Laurels Hotel and Country Club

National Labor Relations Board - Board Decisions

Sep 21, 1971

193 N.L.R.B. 241 (N.L.R.B. 1971)

L.C.C. RESORT, INC.
L.C.C. Resort, Inc. d/b/a Laurels Hotel and Country
Club and Local 343, Hotel & Restaurant Employees
and Bartenders Union, AFL-CIO. Cases
3-CA-2950,-2, -3, -4, -6,-7,-8,-9,-10,-11, -12,
-15, -16, and -17
September 21, 1971
SUPPLEMENTAL DECISION AND
ORDER
BY CHAIRMAN MILLER AND MEMBERS
FANNING, JENKINS, AND KENNEDY
On March 26, 1971, Trial Examiner Joseph I.
Nachman issued a Supplemental Decision, attached
hereto, finding that specific amounts of backpay be
awarded to certain employees of the Respondent.'
Thereafter, the Respondent filed exceptions to the
Trial Examiner's Supplemental Decision and a
supporting brief and the General Counsel filed
exceptions to the Trial Examiner's Supplemental
Decision.
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 Supplemental Decision,2 the exceptions
and brief, and the entire record in these cases, and
hereby adopts the findings, conclusions, and recom-
mendations of the Trial Examiner, as modified
below.3
SUPPLEMENTAL ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board hereby orders that the Respondent,
L.C.C. Resort, Inc. d/b/a Laurels Hotel and Country
Club, its officers, agents, successors , and assigns, shall
i On April 8, 1968, the National Labor Relations Board issued a
Decision and Order in which the Board directed the Respondent , inter aha,
to offer each of the eight employees full reinstatement to his former or
substantially equivalent position , and make each whole for any loss of pay
suffered by reason of Respondent 's discrimination 170 NLRB 1140
Thereafter , Respondent entered into a stipulation with the General
Counsel that the latter should institute a backpay proceeding and, after a
decision by a Trial Examiner as to the amount of backpay due, that issue
would be subject to review by the Board , and, should judicial proceedings
thereafter become necessary , the only issue before the appellate court
would be the correctness of the backpay computations , Respondent
conceding that the Board's Order of April 8 , 1968, was in all respects valid
and proper On May 11 , 1970, the General Counsel issued his backpay
specifications Subsequently , deeming the Respondent 's answer thereto
insufficient , the General Counsel on June 18 , 1970, moved for an order
that the specifications be deemed true, that the affirmative defenses be
stricken , and for summary judgment After issuance of an Order To Show
Cause and considering the responses thereto in light of the pleadings, Trial
Examiner William W . Kapell, on August 12, 1970 , issued a Decision on the
General Counsel 's motion , in which he recommended that, as the
Respondent had affirmatively alleged in its answer that the discriminatees
failed to seek available interim employment and that they absented
themselves from Respondent 's geographical area during part of the
241
make the employees involved in this proceeding
whole by payment to them of the amounts set forth
opposite their names in the Supplemental Order in the
Trial Examiner's Supplemental Decision attached
hereto.
CHAIRMAN MILLER, dissenting:
In my view, the backpay computation with respect
to employee Sturm is contrary to logic and to Board
precedent. Sturm is eligible for backpay during the
second and third quarters of 1966. On June 10, 1966,
Sturm shipped out on a passenger vessel and was so
employed until July 7. He was paid in full for his
services on the voyage at the completion of the
voyage, and the entire sum was credited as interim
earnings for the third calendar quarter. The Respon-
dent excepts to that treatment of Sturm's earnings and
argues, alternatively, that the wages should either be
pro-rated or that Sturm should be treated as unavaila-
ble for work from June 10 until the end of the quarter.
The Trial Examiner rejected both arguments and
held, in effect, that Sturm was available for work,
unemployed, and eligible for backpay during the 20
days he was at sea. The majority affirms that
determination.
Although no objection can be made to the practice
of crediting interim earnings in the quarter when
received, it seems ill advised to treat as available for
work a man who is actually employed full time in a
job distinguished only by the fact that compensation
will be deferred, and Board precedent is to the
contrary. Brown and Root, Inc., 132 NLRB 486,
involved the problem of interim earnings for an
employee whose sole employment after discharge was
farming. The employee worked his farm, planted
crops, and reported no income in any quarter other
than the quarter in which the crops were harvested
and marketed. The Trial Examiner held that the
employee should be credited with interim earnings
backpay period, a hearing be held to afford the Respondent an opportunity
to examine the discrimmatees in support of its affirmative defenses On the
same date the Board issued an order transferring the case to the Board.
Subsequently, on August 24, 1970, the Board issued an order rescinding its
order transferring the case , and the matter was returned to the Regional
Director for Region 3 to comply with Section 102 26 of the Board's Rules
and Regulations.
2 In addition to adopting the Trial Examiner's reasons for crediting
Joachim Sturm's earnings for work performed between June 10 and July 7
to the third quarter of 1966, we are of the opinion that the question of
whether one formula of computation is preferable to another does not turn
on the question of whether the computation favors the employer or the
employee That could change from case to case . Sound administrative
practice, we believe, requires that we adhere as a matter of policy to the
Social Security Administration' s practice in this area and not attempt to go
behind their policy Were we to accept the Employer' s argument here we
would be creating very difficult compliance problems for our Regional
Offices by attempting to go behind social security reports and determine
when wages were earned rather than when they were received
3 We do not adopt the Trial Examiner 's findings that counsel for
Respondent also appeared before the Board as counsel for Grossinger's in
a prior matter before the Board , as it is not supported by the record.
193 NLRB No. 26
242 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
only for the calendar quarter in which he realized
income from the sale of crops. Supra, 534. The Board
expressly disavowed that means of computation and
in an effort to assign some reasonable value to the
employee's farm labors, credited him with an amount
"equal to the average Arkansas farm laborers' income
during the period [he] worked on this farm." Supra,
500.
The only feature which distinguished Sturm's
situation in the instant case is that the record discloses
the amount of his interim earnings and, therefore, no
fictional computation is necessary. The Brown and
Root case seems clearly to require either that Sturm's
earnings be pro-rated or that he be treated as
unavailable for work after June 10 of the second
quarter.
While utilizing records as to actual receipt of
earnings in any given quarter normally provides a
convenient administrative technique for making
backpay computations and works no basic injustice,
where it is demonstrated that the use of that rule of
thumb produces an illogical and substantially errone-
ous result, we should not hesitate to make an
appropriate adjustment. Here we have not only a
showing that our rule of convenience does not fit the
facts of the case but we also have all the facts
necessary to make the required adjustment. In my
view, the majority errs in ignoring this set of
circumstances and instead permitting a mechanistic
application of a practice which, in this case, has been
shown to operate unfairly and illogically.
TRIAL EXAMINER'S SUPPLEMENTAL
DECISION
STATEMENT OF THE CASE
JOSEPH I . NACHMAN , Trial Examiner : This proceeding to
determine backpay was tried before me at Monticello, New
York, with all parties present and represented , on October
13, 14, and 15, and on November 9 and 10 , 1970, on the
General Counsel 's Backpay Specifications issued May 11,
1970.1 At the trial all parties were afforded full opportunity
to adduce relevant evidence , to examine and cross-examine
witnesses , to argue orally on the record , and to submit
briefs . Oral argument was waived . Briefs submitted by the
, On December 3, 1970, I issued an order reopening the record solely
for the purpose of receiving a stipulation of the parties with respect to the
number of employees in the classifications here involved hired by
Kiamesha Concord, a competitor of Respondent , during the backpay
period . The stipulation has been marked "Trial Examiner's Exhibit I," and
filed with the record.
2 In one respect the transcript herein needs explanation because it does
not, and cannot fully, reflect what actually happened . At page 534 of the
transcript General Counsel's representative was speaking to some position
he was urging . As the transcript reflects, Respondent's counsel interrupted
the General Counsel to assert his objection to General Counsel's remarks.
What the transcript does not reflect is that when counsel for Respondent
arose he pounded the metal table at which he was seated with either his fist
or the palm of his hand and made his remarks in a shouting voice. It was
because of this conduct that I told counsel to sit down and be quiet until
General Counsel and Respondent, respectively, have been
duly considered.
Upon the entire record in the case,2 including my
observation of the demeanor of the witnesses while
testifying, I make the following:
FINDINGS OF FACT
Background and Settings of the Issues
On April 8, 1968, the Board adopted (with modifications
not here material) the findings, conclusions , and recom-
mendations of Trial Examiner Ricci that L.C.C. Resort,
Inc., d/b/a Laurels Hotel and Country Club (herein
Respondent or Company), violated Section 8(a)(3) and (1)
of the National Labor Relations Act, as amended (herein
the Act), by discriminatorily discharging eight employees.
By way of remedy, the Board directed Respondent inter alia
to offer each of the eight employees full reinstatement to his
former or substantially equivalent position, and make each
whole for any loss of pay suffered by reason of
Respondent's discrimination. 170 NLRB No. 113.3
On May 11, 1970, the General Counsel issued his
Backpay Specifications.4 On June 8, 1970, Respondent filed
its answer to the Backpay Specifications, denying the
allegations thereof, putting the General Counsel to his
proof, and affirmatively alleging that each discriminatee
failed to use reasonable diligence in seeking work during
the backpay period and that, had such diligence been used,
the interim earnings of each employee, in each quarterly
period, would have at least equaled the pay they would
have earned had they not been discriminatorily discharged
by Respondent. Deeming Respondent's answer insuffi-
cient, the General Counsel, on June 18, 1970, moved for an
order that the Specifications be deemed true, that the
affirmative defenses be stricken, and for summary judg-
ment. After issuance of an order to show cause and
considering the responses thereto in light of the pleadings,
Trial Examiner Kapell, on August 12, 1970, issued a
Decision on the General Counsel's motion, holding that
Respondent's general denial of the formula pursuant to
which the General Counsel computed the gross backpay
did not conform to the requirements of Section 102.45 of
the Board's Rules and Regulations, that the motion to deem
the allegations of the Specifications with regard to the
computation of gross backpay be granted, and that
Respondent be "precluded from introducing any evidence
controverting said allegations of the Specifications."
Additionally, Trial Examiner Kapell concluded:
he was given an opportunity to reply. Another example of counsel's
behavior at the trial was his threat to filibuster the trial , apparently because
he was not happy with a ruling I made . See transcript page 392.
3 No proceeding for enforcement or review of the Board's Order was
instituted . Instead , Respondent entered into a stipulation with the General
Counsel that the latter should institute a backpay proceeding and, after a
decision by a Trial -Examiner as to the amount of backpay due, that issue
would be subject to review by the Board ; and, should judicial proceedings
thereafter become necessary, the only issue before the appellate court
would be the correctness of the backpay computations, Respondent
conceding that the Board 's Order of April 8, 1968 , is in all respects valid
and proper.
4 By letter dated June 7, 1968 , Respondent offered each discriminatee
reinstatement as of July 1, 1968. Only Hartmut Sturm accepted
reinstatement.
L.C.C. RESORT, INC.
It appears, however, that Respondent has affirma-
tively alleged in its answer that the discriminatees failed
to seek available interim employment, and that they
absented themselves from Respondent's geographical
area during part of the backpay period. The law is well
settled that the employer must establish such defenses
by the preponderance of the evidence.5 These matters,
however, arewithin the knowledge of the discriminatees,
not the employer. W bile the employer must raise this issue
in his answer in mitigation of damages, it does not
follow that he should be required to come forward with
evidence by producing the discriminatees. Nor would it
be a great hardship on the General Counsel to produce
them. I, therefore, conclude that Respondent should be
afforded an opportunity to examine the discriminatees
at a hearing in support of its affirmative defenses, and
that the General Counsel should produce them for that
purpose. . .. It, accordingly, follows that the motion to
strike the alleged affirmative defenses should be, and
hereby is, denied, that the motion for summary
judgment should be, and hereby is, denied, and that a
hearing herein be set for the purpose and reasons set
forth above.
3 See N L R.B v Mooney Aircraft, Inc, 366 F.2d 809 (C.A. 5);
N L R B v Miami Coca-Cola Bottling Co, 360 F.2d 569 (C.A. 5),
N LR B v Mastro Plastics Corp, 354 F 2d 170 (C.A. 2), cert. denied 384
U S. 972
Respondent'did not seek Board review of the aforemen-
tioned Decision.
The Issues Litigated at the Hearing
In presenting his case the General Counsel called and
examined each of the eight discriminatees with respect to
his employment and efforts to secure employment during
the backpay period, and Respondent cross-examined them
in that general area. For its case, Respondent called three
witnesses , and entered into a stipulation with the General
Counsel. All of the testimony offered by Respondent
related to its general defense that each of the discriminatees
failed to use reasonable diligence in seeking employment
during the backpay period.
The gross backpay as computed in the Specifications
being deemed admitted, and except as hereafter specifically
dealt with no issue being raised by Respondent as to the
interim earnings detailed in the Specifications, there is no
reason to repeat here the computations pleaded by the
General Counsel; such computations being incorporated
here by reference. For clarity in presentation, the evidence
dealing with the efforts of each discriminatee to obtain
employment during the backpay period will be detailed,
and in the course thereof any defenses relating only to a
specific employee will be stated, and that issue disposed of.
Louis Crossley
The backpay period for Crossley, who had been
employed by Respondent as a waiter, runs from June 5,
1966, through June 30, 1968, except that the General
Counsel makes no claim for backpay for the first and
second quarters of 1967 or the first and second quarters of
1968.
5 At Post & Paddock the owner stated that most of her help had been
hired, but she did have an opening for a bartender. As Crossley had no
243
Immediately following his discharge by Respondent,
Crossley notified the Local Union at Monticello that he
was available for work, and shortly thereafter filed an
application with Dependable Employment Agency (herein
Dependable), a private employment agency in the Monti-
cello area specializing in providing employees to resort
hotels in that area. He did not, however, register with the
New York State Employment Service. About a week or two
following his discharge, the Union referred Crossley to the
Concord Hotel (herein Concord), to work a lunch meal.
While there, Crossley filed an application for employment
with Concord, but was told by the latter that there were no
openings for steady help because very little hiring was done
after the Memorial Day holiday. In the next few weeks
Crossley applied for work to several restaurants and hotels
in the Monticello area, including Post & Paddock,5
Waldman's, Raleigh's, and Pines, resort hotels in the
Monticello area, as well as Host Farms at Lancaster,
Pennsylvania. Early in July 1966, Crossley obtained part-
time employment at Gage's Diner where he worked mainly
after 3 a.m., cleaning floors, doing maintenance work,
cooking, and working the counter. While working at Gage
he continued to check with the Monticello Local regarding
available work, but nothing was available. In December
1966, Gage notified Crossley that the season was over and
there was no further need for his services. Crossley then left
for Miami, Florida, where he obtained employment at the
Fontainbleau Hotel, where he had previously worked,
being put to work shortly after January 1, 1967. Crossley
remained on this job until the end of May 1968. However,
during the summer of 1967, while Crossley remained on the
job, his earnings at the Fontainbleau were substantially
reduced from what they had been in the preceding winter
and spring. The end of May 1968, Crossley terminated his
employment with the Fontainbleau to take employment
with the Gideon Putnam Hotel, Saratoga Springs, New
York, where his interim earnings were in excess of the gross
backpay for the quarter involved.
Richard Tonn
Tonn's backpay period is from May 27, 1966, the date of
his discharge, to September 6, 1966, when he left the area to
attend school as a full-time student, and from December
23, 1966, through December 31, 1966, when he returned to
the area for the Christmas vacation, and sought work for
that period. No backpay is claimed after the fourth quarter
of 1966.
Immediately following his discharge by Respondent,
Tonn communicated with the Local's business agent,
asking the latter to obtain work for him for the summer.
During the month of June, Tonn obtained a temporary
assignment at the Concord, which lasted only I day. Also
during the month of June, Tonn went to Raleigh's, Pines,
and Kutcher's, all hotels in the Monticello area, where he
spoke to the maitre d' concerning employment as a waiter
or busboy, but was told that no work was available.
Additionally, Tonn filed an application for work at the
local post office, but was told that he would be called only
in the event of an emergency, and he was in fact never
called. On June 22, Tonn obtained employment at
experience in that work he did not qualify for the job.
244 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Monticello Cab Company, where he worked for 1 week,
leaving that job because he regarded the cabs as unsafe.6
Following his work at the cab company, Tonn again talked
with the business agent of the Local regarding possible
employment, again visited Raleigh's and Kutcher's, and
had a friend make inquiry at Grossinger's but no work
materialized . On August 22, through the business agent of
the Local, Tonn obtained employment at the Monticello
racetrack as a meatcutter and was so employed until
September 6, when he left that job to attend school as a full-
time student at the University of Miami; being then in his
third year. As was his practice in prior years, Tonn, who
lived in the Monticello area, returned home for the
Christmas-New Year school vacation and, as he had in the
past, applied for work during the holiday period at
Respondent, but was told by Lowenthal, an admitted
supervisor, that ". . . there was no need for him." 7 During
this period also, Tonn applied to Kutcher's and Raleigh's,
and spoke to the Union's business agent relative to possible
employment during his vacation period, but was unable to
obtain such. There is no evidence that Tonn registered with
the New York State Employment Service, or with any
private employment agency.8
Robert Karosus
The backpay period for Robert Karosus as pleaded by
the General Counsel runs from May 30, 1966, the day of his
discharge, to March 8, 1967.9 Immediately following his
discharge Karosus, whose home is in Carbondale, Pennsyl-
vania, and while employed by Respondent was provided
with lodging by the latter, telephoned the Union's business
agent , and asked for work. The business agent told Karosus
that no work was available, but that he might call back the
following week. Karosus then left for Carbondale, and
several days later applied for unemployment benefits, but
learned that he was not eligible. Karosus registered,
however, for any available work. The following day as a
result of a telephone call to the business agent, Karosus
obtained a weekend job (Friday through Sunday) at the
Concord. Returning to Carbondale upon completion of the
Concord job, Karosus went to several industrial plants in
Carbondale area,'° but was unable to find work. Karosus
then went to the Monticello area where, in addition to
talking to the business agent regarding possible work, he
went to Grossinger's, Brown's, and Raleigh's hotels,
speaking either to the maitre d' or a dining room captain at
each place about work, but was told none was available.11
The first 2 weeks in July, Karosus was on National Guard
duty, and upon completion of that duty went to Bingham-
ton, New York, where he applied to several industrial firms
for work, but was unable to obtain employment.12 During
the first week of August, Karosus obtained employment
with Griffie-Culp Corporation, a contractor engaged in the
6 Tonn credibly testified that the cabs were at the time about 8 years
old, and the one assigned to him during the week he worked caught fire on
one occasion , and on another the brakes failed to operate . His testimony in
this regard is uncontradicted.
7 This latter finding , and my finding as to Lowenthal's supervisory
status, is based on the findings in the unfair labor practice case . 170 NLRB
No. 113.
8 Based on the uncontradicted and credited testimony of Tonn.
9 The reason for the termination of the backpay period on that date is
not disclosed by the record.
10 Eastern Wood, Kendrick's, and Cross Engineering.
construction of a housing development at Kingston,
Pennsylvania, as a sheetrock finisher, and continued at that
job until its completion in early October. Upon completion
of this job, Karosus again communicated with the Union
relative to possible employment, and again visited industri-
al operations and the employment service at Carbondale.
On this occasion the employment office gave Karosus a
telephone number to call for possible employment as a
sheetrock finisher. When Karosus communicated with this
employer he was told that there was no work available. In
January 1967, Karosus became eligible for unemployment
benefits and registered with the Service for that purpose. He
visited the office of the Employment Service each week
thereafter until June 1, 1967, but was never referred to a
possible job.13
Joseph Karosus
Although the General Counsel pleads the backpay period
for this employee to be from May 30, 1966, the date of his
discharge, to June 30, 1968, the Specifications made no
claim for backpay after the close of the third quarter in
1966. Accordingly, I limit my findings to the second and
third quarter of 1966.
Joseph Karosus, like his brother Robert, lived at
Carbondale, Pennsylvania, and returned there immediately
after his discharge by Respondent. Joseph Karosus
promptly registered with the State Employment Service at
Carbondale, and informed the Service that he had
previously worked as a busboy, waiter, truckdriver, and
wagon drill operator. He testified that he returned to the
Service each Monday thereafter, but for what period of
time the record does not show. The uncontradicted and
credited testimony is that at no time did the Service refer
him to any job. The evidence also shows that Karosus made
one or more telephone calls to the Union's business agent
relative to work in the Monticello area, but was told that
none was available. Within a week following his discharge
by Respondent Karosus also telephoned John Barna,
captain of waiters at Grossinger's, regarding work, but was
told "I can't touch you." In addition Karosus applied to
various trucking companies and to Gillen Coal Company
and Eastern Wood Products Corp., all in the Carbondale
area. Although employment was not immediately available,
Karosus did obtain employment with Gillen Coal early in
August 1966, and in each quarter thereafter his interim
earnings exceeded his gross backpay. Karosus admitted
that during his backpay period he did not apply to any
hotel or restaurant in the Carbondale area because no hotel
existed and the restaurants were of the counter variety that
did not employ waiters. Karosus also admitted that he
made no applications to hotels or restaurants in Scranton,
nor did he register with any private employment agency in
the area, because such did not exist.
11 At Grossinger's Karosus spoke to Stanley Straetsky. The latter was
not called by Respondent to contradict Karosus's testimony . It may be
noted that Counsel for Respondent also appeared before the Board as
Counsel for Grossinger. See S. & H. Grossinger's, Inc., 156 NLRB 233,
enfd. 372 F.2d 26 (C.A. 2). Counsel also appeared for Pines Hotel,
TXD-689-70, and Raleigh 's Hotel, Case 3-CA-3978.
12 Among the firms to which he applied were Agfa-Amsco; General
Electric; and Tri-City Construction.
13 As Karosus testified , and as the Specifications disclose, during the
first quarter of 1967, he worked 2 days for Griffie -Culp doing repair work,
and 2 weekends at Raleigh 's Hotel.
L.C.C. RESORT, INC.
Martin Gartell
Although the General Counsel pleads Gartell's backpay
period as running from June 1, 1966, the date of his
discharge, through June 30, 1968, backpay is claimed only
for the second and third quarters of 1966.
Upon discharge by Respondent on May 30, and having
no place to stay in the Monticello area, Gartell went to
Allentown, Pennsylvania, where his mother then lived For
a short period of time he got odd jobs such as mowing
lawns, and did some extra work for his uncle for which he
was not paid wages as such, but was given a few dollars
spending money. Gartell credibly testified that the total
amount that he got from the odd jobs and from his uncle
did not exceed $10 or $11.14 About mid-June 1966, Gartell
obtained temporary employment for 2 weeks, and then a
permanent job on which he began work about July 1, and
continued on the latter job until sometime in August 1966,
when he entered the military service. No backpay is
claimed after the third quarter of 1966.
Hartmut Sturm
The General Counsel pleads the backpay period for this
employee as running from May 2, 1966, the date of his
discharge, through June 30, 1968, when he was offered and
accepted reinstatement to his former job at Respondent.
Backpay is claimed for each quarter except the second
quarter of 1967, when admitted interim earnings exceeded
gross backpay.
Promptly following his discharge, Sturm registered with
the Monticello office of the New York State Employment
Service, and went to hotels and restaurants in the
Monticello area seeking employment. Among the establish-
ments Sturm visited was Kutcher's Hotel & Country Club
where he spoke to one known to him as "Big John," who
stated that he need a roast cook and a breakfast cook, and
asked that Sturm wait while he talked to Milton Kutcher. In
a short time "Big John" returned and told Sturm, "the way
it sounds you won't get a job here." Sturm also applied to
Monticello Diner where ajob was available which required
that he do butchering and baking,15 and as he had no prior
experience in those fields he felt himself unable to take that
job. Sturm then applied to and obtained employment with
Joe's Villa, starting work there about mid-May, and he
worked for about a month and a half. Sturm testified
without contradiction that he took this job at a salary of
$125 a week with a promise that at the beginning of summer
his salary would be increased by $25 weekly, and that when
the time arrived and he asked about the increase he was
told that two people could be hired for that price, and that
he (Sturm) took this as a dismissal. Shortly thereafter Sturm
obtained employment at Tuzzeo's Restaurant, as a cook.
The job, however, was only for the summer, and would end
with Labor Day. Accordingly, during the summer months
Sturm looked for work to commence after Labor Day, and
14 Although the amount so earned is not credited by the General
Counsel in his computations of interim earnings, he did credit the sum of
$11 in the second quarter of 1966, as having been earned for work at the
Concord Hotel The evidence shows, however, that Gartell performed the
work at the Concord prior to his discharge, and, although reflected in the
social security report for the second quarter of 1966, these wages are not
interim earnings for which Respondent is entitled to credit The amount
which Gartell received from the odd jobs and that his uncle gave him
offsets the amount which the General Counsel improperly included, and no
245
found such a job at a restaurant known as Homestead in
Bridgeville, New York. Sturm reported for this job
immediately after Labor Day and worked for about 2
months, when thejob terminated for lack of work.
While employed at Old Homestead, Sturm sought
employment as a cook aboard luxury cruise ships operating
out of New York City. To do this it was necessary that he
secure the requisite seamen 's papers and become a member
of the National Maritime Union. The latter involved an
outlay of $150 for initiation fees, and 2 months' dues in
advance of $30 per month. In addition Sturm was required
to make about eight trips from Monticello to New York
City costing about $15 per trip for food, gas, oil, tolls, and
parking. About half of these trips required that Sturm
remain overnight, which involved hotel expenses of about
$10 per night. Additionally, Sturm incurred expenses of
about $12 for telephone calls. Because Sturm had no
seniority and the hiring hall was operated strictly on
seniority, there were times he went to New York to fill a
possible call only to be beaten out by one with greater
seniority. Sturm made two trips for Grace Lines of 28 days
each; the first beginning in the latter days of December
1966, and the other dunng the second quarter of 1967.i6
During these cruises Sturm received no pay, but, upon
returning to New York at the end of the cruise, he was paid
the full amount of his earnings dunng the entire cruise. On
each cruise Sturm was a relief man for some regular Grace
Lines employee who, for some reason, did not wish to make
the particular trip. At the end of the second trip Sturm,
because of his low position on the seniority list, was unable
to obtain further employment with Grace Lines, and
returned to the Monticello area where he obtained
employment for the summer season with Tuzzeo's Restau-
rant. When the season terminated with Labor Day 1967,
and the job at Tuzzeo' s came to an end , Sturm obtained
employment at Roack's Tavern, and was working there in
June 1968, when Respondent offered and Sturm accepted
reinstatement to his formerjob.
Paul Besdansky
The General Counsel pleads the backpay period for this
employee as running from May 13, 1966, the date of his
discharge by Respondent, through June 30, 1968, except
that no backpay is claimed from February 7 through June
30, 1967, the period Besdansky was in the military service.
Immediately following his discharge on May 13,
Besdansky informed the Union' s business agent that he was
available for work. However, Besdansky, by his own
efforts, obtained a job with Mountain Linen Company and
began working there on June 17. In addition Besdansky
had a part- time job with Seymour Wahl, the operator of the
coffeeshop at Pines Hotel, but this ended a few weeks later
for lack of work. On the last workday before Labor Day
1966, Besdansky terminated his employment with Moun-
adjustment of the figures is necessary
15 The job also required that a man work 12-14 hours a day, 7 days a
week , and paid $25 a week less than Sturm had been earning at
Respondent.
16 Between the end of his employment with Old Homestead in
November 1966, and the time he began his first cruise in December 1966,
Sturm registered with the Monticello office of the State Employment
Service, and reported there each week In addition , he unsuccessfully
sought employment from various employers in the area.
246 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
tarn Linen to return to college at Middletown New York,
approximately 25 miles from Monticello, as a full-time
student. On September 9, 1966, Besdansky was reemployed
by Respondent as a part-time employee,17 and worked until
October 23, 1966, when he was again discharged by
Respondent.18 Following this discharge, because his college
work was his primary consideration, Besdansky could seek
only part-time work. In an effort to obtain such he notified
the Union's business agent of his availability for work;
registered at the Monticello Employment Office, reporting
there weekly for 3-1/2 months thereafter; and went to the
Concord, Kutcher's, and Raleigh 's hotels 19 seeking em-
ployment, but was not successful . On February 7, 1967,
Besdansky was inducted into the military service and upon
his discharge therefrom on June 30, 1967, returned to the
Monticello area . Besdansky testified that upon his dis-
charge from the service he made his availability for work
known to the Union' s business agent , and applied to
Shanks, Olympic, Neville, and Fallsburg hotels,20 but was
told no employment was available.21 Besdansky admits that
after his discharge from the service he did not apply to
Mountain Linen for whom he worked during the summer
of 1966, saying that he just did not think of it. The General
Counsel's Backpay Specifications do not show any interim
earnings for Besdansky for the year after his discharge from
the military service.
Joachim Sturm
Although the General Counsel pleads the backpay period
for Joachim Sturm as running from May 1, 1966, the day of
his discharge, through June 30, 1968, no backpay is claimed
for him after the fourth quarter of 1966.
Promptly after his discharge by Respondent, Sturm
registered with the Monticello office of the State Employ-
ment Service, and with the Jupiter Employment Agency in
New York City, which specializes in servicing the hotel
industry, but did not register with any private employment
agency in the Monticello area . About mid-May Sturm
conferred with a representative of General Foods and
received a job offer which he rejected because the pay
offered was only about $8,000 a year as compared to the
$12,000 he was earning at Respondent. About the same
time Jupiter Employment Agency told Sturm of a possible
short-term job in New England, but he rejected this because
of anticipated more permanent employment with Grace
17 During this penod Besdansky worked a 24-hour week , mostly on
weekends
is In its Decision and Order in this case the Board found that
Besdansky 's second discharge was also discriminatorily motivated. 170
NLRB No. 113, section III, F.
19 Particularly with respect to Raleigh 's, Besdansky gave the name of
the person with whom he spoke, a Mr Sid Salkind . Respondent 's counsel,
who as above indicated represents Raleigh 's, stated on the record that he
would call Mr Salkind to testify, presumably to deny Besdansky's
testimony in that regard , but that witness was not called
20 Besdansky gave the name or identity of the individual with whom he
spoke at each of these hotels , but none of those persons was called by
Respondent as a witness
21 Besdansky also testified that he talked with Harold Streifer, the
owner of Dependable Employment Agency, who was his next door
neighbor, regarding employment, and that the latter promised to give his
request special consideration , but never gave him any referral However,
Streifer testified that , while he saw Besdansky frequently, the latter never
discussed possible employment with him I resolve this conflict by crediting
Streifer
22 To obtain this employment with Grace Lines Sturm made 7 to 10
Lines. Early in June 1966, Sturm obtained employment
with Grace Lines as a relief cook on the cruise liners. The
first such cruise on which Sturm worked was for a period of
28 days which left New York June 10, returning to New
York July 7. The custom and practice at Grace Lines was
that employees received no pay while on the cruise, but
upon return to New York were paid in full for all sums
earned while on the cruise. Grace Lines reported such
wages for social security purposes for the quarter in which
they were actually paid.22 Sturm continued to work for
Grace Lines until early September when, because of lack of
seniority, he became unable to obtain employment. On one
of his trips to New York seeking employment on the ships,
he learned of possible employment with a country club in
Miami Beach, Florida. After making an appointment,
Sturm flew down to Florida for an interview, was hired, but
granted a 2-week period to transport his family and effects
to Miami Beach, reporting for duty about mid-October
1966.23
Contentions and Conclusions
Except for one specific point hereafter discussed,
Respondent's basic contention is that none of the
discriminatees exercised due diligence in seeking employ-
ment during the backpay period and all eight of the
discriminatees here involved should for that reason be
denied any backpay award. To support this contention
Respondent relies on the testimony of Harold Streifer,
president of Dependable Employment Agency, and a
stipulation of counsel dealing with hiring at Concord Hotel
during the backpay period. Streifer testified, in substance,
that his agency has been in business since about 1935, and
is the largest employment agency in the Monticello area
specializing in employment in resort hotels; that, based on
his experience, there would be available about 25 job
offerings daily during the summer months (June-August),
in the categories of waiters, busboys, and bellhops; and that
while such employment opportunities diminish substantial-
ly after Labor Day, because the hotels do not have
sufficient guests, there was nevertheless a good chance that
an experienced employee in the categories mentioned
would get a steady weekend job. Streifer was not asked and
did not explain why employee Crossley, whose testimony in
trips from Monticello to New York, on at least 5 of them being required to
spend the night He testified that these trips cost $5 to $6 for gas; $2 for
tolls; $3 to $5 a day for parking , $20 to $25 a day for food and lodging,
$150 for his union book, and union dues in advance of $30. The General
Counsel pleads these expenses in the second quarter of 1966 as totaling
$220 Respondent introduced no evidence to contradict Sturm 's testimony
in that regard
23 The General Counsel pleads Sturm 's expenses during the fourth
quarter of 1966 as $523. Sturm testified that such expenses consisted of
three or four trips to New York , at least one of which required him to stay
overnight, at a minimum cost of $20 each; air fare to Miami and return for
his interview , as well as food and lodging , costing about $125, the rental of
a large U-Haul trailer costing about $175, to transport his personal effects,
about $25 a day for each of 5 days the trip took, for food and lodging;
about $ 14 for tolls, and about $50 for gas and oil. While Sturm did not
mention it , he obviously incurred the expense of wear and tear on his car
for this journey of about 1,500 miles . Respondent does not question any of
these as legitimate items of interim expenses . It does argue that Sturm
should not be awarded backpay for the 2 weeks he took to report to the
Miami job I do not regard his action in that regard as unreasonable, and
made no deduction for that period.
L.C.C. RESORT, INC
that regard I credit, and who did register with Dependable
shortly after his discharge by Respondent, on June 5, 1966,
never received ajob offer from or through Dependable.
The stipulation of counsel above referred to, and upon
which Respondent so strongly relies, is:
During the period from June 1, 1966 through June 30,
1968, inclusive, the Kiamesha-Concord, Inc. employed
new cooks and a substantial number of new bellboys
and waiters who had not previously worked for that
hotel.
I do not regard the testimony of Streifer, nor the
stipulation of counsel, all of which is general and
exceedingly speculative in nature, as sufficient to overcome
the specific evidence of the discriminatees, whom I credit,
that they made application for employment to many of the
hotels in the Monticello area, including the Concord, and
were told that there were no jobs available. In many of
these instances the discriminatee gave the name or gave a
sufficient description of the individual with whom they
spoke, and, despite the fact that counsel for Respondent
represents some of these hotels, not a single individual from
those hotels was called to deny the testimony of the
discriminatees. Respondent's failure to call such witnesses,
or explain the failure to call them legitimately gives rise to
the inference that the representatives referred to would not
support Respondent's contention. As the Supreme Court
stated in Interstate Circuit v. United States, 306 U.S. 208,
226, "The production of weak evidence when strong is
available can lead only to the conclusion that the strong
would have been adverse."
It is undoubtedly true that a discriminatorily discharged
employee has the duty to seek interim employment to
minimize the amount of backpay. But this principle ".. .
does not require success; it only requires an honest good
faith effort . . ." N.L R.B. v. Cashman Auto Company, etc.,
223 F.2d 832, 836 (C.A. 1), enfg. 109 NLRB 720. And the
burden of establishing that any discriminatee willfully
incurred a loss of earnings rests on Respondent. N.L.R.B. v.
Mastro Plastics Corporation, 354 F.2d 170, 178 (C.A. 2),
cert. denied 384 U.S. 972; N L.R.B. v. Miami Coca-Cola
Bottling Company, 360 F 2d 569, 575 (C.A. 5). This burden,
I find and conclude, Respondent has wholly failed to carry.
The one instance in which I find and conclude that
Respondent has established that the discriminatee with-
drew himself from the labor market and was not in fact
seeking remunerative employment is Paul Besdansky. As
24 Indeed, for the third quarter of 1966, his interim earnings were $900,
almost 50 percent in excess of his gross backpay of $612
25 In this connection it may be noted that during this period Besdansky
did not register with the State Employment Service And, as I have
indicated, while Besdansky claimed that he talked with Streifer, who
happened to be his next door neighbor, about possible employment,
Streifer denied that such a conversation occurred, and I have credited the
latter in that regard
26 Such records were submitted by counsel for Respondent who moved
that they be made a part of the record and considered in support of the
contention now under consideration By my order of December 3, 1970,
the motion to make said material a part of the record was taken under
advisement , to be disposed of in this Decision Because for reasons
hereafter stated I regard the material submitted by counsel to be irrelevant
and immaterial, I now deny the motion to make it a part of the record I
have, however, marked said material as Rejected Exhibit 1, and physically
lodged it with record so that Respondent may have review of my Decision
in that regard by the Board and a court of appeals, if it be so advised
247
above stated, Besdansky was discharged on May 13, 1966,
and from that date until he entered the Armed Forces on
February 7, 1967, although he was during that period a
college student, nonetheless had substantial interim
earnings.24 The evidence also shows that, when not
employed during that period, he applied to hotels in the
area, and registered with State Employment Service.
However, following his discharge from the Armed Forces
on June 30, 1967, until the end of the backpay period,
Besdansky had no interim earnings . Although Besdansky
testified that following his discharge from the Armed
Forces he applied to various hotels in the area for work, but
was told that no work was available, it is inconceivable to
me that if he did apply that he would not have received
some work, even if only for an occasional weekend.25 In
short, I am convinced and accordingly find that during the
year June 30, 1967, to June 30, 1968, Besdansky had
withdrawn from the labor market to devote his full time to
his college studies. Accordingly I shall recommend that he
be awarded backpay only through the end of the first
quarter of 1967, as computed in the General Counsel's
Specifications.
The final contention advanced by Respondent deals with
the computation of backpay for Joachim Sturm. The
Specifications plead that, for the second quarter of 1966,
Sturm's gross backpay was $2,000 with $220 interim
earnings in that quarter offset by expenses , leaving the net
backpay for the quarter as $2,000. For the third quarter of
1966, the gross backpay is $3,000 and, because interim
earnings for the quarter were $3,565, there is no net
backpay for the quarter. The interim earnings for the third
quarter resulted from Sturm's employment by Grace Lines,
as a cook on their cruises out of New York. The payroll
records from Grace Lines26 show that Sturm made three
trips for Grace Lines during 1966, each for a period of 28
days. The first such trip left New York on June 10,
returning on July 7, and for which Sturm received gross pay
of $1,139.77.27 While on this trip Sturm received no money,
but was paid the full amount of $1,139.77, less appropriate
deductions, upon his return to the port of New York.
Respondent contends that, because 5/7 of his earnings on
that trip was for services actually performed in June, that
amount should be regarded as interim earnings for the
second quarter, to that extent reducing the net backpay for
that quarter.28 Alternatively, Respondent argues that, if its
aforementioned contention is rejected, then, for the
27 The other two trips left New York on July 8 and August 4, but the
earnings from those trips are not involved in the contention counsel now
makes
28 At first blush it would seem that the rule for which Respondent
contends would not effect the total net backpay due, but simply transfer
the liability from the second quarter to the third quarter However , because
there was an excess of interim earnings in the third quarter, the figures do
not work out that way Thus, if $814 10 (5/7 of $1,139 77) is regarded as
interim earnings for the second quarter, the net backpay for that quarter
becomes $1,185 90, and, if the $814 10 is then deducted from $3,565
interim earnings for the third quarter as shown by the Specifications, the
interim earnings for the third quarter are $2,750 90 ($3,565 minus $814.10
equals $2,750 90) As the gross backpay for the third quarter is $3,000,
deduction of $2,750 90 , leaves net backpay of $249 10, and the total net
backpay for the second and third quarters is $1,395 ($1,145 90 plus $249 10
equals $1 ,395), instead of $2,000 claimed in the Specifications, or a
reduction in net backpay of $605 As Respondent makes no contention
with respect to the fourth quarter of 1966, those figures are not discussed at
(Continued)
248 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
purpose of computing the gross backpay for the second
quarter, Sturm should be regarded as unavailable for work
from June 10 to June 30. I find both contentions without
merit.
Although I have not been cited to, nor has my
independent research revealed, any case in which the
precise issue was decided by the Board, its decision in F. W.
Woolworth Company, 90 NLRB 289, which was the initial
pronouncement that backpay must be computed by
quarters and that excess earnings in one quarter may not be
used to offset a backpay liability for another quarter, set
forth its reasons for the rule there announced. Among the
considerations mentioned was the desire to avoid prejudice
to an employee's rights under the Social Security Act, and
to conform with and facilitate the practices of the Social
Security Administration. In this connection the Board
stated (90 NLRB at 293):
In devising this method of computation, we have also
heeded its concomitant effects upon [an employee's]
rights and benefits under the Old Age and Survivors
Insurance program of the Social Security Act. Payments
to compensate for loss of wages, made in accordance
with the orders of this Board, are "wages" within the
meaning of the Social Security Act. The Social Security
Administration is required to allocate such payments to
the particular quarter in which the money would have
been earned; only thus can the employee's Old Age and
Survivors Insurance account be restored as eligibility
for old age payments, as well as the measure of benefits,
rest largely upon the number of quarters for which
wages, in the amount of $50 or more, are received in
employment covered by the Social Security Act. Our
present order conforms with and facilitates the
prescribed practice of the Social Security Administra-
tion. All other things being equal, we desire to avoid
prejudice to the employee's rights under other social
legislation designed to "preserve the continuity and
stability of labor remuneration."
For this reason I find and conclude that, for the purpose of
determining the quarter in which interim earnings should
be credited, the determinative test is when were the wages
due and payable under the labor contract or the employer's
custom and practice. Thus, if, under the contract or
practice, employees are paid on Thursday for all work
performed in the previous calendar week, the fact that
January 1 happens to fall on Wednesday preceding payday
does not alter the fact that such wages were not due until
and were in fact paid on January 2, within the first calendar
quarter of the following year, even though the work for
which such wages were paid was all performed in the fourth
quarter of the preceding calendar year.29 Such a rule
conforms not only to the practice under social security, but
to the practice for income tax purposes as well.
With respect to Respondent's alternative contention that,
for the period from June 10 to June 30, Sturm must be
regarded as not available for work, and that gross backpay
computation should not include that time, it is plain that
Respondent overlooks two important facts. In the first
place, by failing to file the proper answer, the amount of
gross backpay has been deemed admitted and may not be
now questioned. Secondly, the term "unavailable for
work," as used in backpay proceedings, refers to one who
has, for one reason or another, withdrawn from the labor
market. Although Respondent argues (Br. p. 13) that to
hold that Sturm was available for work between June 10
and June 30 "would go against all rules of law30 and logic,"
I am unable to perceive how one can logically conclude that
a man who is actually working, and earning wages to reduce
Respondent's backpay liability is unavailable for work.
RECOMMENDED ORDER
Upon the basis of the foregoing findings and conclusions,
and the entire record in the case , and pursuant to Section
10(c) of the National Labor Relations Act, as amended, it is
recommended that the National Labor Relations Board
issue the following:
SUPPLEMENTAL ORDER
It is hereby ordered that Respondent L.C.C. Resort, Inc.,
d/b/a Laurels Hotel and Country Club, forthwith pay to
the following persons backpay in the amount set opposite
their respective names , as required by our Order of April 8,
1968 (170 NLRB No. 113):
Louis Crossley $2,180.00
Richard Tonn 763.00
Robert Karosus 826.00
Joseph Karosus 1,047.00
Martin Gartell 436.00
Hartmut Sturm 4,780.00
Paul Besdansky 635.00
Joachim Sturm 2,928.00
Each of the foregoing sums shall accrue interest at the rate
of 6 percent per annum , computed in the manner set forth
in Isis Plumbing & Heating Co., 138 NLRB 716. There shall
be deducted from each of the foregoing amounts , social
security taxes , income tax withholding , and such other
deductions as may be required by the laws of the United
States or the State of New York.
with respect to the fourth quarter of 1966, those figures are not discussed at case the wages were available to the employee on December 31, and will be
this point . regarded as having been paid on that day.
29 This is not to say that if wages are under the contract or practice due 30 As counsel cites no authority to support this statement I am unaware
on December 31, and the employee fails to claim them until after January of the rules of law to which he refers.
1, that the wages would be deemed as paid in the following year In such a