Nova Services Co.

National Labor Relations Board - Board Decisions

Aug 28, 1974

213 N.L.R.B. 95 (N.L.R.B. 1974)

NOVA SERVICES COMPANY
Nova Services Company and Building Service Employ-
ees' International Union, Local 254, AFL-CIO.
Case 1-CA-9468
August 28, 1974
DECISION AND ORDER
By CHAIRMAN MILLER AND MEMBERS FANNING
AND JENKINS
On April 23, 1974, Administrative Law Judge Ar-
nold Ordman issued the attached Decision in this
proceeding . Thereafter , the General Counsel and the
Charging Party filed exceptions and supporting briefs
and Respondent filed cross -exceptions and briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended , the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three -member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions , cross-ex-
ceptions , and briefs and has decided to affirm the
rulings , findings , and conclusions I of the Administra-
tive Law Judge and to adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Rela-
tions Board adopts as its Order the recommended
Order of the Administrative Law Judge and hereby
orders that the complaint be, and it hereby is, dis-
missed in its entirety.
1 In their exceptions and briefs , the General Counsel and the Charging
Party claim the record evidence is defective and seek to reopen the record
in order to introduce additional evidence relative to certain contractual
relationships bearing on whether Respondent is a legal successor. At the
hearing in this matter , the General Counsel chose to rely on the testimony
of Thomas Spooner to establish the prerequisites for finding that Respondent
was a legal successor to Sanitas with respect to Respondent 's operations at
the Mechanics National Bank. Contrary to the assertions of the General
Counsel and the Charging Party, the evidence now being proffered does not
deal with inconsistencies in the record evidence, but rather attempts to intro-
duce additional evidence which was not presented at the hearing in this
matter . There is no explanation or justification offered as to why this addi-
tional evidence was not available at the time of the hearing . Accordingly,
inasmuch as the factual findings and conclusions of the Administrative Law
Judge are fully supported by record evidence and absent a showing that this
additional evidence was newly discovered or previously unavailable, we here-
by deny the motion that this additional evidence be admitted into evidence
and made a part of the record. Moreover , we are not persuaded that the
proffered evidence , when considered in the context of other findings made
by the Administrative Law Judge , would be of sufficient weight to warrant
overturning the result reached herein.
DECISION
STATEMENT OF THE CASE
95
ARNOLD ORDMAN , Administrative Law Judge: Pursuant to
an unfair labor practice charge filed on December 5, 1973,
by the Union, named in the caption, complaint issued on
January 14, 1974, alleging that Respondent, Nova Service
Company, violated Section 8(a)(5) and (1) of the National
Labor Relations Act, as amended, by refusing, upon re-
quest, to bargain with the Union as the exclusive representa-
tive of certain employees of Respondent comprising an
appropriate unit. Respondent filed an answer to the com-
plaint on January 22, 1974, denying virtually all allegations
of the complaint and specifically asserting that the National
Labor Relations Board was without jurisdiction in the mat-
ter, that Respondent never received a formal request to
bargain, that it was not a successor to a prior employer (with
which the Union had a collective-bargaining relationship),
and that the unit of employees described in the complaint
was not appropriate.
Hearing was conducted in this matter in Worcester, Mas-
sachusetts, on February 13, 1974. At the conclusion of the
hearing counsel for General Counsel argued orally. Respon-
dent and the Union later submitted written briefs. Upon the
entire record, upon my observations of the witnesses and
after due consideration of the argument and briefs, I make
the following:
FINDINGS AND CONCLUSIONS
1. JURISDICTION
Respondent is a sole proprietorship, owned and operated
by Thomas Spooner, and is engaged in the business of fur-
nishing janitorial services to customers. Respondent's of-
fice, serviced by one clerical employee, is located at 1200
Main Street, Worcester, Massachusetts. During the period
here relevant, Respondent, a new enterprise which had
come into being in late March 1973, furnished janitorial
services to a total of five customers, all apparently in the
Worcester area . For this purpose Respondent had a total
complement of about 36 employees. Approximately 10 of
these 36 employees provided janitorial services for I of the
5 customers, namely, Mechanics National Bank of Worces-
ter, specifically, for the latter's main office, its operations
branch and several of its branch offices.
Under Respondent's contractual arrangement with the
bank, an arrangement subject to cancellation by either par-
ty on 30 days' notice, Respondent would receive an annual
return of $59,000 for its janitorial services. Aside from mi-
nuscule purchases of supplies from outside Massachusetts,
Respondent purchases its supplies essentially from Massa-
chusetts suppliers. The value of such supplies over the 10 to
11 month period Respondent has been in business amounts
to no more than $5000 to $6000 for all of Respondent's
operations.
Mechanics National Bank, however, does a substantial
interstate business . Its income from United States Govern-
ment securities in 1973 was $234,749. Additional 1973 in-
213 NLRB No. 14
96 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
come from state and municipal securities , over $50,000
worth of which came from out-of-state, was $629,000. The
bank is a member of the Federal Reserve System and is
regulated by the U.S. Comptroller of Currency and by the
Federal Deposit Insurance Corporation.
So far as the Union is concerned, the complaint alleges,
Respondent at the hearing admitted, and I find, that the
Union is a labor organization within the meaning of Section
2(5) of the Act.
Respondent urges that the Board should not assert juris-
diction in this proceeding because Respondent 's business is
essentially local in character and that the impact on com-
merce flowing from its relationship to the bank is so mini-
mal as not to warrant the assertion of jurisdiction . General
Counsel does not quarrel with the fact that Respondent's
business is essentially local in character. Rather , General
Counsel's claim that jurisdiction should be asserted is predi-
cated solely on the familiar and well-settled principle that
where an employer , here Respondent , furnishes services val-
ued in excess of $50,000 to an enterprise which is engaged
in commerce or in operations affecting commerce , assertion
of jurisdiction is warranted. Siemons Mailing Service, 122
NLRB 81, 86 ( 1958). Equally well-settled is the proposition
that there is no requirement that "impact on interstate
commerce must be established in each particular case."
N.L.R.B. v. Marbro Food Service, Inc., d/b/a Fab's Famous
Foods Company, 366 F.2d 477, 478 (C.A. 10, 1966) cert.
denied 386 U.S. 912 (1967). See also N.L.R.B. v. Dixie Ter-
minal Co., 210 F.2d 538, 539-540 (C.A. 6, 1954), cert. de-
nied 347 U.S. 1015 (1954).
1 find, therefore, that Respondent is an employer within
the meaning of Section 2(6) and (7) of the Act and that it
will effectuate the policies of the Act to assert jurisdiction
herein.
11. THE UNFAIR LABOR PRACTICE
The pleadings in the instant case define quite precisely
the issues to be resolved . Thus , the complaint alleges, in
substance, that in the latter part of 1973 Respondent as-
sumed certain cleaning contracts with Mechanics National
Bank which contracts, prior thereto, had been held by Sani-
tas Services of Massachusetts , Inc., herein Sanitas; that Re-
spondent hired certain employees to perform the cleaning
services for the bank ; and that a majority of these employ-
ees had previously been employed by Sanitas to perform the
same function . The complaint further alleges that the em-
ployees of Respondent who formed its work force at the
bank locations constituted an appropriate unit for the pur-
poses of collective bargaining and that the Union at all
times material herein was the exclusive bargaining represen-
tative of these employees . Finally , the complaint alleges that
on or about November 29, 1973, the Union requested and
Respondent refused to bargain collectively with the Union
as exclusive bargaining representative of these employees.
Respondent in its answer to the complaint (and in its brief
submitted after the close of the hearing) takes sharp issue
with these allegations . First, Respondent challenges the alle-
gation that it is a successor to Sanitas , the underlying prem-
ise upon which the Union 's claim to bargaining status is
predicated. Second , Respondent contends that a unit con-
fined to the approximately 10 employees who service Me-
chanics National Bank is not appropriate and that an ap-
propriate unit would have to include all of Respondent's
janitorial personnel, numbering approximately 36, all of
whom do the same kind of work under the same supervision
and all in the same Worcester area. Finally, in its answer but
not in its brief, Respondent alleges that it had not received
a formal request to negotiate or be recognized by any union.
Accordingly, Respondent argues that it was not required to
bargain with the Union and prays for dismissal of the com-
plaint.
Certain preliminary, albeit important, issues can be dis-
posed of forthwith. On December 3, 1973, the Union sent
Respondent a letter by registered mail to Respondent advis-
ing the latter that the Union represented a majority of its
employees at the Mechanics National Bank and requesting
a meeting for the purposes of entering into a collective-
bargaining agreement. Respondent never received this let-
ter. However, the testimony of E. W. Buffum, business
agent of the Union, and Thomas Spooner, owner of Re-
spondent, is in accord, though differing as to detail, that in
late November or early December, or both, Buffum asked
Spooner to bargain with the Union as the representative of
Respondent's employees at the bank and that Spooner re-
fused.
The resolution of this controversy hinges, therefore, on
whether Respondent had any obligation at all to bargain
with the Union. That issue, in turn, as all parties agree,
hinges on the question whether Respondent was a successor
to Sanitas with respect to Respondent's operations at Me-
chanics National Bank.
The evidence relevant to that issue is largely undisputed.
Prior to early December 1973 when Respondent took over
the janitorial services at the bank locations , those services
had been performed by Sanitas. Sanitas was a statewide
operation with a total complement of over 300 employees.
Sanitas was also a member of an employer association
known as Maintenance Contractors of New England, Inc.
and, as such member, was among the signatories to a collec-
tive-bargaining agreement with the Union entered into on
September 1, 1972, and effective for a 3-year period thereaf-
ter. The Sanitas unit covered by the agreement consisted of
all the employees engaged in the contract building cleaning
industry throughout the Commonwealth of Massachusetts.
The agreement also contained a union-security clause re-
quiring employees covered therein to join the Union within
30 days after the effective date of the agreement.
Sanitas utilized the services of about 65 of its over 300
employees to take care of its Worcester area operations and
II or 12 of these employees were assigned specifically to
take care of those bank janitorial operations later taken over
by Respondent.
As already noted, Respondent was brought into being in
March 1973 by Thomas Spooner, formerly a Worcester area
manager for Sanitas, and had a total complement of about
36 employees to take care of its 5 customers. Mechanics
National Bank became a customer when Sanitas ' cleaning
contract with the bank expired in late 1973. On or about
December 1, 1973, Respondent successfully solicited the
contract, already mentioned, to furnish janitorial services
for the bank's main office, its operations center and several
NOVA SERVICES COMPANY
of its branches. Not all of the bank's janitorial work, which
had previously been done by Sanitas, was taken over by
Respondent. Another company, referred to in the record as
"Allied," took over much of that work.
Respondent began its operations for the bank on Decem-
ber 3, 1973, utilizing the services of about 10 of its total
complement of 36 employees for that purpose. Eight of
these ten employees, all of whom had worked at the bank
locations when Sanitas had the janitorial contract, were and
continued to be members of the Union. Spooner testified
that he knew the eight individuals, knew that they had
worked at the Mechanics National Bank locations for Sani-
tas prior to Respondent's takeover, and knew also that these
employees were represented by the Union.' Spooner testi-
fied also that there was relatively little interchange between
his employees who worked at the bank locations and his
other employees. Indeed, he testified, the employees as-
signed to the different bank locations invariably worked at
the same bank location or branch. Nor was there any signif-
icant change in the functions or duties they performed be-
fore and after Respondent's takeover.
Upon this state of the record General Counsel contends
that with respect to Respondent's operations at the Me-
chanics National Bank locations, Respondent is a successor
to Sanitas and hence owes a bargaining obligation to the
Union.
Viewed from a narrow perspective, this contention has
considerable surface appeal. Respondent did take over the
janitorial services at Mechanics National Bank locations
from Sanitas. Respondent performed the same functions
and duties as its predecessor with virtually the same work
force as its predecessor had utilized in the same locations.
There was also virtually no hiatus in the janitorial opera-
tions as a result of the takeover. These are admittedly the
kind of factors which the Board has taken into account in
determining whether a successor relationship exists. As the
Board said in Lincoln Private Police, Inc., as Successor to
Industrial Security Guards, Inc., 189 NLRB 717, 719 (1971):
The Board has long recognized that a change in own-
ership of a business enterprise does not in itself absolve
the new owner from an obligation, arising under the
Act, to recognize and bargain with the union that rep-
resents the former owner's employees. Where there is
a substantial continuity in the identity of the employing
enterprise, the purchasing employer is bound to recog-
nize and bargain with the incumbent union. [Footnote
omitted.] In the many cases that have been before the
Board on the successorship issue, it has not accorded
controlling weight to any single factor, but has evaluat-
ed all the circumstances present in any given case in
arriving at an ultimate conclusion.
1 Spooner initially disclaimed that he had seen or handled the collective-
bargaining agreement between Sanitas and the Union. Later in the hearing,
however, Spooner acknowledged that when he was Worcester area manager
for Sanitas , dues deductions from the Sanitas employees in favor of the
Union was made under his supervision.
97
Here, as in Lincoln, however, the totality of circumstances
must be considered. A narrow perspective is not enough.
This is not a situation where a former owner has abandoned
or otherwise disposed of his operation and a new owner
takes over all or a major part of that operation. Here, the
former owner, Sanitas, was and remains a statewide opera-
tion. Respondent took over a small part of the Worcester
area segment of Sanitas' operation when Respondent suc-
cessfully solicited a contract to service part of Mechanics
National Bank's facilities.2 A competing enterprise, Allied,
took over much of the bank work all of which Sanitas had
performed before. And, as suggested (fn. 2, supra) the bank
portion of the work which Respondent did perform was less
than half of Respondent's workload and required the serv-
ices of considerably less than half its work force, all of
whom did an identical type of work. Under these circum-
stances the indispensable prerequisite for a finding of suc-
cessorship, namely, that notwithstanding the change of
ownership, there has been "a substantial continuity in the
employing enterprise" has not been met.
Accordingly, while it is true, as the Board said in Lincoln,
that successorship has been found in situations where a new
employer acquires less than a predecessor's entire business,
or hires less than a majority of the predecessor's work force,
present always in those situations has been the basis for a
finding that there was no basic change in the employing
industry as a result of the takeover. That is not the case here.
The fact that a part of Respondent's business was duplica-
tive of a portion of one project which Sanitas had previously
performed does not warrant the conclusion that there has
been a substantial continuity in the employing enterprise.
As in Lincoln, this is too fragmentary a basis upon which
to predicate a finding of legal successorship. It follows that
the bargaining obligation which would have resulted from
that relationship does not exist. Accordingly, I find that
Respondent did not violate Section 8(a)(5) and (1) of the
Act by refusing to bargain with the Union .3 No other unfair
labor practice by Respondent is alleged or disclosed by the
record which would warrant a bargaining order.
CONCLUSION OF LAW
Respondent, Nova Service Company, has not violated
Section 8(a)(5) and (1) of the Act, as alleged in the com-
plaint.
Upon the foregoing findings of fact and conclusion of
2 The record furnishes us with no enlightenment as to whether the other
four customers for whom Respondent furnished janitorial services were or
were not former Sanitas customers . Significantly, however, Respondent
makes no claim here of successorship as to those enterprises.
3 The foregoing finding makes it unnecessary to resolve the remaining and
hotly-contested issue as to whether a unit confined to the 10 employees who
worked at the bank locations would be appropriate . As noted, Respondent's
entire work force numbered about 36, all did the identical type of work,
operated under the same supervision and performed their work in the imme-
diate Worcester area.
98 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
law, upon the entire record , and pursuant to Section 10(c)
of the Act, I recommend the following:
4 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions , and recommended Order herein shall, as provided in Sec . 102.48
ORDER4
The complaint in this proceeding is dismissed in its entire-
ty
-of the Rules and Regulations , be adopted by the Board and become its
findings , conclusions and Order , and all objections thereto shall be deemed
waives for all purposes.