Greenleaf Motor Express, Inc. And Ashtabula Chemical Corp.

National Labor Relations Board - Board Decisions

Apr 16, 1990

298 N.L.R.B. 227 (N.L.R.B. 1990)

GREENLEAF MOTOR EXPRESS 227
Greenleaf Motor Express , Inc. and Ashtabula Chem-
ical Corp. and Chauffeurs , ' Teamsters, Ware-
housemen and Helpers of America , Local Union
No. 377, a/w International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and
Helpers of America , AFL-CIO.' Case 8-CA-
18908
April 16, 1990
DECISION AND ORDER REMANDING
BY CHAIRMAN STEPHENS AND MEMBERS
CRACRAFT AND DEVANEY
On February 21, 1989, Administrative Law
Judge Thomas A. Ricci issued ' his decision in this
proceeding. The Respondent filed exceptions and a
supporting brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has reviewed the decision and the
record in light of the exceptions and brief and has
decided to remand this proceeding to the judge for
further hearing and the taking of additional evi-
dence.
The complaint alleged that the Respondent vio-
lated Section 8(a)(5) and (1) by reducing the wages
of its employees without bargaining with the
Union. The General Counsel contended that the
Respondent unilaterally altered the contractual
wage provisions of the' applicable bargaining agree-
ment by failing to pay unit employees at the re-
quired rate of 18 percent of the gross revenues pro-
duced by each employee. Conversely, the Re-
spondent contended, inter alia, that, under the
terms of the applicable wage compensation formu-
la, the calculation of 18 percent of gross revenues
must be derived from those revenues generated by
each employee for the Respondent.2
The governing wage compensation provision
provides that
The Employer agrees to pay each employee
eighteen (18) percent of all gross revenues that
each employee directly produces (reduced by
pension and health and welfare costs as pro-
vided elsewhere in this agreement), and addi-
' On November 1, 1987, the Teamsters International Union was read-
mitted to the AFL--CIO. The caption has been amended to reflect that
change.
S The Respondent entered into agreements with Leaseway Bulk Serv-
ices under the terms of which Leaseway, using tractors and trailers
leased from the Respondent and the Respondent's unit employees as dnv-
ers, performed the' Respondent 's shipping services . Customers paid their
delivery fees to Leaseway, which retained 17 percent of the payment and
forwarded the remainder to the Respondent.
We note that the judge inadvertently stated that the "agreement be-
tween Leaseway and the Respondent" terminated on July 31, 1986,
rather than on July 31, 1988, the actual date of termination.
tionally , [$ 15.00] per load for each load that
each employee is authorized by the employer
to load and which each employee actually
loads . Each employee shall receive [$ 10.00]
per hour [for waiting time spent] beyond the
[2] consecutive hours detention at a customers
location.
At the hearing, the Respondent attempted to elicit
evidence that the parties formerly used a wage
compensation formula tied strictly to mileage and,
thereafter, switched to a percentage method of
compensation, with the intention of thereby accept-
ing the risks or rewards of a compensation formula
that fluctuated according to those revenues the Re-
spondent was able to charge and collect. The Re-
spondent contended that this bargaining history
and practice would serve to establish that it pro-
ceeded fully consistent with its wage rate obliga-
tions when on January 1, 1986, it commenced pay-
ment of wages based on 18 percent of gross reve-
nues each employed directly produced for the Re-
spondent, thereby reflecting the Respondent's own
reduction of revenues received from contractor
Leaseway Bulk Services.
The judge concluded that the Respondent violat-
ed the Act, as alleged, based on his finding that the
contract could not be interpreted in the manner
argued by the Respondent, noting that the gross
revenues produced necessarily are the total that
each shipper paid for having its materials moved
from one location to another. At the hearing, :how-
ever, the judge refused to permit the Respondent
to introduce evidence and fully develop a record
pertaining to the parties ' bargaining history and
possible intent in switching to a percentage-based
wage formula. As it is conceivable that such evi-
dence could shed light on the proper application of
the governing wage compensation formula, based
on the circumstances existing as of January 1, 1986,
such evidence was relevant to the issues litigated.
Accordingly, in agreement with the Respondent's
contention that a remand is appropriate' to receive
such evidence, we find that it is necessary to
remand this proceeding to the judge for further
hearing to permit the parties to submit additional
evidence on bargaining, history and on the intent of
the parties regarding the wage compensation for-
mula.3
a We note in this regard the present state of the record pertaining to
bargaining history. In rebuttal to the Respondent's presentation, the Gen-
eral Counsel recalled Union Business Agent Frank Licate . Licate testified
on direct examination that the term "revenue" was intended to mean "the
driver's revenue." Tr. 207.25 . On subsequent cross-examination, however,
Licate testified that "it's the gross revenue that is generated by Green-
leaf." He then testified that "it's gross-gross revenue." Tr. 210:21-211:1.
Continued
298 NLRB No. 26
228 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
ORDER
It is ordered that the proceeding is remanded to
Administrative Law Judge Thomas A. Ricci for
the purpose of holding a hearing to receive addi-
tional testimony and other appropriate evidence re-
lating to the parties' applicable bargaining history
and intent in negotiating a wage compensation for-
mula pertaining to the Respondent's wage obliga-
tions commencing January 1, 1986.
IT IS FURTHER ORDERED that, at the conclusion
of the hearing, Judge Ricci issue a supplemental
decision containing findings of fact, credibility res-
olutions, and conclusions of law. The supplemental
decision shall be served on the parties, after which
the provisions of Section 102.46 of the Board's
Rules and Regulations shall be applicable.
In our view, further evidence regarding bargaining history and the intent
of the parties is also appropriate in light of the ambiguities raised by Li-
cate's testimony.
Mark F. Neubecker, Esq., for the General Counsel.
Alan G. Ross, Esq. (Wickens Herzer & Panza), of Lorain,
Ohio, for the Respondent.
Robert S. Moore, Esq. (Green, Haines, Sgambati, Murphy
& Macala), of Youngstown, Ohio, for the Charging
Party.
DECISION
STATEMENT OF THE CASE
THOMAS A. Ricci, Administrative Law Judge. A hear-
ing in this proceeding was held at Jefferson, Ohio, on
October 4, 1988, on complaint of the General Counsel
against Greenleaf Motor Express, Inc. and Ashtabula
Chemical Corp. (the Respondent). The complaint issued
on March 21, 1986, upon a charge filed on February 4,
1986, by Chauffeurs, Teamsters, Warehousemen and
Helpers of America, Local Union No. 377, a/w Interna-
tional Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America (the Union or the
Charging Party). The sole question presented is whether
the Respondent unilaterally changed a very substantial
condition of employment of its employees, disregarding
the current existence of their established collective-bar-
gaining agent, and thereby violated Section 8(a)(5) of the
Act. Briefs were filed by the General Counsel and the
Respondent.
On the entire record and from my observation of the
witnesses I make the following
FINDINGS OF FACT
1. THE BUSINESS OF THE RESPONDENT
Greenleaf Motor Express Inc. and Ashtabula Chemical
Corp., both Ohio corporations, operate out of a common
office in Ashtabula, Ohio, where they are engaged in the
interstate and intrastate transport of bulk chemicals. An-
nually, these two companies in the course of their busi-
ness operations derive gross revenues in excess of
$50,000 for the transportation of commodities from the
State of Ohio directly to points outside the State of
Ohio. The two companies are affiliated business enter-
prises with common officers, ownership, directors, man-
agement, and supervision. They exchange personnel and
formulate and administer a common labor policy, and ac-
cordingly are deemed a single employer, and are there-
fore referred to in this decision as the Respondent.
II. THE LABOR ORGANIZATION INVOLVED
I fmd that Chauffeurs, Teamsters, Warehousemen and
Helpers of America, Local No. 377, a/w International
Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America is a labor organization within
the meaning of Section 2(5) of the Act.
III. THE UNFAIR LABOR PRACTICES
The Respondent is in the business of transporting, by
its trucks and trailers, hazardous materials, such as
chemicals and acids for its customers. It operates princi-
pally in the State of Ohio, but its vehicles run into many
other States also. Its operations are subject to the regula-
tions of the Interstate Commerce Commission and the
Public Utilities Commission of Ohio. It holds valid per-
mits to do business in one State and another. Because of
the dangers on the highway when transportations of
such chemicals is involved, one of the regulatory re-
quirements is that the Company must carry a high rate
of insurance for its trucks and operations. During the
year 1985 that one requirement was that this Company
have a $5 million insurance policy to protect the public.
As the fall of 1985 approached the Respondent found
itself with a problem. The Hartford Insurance Company,
with whose insurance policy the company was operating,
said it would not renew the policy due to expire on De-
cember 31, 1985. The Company then asked a number of
other insurance companies for the necessary insurance,
but none of them were willing to take the risk of selling
any such policy to this Company. Some insurance com-
panies did not even respond to inquiries by the Respond-
ent. With the end of the year approaching the company
realized it would have to discontinue its business entirely
unless it succeeded in obtaining the legally required in-
surance. Since that proved impossible it decided upon
another way of remaining in business.
It made a deal with a company called Leaseway Bulk
Services. Exactly what kind of business Leaseway did on
its own, what kind of trucking and transporting of non-
hazardous or hazardous materials for its own customers,
the record does not clearly show. But it is clear that
company satisfied all the requirements of the various reg-
ulatory agencies, whether state or Federal. If it, too
transported hazardous materials for its own customers,
there is no explanation of why it could obtain the neces-
sary insurance that the Respondent could not. Whatever
Leaseway's old business was both before and after its
deal with Greenfield and Ashtabula, there is no indica-
tion that that changed in any way.
In any event, the arrangement between the two com-
panies was that beginning on January 1, 1986, the Re-
GREENLEAF MOTOR EXPRESS 229
spondent would continue to give the same trucking serv-
ices to its old established customers, but in the name of
Leaseway, and not Greenfield and Ashtabula. The names
on its trucks and trailers were changed to read Leaseway
Bulk Services, and the payments for each truck delivery
was sent to Leaseway instead of to the Respondent. The
Respondent even sold its necessary operations permits to
do business lawfully in Ohio and elsewhere to Leaseway.
In all other respects expect nominally, nothing changed.
The Respondent received the orders from its old custom-
ers, it used the same trucks and trailers it had always
used, it continued to own them as before, it used the
same drivers-about 10, as named in the record, as it
always had working for it, it serviced its vehicle in its
own shop as it always had in the past.
In return for this courtesy of permitting the Respond-
ent to continue its business under the other company's
name, the Respondent agreed to permit Leaseway to
keep 17 percent of the payments made by the shippers of
the hazardous materials. Whenever only the Respond-
ent's tractor and a driver was used Leaseway kept 35
percent of the payment by the shipper. Everytime
Leaseway received a check from one of the Respond-
ent's customers, it kept its own percentage and forward-
ed the rest to the Respondent.
On July 31, 1986, the agreement between Leaseway
and the Respondent was terminated. Greenleaf bought
back its operating permits, it succeeded in obtaining the
necessary insurance, and resumed its old way of doing
business. It became as though nothing had ever changed.
We come to the complaint in the case at bar. Local
377, of the Teamsters Union, the Charging Party here,
has for some years been the bargaining agent for the Re-
spondent's drivers. In fact, on January 1, 1986, there was
in effect a collective-bargaining contract. Its provision
for the drivers' wages reads as follows:
The, Employer agrees to pay each employee eight-
een (18) percent of all gross revenue that each em-
ployee directly produces (reduced by pension and
health and welfare costs as provided elsewhere in
this agreement), and additionally, [$15] per load for
each load that each employee is authorized by the
employer to load and with each employee actually
loads. Each employee shall receive [$10] per hour
[for waiting time spent] beyond the [2] consecutive
hours detention at a customers location.
Consistent with this contract, the drivers were always
paid 18 percent of what the shipper paid for every load
delivered by that driver. That is, the drivers were paid
that amount until January 1, 1986, when the Respondent
changed' its method of operation. On that day it reduced
the drivers' pay and for the next 2-1/2 years paid them
only 18 percent of what it, the Respondent, received
from Leaseway, after that company had exacted its pay-
ment of 17 percent. On a $1000 paid shipment delivered
by the driver, he received not $180 (18 percent of $1000)
but $124',50 (18 percent of $830). That the Respondent
made this reduction change in the pay of its drivers
without even talking about the matter with their Union
is not disputed. That the Respondent did not bargain
with the Union when deciding upon the change and
when unilaterally putting it into effect is the clearest re-
ality on this record. The drivers were its employees
before January 1, 1986, and they remained its direct em-
ployees throughout the 2-1/2 years they suffered that
pay reduction.
The complaint alleges that the reduction in pay was a
unilateral action by the Respondent without first bargain-
ing with the Union, and therefore an unfair labor prac-
tice in violation of Section 8(a)(5) of the Act. I frond the
complaint completely proven by the evidence received,
and therefore conclude that the Respondent--both
Greenleaf and Ashtabula-violated the statue as alleged.
NLRB v. Katz, 369 U.S. 736 (1962).
In defense the Respondent makes two arguments-one
inconsistent with the other. It says that the arrangement
it made with Leaseway "affected the scope, direction
and the nature of the enterprise." It therefore relies on
First National Maintenance Corp., 452 U.S. 666 (1981). Its
alternative defense is that the established pay of the driv-
ers did not change, that they continued at all times to be
paid what the collective-bargaining contract in effect at
the time of the new arrangement called for.
The truth is that the nature of its business operations
did not change one iota. All it did in the past was to
transport hazardous materials for companies which pro-
duced them and wanted them taken from one location to
another. This is exactly what it continued to do-for the
same companies (its customers), with the same vehicles-
truck and trailers, with the same employees (there is no
indication that any single driver was either released or
hired because of the alleged change in operations), there
was also no change in the location of its garage and serv-
ice station, where it continued to repair and maintain its
vehicles. "The scope, direction and the nature" of its op-
erations not only did not change "dramatically," as the
Respondent's brief says, it did not change at all.
And this is why the Respondent also argues that the
pay of "its" employees-there is no contention that the
drivers ever ceased being direct employees of the Re-
spondent companies-never changed at all. This argu-
ment is no more convincing than the first defense„' for it
rests upon a complete distortion of the language of the
collective-bargaining contract in effect at the time. As set
out above, the contract called for "18 percent of all
gross revenues that each employee directly produces."
"The gross revenue" produced was always the total that
the shipper paid for having its hazardous materials
moved from one location to another. Before January 1,
1986, the shipper sent his check directly to the Respond-
ent. Later, for 2-1/2 years, it sent the same check to
Leaseway, which first took out its fee and then sent the
rest to the Respondent. Insofar as these drivers were
concerned, this change `in bookkeeping did nothing to do
with it their work duties or the contract language. The
defense argument is that the contract language must be
read differently, that after the phrase "gross revenue that
each employee directly produces" must be inserted the
words "for Greenleaf' (or Ashtabula). And since after
January 1, 1986, Greenleaf received less than the "gross
revenue" produced by the driver, it means according to
230 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
the defense, that the driver "produced" less than he did
before by his driving work. I find no merit in this de-
fense contention.
IV. THE REMEDY
The Respondent, both Greenleaf and Ashtabula, must
be ordered to cease and desist from again committing the
unfair labor practices found herein. It must also be or-
dered to make whole all of its drivers for that portion of
their pay which was illegally withheld from them
throughout the period in question. The Respondent must
also be ordered to bargain with the Union which repre-
sents its employees on any matters that relate to condi-
tions of employment in the future.
V. THE EFFECT OF UNFAIR LABOR PRACTICES
ON COMMERCE
The activities of the Respondent set forth in section
III, above, occurring in connection with the operations
of the Respondent described in section 1, have a close,
intimate, and substantial relationship to trade, traffic, and
commerce among the several States, and tend to lead
labor disputes burdening and obstructing commerce and
the free flow of commerce.
CONCLUSIONS OF LAW
1. By unilaterally changing the rate of pay of its em-
ployees from January 1, 1986, to July 1, 1988, the Re-
spondent has violated Section 8(a)(5) of the Act.
2. By that same conduct the Respondent has coerced
and restrained its employees in violation of Section
8(a)(1) of the Act.
3. The above-described unfair labor practices affect
commerce within the meaning of Section 2(6) and (7) of
the Act.
On these findings of facts and conclusions of law and
on the entire record, I issue the following recommend-
ed'
ORDER
The Respondent, Greenleaf Motor Express, Inc., and
Ashtabula Chemical Corp., their officers, agents, succes-
sors, and assigns, shall
1. Cease and desist from
(a) Unilaterally changing the rate of pay of its employ-
ees without first bargaining in good faith with their es-
tablished collective-bargaining agent.
(b) Refusing to bargain in good faith with Internation-
al Brotherhood of Teamsters, Warehousemen and Help-
ers of America, Local No. 377, affiliated with the Inter-
national Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America.
(c) In any other manner interfering with, restraining,
or coercing employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
' 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.
2, Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Make whole all of its drivers for any loss of pay
they have suffered from January 1, 1986, to July 1, 1988,
by reason of the Respondent's unilateral, illegal change
of rates, with interest thereon to be computed in the
manner prescribed in F W. Woolworth Co., 90 NLRB
289 (1950), and New Horizons for the Retarded, 283
NLRB 1173 (1987).
(b) On request, bargain with International Brotherhood
of Teamsters, Warehousemen and Helpers of America,
Local No. 377, affiliated with the International Brother-
hood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, as the exclusive representative of its
employees in the appropriate unit on terms and condi-
tions of employment and, if an understanding is reached
embody such understanding in a signed agreement.
(c) Preserve and, on request, make available to the
Board or its agents for examination and copying, all pay-
roll records, social security payment records, timecards,
personnel records and reports, and all other records nec-
essary to analyze the amount of backpay due under the
terms of this Order.
(d) Post at its place of business in Ashtabula, Ohio,
copies of the notice attached hereto and marked "Appen-
dix."2 Copies of the notice, on forms provided by the
Regional Director for Region 8, after being signed by
Respondent's authorized representatives, shall be posted
by the Respondent immediately upon receipt and main-
tained for 60 consecutive days in conspicuous places, in-
cluding all places where notices to employees are cus-
tomarily posted. Reasonable steps shall be taken to
ensure that the notices are not altered, defaced, or cov-
ered by any other material.
(e) Notify the Regional Director in writing within 20
days from the date of this Order what steps the Re-
spondent has taken to comply.
2If 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 "
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 having found, after
a hearing, that we violated the law by unilaterally chang-
ing the conditions of employment of our employees and
by refusing to bargain with their union in good faith.
WE WILL NOT unilaterally change the rate of pay for
our driver employees without first bargaining in good
faith with International Brotherhood of Teamsters,
Warehousemen and Helpers of America, Local No. 377,
affiliated with the International Brotherhood of Team-
GREENLEAF MOTOR EXPRESS 231
sters, Chauffeurs, Warehousemen and Helpers of Amer-
ica.
WE WILL NOT refuse to bargain in good faith with that
labor organization on behalf of our driver employees.
WE WILL NOT in any other manner interfere with, re-
strain, or coerce our employees in the exercise of the
right to self-organization guaranteed in Section 7 of the
Act.
WE WILL make whole all of our drivers for any loss of
pay which they may have suffered from January 1, 1986,
to July 1, 1988, in consequence of our unilateral action in
reducing their rate of pay in violation of the statue.
WE WILL, on request, bargain with the above-named
union and put in writing and sign any agreement reached
on terms and conditions of employment for our employ-
ees in the bargaining unit.
All our employees are free to join or assist International
Brotherhood of Teamsters, Warehousemen and Helpers
of America, Local No. 377, affiliated with the Interna-
tional Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America, or any other labor
organization of their choice.
GREENLEAF MOTOR EXPRESS , INC. AND
ASHTABULA CHEMICAL CORP.