continued to
work primarily on the Anets table. Arlene Arnold, who
worked at shipping and packaging, continued to perform
the same work As the Company had less need for an
icer, Deloris Schwerin was transferred from that work to
mainly packaging, which she had also performed for
Cocoa's. There was no interchange of work between
production and maintenance personnel either under
Cocoa's or the Company, although for a brief period of
time the Company had one employee mechanic, and the
production employees were not qualified to perform his
work Cocoa's performed some deliveries, but the Com-
pany does not. However, this work was performed by
maintenance, i.e, warehouse personnel. The collective-
bargaining contract between the Union and Cocoa's pro-
vided pension plan and health and welfare coverage for
the unit, i.e., production employees. The Company has
one health insurance plan for all hourly rated employees
Plant Manager Schwerin supervises both production and
maintenance personnel, however, Mark Goodspeed su-
pervises only the production employees.
President Littell testified in sum that when the Compa-
ny commenced operations, it had (1) an immediate goal,
to be achieved within 30 to 60 days, of increasing the
sales volume from about $10,000 per week to about
twice that figure, using existing equipment, (2) an inter-
mediate goal, to be achieved by the end of 1986, of suffi-
cient business to warrant a complement of about 30 em-
ployees, based on retention of Cocoa's business and
having new equipment in place, and (3) a final goal, to
be achieved within 6 months of the commencement of
operations, of sufficient work to warrant a complement
of about 50 employees According to Littell, the Compa-
ny failed to achieve these goals because of the loss of
Cocoa's customers and delays in installing equipment
Littell's testimony was demonstrably false. Even if the
Company had retained all of Cocoa's business, this fact
would not have significantly altered the size of the Com-
pany's complement. The Company's figures indicate that
the business from Cocoa's former regular customers
(Perfection, Holsum, and Marsh) amounted at best to
well under $10,000 per week. When the Company took
over the operation, about half of Cocoa's employees
were in layoff status. It is evident that this business
would not have warranted hiring of more than a handful
of new employees. It would not have warrated a com-
plement of 30 employees, much less 50. During the week
ending 16 November, the last week in which the Compa-
ny performed substantial work for Cocoa's former cus-
tomers, and when the Company was also performing
substantial work for Maplehurst, the Company had a
complement of 16 to 18 production employees. As for
the new machinery, Littell admitted that the Company's
volume of business, even as of March 1987, was too low
to warrant use of that equipment Moreover, the new
equipment would have been unsuitable for much of the
business of Cocoa's former custormers, e g., fresh bread
and various small orders Plainly the Company had no
definite plan for expansion beyond the employee level at-
tained in early November Rather the figures of 30 and
50 employees mentioned by Littell, if credible, represent-
ed at best a hope rather than a definite plan or even a
reasonable expectation
Analysis and Concluding Findings
In Fall River Dyeing Corp. v. NLRB, 482 U.S 27
(1987), affg. 775 F.2d 425 (1st Cir 1985), which issued
shortly after the briefs were submitted in the present
case, the Supreme Court laid down or approved certain
standards governing successorship issue cases As will be
discussed, the Court's decision is substantially dispositive
of the questions presented in the present case.
In Fall River, the Supreme Court set forth four stand-
ards governing successorship issue cases. First, "a succes-
sor's obligation to bargain is not limited to a situation in
which the union in question has been recently certified.
Where . the union has a rebuttable presumption of
majority status, the obligation to bargain with that union
so long as the new employer is in fact a successor of the
old employer and the majority of its employees were em-
ployed by the predecessor" Second, in determining
whether a new employer is the successor to the old, the
question presented is whether the new Company has "ac-
quired substantial assets of its predecessor and continued,
without interruption or substantial change, the predeces-
sor's business operations. . Hence the focus is not
whether there is `substantial continuity' between the en-
terprises. Under this approach, the Board examines a
number of factors. whether the business of both employ-
ers is essentially the same, whether the employees of the
new company are doing the same job in the same work-
ing conditions under the same supervisors; and whether
the new entity has the same products, and basically has
the same body of customers " Third, the Court rejected
the argument that the question of whether a majority of
the successor's employees were employed by the prede-
cessor should be determined when the successor has a
"full complement" of employees. Rather the Court ap-
GOOD N' FRESH FOODS
proved the Board's "substantial and representative com-
plement" test for this determinative time. The Court held
that this test balances "the objective of insuring maxi-
mum employee participation in the selection of a bar-
gaining agent against the goal of permitting employees to
be represented as quickly as possible " In determining
whether a substantial and representative complement
exists, the Board considers "whether the job classifica-
tions designated for the operation were filled or substan-
tially filled and whether the operation was in normal or
substantially normal production . . the size of the com-
plement on that date and the time expected to elapse
before a substantially larger complement would be at
work . . . [and] the relative certainty of the employer's
expected expansion ." Fourth, the Court approved the
Board's "continuing demand" rule, i .e., that "when a
union has made a premature demand that has been re-
jected by the employer, this demand remains in force
until the moment when the employer attains the 'substan-
tial and representative complement "'
Applying the standards of Fall River to the facts of the
present case, I find first that the Company was and is the
successor of Cocoa's. The Company acquired substantial
assets of Cocoa's, and indeed has continued to operate in
the same plant , using substantially the same equipment.
The Company is operating with only one new major
piece of equipment (the freezer tunnel), and this equip-
ment , which was added long after the Company com-
menced operations, simply constituted a more expedi-
tious manner of conducting the former freezing oper-
ation . Unlike the situation in Fall River, where there was
a 7-month hiatus in normal operations, there was no
hiatus in operations in the present case. Cocoa's main-
tained normal operations until the close of business on
Friday, 26 September, and the Company commenced
normal production operations the following Monday.
The Company is engaged in the same business as
Cocoa's, namely, the production and wholesale distribu-
tion of baked goods. As President Littell testified so elo-
quently, this is not a case where a steel mill was convert-
ed into a bakery The only significant change in the
nature of the business was that over a period of several
months the Company shifted from predominent (but not
exclusive) production of fresh products to predominant
(but not exclusive) production of frozen products. This
change is at most comparable to the change involved in
Fall River, in which the successor abandoned "convert-
ing" dying, which accounted for most of the predeces-
sor's business , in favor of an exclusive "commission"
dying operation. Although the production process did
not change, this shift meant that the successor, unlike the
predecessor, did not have to maintain a sales force or
retail outlet to sell its cloth, or allocate capital for pur-
chasing material . The dissenting justices attached signifi-
cance to this change, but the majority did not. In this
regard, it is significant that Littell attributed allegedly
poor production conditions under Cocoa's (which the
Company hoped to remedy) to "lack of funds," i e., the
same problem that led the successor in Fall River to
abandon converting dying. Here the Company sought to
remedy such financial problems by bringing in its own
customers , whose demand was for frozen baked goods
1235
that could be produced in larger quantities per order and
by a somewhat simplified process The recipes were sim-
pler, although the dough was physically harder to handle
and baking required less timing , but the operation re-
mained substantially unchanged The employees contin-
ued to perform substantially the same jos. As under
Cocoa's, employees were shifted as needed, and job cate-
gories both under Cocoa's and the Company reflected
the employees' skill level and commensurate pay rather
than a strict division of labor. The principal job func-
tions, such as baker-mixer, machine operator, and ship-
ping and packaging, remained substantially intact Below
the level of President Littell, who was in overall charge
of the Indianapolis and Fort Wayne bakeries, supervision
remained unchanged. Insofar as working conditions
changed, they reflected (1) modification of work tasks as
necessary in working primarily with frozen products,
and (2) changed wages, benefits, and disciplinary proce-
dure stemming from the fact that the employees were no
longer covered by a collective-bargaining contract. Reli-
ance on the latter as demonstrating lack of successorship
would essentially constitute a bootstrap argument. If sub-
stitution of nonunion for union conditions demonstrated
lack of successorship, there would be no successor rela-
tionship unless the successor accepted the predecessor's
union contract, although it did not plan this result. How-
ever, the successorship doctrine does not require that the
predecessor and the successor have the same customers.
Rather as indicated by the Supreme Court, the pertinent
question is whether they "basically [have] the same body
of customers," i.e., whether they do business in the same
market. Here, Cocoa's did and the Company does busi-
ness with the same class of customers, i e., both sell to
wholesale and retail distributors of bakery products On
balance, and considering the "totality of the circum-
stances" (Fall River, supra), I find that the factors dem-
onstrating a successor relationship outweigh the factors
mitigating against such a finding, and that the Company
is the successor of Cocoa's.
I further find that by 7 October (the date that the
Union requested bargaining) the Company had a "sub-
stantial and representative complement" of employees, a
majority of whom had been employees of Cocoa's
Indeed I could well find that by 17 October, when the
Company refused the Union's request, the Company had
a "full complement" of employees, a majority of whom
had worked for Cocoa's As of 7 October the Company
had employees in all department and wage (job) catego-
ries, with a complement of one production and two
maintenance employees. At no time prior to the present
hearing, nearly 6 months after the Company commenced
operations, did the Company have more than 19 produc-
tion and 4 maintenance employees, and it usually had
less. As indicated, as of the present hearing the Company
had no current plans or intention to enlarge its comple-
ment By 2 November the Company reached a peak of
18 production, 3 maintenance, and 1 production-mainte-
nance employee. Although by mid-November the Com-
pany's gross sales volume rose to over $20,000 per week,
thereby meeting its professed initial target , the. Company
failed to replace several employees who left. Conse-
1236 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
quently by 15 February 1987 the Company had only 15
production and 2 maintenance employees Therefore it is
evident that the Company was overstaffed on 2 Novem-
ber, and that the 15 February figure, which was approxi-
mately the same as that on 17 October (when the Com-
pany had 14 production, 3 maintenance, and 1 produc-
tion-maintenance employees) constituted a normal full
complement At all times the 7 October figure comprised
more than one-half of the total complement, and at all
times more than one-half of the production employees
were former Cocoa's production employees Until Febru-
ary 1987 more than one-half of the total production and
maintenance complement consisted of former Cocoa's
employees. In Fall River, the Supreme Court held in
agreement with the Board and the court of appeals, that
the successor had a "substantial and representative com-
plement" when it "had hired employees in virtually all
job classifications, had hired at least fifty percent of
those it would ultimately employ in the majority of those
classifications, and it employed a majority of the employ-
ees it would eventually employ when it reached full
complement," and "had begun normal production," even
though the successor intended to expand to two shifts,
contingent on growth of business, and in fact reached
this goal 3 months later. On the authority of Fall River, I
find that by 7 October the "substantial and representative
complement" test was met.
The remaining question regarding the 8(a)(5) allegation
is whether the Union enjoyed majority and representa-
tive status as of 7 October, when it requested bargaining.
I find that it did, regardless of whether the appropriate
unit be deemed the production unit, which was covered
by the Cocoa's contract, as contended by the General
Counsel, or a unit that would also include maintenance
and sanitation employees, as contended by the Company
(Br. 21). As of 7 October the Company had 11 produc-
tion and 2 maintenance employees (total of 13), of whom
10 were former Cocoa's employees who were union
members. The Company did not present evidence that
would overcome the Union's presumption of majority
status. On the contrary, President Littell admitted in his
testimony that Vic Seibert reported to him that after
"evaluat [ing] all of the employees," Seibert could not
find a basis for concluding that the employees rejected
union representation. I further find that the Company, by
Seibert, violated Section 8(a)(1) of the Act by asking em-
ployee Debris Larkey to circulate a petition among the
employees rejecting union representation PYA Monarch,
Inc., 275 NLRB 1194, 1196 (1985); see also NLRB v.
Redwig Carriers, 586 F 2d 1066 (5th Cir. 1978).5
5 Wagoner Water Heater Co, 203 NLRB 518, 521 (1973), relied on by
the Company (Br 27), is distinguishable on its facts In Wagoner, the ad-
ministrative law judge, although "entertaining some reservations in this
regard ," concluded that a conversation in which an employer agent solic-
ited an employee to talk other employees out of joining a union did not
violate Sec 8(a)(1) because "The total conversation was between indi-
viduals who had a working relationship of many years", the agent "seems
to have played no role in labor relations matters , the incident was isolat-
ed, does not appear to have been transmitted to other employees , and ap-
pears to have had no impact on the election which occurred the follow-
ing day " In the present case , the solicitation was committed by the Com-
pany 's general manager, acting on instructions from its president, who
had no prior relationship with Larkey The solicitation occurred in the
Concerning the unit question, the Union did not condi-
tion its request for bargaining on a strictly production
unit Rather the Union requested that the Company
either accept the Cocoa's contract or bargain over terms
and conditions of employment "for the appropriate bar-
gaining unit." In its response letter of 17 October, the
Company did not raise any question concerning the unit.
Therefore the Union's request would be valid and (in
view of the Union's majority status) the Company would
be obligated to bargain regardless of which unit was ap-
propriate. I find that the Company is correct regarding
the appropriate unit. In a manufacturing plant such as
here involved, a production and maintenance unit is pre-
sumptively appropriate. In Abdow Corp., 271 NLRB 1269
(1984), which involved a commissary operation, the
Board reversed a Regional Director's determination to
conduct an election in a unit of drivers and warehouse
employees, holding that "we conclude that a plantwide
unit is alone appropriate." The Board explained:
We rely especially on the fact that the Employer
employs a relatively small complement of plant em-
ployees, approximately 24, they are all located
within a single building, the building is designed in
such a way that there necessarily is contact between
the various classifications, all aspects of the Em-
ployer's operation are functionally integrated, re-
volving around a single goal of preparation and de-
livery of the Employer's food products to the res-
taurants; and all employees are allowed to and actu-
ally do perform receiving functions. Based on these
factors, we are of the view, contrary to the Region-
al Director, that a unit limited to the Employer's
drivers and warehouse employees is inappropriate.
Instead, we find that the kitchen and bakery em-
ployees share such a substantial community of inter-
est with the warehouse employees that only a
plantwide unit is appropriate
The present case is substantially similar to the situation in
Abdow. Here both production and maintenance employ-
ees work within one small integrated food production
operation, under substantially common supervision. The
Company no longer makes deliveries (work formerly
done by maintenance personnel) Therefore the mainte-
nance employees now work exclusively at the plant
premises, in close and regular proximity to the produc-
tion workers. As in Abdow, the production and nonpro-
duction employees perform separate tasks, although for a
brief period of time the Company had one employee in
the category of production-sanitation-warehouse If a
production unit were found appropriate, then the mainte-
nance personnel would probably be deprived of any rea-
sonable opportunity for union representation As of 7
October the Company had two maintenance employees:
Dana Hullinger, a skilled mechanic in the highest pay
category (IV); and Tim Gibson, a sanitation-warehouse
context of a refusal to recognize and bargain with the incumbent Union,
and the solicitation was demonstrably part of an effort by the Company
to justify that refusal In these circumstances, the fact that Larkey reject-
ed the solicitation does not exonerate the Company 's conduct
GOOD N' FRESH FOODS 1237
employee who performed unskilled work and fell in the
lowest pay category (1) As a separate entity, such em-
ployees would not form a homogeneous group. Howev-
er, together with the production employees they function
as part of an integrated operation I find that the produc-
tion and maintenance employees share a community-of-
interest that warrants their inclusion in one unit 6
As all the requisite elements under Fall River are
present, I find that the Company violated Section 8(a)(5)
and (1) of the Act by failing and refusing to recognize
and bargain with the Union as the collective-bargaining
representative of the employees in the appropriate unit.
CONCLUSIONS OF LAW
1 The Company is an employer engaged in commerce
within the meaning of Section 2(6) and (7) of the Act,
and has continued the employing entity and is a succes-
sor of Cocoa's Bakery, Inc
2 The Union is a labor organization within the mean-
ing of Section 2(5) of the Act.
3 All production and maintenance employees em-
ployed at the Company's Fort Wayne, Indiana facility,
including bakers, machine operators, general bakery
workers, maintenance and sanitation-warehouse employ-
ees, but excluding office clerical employees, professional
employees, and guards and supervisors as defined in the
Act, constitute a unit appropriate for the purpose of col-
lective-bargaining within the meaning of Section 9(b) of
the Act.
4 The Union has been, and is, the exclusive collective-
bargaining representative of the Company's employees in
the unit described above
5 By failing and refusing since 7 October 1986 to rec-
ognize and bargain collectively with the Union as the ex-
clusive representative of its employees in the appropriate
unit, the Company has engaged in, and is engaging in,
unfair labor practices within the meaning of Section
8(a)(1) of the Act
6 By soliciting an employee to circulate, for employ-
ees' signatures, a petition stating that the employees no
longer supported the Union, the Company has violated
Section 8(a)(1) of the Act
7 The aforesaid labor practices are unfair labor prac-
tices affecting commerce within the meaning of Section
2(6) and (7) of the Act.
THE. REMEDY
Having found that the Company has committed viola-
tions of Section 8(a)(1) and (5) of the Act, I shall recom-
mend that it be required to cease and desist therefrom
and take certain affirmative action designed to effectuate
the policies of the Act. I shall recommend that the Com-
pany be ordered to recognize and, on request, bargain
with the Union as the bargaining representative of the
employees in the appropriate unit, and to post appropri-
ate notices
6 In making this determination I have not relied on the Company's ar-
gument that the larger unit is warranted because the employees are cov-
ered by a common compensation plan As discussed, this simply derives
from the fact that the Company is now operating nonunion
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
ed7
ORDER
The Respondent , Good N' Fresh Foods, Inc, Fort
Wayne, Indiana, its officers , agents, successors , and as-
signs, shall
1 Cease and desist from
(a) Refusing to bargain collectively with United Food
and Commercial Workers Union , Local 37, a/w United
Food & Commercial Workers International Union,
AFL-CIO, CLC, as the exclusive bargaining representa-
tive of its employees in the following appropriate unit
All production and maintenance employees em-
ployed at the Company's Fort Wayne, Indiana facil-
ity, including bakers, machine operators, general
bakery workers, maintenance and sanitation-ware-
house employees, but excluding office clerical em-
ployees, professional employees and guards and su-
pervisors as defined in the Act
(b) Soliciting employees to circulate antiunion petitions
among their fellow employees
(c) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of the
rights guaranteed them by Section 7 of the Act.
2 Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Recognize and, on request, bargain collectively
with the above-named Union as the exclusive representa-
tive of all employees in the appropriate unit described
above, with regard to rates of pay, hours of employment,
and other terms and conditions of employment and, if an
understanding is reached, embody such understanding in
a signed agreement
(b) Post at its Fort Wayne, Indiana facility copies of
the attached notice marked "Appendix "8 Copies of the
notice, on forms provided by the Regional Director for
Region 25, after being signed by the Respondent's au-
thorized representative, shall be posted by the Respond-
ent immediately upon receipt and maintained for 60 con-
secutive days in conspicuous places including all places
where notices to employees are customarily posted. Rea-
sonable steps shall be taken by the Respondent to ensure
that the notices are not altered, defaced, or covered by
any other material
(c) Notify the Regional Director in writing within 20
days from the date of this Order what steps the Re-
spondent has taken to comply
If no exceptions are filed as provided by Sec 102 46 of the Board's
Rules and Regulations , the findings, conclusions , and recommended
Order shall, as provided in Sec 102 48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses
8 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 Nation-
al 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 "
1238 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
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 refuse to bargain collectively with
United Food and Commercial Workers Union, Local 37,
a/w United Food & Commercial Workers International
Union, AFL-CIO, CLC, as the exclusive bargaining rep-
resentative of our employees in the following appropriate
unit:
All production and maintenance employees em-
ployed at the Company's Fort Wayne, Indiana facil-
ity, including bakers, machine operators, general
bakery workers, maintenance and sanitation-ware-
house employees, professional employees and
guards and supervisors as defined in the Act.
WE WILL NOT solicit employees to circulate antiunion
petitions among their fellow employees.
WE WILL NOT in any like or related manner interfere
with , restrain , or coerce you in the exercise of the rights
guaranteed you by Section 7 of the Act.
WE WILL recognize and, on request, bargain collec-
tively with the above-named Union as the exclusive rep-
resentative of all employees in the appropriate unit de-
scribed above concerning rates of pay, hours of employ-
ment , and other terms and conditions of employment
and, if an understanding is reached, embody such under-
standing in a signed agreement
GOOD N' FRESH FOODS, INC