Hood Industries, Inc.,

National Labor Relations Board - Board Decisions

Jan 23, 1985

273 N.L.R.B. 1587 (N.L.R.B. 1985)

HOOD INDUSTRIES 1587
Hood Industries, Inc., and its Wholly Owned Sub-
sidiary, B & K Transportation, Inc. and Team-
sters Local 25, a/w International Brotherhood
of Teamsters, Chauffeurs, Warehousemen &
Helpers of America. Case 1-CA-14624
23 January 1985
SUPPLEMENTAL DECISION AND
ORDER
BY CHAIRMAN DOTSON AND MEMBERS
HUNTER AND DENNIS
On 20 March 1980 the National Labor Relations
Board issued a Decision and Order in this proceed-
ing' finding that the Respondent violated Section
8(a)(1), (3), and (5) of the National Labor Relations
Act. As a remedy for the 8(a)(3) violations the
Board ordered the Respondent to reestablish its de-
livery operation and reinstate and make whole its
delivery employees. Thereafter, on 25 April 1980,
the Respondent filed a motion to reopen the record
asserting that compliance with the Board's order to
reestablish B & K Transportation, Inc. (B & K)
would increase its monthly costs by about $20,0002
and thereby endanger the Respondent's continued
viability.
On 16 June 1980 the Board granted the Re-
spondent's motion and ordered the hearing re-
opened to enable "the Board to determine the fac-
tual accuracy of Respondent's assertions, and fur-
ther, if true, whether Respondent's continued via-
bility would be endangered by our remedy."
On 3 December 1981 Administrative Law Judge
Peter E. Donnelly issued his decision on order re-
opening the record. He found that the Respondent
failed to demonstrate that the cost of reestablishing
the trucking service would endanger the Respond-
ent's economic survival and therefore recommend-
ed affirmance of the Board's earlier Order. There-
after, the Respondent filed exceptions and a sup-
porting brief and moved for reconsideration of the
Board's underlying Decision and Order, and the
General Counsel filed an answering brief.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge's rulings, findings, and
conclusions only to the extent consistent herewith
and to modify the Board's Decision and Order re-
ported at 248 NLRB 597.3
' 248 NLRB 597 (1980)
2 The Respondent's motion on its face alleged estimated monthly costs
of $51,428 An addition error shows that the monthly figure was under-
stated by $9700 making the alleged monthly costs approximately $60,000
(as compared with an average of $30,000 per month paid to outside deliv-
ery contractors from December 1979 through March 1980)
3 None of the Board Members herein participated in the underlying
Decision and Order
The Respondent learned in early 1978 that its
trucking contractor James Foley had a terminal ill-
ness. It thereupon formed B & K to acquire Foley's
trucks and equipment and to take over delivery of
polyurethane foam products to its customers. B &
K began delivery operations in April 1978, 4 and
lost $406 and $3200 in its first 2 months. After only
5 or 6 months the Respondent terminated B & K's
operations for reasons which have been found to
be discriminatory. About November 1978 the Re-
spondent began contracting its delivery work to
outside local and long-distance trucking contactors.
The Respondent's comptroller Raleigh testified
without contradiction that the amount of the Re-
spondent's delivered goods has increased since B &
K's cessation of active trucking operations. The
Respondent's statement of 1980 operations in evi-
dence reveals that its contracting costs continued
to average $30,000 per month through calendar
year 1980.
As noted above, the Board ordered this proceed-
ing reopened in order to evaluate the economic
impact of the status quo ante remedy on the Re-
spondent. Comptroller Raleigh introduced into evi-
dence Respondent's Exhibit 1, which estimated
total costs of $600,966 per year (or $50,080.50 per
month) for B & K's resumption of the delivery
function. Raleigh testified that he calculated those
costs based on the Respondent's need to acquire six
used tractors and employ six truckdrivers at $10.93
per hour. 3 In addition, Raleigh figured on the Re-
spondent's hiring a full-time dispatcher, mechanic,
and clerical at annual salaries of $15,000, $19,660,
and $10,000, respectively. The Respondent's finan-
cial statement for 1980 introduced into evidence
showed that it lost $146,000 in 1980 and that its li-
abilities at the time of the hearing exceeded current
assets by $360,000. Independent certified public ac-
countant Howard testified that he was familiar
with the Respondent's financial condition and that
in his professional opinion requiring the Respond-
ent to expend the additional costs (set forth in R.
Exh. 1) would adversely affect its continued viabil-
ity. 6
The Respondent's motion for reconsideration of that decision is denied
because It contains nothing not previously considered
4 B & K employed one part-time and four full-time drivers at $5 or $6
per hour Its dispatching, payroll, and other administrative clencal func-
tions were performed by Flood employees who had other full-time job
responsibilities and lacked pnor experience in the trucking business
5 The source of the estimated hourly wage for truckdrivers is a survey
of average hourly wages in the Boston area as of August 1980 conducted
by the Bureau of Labor Statistics of the United States Department of
Labor (BLS)
Contrary to the judge, we perceive no basis for rejecting projected
hourly rates derived from the BLS survey
6 Howard specifically noted that the Respondent could not afford a
capital outlay of $120,000 for the purchase of six used tractors and would
be viewed by lenders as an unattractive borrower of such funds
273 NLRB No. 197
1588 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The judge found that the Respondent failed to
substantiate the above-proposed expenditures. He
noted that there were flaws in the Respondent's
method of computing some costs and that it did
not adduce evidentiary support for employment of
additional personnel. The judge further interpreted
the Board's remedy as contemplating restoration of
the B & K operation as it formerly existed. He con-
cluded that the Respondent's cost figures were ex-
cessive and therefore discounted Howard's opinion
that requiring such expenditures would endanger
the Respondent's continued viability. Contrary to
the judge, however, we find that the Respondent
has sufficiently proved that reestablishment of the
B & K operation would endanger its continued via-
bility.
First, we find that the record evidence 7 supports
the cost estimates in Respondent's Exhibit 1 in sub-
stantial part. Clear and undisputed evidence that
the Respondent's volume of delivered goods has in-
creased since B & K ceased operating supports the
asserted need for one additional driver. It also ne-
gates the judge's premise that the reestablishment
order limits the size of the business to that formerly
operated by B & K. This is so notwithstanding al-
leged flaws or inaccuracies in the Respondent's
method of calculating costs as found by the judge.
An enlarged delivery function and B & K's former
unprofitable operation point up the necessity for at
least one full-time employee with knowledge of the
trucking business to perform dispatching and other
clerical or administrative duties for a reestablished
delivery business. In addition, there is no dispute as
to the reasonableness of approximately $20,000 for
the annual salary of a mechanic. We conclude from
the foregoing that the record evidence substantiates
most, if not al1, 8 of the approximately $20,000 of
increased monthly costs which the Respondent
projects for reestablishment of its delivery function.
Moreover, we find that requiring the acquisition
of six tractors costing more than $100,000 would
be especially problematic for the Respondent in its
present financial condition. Under all the circum-
7 Like the judge, we have used the cost figures adduced at the hearing
rather than those contained in the Respondent's preheanng motion In
this regard, we note that Raleigh testified that he performed the calcula-
tions for the cost estimates appended to the preheanng motion, but that
the only person with knowledge of the underlying data—former Vice
President Lundstrom—was no longer in the Respondent's employ
8 We agree with the judge that the Respondent has not justified the
$10,000 annual salary for a full-time clerical employee and that inaccura-
cies in the Respondent's method of ascertaining cost estimates from con-
tractor billings could have caused some overstatement in cost figures for
fuel consumption or in the precise number of driver-hours required
However, the clencal's salary and the other possibly inflated estimates
account for only a relatively small portion of the $20,000-per-month In-
crease in the cost of reestablishing B & K's trucking business We dis-
agree with the judge's position that the Respondent's selection of a 3-year
(rather than a 5-year) period for depreciating tractors is probative evi-
dence of the Respondent's efforts to maximize its cost projections
stances, we find that a reestablishment order would
be unduly burdensome and is unnecessary to effec-
tuate the policies of the Act.° Rather, we conclude
that the Respondent's unfair labor practices will be
sufficiently remedied by a full make-whole order
covering the employees of the discontinued truck-
ing business
AMENDED REMEDY
We shall order the Respondent to make whole
the truckdrivers it discriminatorily terminated by
paying to each a sum of money equal to the
amount he would have earned as wages and other
benefits from the date of termination to the date he
secures equivalent employment, computed in ac-
cordance with the Board's usual formula set forth
in F. W. Woolworth Co., 90 NLRB 289 (1950), with
interest thereon computed in the manner set forth
in Florida Steel Corp., 231 NLRB 651 (1977).10
ORDER
It is ordered that the Board's Order in 248
NLRB 597 (1980) is amended by deleting para-
graph 2(a) and by substituting the following for
paragraph 2(b):
"(b) Make whole John Wharton, Irving
Sweetser, Roger Morrison, Nils Swanson, and Paul
Brown for any loss of wages and other benefits
they may have suffered as a result of our discrimi-
nation against them, with interest, in the manner
set forth in the "Amended Remedy."
IT IS FURTHER ORDERED that the attached appen-
dix be substituted for that attached to the Board's
decision in 248 NLRB 597 (1980).
9 Purolator Armored, Inc , 268 NLRB 1268 (1984)
i ° See generally Isis Plumbing Go, 138 NLRB 716 (1962)
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 ordered us to post and abide by this notice.
WE WILL NOT coercively interrogate our em-
ployees concerning union activities.
WE WILL NOT threaten our employees that they
would be discharged because of their union activi-
ty.
HOOD INDUSTRIES 1589
WE WILL NOT discharge or otherwise discrimi-
nate against any employee because of the union ac-
tivity of our employees.
WE WILL NOT contract out bargaining unit work
because of the union activities of our employees.
WE WILL NOT refuse to recognize and bargain
with Teamsters Local 25, a/w International Broth-
erhood of Teamsters, Chauffeurs, Warehousemen &
Helpers of America, as the exclusive collective-bar-
gaining representative of our employees in the fol-
lowing unit:
All full-time and regular part-time chemical
drivers, truck drivers and shipper-receivers
employed by the Employer at 14 Audubon
Road, Wakefield, Massachusetts, but excluding
all office clerical employees, production and
maintenance employees, managerial employees,
professional employees, guards and supervisors
as defined in the Act.
WE WILL NOT in any other manner interfere
with, restrain, or coerce employees in the exercise
of the rights guaranteed them by Section 7 of the
Act.
WE WILL make whole John Wharton, Irving
Sweetser, Roger Morrison, Nils Swanson, and Paul
Brown for any loss of wages and other benefits
they may have suffered as a result of our discrimi-
nation against them, with interest.
WE WILL, on request, recognize and bargain
with the Union as the exclusive collective-bargain-
ing representative of our employees in the bargain-
ing unit set forth above with respect to wages,
hours, and other terms and conditions of employ-
ment; and, if an understanding is reached, WE WILL
embody such understanding in a signed agreement.
HOOD INDUSTRIES, INC., AND ITS
WHOLLY OWNED SUBSIDIARY, B & K
TRANSPORTATION, INC.
DECISION ON ORDER REOPENING
RECORD
STATEMENT OF THE CASE AND BACKGROUND
PETER E. DONNELLY, Administrative Law Judge. The
original administrative law judge's decision issued on Oc-
tober 17, 1979. As set forth, it appears that Hood Indus-
tries, Inc. (Hood or Respondent) employed one James
Foley to distribute its products. When Foley became ter-
minally ill, Respondent formed B & K Transportation,
Inc. (B & K) to distribute its products. It purchased all
of Foley's equipment, trucks, and permits and began its
own distribution operation in February 1978.
On April 6, 1979, Teamsters Local 25, a/w Interna-
tional Brotherhood of Teamsters, Chauffeurs, Ware-
housemen & Helpers of America (Local 25 or the Union)
filed a petition to represent the truckdrivers and platform
workers employed by B & K. After an election, the
Union was certified as the collective-bargaining repre-
sentative of the unit employees on May 30, 1978. Shortly
thereafter, the Respondent subcontracted the distribution
operation being performed by B & K and discharged the
drivers. The Union filed 8(a)(1), (3), and (5) charges on
June 14, 1978. The judge decided, inter alia, that "Re-
spondent's decision to cease its trucking operation and its
actions in selling the equipment and terminating the em-
ployees who were members of the Union were motivat-
ed by a desire to discourage union Membership and not
to bargain with the Union." The judge ordered the Re-
spondent to reestablish its trucking operation and rein-
state the discharged drivers. In the remedy portion of
this decision the judge also concluded that he did "not
believe that it would be an undue hardship for Respond-
ent to resume its trucking operation," and that "Re-
spondent has not shown that the economic burden of
purchasing trucks and resuming its trucking operations
would endanger the continued viability of Respondent,"
so as to bring this situation within the ambit of the
Board's decision in Great Chinese American Sewing Co.'
The Board, in a Decison and Order affirming the
judge dated March 20, 1980 (248 NLRB 597), comment-
ed on the Great Chinese case, saying: "The Great Chi-
nese case involved a unique situation, and the [Board]
majority [Member Fanning, dissenting], rather than forc-
ing the reestablishment of a clearly unprofitable oper-
ation, found that the policies of the Act were sufficiently
fulfilled by a full make-whole order covering the em-
ployees of the terminated plant."
Thereafter, on April 24, 1980, Respondent filed a
motion to reopen record to show that the future liability
of the Respondent would be endangered by requiring it
to reestablish its trucking operation. The motion enumer-
ated various individual specific costs amounting to
$51,428 per month which Respondent contends it would
cost to reestablish the trucking operation, as compared to
an average cost of $30,542 per month for December 1979
and January, February, and March 1980, representing the
cost to contract out the trucking operations. Based on
these figures, Respondent contends that the cost of rees-
tablishing the trucking operation under the Board's order
would increase its costs by in excess of $20,000 per
month. This, argues the Respondent, would "endanger
the future liability" of Respondent within the meaning of
the Great Chinese case. This being the case Respondent
contends that the remedy for the discriminatory shut-
down should be limited to backpay for the discriminatees
until they obtain substantially equivalent employment.
By Order dated June 16, 1980, over the General Coun-
sel's opposition, the Board (Member Jenkins dissenting)
granted the Respondent's motion to reopen the record in
order to afford the Respondent "an opportunity to devel-
op a record which would permit the Board to determine
the factual accuracy of Respondent's assertions and fur-
ther, if true, whether Respondent's continued liability
would be endangered by our remedy."
1 227 NLRB 1670 (1977).
1590 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
A hearing on these issues was held before me on Feb-
ruary 25, 26, and 27 and April 6 and 7, all in 1981. Briefs
have been timely filed by Respondent and the General
Counsel which have been duly considered.2
FACTS
I ESTIMATED COST OF RESUMING THE TRUCKING
OPERATION
In support of its position, Respondent, at the hearing,
introduced into evidence a document captioned "Pro-
posed Costs to Set Up Trucking Operation" (R Exh. 1).
In totaling the various cost items enumerated therein, a
total figure of $600,966 per year is advanced. In its
motion to reopen record (G.C. Exh. 2(a)), the annual
figure is represented to be $617,136, a discrepancy of
some $17,000 per year, disclosing variances in the indi-
vidual cost items when comparing the two submissions.3
The various cost estimates of the Respondent, as set
out in Respondent's Exhibit 1, are as follows
A. Driver's Wages ($148,753)
To arrive at this figure, Respondent calculated the
hours billed by subcontractors in 1980 to arrive at a
figure of 5608 for local hauling and estimated the hours
worked by subcontractors as to long-distance hauling at
7334 to arrive at a total of 12,942 hours plus 382 hours (8
days) of holiday pay for a total of 13,326 hours since hol-
iday time displaces working time. None of the source
documents were introduced to support these figures.
Based on these figures Respondent calculated that six
drivers were needed 4 2000 hours per year, per driver,
plus 1326 hours of overtime. Respondent assumed an
hourly rate of $10.93 per hour, with overtime hours at
time and half ($15.40) as derived from Bureau of Labor
Statistics for the Boston area as of August 1980.
B Layovers ($10,830)
It is not disputed that Respondent did not pay for lay-
overs while B & K performed the trucking operation.
The number of layovers was arrived at by determining
which long-distance hauls done by subcontractors in
1980 required layovers and assigning the cost of $30 to
each layover.
C. Clerical ($10,000)
Respondent contends that a resumption of the trucking
operation would require the full-time services of a cleri-
cal employee at an annual salary of $10,000 to perform
such functions as filling out fuel tax forms, obtaining nec-
essary truck and trailer licenses, making up the payroll,
paying vendors, and maintaining the books.
It is not disputed that B & K had not employed a full-
time clerical. Those clerical functions incident to the B &
2 In the absence of exceptions thereto, Respondent's motion to correct
transcript is granted
3 The testimony in support of the cost figures in R Exh I was pre-
sented by Douglas Raleigh, Respondent's comptroller
4 Only four full-time and one part-time drivers had been employed in
the B & K trucking operation pnor to its discontinuance, at a rate of $5
per hour
K trucking operations had been performed by employees
of the Respondent, including the secretary to the presi-
dent, and Raleigh himself. The record does not show
that these functions required 40 hours per week to per-
form.
D. Dispatcher ($15,000)
It is undisputed that B & K did not employ a full-time
dispatcher when it performed the trucking operation.
The function of the dispatcher was done by Hood Vice
President Kenneth Lundstrom and Raleigh, as employees
of Hood at no additional cost to B & K. Obviously the
Board's Order requires only restoration of the status quo
and Hood is not obliged to hire a full-time dispatcher
But Respondent contends that one would be necessary if
the trucking operation were to be granted.
E. Mechanic ($19,660)
In the cost proposal the figure of $19,660 per year is
based on an hourly rate of $9.83 per hour, which again
was the hourly rate for mechanics in the Boston area in
1980 as determined by the Bureau of Labor Statistics.
With respect to the services of a mechanic, it should be
noted B & K had not employed a mechanic and obvious-
ly the Board's Order to reestablish the trucking oper-
ation would not obligate the Respondent to hire a me-
chanic.
F. Blue Cross-Blue Shield ($10,783)
While B & K performed the trucking operation it paid
one-half of the monthly Blue Cross-Blue Shield premi-
ums for employees with less than 1 year of service and
all of the premiums for those with more than 1 year of
service. Respondent bases its premium cost figure of
$10,793 on the assumption that the discriminatees would
be reemployed and that a mechanic, dispatcher, and cler-
ical would be employed full time, although this had not
been the case when B & K maintained the trucking oper-
ation
G. Holiday Pay ($10,858)
Respondent bases this figure on the assumption that six
drivers and a mechanic will be hired to resume the
trucking operation, and apparently that these employees
would be paid 8 hours at regular time in addition to their
normal pay for the holiday at their rate of $10.93 per
hour. When B & K performed the trucking operation,
drivers received only 8 hours' pay for holidays.
H. Unemployment Compensation; FICA Expense;
Workmen's Compensation Expense
Like the calculations on holiday and vacation pay, Re-
spondent assumes the hiring of six drivers, a mechanic, a
dispatcher, and a clerical employee at the wages noted
above, in arriving at the cost figures for these items.
I Fuel ($160,152)
In order to arrive at an annual figure for the fuel cost,
Respondent divided the estimated total number of miles
driven by 4.5 miles per gallon and then multiplied by the
HOOD INDUSTRIES 1591
estimated cost of $1.448 per gallon for fuel. Obviously
this calculation depends on an accurate total mileage
figure for its validity. The mileage figures were arrived
at from bills submitted by the subcontractors of B & K.
As to long-distance mileage, B & K was billed at a rate
of 60 cents per mile and total long-distance mileage was
thus computed. Local hauling was billed differently, at
$18 per hour. Respondent translated this to a mileage
figure by dividing the total cost of local hauling by a
factor of 53 cents per mile. However, the record dis-
closes that there is a considerable discrepancy between
the actual local miles driven and the Respondent's mile-
age figures. In two instances, Respondent's calculations
erroneously showed mileage figures twice as great as the
actual miles driven.
J. Depreciation ($48,681)
Respondent recites depreciation as an expense and put
the figure at $48,681 per year for six tractors. 5 Respond-
ent elected to estimate depreciation under IRS rules over
3 years instead of 5 years, as IRS rules would have per-
mitted, with the resulting increased yearly depreciation
figure showing as an expense.
II. FINANCIAL CONDITION OF RESPONDENT
The bulk of the testimony concerning the financial
condition of the Respondent is derived from the testimo-
ny of William Howard, a certified public accountant
with the CPA firm of Alexanderia Grant and Company,
which firm has audited the Respondent since 1976.
Howard was asked to examine the Respondent's exhibits
for the purpose of forming an opinion as to whether or
not the Respondent's viability would be affected if it
were required to resume the trucking operation. Howard
testified that, assuming the accuracy of these cost figures,
the additional cost would eliminate the stockholders'
equity which would "seriously impact the future of the
company." He also noted that the current liabilities,
those to fall due before January 1, 1982, exceed assets by
about $360,000 and Hood would have to look elsewhere
to pay those liabilities. In testifying about the Respond-
ent's weak financial condition, Howard also noted the
loss of $146,000 in 1980, and testified that these liabilities
and losses precluded the use of current assets as a source
to fund the resumed trucking operation. Also, that bor-
rowing would be difficult since a firm with a working
capital deficit of $365,000 would be unattractive to lend-
ers. Given these considerations, Howard concluded that
there was a clear question as to the ability of Respondent
to continue operating if it were required to resume the
trucking operation.
III. ANALYSIS AND RECOMMENDATION
The first question for which the Board has ordered the
record to be reopened was to "determine the factual ac-
curacy of the Respondent's assertions" in its motion to
5 Respondent presently owns two tractors, a Peterbilt and a Mack.
The Mack was retained as a "yard horse," when the B & K equipment
was sold m 1978, replacing an older White, which was sold. The Peter-
bill apparently was taken out of service on October 6, 1978, but is still
owned by Respondent.
reopen record. (G.C. Exh. 2(a).) However, at the hearing
the Respondent introduced a different set of cost figures,
differing both in total cost and obviously in several indi-
vidual cost items (R. Exh. 1). By attempting to prove its
case using the figures introduced at the hearing, Re-
spondent has effectively abandoned the cost figures pre-
sented to the Board, and on which the Board acted in
ordering the hearing to be reopened. 6 Accordingly, I am
not able to determine the accuracy of the cost represen-
tations made in the Respondent's motion to reopen
record. However it seems appropriate to address the ac-
curacy of the cost figures presented at the hearing and I
shall do so.
A. Drivers Wages
Respondent estimated that it would need six drivers at
an hourly rate of $10.93 per hour, despite the fact that B
& K, when performing the trucking operation itself, op-
erated with only five drivers at $5 an hour. I am not sat-
isfied that the Respondent has established the need for a
sixth driver whether due to an increase in production,
sales, or whatever, nor am I satisfied that drivers cannot
be retained at less than 119 percent of what they were
paid as employees of B & K. Accordingly, I conclude
that this cost figure has not been proven and that an ac-
curate cost figure would be considerably less.
B. Clerical Employee
While B & K performed its own trucking operation,
the insubstantial clerical functions necessary were per-
formed by employees of Hood. Respondent has not
shown that a resumption of the trucking operation neces-
sitates a change in this method of operation to the extent
of employing a full-time clerical employee. Therefore,
without such a showing, this cost figure to perform cleri-
cal functions is unsubstantiated.
C. Dispatcher
I am not satisified that the full-time services of a dis-
patcher would be required in order to conform to the
Board's Order to reestablish the trucking operation. The
dispatcher's function had previously been performed by
employees of the Respondent, and I am not satisfied that
reestablishment of the trucking operation would require
the services of a full-time dispatcher for B & K.
D. Mechanic Employee
Obviously, as with the clerical and dispatcher, the
Board's Order does not require the hiring of an individ-
ual to perform mechanical work. Certainly trucks will
need to be maintained, but it would comport fully with
the Board's Order to have the work done as it has been
done previously. I cannot conclude that the assumption
of the trucking operation requires the hiring of a full-
time mechanic. Whether or not the yearly salary of
$19,660 per year would be adequate for the services of
6 The cost figures to restore the trucking operation in the motion to
reopen record was $51,428 per month or $617,136 per year. The yearly
cost figure in R. Exh. 1 is $600,966 per year or $50,080.50 per month.
1592 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
outside maintenance on the vehicles, it is not possible to
determine without more information.
E. Blue Cross-Blue Shield
With respect to the cost estimate for Blue Cross-Blue
Shield coverage, the Respondent has included within
that cost item coverage for a full-time clerical, mechanic,
and dispatcher. As noted earlier, I am not satisfied that
the Board's Order to resume the trucking operation re-
quires their hiring, and thus I conclude that Respondent's
cost estimate is excessive.
F. Holidays and Vacations
Similarly, with respect to the matter of holiday and
vacation pay, those amounts are reducible by the
amounts attributable to the mechanic, dispatcher, and
clerical, whom I conclude that the Respondent is not re-
quired to employ. Moreover, Respondent's calculation
appears to provide, as to the eight holidays, both regular
pay plus 8 hours of holiday pay for each holiday, where-
as previously they had been paid for only 8 hours of reg-
ular pay on holidays. Additionally, as noted earlier, I am
not convinced that drivers would be unavailable to the
Respondent at less than $10.93 per hour. All of these fac-
tors persuade me that the holiday and vacation cost fig-
ures could be substantially less than those advanced by
Respondent.
G. Unemployment Compensation, FICA, Workmen's
Compensation
Likewise, the unemployment compensation, FICA,
and workmen's compensation premium expenses to the
Respondent are exaggerated to the extent that they in-
clude payments for the mechanic, dispatcher, and cleri-
cal, the necessity for whose employment has not been
shown.
H. Fuel Costs
With respect to the largest expense item, fuel, it ap-
pears to me to be substantially inaccurate and, as in those
instances pointed out by the General Counsel, overstat-
ed. The fault lies with the above formula used to deter-
mine the number of miles driven locally, which pro-
duced seriously flawed mileage figures. In these circum-
stances, I conclude that the cost figure for fuel is sub-
stantially inaccurate, and not a reliable projection of fuel
costs. Of course since vehicle maintenance costs depend
on the same formula, they too are also flawed to that
extent.
I. Depreciation
Respondent chose to project depreciation over 3 years
rather than 5 years. The effect of this is to show a great-
er yearly expense than would have appeared if the 5-year
depreciation option had been elected. While the Re-
spondent contends that this is a business decision, beyond
the scrutiny of the General Counsel, I conclude that it
reflects a maximization of expense beyond what is neces-
sary in order to resume the trucking operation under the
Board's Order
J. Financial Condition of Respondent
In evaluating the testimony of Howard, it is necessary
to bear in mind that he was not responsible for, and ap-
parently took no part in, the preparation of the docu-
ment showing the proposed cost of resuming the truck-
ing operation, or any of the other cost figures in Re-
spondent's documents in evidence, with the exception of
Respondent's financial statement (R. Exh. 7). Any opin-
ion offered by Howard as to the continued viability of
Respondent necessarily involves a comparison of the cost
to resume the trucking operation with Respondent's fi-
nancial position. I have concluded that the estimated cost
figures to resume the trucking operation are substantially
inaccurate and excessive. Accordingly, Howard's opin-
ion, however valid it may have been premised on accu-
rate projected cost figures, is fatally defective in view of
Respondent's demonstrably inaccurate cost projections.
In summary, I am not satisfied that the figures ad-
vanced by the Respondent adequately reflect the cost of
reestablishing the trucking operation. It appears that the
real figures would be substantially less, although it is im-
possible to be definitive as to specifics in this regard, be-
cause the date in the record is insufficient. While it ap-
pears that some additional expense may be encountered
by the reestablishment of the trucking operation, I am
not convinced that this record shows that the continued
viability of the Respondent has been endangered so as to
bring the Respondent within the ambit of the Great Chi-
nese case, supra.
In the instant case, Respondent shut down its trucking
operation discriminatorily, and discharged the drivers in
an effort to discourage union membership, and so violat-
ed Section 8(a)(3) of the Act. That is not in dispute in
this matter. Respondent's motivation was discriminatory,
not economic In these circumstances, the traditional
Board remedy provides, inter alia, for the reestablish-
ment of the operation. However, the Board appears to
have chiseled an exception for employers whose contin-
ued viability would be endangered by such reestablish-
ment.
But as the Board notes in its original Decision and
Order herein, supra, 248 NLRB 597 fn. 3, Great Chinese
involved a "unique situation" and made its position clear
in holding, "We continue to adhere to the well-estab-
lished principle that, in cases involving discriminatory
conduct, the restoration of the status quo ante is the
proper remedy unless the wrongdoer can demonstrate
that the normal remedy would endanger its continued vi-
ability. See Lion Uniform, Jamesville Apparel Division, 247
NLRB 992 (1980); R & H Masonry Supply, Inc., supra
[238 NLRB 1044] "
HOOD INDUSTRIES 1593
In my opinion, a simple showing that reestablishing
the operation would be financially detrimental would not
suffice. There must be a showing, with accurate support-
ing data and financial documentation, that the Respond-
ent's economic survival would be endangered. The Re-
spondent in the instant case has not met this burden. Ac-
cordingly, it is my recommendation that the Board's
Order in this case be enforced.7
7 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.