Mining Specialists

National Labor Relations Board - Board Decisions

Jul 8, 1994

314 N.L.R.B. 268 (N.L.R.B. 1994)

268
314 NLRB No. 51
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 Backpay for wages lost as a result of the Respondents’ failure
to apply the National Bituminous Coal Wage Agreement of 1988 to
unit employees of Respondent Point Mining, Inc. shall be computed
in the manner set forth in Ogle Protection Service, 183 NLRB 682
(1970), enfd. 444 F.2d 502 (6th Cir. 1971).
2 I.e., the National Bituminous Coal Wage Agreement of 1988.
3 Art. I, A(f) states in full as follows:
Application of This Contract to the Employer’s Coal Lands.
As part of the consideration for this Agreement, the Employers
agree that this Agreement covers the operation of all the coal
lands, coal producing and coal preparation facilities owned or
held under lease by them, or any of them, or by any subsidiary
or affiliate at the date of this Agreement [i.e., February 1, 1988],
or acquired during its term which may hereafter (during the term
of this Agreement) be put into production or use. This section
will immediately apply to any new operations upon the Union’s
recognition, certification, or otherwise properly obtaining bar-
gaining rights. Notwithstanding the foregoing, the terms of this
Agreement shall be applied without evidence of Union represen-
tation of the Employees involved to any relocation of an oper-
ation already covered by the terms of this Agreement.
4 Art. II,A.1 of the agreement states in pertinent part as follows:
Non-Signatory Operations.
[T]he first three out of every five new job openings for work
of a nature covered by this Agreement at any existing, new, or
newly acquired non-signatory bituminous coal operation of the
Employer shall be filled by classified laid-off Employees on the
panels of the Employer’s operations covered by this Agreement.
5 It is well settled that the Board has the authority to interpret col-
lective-bargaining agreements in the course of deciding unfair labor
practice cases. E.g., Redway Carriers, 274 NLRB 1359, 1376 fn. 22
(1985); Electrical Workers IBEW Local 11 (Los Angeles NECA), 270
NLRB 424, 425–426 (1984), enfd. 772 F.2d 571 (9th Cir. 1985).
6 E.g., Lear Siegler, Inc., 293 NLRB 446, 447 (1989).
Mining Specialists, Inc. and its alter ego or suc-
cessor Point Mining, Inc. and United Mine
Workers of America, District 17. Case 9–CA–
30680
July 8, 1994
DECISION AND ORDER
BY MEMBERS STEPHENS, DEVANEY, AND
BROWNING
On January 26, 1994, Administrative Law Judge
Claude R. Wolfe issued the attached decision. The Re-
spondents filed exceptions and a supporting brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the exceptions and brief and has de-
cided to affirm the judge’s rulings, findings, and con-
clusions and to adopt the recommended Order.1
We agree with the judge, for the reasons he sets
forth, that Respondent Point Mining, Inc. (PMI) is an
alter ego of Respondent Mining Specialists, Inc. (MSI),
and that PMI is therefore bound by the collective-bar-
gaining agreement between MSI and the Union.2
We further agree with the judge, again for the rea-
sons he sets forth, that the Respondents violated Sec-
tion 8(a)(1) of the Act by telling laid-off MSI employ-
ees at the Witcher Creek mine that they could go to
work for PMI at the Campbell’s Creek mine, but that
PMI was going to be a ‘‘union-free’’ company, that
only those who wanted to work on such a ‘‘union-
free’’ basis should sign up to work for PMI, and that
if employees who went to work for PMI subsequently
tried to become unionized, PMI would be shut down.
We also agree with the judge that the Respondents
violated Section 8(a)(5) and (1) of the Act by bypass-
ing the Union and dealing directly with the unit em-
ployees, withdrawing recognition of the Union, abro-
gating the collective-bargaining agreement between
MSI and the Union, and refusing to provide the Union
with requested information that is relevant and nec-
essary for the Union’s performance of its duties as the
representative of the Respondents’ unit employees.
The Respondents argue, inter alia, that even assum-
ing that PMI is an alter ego of MSI, Campbell’s Creek
is a ‘‘new operation’’ within the meaning of article
IA(f) of the collective-bargaining agreement, rather
than a ‘‘relocation of an operation [i.e., Witcher Creek]
already covered by the terms of [the] Agreement,’’
within the meaning of the same article.3
The Respondents consequently argue that because
the Campbell’s Creek operation is a ‘‘new operation’’
under article I,A(f), (1) the Respondents were not obli-
gated to apply the collective-bargaining agreement at
Campbell’s Creek unless the Union had independently
obtained recognition, certification, or otherwise prop-
erly obtained bargaining rights for the employees at
Campbell’s Creek—which the Union has not done, and
(2) the Respondents’ only obligation at Campbell’s
Creek has been to comply with article II,A.1 of the
collective-bargaining agreement by filling at least three
out of every five vacancies with laid-off former Witch-
er Creek employees—which the Respondents have
done.4
We reject the Respondents’ argument that their
Campbell’s Creek operation is a ‘‘new operation’’
within the meaning of article IA(f) of the collective-
bargaining agreement. Instead, based on our interpreta-
tion of the collective-bargaining agreement in light of
the record evidence,5 we find that the Campbell’s
Creek operation is a ‘‘relocation of an operation al-
ready covered’’ by the collective-bargaining agree-
ment—Witcher Creek. Consequently, we further find,
pursuant to the express provisions of article I,A(f), that
the terms of the collective-bargaining agreement were
applicable to the Campbell’s Creek operation without
the Union having to become separately recognized or
certified, or otherwise having to obtain separate bar-
gaining rights at Campbell’s Creek.
In contract interpretation matters like this, the par-
ties’ actual intent underlying the contractual language
in question is always paramount, and is given control-
ling weight.6 To determine the parties’ intent, the
269MINING SPECIALISTS
7 See, e.g., Johnson-Bateman Co., 295 NLRB 180, 184–188
(1989).
8 The Respondents have attached to their brief in support of excep-
tions copies of three apparently unpublished arbitration awards, in-
volving other employers. These awards, however, were not entered
into evidence, and they are not part of the record.
9 See J.R.R. Realty Co., 301 NLRB 473, 474–475 (1991), enfd. per
curiam mem. 955 F.2d 764 (D.C. Cir. 1992).
10 E.g., Rock Bottom Stores, 312 NLRB 400 (1993).
11 E.g., General Electric Co., 170 NLRB 1272 (1968).
12 Central Soya Co., 281 NLRB 1308 (1986), enfd. 867 F.2d 1245
(10th Cir. 1988).
Board normally looks to both the contract language
itself and relevant extrinsic evidence, such as a past
practice of the parties in regard to the effectuation or
implementation of the contract provision in question,
or the bargaining history of the provision itself.7
In the instant case, however, the record does not
contain extrinsic evidence of the parties’ intent.8 We
must attempt, therefore, to determine the parties’ intent
regarding the implementation of article I,A(f) in the
light of the ordinary meaning of the crucial terms of
that article as applied to the instant facts.9 This is not
to say that the Board interprets collective-bargaining
agreements in a vacuum, solely in accordance with
‘‘abstract definitions unrelated to the context in which
the parties bargained and the basic regulatory scheme
underlying that context.’’ NLRB v. C & C Plywood
Corp., 385 U.S. 421, 430 (1967). ‘‘Rather, collective
bargaining agreements must be read in light of the re-
alities of labor relations and considerations of federal
labor policy . . . which make up the background
against which such agreements are entered.’’ Electrical
Workers IBEW Local 1395 v. NLRB, 797 F.2d 1027,
1033 (D.C. Cir. 1986).
Like the collective-bargaining provision in issue
here, Federal labor policy also distinguishes between a
‘‘relocation’’ on the one hand and a ‘‘new operation’’
on the other. If the employer’s change in operations
amounts to a ‘‘relocation,’’ the parties’ contract re-
mains in effect,10 just as article I,A(f) provides here.
However, if the change results in the creation of ‘‘an
entirely new operation,’’ the employer may not have a
duty to bargain with the union at the new facility.11
Similarly, article I,A(f) significantly limits the Re-
spondents’ obligations in the case of a ‘‘new oper-
ation.’’ Factors the Board uses to determine the cat-
egory in which a case falls include the following: the
products produced; the machinery used; the organiza-
tion and nature of the work force; and the geographical
separation between the two locations.12
Applying these factors by analogy here, we note that
the Respondents had the same managers, and largely
the same supervisors, running PMI’s Campbell’s Creek
operation as they had running MSI’s Witcher Creek
operation only a week earlier. The two operations pro-
duced the same product (coal) for the same type of
customers. All the Respondents’ MSI employees at
Witcher Creek went directly to work as the Respond-
ents’ PMI employees at Campbell’s Creek immediately
after the shutdown of Witcher Creek a week earlier,
and experienced no significant change in job duties.
The Respondents used much of the same equipment at
Campbell’s Creek as they used at Witcher Creek—in
some instances the same actual pieces of equipment, in
other instances the same type of equipment. Some
other equipment was owned by Catenary Coal Com-
pany, but was used free of charge to the Respondents,
first at Witcher Creek and then at Campbell’s Creek.
Still other equipment from Witcher Creek was used
briefly at Campbell’s Creek and then replaced by
newer pieces of equipment purchased for Campbell’s
Creek. Finally, the two operations were relatively close
together (approximately 4 miles apart).
Thus, in the totality of the circumstances presented
here, we find that the Respondents’ operation at Camp-
bell’s Creek constituted a ‘‘relocation of an operation
already covered by the terms’’ of the instant collective-
bargaining agreement, rather than a ‘‘new operation.’’
Accordingly, we find that the Respondents were obli-
gated under article I,A(f) of the collective-bargaining
agreement to recognize the Union and apply the collec-
tive-bargaining agreement to the Campbell’s Creek op-
eration, and that the Respondents violated Section
8(a)(5) and (1) of the Act by their failure to do so.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondents, Mining Specialists, Inc.
and Point Mining, Inc., both of Belle, West Virginia,
their officers, agents, successors, and assigns, shall
take the action set forth in the Order.
David L. Ness, Esq., for the General Counsel.
Michael Whitt and Dan Stickler, Esqs., for Respondents Min-
ing Specialists, Inc. and Point Mining, Inc.
DECISION
STATEMENT OF THE CASE
CLAUDE R. WOLFE, Administrative Law Judge. This pro-
ceeding was litigated before me at Charleston, West Virginia,
on November 18, 1993, pursuant to charges filed by the
United Mine Workers of America, District 17 (the Union) on
May 10, 1993, and complaint issued on June 22, 1993, alleg-
ing Respondents Mining Specialists, Inc. (MSI) and its alter
ego or successor Point Mining, Inc. (PMI) have violated Sec-
tion 8(a)(1) and (5) of the National Labor Relations Act (the
Act). Respondents deny the commission of unfair labor prac-
tices and that the alleged alter ego or successorship relation-
ship exists.
On the entire record, and after considering the demeanor
of the witnesses and the posttrial briefs of the parties, I make
the following
270 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
FINDINGS OF FACT
I. JURISDICTION
The complaint alleges, MSI admits, and I find that at all
material times until January 29, 1993, when it ceased oper-
ations, it was a corporation with an office in Belle, West Vir-
ginia, was engaged in the operation of a coal mine at Witch-
er Creek in the vicinity of Cabin Creek, West Virginia, and
in conducting these operations sold and shipped from its
Witcher Creek mine goods valued in excess of $50,000 di-
rectly to points outside the State of West Virginia, and at all
material times has been engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act.
It has also been alleged and admitted, and I find, that since
about February 6, 1993, PMI has been a corporation with an
office in Belle, West Virginia, has been engaged in the oper-
ation of a coal mine at Campbell’s Creek 3 mine in the vi-
cinity of Malden, West Virginia, and, based on a projection
of its operations since about February 6, 1993, at which time
PMI commenced its operations, PMI, in conducting these op-
erations, will annually sell and ship from the Campbell’s
Creek 3 mine goods valued in excess of $50,000 directly to
points outside the State of West Virginia, and, therefore, at
all material times PMI has been engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act.
In addition to these pleadings, the parties entered into a
joint stipulation providing as follows:
During calendar year 1992, respondent MSI pur-
chased and received at its West Virginia facility goods
valued in excess of $50,000 directly from suppliers
within the State of West Virginia, and those suppliers
purchased and received such goods directly from points
outside the State of West Virginia.
Since about February 6, 1993, respondent Point Min-
ing purchased and received at its West Virginia facility
goods valued in excess of $50,000 directly from sup-
pliers within the State of West Virginia, and those sup-
pliers purchased and received such goods directly from
points outside the State of West Virginia; and, at all
material times, respondents have been engaged in com-
merce within the meaning of Section 2(2), (6), and (7)
of the Act.
II. LABOR ORGANIZATION
At all times material to this proceeding the Union has been
and is a labor organization within the meaning of Section
2(5) of the Act.
III. ALLEGED UNFAIR LABOR PRACTICES
A. The Allegations
The complaint alleges the following conduct took place
and therefore violated the Act:
About January 26, 1993, Respondents, by Rodney
David Lucas, at the Witcher Creek mine office, threat-
ened employees with discharge and mine closure if they
engaged in union activities or selected the Union as
their bargaining representative.
About February 6, 1993, Respondents, through the
conduct of Respondent Point Mining, withdrew recogni-
tion of the Union as the exclusive collective-bargaining
representative of the unit.
About January 26, 1993, Respondents, by James Roy
Lucas . . . bypassed the Union and dealt directly with
its employees in the Unit by offering them a wage in-
crease and changes in their health insurance, pension
benefits, holiday and vacation pay and other benefits if
they agreed to work on a nonunion basis for Respond-
ent Point Mining.
About late April 1993 or early May 1993, a more
precise date being unknown to the General Counsel,
Respondents, by James Roy Lucas at the Campbell’s
Creek No. 3 mine office, bypassed the Union and dealt
directly with its employees in the Unit by informing
them that Respondent Point Mining would be distrib-
uting a booklet setting forth their new wages and bene-
fits.
About February 6, 1993, Respondents, failed to con-
tinue in effect all the terms and conditions of the agree-
ment with the Union by failing to provide its employ-
ees the wage rates, health insurance coverage, pension
benefits, holiday and vacation pay, personal days’ and
floating days’ pay and other benefits as required by the
agreement.
Since about April 7, 1993, the Union has requested the
Respondents to furnish it with information necessary for and
relevant to the Union’s performance of its duties as the ex-
clusive collective-bargaining representative of Respondents’
employees.
B. Chronology
MSI was incorporated in West Virginia on March 24,
1988, by James Roy Lucas, president and sole owner of both
MSI and PMI. He then signed a collective-bargaining agree-
ment, on behalf of MSI, with the Union on April 26, 1988.
MSI thereafter operated under the terms of that agreement
which covered all of its nonsupervisory employees engaged
in mining until it ceased operations on January 29, 1993,
when it exhausted the coal seam it was mining as a contract
miner for Catenary Coal Company which owned the
minesite. The relationship between MSI and the Union was
not entirely harmonious. On August 3, 1992, James Roy
Lucas wrote to the Union complaining that the contractually
required medical and pension benefits made it impossible for
MSI to compete with nonunion companies. Prior to the writ-
ing of this letter there had been disputes between MSI and
the Union concerning payment for these benefits, and at one
point in 1991 MSI had changed the health plan from 100-
percent coverage to an 80/20 plan and only returned to the
100-percent coverage under protest. MSI has not engaged in
any mining operation since January 29, 1993, its closing
date.
PMI was incorporated on February 10, 1992. From Feb-
ruary 6, 1993, to the present, PMI has worked as a contract
miner for Valley Coal Company at a location about 3 miles
from the mine that MSI had worked until its January 1993
closing. The PMI work was secured via a bid made to Cat-
enary Coal, who appears to have been acting on behalf of
Valley Coal at the time, some time in October 1992. This
was after James Roy Lucas and his certified public account-
ant Billy Cline, who worked closely with Lucas in incor-
271MINING SPECIALISTS
1 My disposition of the alter ego issue renders the disposition of
the alternative theory of successorship unnecessary. Mid-Hudson
Leather Goods Co., 291 NLRB 449 fn. 2 (1988).
2 265 NLRB 1301 (1982), enfd. 725 F.2d 1416 (D.C. Cir. 1984);
and see also, e.g., Advance Electric, 268 NLRB 1001, 1002 (1984);
Iron Workers Local 15, 306 NLRB 309, 312 (1992).
porating and monitoring the financial details of both MSI and
PMI, discovered in the late summer of 1992 that MSI was
faced with financial disaster because it had run into hard
rock obstructing access to the coal. Notwithstanding Cline’s
warning Lucas was getting himself into a very weak financial
position by not immediately stopping work at the Catenary
site, MSI continued mining that site with continuing losses
until it was forced by these financial difficulties to cease op-
erations. Cline estimates the decision to terminate operations
was made in November 1992 or thereabouts.
On January 26, 1993, James Roy Lucas conducted an all-
employee meeting in the MSI office trailer at the Catenary
site. He gave no notice of this meeting to the Union. At the
meeting he told the employees that PMI would operate union
free and that those employees who wished to work for PMI
on a ‘‘union-free basis’’ should sign a sheet of paper he
passed around. At the bottom of the sheet, after the employ-
ees had signed, he wrote:
Meeting held & discussed opening of a new mine as
MSI is closeing [sic]. Explained as to a new company
on a union free basis. Explained offer to men as Point
Mining Inc. & the so-listed desired to be considered for
employment.
In addition to James Roy Lucas’ comments, his son Rod-
ney David Lucas, the mine foreman at MSI and PMI and an
admitted statutory supervisor and agent, told the employees
that if they went to work for PMI and then tried to get a
union in the mine would be shut down. I credit his father
that Rodney Lucas further stated that ‘‘We had to bid on a
union-free basis to be competitive.’’ Because this testimony
is not controverted and is consistent with James Roy Lucas’
previous statements to the Union that MSI could not be com-
petitive if it had to pay the health and pension benefits re-
quired by the collective-bargaining agreement.
At this meeting, Lucas Sr. also told the employees of the
wages and other benefits they would receive as employees of
PMI. Compared to those set forth in the contract with the
Union, PMI wages were higher, health insurance coverage
was lower, there were fewer paid vacation days, individual
retirement accounts were substituted for the union pension
plan, and an in-house grievance procedure with no arbitration
or other independent tribunal to which to appeal replaced the
contractual grievance procedure. At a later meeting with em-
ployees in April or May 1993, James Roy Lucas announced
he would issue them a booklet setting forth the wages and
other conditions of employment he had described to them on
January 26, 1993. The union contract was simply abandoned
by Lucas Sr. with the closing of MSI. PMI has always oper-
ated nonunion.
By a four-page letter to Roy Lucas as president of MSI,
dated April 7, 1993 (Exh. A attached hereto as App. A),
Robert Phalen, president of District 17, requested 16 sets of
documents and posed 8 interrogatories relating to the rela-
tionship between PMI and MSI so that ‘‘the Union may
properly perform its statutory duties as a certified collective-
bargaining agent for your unionized employees, as well as
monitor performance of important legal and contractual obli-
gations’’ considering that ‘‘there are a number of problems
which have been brought to my attention, including the non-
provision of insurance benefits and payment of other wages
and benefits.’’ The Union was not supplied with the re-
quested information.
On July 22, 1993, James Roy Lucas wrote the Inter-
national union that MSI was thereby notifying it that MSI’s
collective-bargaining agreement with the Union was termi-
nated pursuant to article XXIX of that agreement. This was
1 month after the complaint in this case issued and is of no
relevance to this proceeding.
C. Discussion and Conclusions
1. The alter ego issue1
The Board’s longstanding position on the alter ego issue
was set forth in Fugazy Continental Corp.,2 as follows:
In determining whether [one employer] is the alter
ego of [another], we must consider a number of factors,
no one of which, taken alone, is the sine qua non of
alter ego status. Among these factors are: common
management and ownership; common business purpose,
nature of operations, and supervision; common premises
and equipment; common customers, i.e., whether the
employers constitute ‘‘the same business in the same
market’’; as well as the nature and extent of the nego-
tiations and formalities surrounding the transaction. We
must also consider whether the purpose behind the cre-
ation of the alleged alter ego was legitimate or whether,
instead, its purpose was to evade responsibilities under
the Act.
Common management, ownership, and supervision of MSI
and PMI exists in the persons of James Roy Lucas, his wife
Betty, their son Rodney, and the supervisory staff under
them. James Roy Lucas is the sole owner and president of
both MSI and PMI, his wife is the secretary-treasurer of
both, and his son Rodney served as the mine foreman for
both. The ownership and control of both companies by the
Lucas family is patently ‘‘substantially identical’’ for pur-
poses of deciding alter ego status, Crawford Door Sales Co.,
226 NLRB 1144 (1976). Gerald Lucas has been the section
foreman for both MSI and PMI, and Charles Riser serves
both of them as maintenance foreman. James Roy Lucas is
the overall manager of both entities, and Gerald and Rodney
Lucas are statutory supervisors and agents of both entities as
is Riser. PMI has two other supervisors: Charles Hanson,
who worked only for PMI, and Thomas Dunlap, who worked
for PMI and also as an hourly paid employee for MSI. Wes-
ley Smith, now employed as an hourly paid worker for PMI,
was a section foreman for MSI. The preponderance of iden-
tical supervision at both locations warrants a common super-
vision finding.
The coal mining operations of both MSI and PMI are quite
similar in that they both utilize in considerable part the same
equipment, producing the same product, coal, for the same
type of customers. It might even be reasonably argued the
customer for all intents and purposes was the same at both
272 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
3 Advance, supra at 1004.
4 See Alkire v. NLRB, 716 F.2d 1014 (4th Cir. 1983).
5 Precision Builders, 296 NLRB 105, 110 (1989).
6 This has long been a test for alleged violations of Sec. 8(a)(1)
of the Act. See, e.g., G. H. Hess, Inc., 82 NLRB 463 fn. 3 (1949).
locations because Catenary Coal gave the work to MSI and
obtained the work for PMI. In any event, MSI and PMI
clearly engage in ‘‘the same business in the same market’’
with substantially the same equipment as well as the very
same hourly paid employees, all of whom came to PMI from
MSI. With respect to the nature and extent of negotiations
and formalities between PMI and MSI, they amounted to
nothing more than James Roy and Betty Lucas exchanging
formalistic letters confirming the transfer and purported pur-
chase of machinery from MSI by PMI. All that happened
here is that James Roy Lucas transferred that which he
owned from one location to another but 3 miles distant, with-
out losing ownership or possession of that which he trans-
ferred, for, as agreed by the parties, he was the sole owner
of both corporations. He was simply dealing with himself.
Although, as the Board stated in Fugazy, supra, the pur-
pose behind the creation of an alleged alter ego must be con-
sidered, the Board has recently specifically reminded us that
an alter ego finding does not require the existence of illegal
motivation. Johnstown Corp., 313 NLRB 170 (1993). Thus,
the presence of such a motive is a factor to be considered,
but is not a required support for an alter ego finding. I am
persuaded there is sufficient evidence to infer an unlawful
motive in the instant case.
As early as 1991, James Roy Lucas was unhappy with the
costs connected with complying with the collective-bar-
gaining agreement, and attempted to unilaterally change the
health care plan. Although thwarted in this effort, it is obvi-
ous from his testimony and his letter to the Union that he
continued to consider the costs of medical as well as pension
benefits to be impediments to MSI’s competition with non-
union firms. It may be that James Roy Lucas initially
planned to operate PMI and MSI at the same time, but I
doubt this was the case. I do not believe it was pure coinci-
dence, given his antiunion contract posture, that after failing
in his effort to unilaterally change benefits, he formed PMI
in February 1992 when there appeared to have been neither
a pressing need to so do nor any firm indication that work
for PMI, which then had no employees, would soon be forth-
coming. Moreover, even though James Roy Lucas knew at
the time he bid for the new work on behalf of PMI that the
operations at MSI could not long continue without ruinous
financial losses, he made no effort to secure the work for
MSI. There is nothing in the record that credibly explains
why he did not bid on behalf of MSI and cut his losses.
The program for the January 26, 1993 meeting with em-
ployees, involving not only a notice of MSI closing but also
a detailed explanation of the wages and other benefits to be
conferred on employees of PMI and the adjuration that union
support would not be tolerated, was not something conjured
up on the spur of the moment. The Lucas pronouncements
by father and son viewed in context with James Roy Lucas’
previous efforts to escape the contractual health insurance
program and his pronouncements to the Union, and before
me, concerning the impediments to competition posed by the
collective-bargaining agreement, reflect a carefully thought-
out plan to evade MSI’s statutory obligation to honor the ex-
isting collective-bargaining agreement. This, I am persuaded,
was the true reason for the utilization of PMI rather than
MSI to further the family contract mining business. It is well
settled that such a motivation supports an alter ego finding.3
Moreover, it is clear that James Roy Lucas expected to ob-
tain, and it was reasonably foreseeable that he would obtain,
economic benefits consisting of less expensive employee
benefits, freedom from the restrictions placed on him by the
collective-bargaining agreement, and greater success in deal-
ing with the competition by switching his operations from
MSI to PMI. Although it is not as yet known whether better
competitive success will result from this maneuver, the other
expected benefits have been realized. The presence of these
benefits achieved as a result of the work transfer to PMI (to-
gether with the other factors previously mentioned) meets the
alter ego requirements of the United States Court of Appeals
for the Fourth Circuit.4
For all the foregoing reasons I conclude and find PMI is
an alter ego of MSI.
2. Direct dealing, withdrawal of recognition, and
other conduct
As MSI’s alter ego PMI had a duty to honor the collec-
tive-bargaining agreement between MSI and the Union. PMI
has not done so, and Respondents MSI and PMI have vio-
lated Section 8(a)(5) and (1) of the Act by failing to continue
in effect the agreement with the Union, refusing to apply its
terms and conditions, failing and refusing to provide employ-
ees with the wages and other benefits required by the agree-
ment, bypassing the Union and bargaining directly with em-
ployees concerning wages and other benefits they would re-
ceive as employees under the PMI title, and refusing to bar-
gain with the Union as the representative of PMI employ-
ees.5
By conditioning employment at PMI on employee agree-
ment to forswear union representation, Respondent engaged
in conduct reasonably tending to interfere with, restrain, and
coerce employees in the exercise of rights guaranteed them
by Section 7 of the Act6 and therefore violated Section
8(a)(1) of the Act. Similarly, the conduct of Rodney David
Lucas on January 26, 1993, in threatening employees with a
shutdown of operations and thus loss of employment, had the
same tendency and violated Section 8(a)(1) of the Act.
3. The refusal to furnish information
The Union had a valid and enforceable collective-bar-
gaining agreement with MSI, and thus PMI, when the infor-
mation was requested and denied. The Union has the respon-
sibility of administering that contract. Clinchfield Coal Co.,
275 NLRB 1384 (1985). Respondents are statutorily obliged
to furnish information relevant and reasonably necessary to
the Union’s performance of those responsibilities. NLRB v.
Acme Industrial Co., 385 U.S. 432 (1967); NLRB v. Truitt
Mfg. Co., 351 U.S. 149 (1956). Phalen’s April 7, 1993 letter
requests information for contract administration purposes.
Respondent has refused to deliver it. The Board succinctly
summarized the applicable law in W-L Molding Co., 272
NLRB 1239, 1240 (1984), in the following terms:
273MINING SPECIALISTS
7 See, e.g., George Koch & Sons, Inc., 295 NLRB 695 (1989),
where the union sought and the employer was ordered to furnish re-
sponses to 89 items.
8 See Edward J. White, Inc., 237 NLRB 1020, 1026 (1978).
9 Under New Horizons, interest on and after January 1, 1987, is
computed at the ‘‘short-term Federal rate’’ for the underpayment of
taxes as set out in the 1986 amendment to 26 U.S.C. § 6621.
[A] broad discovery-type standard is applicable to re-
quests for information relevant to a union’s functions of
negotiating and policing compliance with a collective-
bargaining agreement. NLRB v. Acme Industrial Co.,
385 U.S. 432, 437 (1967); General Motors v. NLRB,
700 F.2d 1083, 1088 (6th Cir. 1983); NLRB v. Rock-
well-Standard Corp., 410 F.2d 953, 957 (6th Cir.
1969). ‘‘[I]t is not the Board’s function in this type
case to pass on the merits of the Union’s claim that Re-
spondent breached the collective bargaining agreement
or . . . committed an unfair labor practice.’’ NLRB v.
Rockwell-Standard Corp., 410 F.2d at 957. ‘‘Thus, the
union need not demonstrate actual instances of contrac-
tual violations before the employer must supply infor-
mation.’’ Boyers Construction Co., 267 NLRB 227, 229
(1983). ‘‘Nor must the bargaining agent show that the
information which triggered its request is accurate, non-
hearsay, or even ultimately reliable.’’ Ibid. ‘‘The
Board’s only function in such situation is in ‘acting
upon the probability that the desired information was
relevant, and that it would be of use to the union in
carrying out its statutory duties and responsibilities.’’’
NLRB v. Rockwell-Standard Corp., 410 F.2d at 957
quoting NLRB v. Acme Industrial Co., 385 U.S. at 437.
Accord: General Motors v. NLRB, 700 F.2d at 1088.
[Footnote omitted.]
The Board has had occasion to address requests for a great
number of items relevant to a union’s ability to perform its
responsibilities as a collective-bargaining agent and has
granted those requests.7 Accordingly, inasmuch as the Union
is entitled to the information sought and Respondents have
refused to deliver it, I find such refusal violated Section
8(a)(5) and (1) of the Act.
In reaching the foregoing conclusions, I have considered
Respondents’ argument that the matters at issue should be
deferred to arbitration and conclude this argument cannot
prevail because the issue of an alter ego allegedly established
to evade a collective-bargaining relationship is not something
that can be resolved in the contractual grievance procedure,8
and the Board is not required to defer to arbitration in any
event. I am persuaded this case involves issues which should
not be deferred, cannot be dealt with appropriately within the
framework of the collective-bargaining grievance procedure,
and involves egregious violations of the Act which require
a remedy fashioned by the Board.
CONCLUSIONS OF LAW
1. Respondents PMI and MSI are alter egos and employers
engaged in commerce within the meaning of Section 2(2),
(6), and (7) of the Act.
2. The Union is a labor organization within the meaning
of Section 2(5) of the Act.
3. The Union is the designated and recognized collective-
bargaining representative of the Respondents’ employees
constituting a unit described in the collective-bargaining
agreement between the Union and the Respondents which
was entered into in 1988 and remains valid to date on its
terms.
4. Respondents PMI and MSI have violated Section
8(a)(5) and (1) of the Act by failing to continue in effect the
aforesaid collective-bargaining agreement, by refusing to
apply its terms and conditions to PMI employees, by refusing
to provide the employees with the wages and other benefits
required by the agreement, by bargaining directly with em-
ployees concerning wages and other benefits they would re-
ceive as employees of PMI and by placing these wages and
benefits in effect, and by failing and refusing to bargain with
the Union as the representative of its employees.
5. By refusing to furnish the Union the requested informa-
tion necessary and relevant to administration of the collec-
tive-bargaining agreement, the Respondent failed to bargain
collectively and in good faith with the Union and has thereby
engaged in unfair labor practices affecting commerce with
the meaning of Section 8(a)(5) and (1) of the Act.
6. By conditioning employment at PMI on employee
agreement to forswear union representation, Respondent vio-
lated Section 8(a)(1) of the Act.
7. By threatening employees with a shutdown of oper-
ations if they seek union representation, Respondent has vio-
lated Section 8(a)(1) of the Act.
8. The aforesaid violations of the Act are unfair labor
practices affecting commerce within the meaning of Section
2(6) and (7) of the Act.
THE REMEDY
Having found that MSI and PMI have violated Section
8(a)(5) and (1) of the Act, my recommended Order will re-
quire them to cease and desist therefrom and to take certain
affirmative action designed to effectuate the policies of the
Act.
Inasmuch as PMI is the alter ego of MSI and the two con-
tinue to operate the same business, but have failed and re-
fused to recognize the Union as the collective-bargaining
representative of PMI employees or to apply the terms of the
collective-bargaining agreement between MSI and the Union,
I shall recommend PMI be ordered to recognize the Union
as the representative of its employees and to honor and apply
the terms of that agreement, and any subsequent agreement,
to its employees. I shall also order MSI and PMI to make
the contractually established payments due on and after Janu-
ary 26, 1993, to the various trust funds established by the
collective-bargaining agreement, with interest in accordance
with the criteria set forth in Merryweather Optical Co., 240
NLRB 1213, 1216 fn. 7 (1979), and by reimbursing unit em-
ployees for any expenses they incurred as a result of the un-
lawful failure to make such required payments, as provided
in Kraft Plumbing & Heating, 252 NLRB 891 fn. 2 (1980).
MSI and PMI are also ordered to make their employees
whole for any loss of wages suffered by virtue of the failure
to apply the collective-bargaining agreement to PMI employ-
ees with interest as described in New Horizons for the Re-
tarded, 283 NLRB 1173 (1987).9
274 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
10 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
11 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended10
ORDER
Respondents Mining Specialists, Inc. and its alter ego or
successor Point Mining, Inc., Belle, West Virginia, their offi-
cers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Refusing to recognize and bargain with the Union as
the exclusive representative of its employees in the appro-
priate unit set forth in the National Bituminous Coal Wage
Agreement of 1988 with respect to wages, hours, working
conditions, or other terms or conditions of employment of
the employees, and refusing to honor the collective-bar-
gaining agreement applicable to those employees.
(b) Failing to bargain collectively and in good faith with
the Union by refusing to furnish the Union with requested
information relevant to administration of the collective-bar-
gaining agreement between Respondent and the Union.
(c) Bargaining directly with employees represented by the
Union concerning their wages, hours, and working condi-
tions.
(d) Conditioning employment on the abandonment of
union activity.
(e) Threatening employees with a shutdown of operations
if they seek union representation.
(f) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of the rights guar-
anteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Comply with the terms and conditions of the collec-
tive-bargaining agreement between the Union and MSI retro-
actively to January 26, 1993, and prospectively until such
time as proper and timely notice of cancellation is given, in
the manner set forth in the collective-bargaining agreement.
(b) On request, recognize and bargain with the Union as
the exclusive representative of the employees in the unit cov-
ered by the agreement concerning terms and conditions of
employment.
(c) Immediately furnish the Union with the information it
requested by letter of April 7, 1993.
(d) Make whole the unit employees by transmitting the
contributions owed to the Union’s health and welfare, pen-
sion, and other funds pursuant to the terms of the collective-
bargaining agreement with the Union, and by reimbursing
unit employees for medical, dental, or any other expenses en-
suing from its unlawful failure to make such required con-
tributions.
(e) Make whole the unit employees for any wages lost as
a result of its failure to comply with the terms of the collec-
tive-bargaining agreement.
(f) Preserve and, on request, make available to the Board
or its agents for examination and copying, all payroll records,
social security payment records, timecards, personnel records
and reports, and all other records necessary to analyze the
amounts due under the terms of this Order.
(g) Post at their facility in Belle, West Virginia, and at
their jobsites, copies of the attached notice marked ‘‘Appen-
dix B.’’11 Copies of the notice, on forms provided by the Re-
gional Director for Region 9, after being signed by the Re-
spondents’ authorized representative, shall be posted by the
Respondents immediately upon receipt for 60 consecutive
days in conspicuous places including all places where notices
to employees are customarily posted. Reasonable steps shall
be taken by the Respondents to ensure that the notices are
not altered, defaced, or covered by any other material.
(h) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondents have
taken to comply.
APPENDIX A
UNITED MINE WORKERS OF AMERICA
TELEPHONE (304) 346–0341
ROBERT E. PHALEN MAYNARD H. DANIEL
PRESIDENT SECRETARY-TREASURER
MIKE BROWNING HOWARD L. GREEN
VICE PRESIDENT INTERNATIONAL EXECUTIVE
UNITED MINE WORKERS BUILDING
1300 KANAWHA BOULEVARD E.
POST OFFICE BOX 1313
CHARLESTON, WEST VIRGINIA 25325
April 7, 1993
Roy Lucas, President
Mining Specialists, Inc.
P. O. Box 197
Belle, WV 25015
RE: UMWA Information Request
Dear Mr. Lucas:
It has just come to my attention that you have or are
in the process of changing your corporate name and
continuing operations as Point Mining, Inc., and oper-
ating as a joint/single employer with or successor to
Mining Specialists, Inc.
Therefore, in order that the Union may properly per-
form its statutory duties as a certified collective bar-
gaining agent for your unionized employees, as well as
monitor performance of important legal and contractual
obligations, I hereby request the below listed informa-
tion for Mining Specialists, Inc. and Point Mining, Inc.
For your convenience, I have separated the informa-
tion request into ‘‘Documentary Requests’’ and ‘‘Inter-
rogatories.’’
275MINING SPECIALISTS
I.
DOCUMENTARY REQUESTS
1. Copies of the leases, subleases and/or mining con-
tracts for Mining Specialists, Inc. and Point Mining Inc.
in effect from February 1, 1988 to present.
2. Copies of any leases, subleases and/or mining
agreements presently in effect for both companies.
3. Copies of the legal identity reports filed with
MSHA for the operations owned, leased, controlled by
either of the above companies or in which any of the
above companies has or held an interest.
4. Copies of all mining permits in existence presently
and during the 1988 National Bituminous Coal Wage
Agreement issued by state and/or federal regulatory
agencies for both companies.
5. Copies of all ‘‘Annual Return Report of Employee
Benefit Plan’’ Form 5500 (or any other similar report
in connection with the payment of employee benefits
filed with the Internal Revenue Service from 1988 to
the present for both companies.
6. Copies of all notices given to the West Virginia
Commissioner of Labor regarding any contract, sub-
contract, lease or sublease for mining operations on any
property owned, leased, controlled by either of your
companies or in which either company has had or has
an interest from 1988 to the present.
7. Copies of wage bonds posted for each company
as well as all correspondence to and from the West Vir-
ginia Department of Labor concerning your wage bond
for both companies.
8. Copies of any withdrawal liability notice and de-
mand required by Section 219 of ERISA (29 U.S.C.
Sec. 1399) or any opinions, documents and correspond-
ence to or from the UMWA Health & Retirement
Funds or anyone else concerning withdrawal liability
for Mining Specialists, Inc.
9. Copies of all coal sales and processing contracts
for or between Mining Specialists, Inc. and Point Min-
ing, Inc. and the purchasers of your coal. Naturally, you
may feel free to delete the actual price per ton of coal
received and such other similar financial information.
10. Copies of both companies’ corporate income tax
returns (Form 1120). If you filed a consolidated return
for Mining Specialists, Inc. and Point Mining, Inc.,
please designate with specificity.
11. An organizational or flow chart showing the
structure and interrelationship of each of Mining Spe-
cialists, Inc. and Point Mining, Inc.
12. A copy of the health and life insurance policy in
effect for your classified employees.
13. A list of the names, addresses and phone num-
bers for the employees of Mining Specialists, Inc.
(since 1990) and Point Mining, Inc.
14. A list of all equipment and inventory loaned,
leased, or sold by Mining Specialists, Inc. to Point Min-
ing, Inc.
15. Copies of all MSHA Form 7000–2, ‘‘Quarterly
Mine Employment and Coal Production Reports’’ filed
by both companies since 1990.
16. Copies of all monthly coal mine reports filed by
both companies as required by W.Va. Code § 22A–2–77
since July, 1992.
II.
INTERROGATORIES
1. Identify the name, title(s) and company of any of-
ficer, director or any other management representative
who held or holds a position with Mining Specialists,
Inc. and Point Mining, Inc. In each case, also identify
applicable time period.
2. Identify the name, job title(s), and present com-
pany affiliation of any person who held or holds a func-
tion related to labor relations in your company and
Point Mining, Inc. In each case, also identify the appli-
cable time period and the job duties of the individual
in question.
3. Identify the customers of Point Mining, Inc. which
are now or formerly customers of Mining Specialists,
Inc. In each case, also identify the applicable time pe-
riod and the specific company per customer.
4. Identify the name, job title and company of each
individual who performed or performs any service, in-
cluding clerical, administrative, bookkeeping, manage-
rial, engineering, sales, estimating, or other services for
Mining Specialists, Inc. and Point Mining, Inc. For
each such person, also identify the time period, com-
pany and service in question.
5. Identify any common insurance carrier(s) used by
Mining Specialists, Inc., and Point Mining, Inc. for
every insurance related employment benefit, including
health insurance. Please specify the exact benefit and
company per item.
6. Identify any equipment exchanged, loaned, sold or
leased between Mining Specialists, Inc. and Point Min-
ing, Inc. Identify the appropriate date and parties in-
volved in the arrangement.
7. Identify any employees, supervisory personnel and
managers who have transferred from Mining Special-
ists, Inc. to Point Mining, Inc. For each such person,
give job title, current company, and approximate date
of transfer.
8. Identify the entire hiring procedure for each com-
pany and provide samples of the application forms uti-
lized in processing the application.
As I indicated above, the requested information is es-
sential to fulfillment of the Union’s role as statutory
collective bargaining agent for your unionized employ-
ees. As there are a number of problems which have
been brought to my attention, including the nonprovi-
sion of insurance benefits and payment of other wages
and benefits, I would appreciate your prompt response
to this request.
276 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
Should you wish to discuss this matter, please feel
free to contact me at your earliest convenience.
Sincerely,
/s/ Robert E. Phalen
REP: pw
cc: Clifford Crum
Mark March
APPENDIX B
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we vio-
lated the National Labor Relations Act and has ordered us
to post and abide by this notice.
WE WILL NOT refuse to recognize and bargain with United
Mine Workers of America, District 17 as the exclusive bar-
gaining representative of our employees in the unit described
in the National Bituminous Coal Wage Agreement of 1988.
WE WILL NOT repudiate the collective-bargaining process
by withdrawing recognition from the above-named Union as
the exclusive collective-bargaining representative of our unit
employees, and WE WILL NOT refuse to follow the collective-
bargaining agreements applicable to our unit employees.
WE WILL NOT bargain directly with our unit employees
over wages, hours, or any other conditions of employment.
WE WILL NOT refuse to furnish the Union with requested
information relevant to the administration of our collective-
bargaining agreement.
WE WILL NOT condition employment on the abandonment
of union representation.
WE WILL NOT threaten our employees with operational
shutdown if they engage in protected union activity.
WE WILL NOT in any like or related manner interfere with,
restrain, or coerce you in the exercise of the rights guaran-
teed you by Section 7 of the Act.
WE WILL, on request, bargain with the above-named Union
as the exclusive representative of all the employees in the ap-
propriate unit concerning rates of pay, wages, hours of work,
and other terms and conditions of employment.
WE WILL comply with the terms and conditions of the col-
lective-bargaining agreement between the Union and Mining
Specialists, Inc., to which Mining Specialists, Inc. and Point
Mining, Inc. are bound retroactively to January 26, 1993, and
prospectively until such time as proper and timely notice of
cancellation is given in the manner set forth in said agree-
ment.
WE WILL make whole our unit employees by transmitting
the contributions owed to the Union’s health and welfare,
pension, vacation and holiday, and other funds pursuant to
the terms of our collective-bargaining agreement with the
Union, and by reimbursing unit employees for any medical,
dental, or any other expenses ensuing from our unlawful fail-
ure to make such required contributions.
WE WILL also make our employees whole for any wages
lost as a result of our refusal to comply with the terms of
the collective-bargaining agreement, with interest.
WE WILL promptly furnish the Union, on request, the pre-
viously requested information relevant to the administration
of our collective-bargaining agreement.
MINING SPECIALISTS, INC. AND POINT MIN-
ING, INC.