Ingledue Excavation Service

National Labor Relations Board - Board Decisions

Jan 14, 1965

150 N.L.R.B. 1024 (N.L.R.B. 1965)

1024 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
- APPENDIX B
NOTICE To ALL MEMBERS OF STEEL , PAPERHOUSE & CHEMICAL
DRIVERS & HELPERS LOCAL No. 578, IBT
Pursuant to the Recommended Order of a Trial Examiner of the National Labor
Relations Board , and in order to effectuate the policies of the National Labor Rela-
tions Act, as amended , from time to time, we hereby notify you that:
WE WILL NOT induce or encourage the employees of any employer to engage
in a strike or a concerted refusal in the course of their employment to use,
manufacture , process, transport , or otherwise handle or work on any goods,
articles, or commodities , or to perform any services for their respective employ-
ers where an object thereof is to force or require any employer br self-employed
person to join any labor organization. -
STEEL, PAPERHOUSE & CHEMICAL DRIVERS & HELPERS
LOCAL No. 578, IBT,
Labor Organization.
Dated------------------- By-------------------------------------------
(Representative ) ( Title)
This notice must remain posted for 60 consecutive days from the date of posting,
and must not be altered , defaced , or covered by any other material.
Members and employees may communicate directly with the Board 's Regional
Office, 849 South Broadway , Los Angeles , California , Telephone No. 688-5206, if
they have any questions concerning this notice or compliance with its provisions.
Bud Ingledue d/b/a Ingledue Excavation Service and Ingledue
Excavation Company and Local 649, International Union of
Operating Engineers , AFL-CIO and District 50, United Mine
Workers of America, Party to the Contract . Case No. 38-CA-8
(f ornierly 13-CA-5995). January 14, 1965
DECISION AND ORDER
On September 28, 1964, Trial Examiner Leo F. Lightner issued his
Decision in the above-entitled proceeding, finding that Respondent
had engaged in and was engaging in certain unfair labor practices
and recommending that it cease and desist therefrom and take certain
affirmative action, as set forth in the attached Trial Examiner's Deci-
sion. Thereafter, Respondent filed exceptions to the Trial Exam-
iner's Decision and a supporting brief.
Pursuant to the provisions of Section 3(b) of the National Labor
Relations Act, the Board has delegated its powers in connection with
this case to a three-member panel [Chairman McCulloch and Mem-
bers Fanning and Jenkins].
The Board has reviewed the rulings 'of the Trial Examiner made at
the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Trial
Examiner's Decision, the exceptions and briefs, and the entire record
in the case, and hereby adopts the Trial Examiner's findings, conclu-
sions , and recommendations only to the extent that they are consistent
with this Decision and Order.
150 NLRB No. 98.
INGLEDUE EXCAVATION SERVICE, ETC. . 1025
The -Trial Examiner finds that Ingledue Excavation Service, an
individual proprietorship,' which had union-shop agreements with
Local 649, International Union of Operating Engineers, AFL-CIO 2
and Ingledue Excavation Company, a corporation newly organized
on September 19, 1963,3 constituted a single employer which violated
Section 8(a) (1), (2), (3), and (5) of'the Act when the corporation
entered into a union-shop agreement with District 50, United Mine
Workers of America. We do not agree that this conduct was
unlawful.
The record shows that since 1954 Service engaged in the construc-
tion of water and sewer pipelines, excavating, and' landscaping.4 On
July 13, 1963, Service and the Operating Engineers entered into two
collective-bargaining agreements covering building construction and
highway and heavy construction employees engaged in "the operation
and maintenance of all hoisting and portable machines and engines."
On October 10, 1963, about a month after the corporation was
organized, Ingledue, on behalf of the corporation, entered into a
collective-bargaining agreement with District 50 covering plumbers,
pipefitters, equipment operators, shop employees, welders, truck-
drivers, and laborers. Four days later, Ingledue, who had on Octo-
ber 7 received permission from the city of Macomb to do so, arranged
for Service to sublease the remaining work on the city project to the
corporation. Four'Service employees, who were transferred to the
corporate's payroll, and three other employees who continued on the
Service payroll until April 1964, performed this work for the corpo-
ration and in doing so engaged in such varied jobs as machine operat-
ing, carpentry, labor, masonry, and some electrical work. Although
Service had union-security contracts with the Operating Engineers,
Ingledue testified without contradiction that only one of this group;
namely, Wilson, who became a foreman for the corporation, was a
member of the Operating Engineers .5
On October 14, 1963, and on three occasions in the following month,
McCormick, 'business agent of the Operating Engineers, met with
Ingledue. After contending that the Service contracts with the
Operating Engineers had been breached by transferring to the corpo-
ration work covered by those contract's, McCormick requested Ingle-
due to bargain about such work with that Union. Ingledue replied
1 The sole owner of Service is Bud Ingledue
2 Herein called Operating Engineers
3 Bud Ingledue owned 298 of the corporation 's 300 shares
4 On June 13 , 1963, Service embarked on a substantial water pipeline project when it
contracted to do such work for the city of Macomb
5 As indicated below, , Lundgrin , another Service employee who was a member of the
Operating Engineers , left Service on October 12, 1963, and was not among those working
for the corporation.
1026 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
that he fully intended to operate both as an individual proprietor
and as a corporation and that he was willing to live up to his con-
tracts with both the Operating Engineers and District 50 .6
The Trial Examiner finds on the basis of Ingledue's testimony that
Wilson and Lundgrin were members of the Operating Engineers and
as such performed work covered by the Service contracts with that
organization. However, he also finds "inferentially," but without
sufficient supporting evidence, that there were other Service
employees who operated or maintained hoisting and portable ma-
chines and thus came within the description of the classifications
covered by the agreements with the Operating Engineers. The evi-
dence as to which corporation personnel performed work described in
the contracts between Service and the Operating Engineers is limited
to Ingledue's further testimony that he, the top management official,
and Wilson, who the record shows is a supervisor, were "about the
only ones that performed the hoisting and operating work" for the
corporation. The Trial Examiner nevertheless "infers on the record
as a whole" that other employees of the corporation also engaged in
the operation and maintenance of hoisting engines and portable
machine engines. - While the contract with District 50 does include in
its coverage the classification of "equipment operators," there is no
adequate evidence that any employees of the corporation engaged in
work covered by the contracts with the Operating Engineers.
It is clear from the foregoing that the General Counsel has not
proved by a preponderance of the evidence that the coverage of Dis-
trict 50's contract is coextensive with or overlaps the units set forth
in the agreements with Operating Engineers. We therefore find that
no violation occurred when Ingledue entered into an agreement with
District 50 to have that organization represent the unrepresented
employees of the corporation. In view.of Ingledue's uncontradicted
testimony concerning his willingness to bargain with that Union, we
also find that there was no unlawful refusal to bargain with the
Operating Engineers. Accordingly, we, shall order that the com-
plaint be dismissed.
[The Board dismissed the complaint.]
e Lundgrin , a member of the Operating Engineers , "quit" in protest against the alleged
refusal to bargain.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
This proceeding was heard before Trial Examiner Leo F. Lightner in Macomb,
Illinois, on June 2, 1964, on the complaint of the General Counsel and the answer, as
amended, of Bud Ingledue d/b/a Ingledue Excavation Service and Ingledue Excava-
tion Company , herein collectively referred to as Respondent .' The issues litigated
'A charge was filed on November 4, 1963 ; an amended charge was filed on November 20,
1963 , and a complaint was issued on March 3, 1964.
INGLEDUE EXCAVATION SERVICE, ETC. 1027
were whether the Respondent violated Section 8(a) (1), (2), (3), and (5) and Section
2(6) and (7) of the Labor-Management Relations Act of 1947, as amended, 61 Stat.
136, herein called the Act. The parties waived oral argument and briefs filed by the
General Counsel and Respondent have been carefully considered.
Upon the entire record, and from my observation of the witnesses, I make the
following:
FINDINGS AND CONCLUSIONS
1. THE BUSINESS OF THE RESPONDENT
At the outset of the hearing, Respondent amended its answer, the parties entered
into certain stipulations, and, except where otherwise indicated, the jurisdictional facts
set forth are not in dispute.
Bud Ingledue, an individual entrepreneur, is the sole owner of and, since 1954, has
been engaged in construction work under the name of Ingledue Excavating Service,
with his principal place of business at Macomb, Illinois. His office is in his home and
he maintains a separate garage and shop for the storage of materials and equipment.
Ingledue, at all times pertinent herein, has been engaged in the construction of water
and sewer pipelines, primarily in the area of Macomb, Illinois, including work per-
formed for the city of Macomb. In addition, Ingledue does general excavation work
for buildings, storm sewers, water mains, sanitary sewers, and landscaping. During
the year preceding the issuance of the complaint, a representative period, Ingledue
purchased, in the course and conduct of his business operations, trailers, pipe, and
other goods and materials valued in excess of $50,000, from suppliers located in
States of the United States other than the State of Illinois.
Ingledue Excavation Company was incorporated under the laws of the State of
Illinois, on September 19, 1963, with its principal place of business in Macomb,
Illinois. The office of the corporation is in the home'of Ingledue, and its equipment
and materials are stored and maintained in the same shop and garage used for that
purpose by the individual proprietorship. The corporation is engaged in construction
work and its principal business has been sewer and water main construction, general
building excavation, and landscaping. Of 250 shares of corporate stock which have
been issued Ingledue holds 248 shares, his wife holds 1 share, and Charles Conner,
who operates a bookkeeping and accounting service in Macomb, holds 1 share. The
same three were the incorporators and constitute the board of directors. Ingledue is
president of the corporation, Conner "believed" that he was vice president, and
Ingledue's wife, Harriet, is secretary of the corporation.
Respondent denies that the individual proprietorship and corporation constitute a
single integrated enterprise. Respondent denies that Ingledue formulates and admin-
isters the labor policy of the corporation. Respondent admits that the corporation
made certain purchases in the State of Illinois, some of which may have originated
out of the State of Illinois, but asserts that the total of such purchases originating from
without the State was not in the amount of $50,000. These contentions are next
considered.
The evidence does not establish, and the complaint does not allege, that the corpo-
ration, as a separate entity, purchased supplies and materials in the amount of $50,000
from without the State of Illinois. Rather, the complaint alleges that the activities of
the individual entrepreneur and the corporation constitute a single integrated business
enterprise.
Ingledue initially opened a checking account for the corporation in October 1963, by
withdrawing $1,000 from his individual business account. He acknowledged other
such deposits from his sole proprietorship account to the corporation, in the amount
of $2,000, on December 11, 1963, $7,000 on March 2, 1964, and $5,000 on March 16,
1964. In addition, Ingledue gave his personal note for bank loans to the corporation
in the amount of $3,000 on November 19, 1963, and $4,000 on November 30, 1963.
It is undisputed that none of these amounts have been repaid. Ingledue effected trans-
fers of equipment, formerly used in his sole proprietorship, to the corporation, but
was unable to relate the precise identity of the equipment so transferred Ingledue
related that the first two pieces of equipment were sold to the corporation for $10,000
on September 24, 1963. Additional equipment was transferred to the corporation,
from the individual proprietorship, inferentially in January and February 1964.
Ingledue was unable to relate the precise amount of the notes, purportedly executed
as payment for the equipment, which he related were held by an individual, having
been given by him as collateral for a cash loan. The record is obscure as to whether
the cash loan was used in his individual business or placed at the disposal of the
corporation. Additional equipment was transferred to the corporation by Ingledue
about the first part of April 1964, and a note was executed by Ingledue, as president
of the corporation, which Ingledue "believed" to be in the amount of about $7,000.
1028 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Each of these notes were executed by Ingledue as president payable to Ingledue as an
individual. No bills of sale, chattel mortgages, or contracts of sale were executed.
None of the indebtedness has been paid. The notes contain no specified due date,
but do provide for 5 percent interest. Ingledue was unable to either relate, or even
estimate , the approximate value of the equipment transferred to the corporation in
January, February, and April, 1964. While Ingledue estimated that the Service and
corporation had a total of between 10 and 15 trucks, he was uncertain as to how many
truck licenses were obtained for the corporation trucks in February 1964 and how
many for the individual proprietorship trucks, at that time. It may be inferred that
no new licenses were obtained for the corporate trucks prior to February 1964, if,
in fact, any trucks were transferred to the corporation prior thereto.
It is undisputed that a contract in the amount of $192,000 was entered into by
Ingledue, as an independent entrepreneur, with the city of Macomb, on June 13, 1963.
The contract covered an extension of water pipes for the supplying of water to the
university and some incidental water pipes. It is undisputed that this contract was
not completed when the corporation was formed and the unfinished work was sub-
contracted, by Ingledue, to the corporation, without a new performance bond being
required or supplied.
While set forth in more detail infra, it is undisputed that the employees who were
transferred to the corporate payroll on October 14, 1963, to work on this contract,
all formerly did the same work for the individual proprietorship, immediately prior
to said transfers. Ingledue acknowledged that after October 14, 1963, some of the
employees employed on the water contract installation, which had been so subcon-
tracted,'were carried on the payroll of the individual proprietorship. Ingledue
acknowledged that only two pieces of equipment were covered in the September 24,
1963, sale of equipment to the corporation. No other equipment appears to have
been transferred to the corporation prior to January 1964. It thus may be inferred,
and does not appear to be disputed, that such other equipment as may have been
needed for the conduct of the corporate enterprise activities was supplied, inferen-
tially without cost , by the individual proprietorship. This record contains no evi-
dence to the contrary.
Ingledue acknowledged that he made the decision as to which employees would
be transferred to the corporate payroll, and continued to pay said employees the
same rates of pay and provide the same working conditions. While Ingledue asserted
that he had empowered Foreman Wilson to hire and fire corporate employees, Ingle-
due acknowledged that he followed seniority, provided the employee was able to do
the requisite work, in the matter of layoffs. Ingledue acknowledged that no one
could change his labor policies without clearing with him.
The initial corporate minutes of the board of directors reflect that Ingledue, as
president, was vested with complete authority to enter into: such construction con-
tracts "as he deems necessary"; to purchase specified equipment on such terms "as
he deems necessary"; and to arrange for leasing or renting of equipment and materials
with authorization to pay for, accept payment, or arrange such terms of credit "as he
deems necessary." General Counsel contends these and other corporate minutes, of
the board of directors, vested blanket authority in Ingledue for the transfer of thou-
sands of dollars of equipment if and when Ingledue saw fit to make the transfer, and
to extend credit without prior or subsequent control as to his decisions. I so find.
Accordingly, for the reasons set forth, I find that the individual proprietorship and
the corporation constitute a single integrated business enterprise, that they are affili-
ated businesses with common ownership, and that Ingledue formulates and admin-
isters a common labor policy, there is common management and supervision and an
interrelation of operations. I further find the corporation is the alter ego of the
individual proprietorship. P-M Garages, Inc., et al., d/b,/a P-M Parking System,
139 NLRB 987; Ethel Fistere, an individual, t/a Arthur Murray Dance Studios, 100
NLRB 1303.
Accordingly, I find that Respondent Corporation and Respondent Ingledue is a
single employer engaged in commerce within the meaning of Section 2(6) and (7)
of the Act.2
IT. THE LABOR ORGANIZATIONS INVOLVED
Local 649, International Union of Operating Engineers , AFL-CIO, herein called
Operating Engineers, and District 50, United Mine Workers of America, herein
called District 50, are labor organizations within the meaning of Section 2(5) of
the Act.
IN L.R.B. v. Deena Artware, Inc., 361 U.S. 398; Oilfield Vaintenance Co., Inc., and
Oilfield Maintenance & Engineering Co., Inc., 142 NLRB 1384,
INGLEDUE EXCAVATION SERVICE, ETC.
IIl. THE ALLEGED UNFAIR LABOR PRACTICES
1029
A. The issues
The principal issues raised by the pleadings, as amended, and litigated at the hear-
ing are whether the Respondent: (a) commencing on or about October 14, 1963, and
thereafter engaged in a refusal to bargain collectively with the Operating Engineers
in violation of the provisions of Section 8(a)(5) and (1) of the Act; or (b) com-
mencing on or about October 10, 1963, and continuing thereafter, rendered unlawful
aid, assistance, and support to District 50 in violation of the provisions of Section
8(a)(2) and (1) of the Act; or (c) by entering into an agreement with District 50,
on October 10, 1963, and failing and refusing to make contributions to the Operating
Engineers health benefit plan, Respondent engaged in conduct violative of Section
8 (a) (5), (3), and (1) of, the Act. Respondent generally denied the commission of
any unfair labor practices.
B. The appropriate unit
It appears undisputed, and I find, the following employees of Respondent consti-
tute a unit appropriate for the purpose of collective bargaining within the meaning
of Section 9(b) of the Act:
All employees engaged in the operating and maintenance of hoisting and portable
machinery and engines used on: (a) open'and heavy construction work, and machin-
ery, engines, motors, 'boilers, and pumps used at asphalt or blacktop mixing plants,
and, (b) all kinds of building, wrecking, repairing, excavation and construction
work, in and around McDonough County, Illinois, but excluding office clerical
employees, guards, all other employees, and supervisors as' defined in the Act.
C. Background and sequence of events
Except as noted there is no dispute as to the sequence of events herein set forth.
During the period from an unspecified date in 1954 to and including the time of
the hearing herein, on June 2, 1964, Ingledue engaged in the construction of water
and sewer pipelines, general excavating, and landscaping as an independent entre-
preneur. On July 13, 1963, Ingledue and the Operating Engineers entered into' a
collective-bargaining agreement covering work commonly classified as building con-
struction, being identical to an agreement previously negotiated between Peoria
Building Contractors 'Association, AGC, and the Operating Engineers. On the same
date, July 13, 1963, Ingledue and the Operating Engineers entered into a collective-
bargaining agreement covering highway and heavy construction work, being identi-
cal to an agreement previously entered into between Western Illinois Contractors
Association, AGC, and the Operating Engineers. These agreements were effective
as of May 1, 1963, and both agreements provided that they would remain in effect
until April 30,- 1966, with options thereafter. Ingledue is not a member of AGC.
Ingledue acknowledged that he had seen prior contracts between the respective asso-
ciations and the Operating Engineers but could not recall if he had ever previously
become a signatory. Ingledue acknowledged that it had been'his practice prior to
July 1963 to call the office of Local 649, Operating Engineers, in the spring, for
referrals of men to operate his equipment. Ingledue acknowledged that the men
operating the equipment prior to such time were ";Operating Engineers." I find it
reasonable to infer that they were members of the Operating Engineers Union. Ingle-
due acknowledged that he is, and has been for 10 years, a member of the Operating
Engineers, and that in the course of operating his business he operated equipment that
would normally be operated by operating engineers.
The collective-bargaining agreements entered into on July 13, 1963, cover work
performed in a number of counties in the State of Illinois, including McDonough,
in which the city of Macomb is situated. The agreements cover employees employed
by Respondent engaged in operating and maintenance of hoisting portable machinery
and engines used on: (a) open and heavy construction work and machinery, engines,
motors, boilers, and pumps used at asphalt or blacktop mixing plants, and (b)
all kinds of building, wrecking, repairing, excavating, and construction work. The
agreements contain a.union-shop provision. The agreements also contain a provision
that the employer will contribute 10 cents for each hour worked (by each employee)
into a health benefit plan, which is further discussed infra.
Ingledue acknowledged that Gene Wilson and Lundgrin, who were employed by
Ingledue prior to October 14, 1963, were members of the Operating Engineers.
Inferentially there were other employees of Ingledue, identity not specified, who
operated or maintained hoisting and portable machinery and thus came within the
description of employees covered by the collective-bargaining agreements.
1030 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
On September 19, 1963, Ingledue Excavation Company was organized as a corpo-
ration. The incorporators were Ingledue, his wife, and Charles Conner. Ingledue
holds 248 of 250 shares of stock, his wife holds 1 share, and Conner the other share.
The three named constitute the board of directors. Ingledue is president and his wife
is secretary of the corporation. The office of the corporation is located in Ingledue's
home, as is his office for his individual activities. The same shop and garage is used
for corporate storage of materials and maintenance of equipment as that used by
Ingledue, for the same purposes, for his individual activities. Immediately prior to
incorporation, and for a short period thereafter, Ingledue, as an independent entre-
preneur, was engaged, among other things, in an extension of water pipes for the
supplying of water to the university in the city of Macomb. This work was being
performed under a contract in the amount of $192,000, entered into between Ingledue
and the city of Macomb on June 13, 1963. Thereafter on or about October 7, 1963,
Ingledue obtained permission from the city council to sublease the remaining work
to the corporation. This appears to have been the initial activity of the corporate
employees. Ingledue's individual performance bond was not substituted with a cor-
porate performance bond.
Ingledue asserted that about the time of incorporation he mentioned the fact of
incorporation to one or two of his employees, unidentified. Shortly thereafter,
according to Ingledue, he was approached by Gene Wilson, John Kreps, Tom Murfin,
and Larry Foxall, who inquired if they could go to work for the corporation. Ingle-
due asserted that he responded that they could, if and when the corporation acquired
any work. Ingledue stated that about September 25, the named employees again
approached him and were accompanied by Frank Weistart, representative of District
50, United Mine Workers. Ingledue related that the employees inquired as to
Ingledue's attitude toward their joining District 50, and if Ingledue would still put
them to work for the corporation in the event they did join. Ingledue asserted that
he advised the employees that it was entirely their choice as to what union, if any,
they joined, that he would put them to work if and when the corporation acquired
work. Ingledue, however, was inconsistent in his recitation of the events of Septem-
ber 25, in that he acknowledged that Weistart produced authorization cards signed
by the named employees at that time. Ingledue acknowledged the only other meeting
he had with Weistart was on October 10, 1963. It is undisputed that the named
employees were employed by Ingledue as an individual on September 25 and did not
become corporate employees until October 14, 1963.
On October 10, 1963, Ingledue signed a collective-bargaining agreement, on behalf
of the corporation, with District 50. The agreement provides, inter alia: Recogni-
tion of District 50 "as the sole collective bargaining agency for all employees who
are now members of District 50"; a union-shop provision; the term of the agreement
is October 1, 1963, to October 31, 1965, with options thereafter; and wage rates pro-
vided include a classification of "equipment operators."
Wilson, Foxall, Kreps, and Murfin were the only employees transferred from the
payroll account of the independent entrepreneur, to the corporate payroll com-
mencing Monday, October 14, 1963. On October 12, 1963, Gene Wilson was
advised that he would be a supervisor with the right to hire and fire as a corporate
employee. Ingledue acknowledged that these employees continued to do the same
work, on the water lines, as they had been performing for the sole proprietorship
"to a certain degree." Ingledue explained his qualifying words to mean that while
each employee previously had worked only in a particular classification, under the
District 50 agreement, "they were free to do more classifications." Ingledue asserted
there were some classifications where the employees drew different amounts of money
and those who were able to do all kinds of work received whatever pay the specific
classification required. Ingledue described the work done by these employees as
machine operating, labor work, truckdriving, carpentry, masonry, plumbing, and
electrical work. While Ingledue asserted that he and Gene Wilson "are about the
only ones that perform the hoisting and operating work," it is reasonable to infer
on the record as a whole that other employees engaged in the operation and main-
tenance of hoisting and portable machines and engines. I find accordingly.3
s In so finding I am mindful of Ingledue's assertion that under the individual proprietor-
ship each employee would do primarily one particular kind of a job, while among the
employees of the corporation no employee merely operated and maintained hoisting and
portable machinery and engines and did nothing else, or did mostly that and nothing else.
Ingledue was queried as to whether all of his corporate employees, except Ingledue and
Wilson, "performed little work that involves operating and maintenance of hoisting and
portable machinery and engines." Ingledue confined his answer to operating as distin-
guished from maintenance.
INGLEDUE EXCAVATION SERVICE, ETC. 1031
Ingledue acknowledged- that three employees,' identified as' Bill Shoemate, Sam
Logan, and Bill Shaffer, were engaged in activities being performed by the corpora-
tion, inferentially commencing October 14, 1963, but were continued on the payroll
of the individual proprietorship until about the middle of April 1964. Ingledue was
asked if it was his decision as to which account the employees would be paid from.
Ingledue responded that he had authority to write the check, and "if you make 'a
mistake, you have to live with it after you make it." Ingledue'acknowledging that
Shoemate was working for the corporation, but carried on the payroll of the indi-
vidual proprietorship and gave as reasons therefor: "Probably because we were
either afraid of the prior investigations by the National Labor Relations Board, or
else we were short of money in the corporate fund-he' is a truckdriver and I felt
that if I was short of money any place, I could carry him in the Service (Ingledue
Excavation Service) account the easiest and the best." Ingledue listed Logan and
Shoemate as being among the eight corporate employees who were given a Christmas
present, by the corporation, at Christmas time, 1963, further evidence that they were
in fact corporate employees.
It is undisputed that no payments were made to the Operating Engineers by Ingledue
or the corporation, for corporate employees, at any time after,the corporation was
organized, for the health benefit plan, as provided in article 21 of the Operating Engi-
neers agreements.
It is undisputed that on October 14, 1963, McCormick, business agent of Local 649,
Operating Engineers, met with Ingledue. Ingledue first denied, but later admitted,
that McCormick requested Ingledue to bargain with the Operating Engineers relative
to the work being done by the corporation formerly covered by the contract between
Ingledue and the Operating Engineers. Further meetings were held between McCor-
mick and Ingledue on October 16 and November 4, 5, or 6, to no avail. Ingledue
related that at the latter meeting a request was made for him to forget about the
corporation and go back to his former way of operating. Ingledue related that he
responded that he had never ceased to operate as an individual entrepreneur and that
he fully intended to operate both as an individual and as a corporation. Ingledue
acknowledged advising McCormick, at the November meeting, that his reason for
forming the corporation was for tax purposes and limitation of personal liability.
It is patent that Ingledue refused to bargain. Ingledue asserted that he informed
McCormick that he could not bargain on behalf of the corporation, because the cor-
poration had already signed a contract with District 50 at the employees' request.
Ingledue acknowledged that the corporation had no employees at,the time it signed
the District 50 agreement on October 10, 1963.
Ingledue, under his sole proprietorship, placed a bid in September, and obtained
a contract October 5, 1963, with the city of Macomb for the performance of work
involving sewers for water pollution control. The contract was in the amount of
$58,815. It was stipulated that Federal and State funds 'were involved. Ingledue
first denied, then later admitted, that he attempted to arrange for the subleasing of
this contract to the corporation. His asserted reason for this effort was that the
Operating' Engineers had advised him that they would refuse to supply men to the
individual proprietorship, inferentially because of Ingledue's refusal to bargain rela-
tive to the corporation work, formerly performed by the individual proprietorship
under the Operating Engineers agreements. It appears undisputed that when Ingle-
due refused -McCormick's request, on October 14, 1963, Lundgrin, a member of the
Operating Engineers, walked off the job.
The corporate minutes of September 24, 1963, reflect that Ingledue, as president,
was authorized to enter into such contracts for the performance of work "as he deems
necessary." In the same minutes, Ingledue was authorized to purchase one HD6
endloader and one Bantam crane, and to arrange the essential credit for said pur-
chases. He was also authorized to lease or rent truck or excavating equipment. No
other purchases of equipment are reflected in this record prior to January 1964. It
is patent that when Ingledue subcontracted his water main contract with the city of
Macomb to the corporation, he not only transferred some employees to the corporate
payroll, but retained others on his individual payroll while they were doing corporate
work, at the same time he used trucks and other equipment owned by his individual
proprietorship in the corporate activity and vice versa. Ingledue asserted that he had
blanket authority to determine what contracts the corporation would undertake, and
the minutes of September 24, 1963, appear'to support his statement. Similarly,
Conner's admission that "I wouldn't have any idea at all" what work the corporation
was undertaking or performing, is indicative of the absence of any reports by Ingle-
due to the board of directors. There was not only a commingling of the two business
operations in terms of personnel and equipment but also of cash and credit arrange-
ments. In the latter category the record reflects among other things: that equipment
1032 DECISIONS OF NATIONAL .LABOR RELATIONS BOARD
was transferred to the corporation in exchange for notes signed by Ingledue as presi-
dent, payable to Ingledue as an individual, without a contract of sale, bill of sale, or
chattel mortgage; Ingledue gave his personal note as security for corporate loans;
Ingledue pledged„as collateral for loans, notes payable from the corporation to him
as an individual, with the use of the funds thus obtained obscure; and Ingledue paid
corporate employees, for work performed, out of his individual business account,
for a period of months. Neither Ingledue or, Conner, his accountant, could relate
what equipment had been transferred to the corporation and what had been retained
by the proprietorship. It thus appears that 'the corporate activity was the alter ego
of the individual proprietorship, to the extent the corporation succeeded the individual
proprietorship in the activities in which the corporation engaged. I find accordingly .4
In spite of Ingledue's many efforts of evasion of direct answers, it is clear from the
record that Ingledue alone controlled the labor relations policy of both his independ-
ent enterprise and the corporation.5
Concluding Findings
General Counsel asserts that- the issues may be summarized as'follows: ( a) can
a sole proprietor avoid his duty to bargain under existing contracts, by forming a
corporation, and (b) is the contract between the corporation and District 50 valid.
General Counsel urges that both answers should be in the negative. I agree.
I have found, supra, that the Respondent is a "single employer" for jurisdictional
purposes. The principal factors which the Board has considered relevant in deter-
mining the extent of integration are: (1) interrelation of operations, (2) centralized
control of labor relations, (3) management„and (4) common ownership of financial
control. P-M Garages, Inc., et al., d/b/a P,-M Parking System, 139 NLRB 987;
Sakrete of Northern California, Inc., 137 NLRB 1220. The facts herein disclose
that: `The operations of both entities are identical'and are managed by Ingledue
alone; Ingledue establishes the labor policy for both operations; Ingledue 'owns both
companies and.has financial control over both, as reflected by the cash and credit
transactions in which he engaged; and Ingledue had the corporation undertake the
performance of work, by subcontract, which had been undertaken by the proprietor-
ship, with an interchange of equipment and personnel, with a commingling of assets,
and without any new performance bond being supplied.
The Board has held that a sole proprietorship and corporate entity can be found
to be an integrated operation when the elements set forth exist. Ethel Fistere, an
individual, t/a Arthur Murray Dance Studios, 100 NLRB 1303. The Supreme Court
has stated that it is proper to consider an employer as one integrated operation where
supposedly different entities are merely paper 'arrangements that do not reflect the
business realities. N.L.R.B. v. Deena Art ware, Inc., 361 U.S. 398. One observa-
tion of the Supreme Court appears particularly applicable to the facts revealed in the
instant record, to wit: "The affairs of the group may be so intermingled that no
distinct corporate lines are maintained." Id. at 403.
.General Counsel urges that in a Board decision, with substantially the same factual
situation as the instant case, the newly organized corporation was found to be an
integrated operation and the alter ego of a previously existing company. In that case,
for reasons explicated therein, the Board found the execution of a collective-bargain-
ing agreement with the Oil ' Workers, when existing contracts with craft unions had
not expired to be conduct constituting violations of the Act. Specifically the Board
found: that the extending of recognition and entering into a collective-bargaining
agreement with the Oil Workers to be violative of Section 8(a)(2) and (1); that by
requiring membership in the Oil Workers as a condition of employment was viola-
tive of Section 8(a)(3) and (1); and that the withdrawal of recognition from labor
organizations, at a time when'the Respondents were bound to continue such recog-
nition under valid, existing contracts, and by failing to' maintain such contracts in
effect for the remainder of their terms was violative of Section. 8(a) (5) and (1).
Oilfield Maintenance Co., Inc., et al., 142 NLRB 1384.
4 Further evidence, if needed, is Ingledue' s admission that he personally placed bids
for water pipe work with the city of Petersburg, in December 1963, and that the corpora-
tion would undertake performance.
5 While it is undisputed that Wilson had authority to hire and fire, Ingledue acknowl-
edged that as president he would approve anyone hired or fired , that when Wilson hired
anyone he brought them to Ingledue, who would approve Wilson's action. Similarly,
Ingledue acknowledged that no one could change his labor policy decisions once he had
'enunciated them, without clearing with Ingledue.
INGLEDUE EXCAVATION SERVICE, ETC.' 1033
I have found supra, on the basis of undisputed evidence, that Ingledue entered into
collective-bargaining agreements, on,July 13, 1963, with the Operating Engineers,
which agreements by their terms do not expire until April 30, 1966., These agree-
ments contain a union-shop provision, and by their terms cover some, if not 'all, of
the Respondent's employees. Ignoring the obligations so undertaken, Ingledue, on
September 25, 1963, accorded recognition to, and on October 10, 1963, entered into
an agreement with, District 50 as president of the corporation. This agreement was
entered into, admittedly, at a time when the corporation had no employees. Ingle-
due's assertion that he signed this agreement at the request of employees must be
found to be without merit. Ingledue's effort to justify his conduct on the ground
that the employees soliciting the action were in fact the employees subsequently trans-
ferred to the corporate payroll requires a further observation. It is noted that three
employees who were engaged in corporate work were not transferred to the corporate
payroll, until many months later; and one of the four employees whom.Ingledue
asserts approached him was, according to Ingledue, made a supervisor-'when he
became a corporate employee. The District 50 agreement also contains a union-shop
provision and ostensibly includes "equipment operators," a classification which it
may be inferred was included in the Operating Engineers agreement. I have also
found, supra, that on October 14, 1963, and thereafter, McCormick requested Ingle=
due to bargain relative to the work being performed by the corporation, which came
within the purview of the Operating Engineers agreement. It is undisputed that
Ingledue refused to bargain. It is undisputed that Ingledue failed to make any pay-
ments, on behalf 'of corporate' employees, to the Operating Engineers health benefit
plan, in accordance with the contractual undertaking. General Counsel contends that
Respondent's conduct encouraged membership in District 50 and discouraged mem-
bership in the Operating Engineers. I concur.
Accordingly, on the basis of the record as a whole, I conclude and find: that by
withdrawing recognition from the Operating Engineers, and failing to conform with
the conditions of a valid, existing contract, by failing to maintain such contracts in
effect for the remainder of their terms, and by refusing to bargain, Respondent vio-
lated Section 8(a)(5) and (1) of the Act; that by requiring membership in District 50
as a condition of employment, Respondent violated Section 8(a)(3) and (1) of the
Act; that in recognizing and assisting District 50, by extending recognition to and
contracting with it, Respondent violated Section 8(a) (2) and (1) of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of the Respondent set forth in section III, above, occurring in con-
nection with-Respondent's operations described in section I, above, have a close, inti-
mate, and substantial relationship to'trade, traffic, and commerce among the several
States, and, such of them as have been found to constitute unfair labor practices, tend
to lead to labor disputes obstructing commerce and the free flow of commerce.
V. THE REMEDY
Having found that the Respondent has engaged in and is engaging in certain unfair
labor practices , it will be recommended that it cease and desist therefrom and take
affirmative action designed to effectuate the policies of the Act.
It will be recommended that Respondent, upon request , bargain collectively with
Local 649, International Union of Operating Engineers , AFL=CIO, as the exclusive
representative of all employees in the unit herein found to be appropriate for the
purpose of collective bargaining ; that Respondent withdraw and withhold recognition
of District 50, United Mine Workers of America, as the collective -bargaining repre-
sentative of all employees in the unit herein found to be appropriate for the purposes
of collective bargaining , unless and until such labor organization shall have been
certified by the National Labor Relations Board; that Respondent cease giving effect
to the October 10, 1963, contract , with, District 50, or any supplement , extension, or
renewal thereof ; because the contract, by requiring membership in District 50, as a
condition of employment , unlawfully restrained and coerced the employees in the
exercise of the rights guaranteed in Section 7 of the Act, it will be recommended that
all employees who paid moneys to District 50 after recognition and the signing of
this contract , be reimbursed by the Respondent for initiation fees, dues, or assess-
ments, with interest at the rate of 6 percent per annum ; 6 that Respondent make such
health benefit plan payments to Local ' 649, International Union of Operating Engi-
8 Seararers International ' Union of, North America, Great Lakes District , AFL-CIO,
138 NLRB 1142. 1
1034 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
neers, AFL-CIO, for the employees covered by said unions agreements and for whom
Respondents would have made such contributions had Respondent not abrogated
said agreement.
In view of the nature of the unfair labor practices committed, the commission of
similar and other unfair labor practices reasonably may be anticipated. I shall there-
fore recommend that the Respondent be ordered to cease and desist from in any
manner infringing upon rights guaranteed to its employees by Section 7 of the Act.
Upon the foregoing findings of fact, and upon the entire record in the case, I make
the following:
CONCLUSIONS OF LAW
1. Respondent is engaged in commerce within the meaning of Section 2(6) and
(7) of the Act.
2. Local 649, International Union of Operating Engineers, AFL-CIO, and Dis-
trict 50, United Mine Workers of America, are labor organizations within the mean-
ing of Section 2(5) of the Act.
3. All employees employed by Respondent and engaged in the operating and main-
tenance of hoisting and portable machinery and engines used on: (a) open and heavy
construction work and machinery, engines, motors, boilers, and pumps used at asphalt
or blacktop mixing plants, and (b) all kinds of building, wrecking, repairing,
excavation, and construction work in and around McDonough County, Illinois, but
excluding office clerical employees, guards, all other employees, and supervisors as
defined in the Act, constitute a unit appropriate for the purpose of collective bargain-
ing within the meaning of Section 9 (b) of the Act.
4. Local 649, International Union of Operating Engineers, AFL-CIO, is, and at
all times commencing and since July 13, 1963, has been, the exclusive representative
of all employees in the aforesaid appropriate unit for the purpose of collective bar-
gaining within the meaning of Section 9(a) of the Act.
5. By failing and refusing at all times, commencing and since October 14, 1963, to
bargain with Local 649, International Union of Operating Engineers, AFL-CIO, as
the exclusive bargaining representative of employees in the appropriate unit, and by
failing to conform with the provisions of the contracts of July 13, 1963, relative to
payments as to the health benefit plan, as therein provided, and by otherwise failing
to maintain such contracts in effect for the remainder of their terms, Respondent has
engaged in and is engaging in unfair labor practices within the meaning of Section
8(a)(S) and (1) of the Act.
6. By recognizing and entering into a contract with District 50, United Mine
Workers of America, Respondent has contributed support and assisted District 50
and has interfered with, restrained, and coerced employees in the exercise of rights
guaranteed in Section 7 of the Act in violation of Section 8(a) (2) and (1) of the Act.
7. By entering into a contract with District 50, United Mine Workers of America,
requiring membership in that organization as a condition of employment, Respondent
has discriminated in regard to hire or tenure of employment to encourage member-
ship in District 50 and to discourage membership in Local 649, International Union
of Operating Engineers, AFL-CIO, and thus has engaged in unfair labor practices
within the meaning of Section 8 (a) (3) and (1) of the Act.
8. The aforesaid labor practices are unfair labor practices affecting commerce
within the meaning of Section 2(6) and (7) of the Act.
[Recommended Order omitted from publication.]
The Baugh Chemical Company and Industrial Union of Marine
and Shipbuilding Workers of America , AFL-CIO, Petitioner.
Case No. 5-RC-4554. January 14, 1965
DECISION ON REVIEW
On July 17, 1964, the Regional Director for Region 5 issued a
Decision and Direction of Election' in the above-entitled proceeding.
'On August 18, 1964, the Regional Director, issued an order denying a motion for
reconsideration filed by the Petitioner on July 27, 1964.
150 NLRB No. 103.