Plastonics, Inc.

National Labor Relations Board - Board Decisions

Oct 12, 1993

312 N.L.R.B. 1045 (N.L.R.B. 1993)

1045
312 NLRB No. 155
PLASTONICS, INC.
1 On January 8, 1993, Administrative Law Judge Wallace H. Na-
tions issued the attached decision. The General Counsel and the
Charging Party (the Union) filed exceptions and supporting briefs.
The Respondent filed an answering brief.
2 There are no exceptions to the judge’s findings that the unilateral
layoffs violated Sec. 8(a)(5).
3 We find no merit in the Union’s request for an extension of the
certification year. The layoffs were completed in less than 3 weeks,
and no employee was laid off for more than 2 weeks. All employees
were recalled prior to the first bargaining session. As of the hearing
date, the bargaining had lasted 9 months and was continuing. There
is no allegation that the bargaining was in bad faith, and no showing
that it was tainted by the layoffs. In these circumstances, and noting
the backpay remedy that we are granting, we are not persuaded that
the further remedy of extending the certification year is warranted.
4 Interest on backpay shall be computed in the manner set forth
in New Horizons for the Retarded, 283 NLRB 1173 (1987). Inas-
much as the Respondent recalled all laid-off employees, there is no
need to require reinstatement in the Order.
Plastonics, Inc. and Local 151, International Ladies’
Garment Workers Union, AFL–CIO. Case 34–
CA–5626
October 12, 1993
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
DEVANEY AND RAUDABAUGH
The issues remaining in this case concern the
judge’s recommended remedy for the Respondent’s
unilateral layoff of unit employees in violation of Sec-
tion 8(a)(5) and (1) of the Act.1 The General Counsel
and the Charging Party both contend that the judge
erred by failing to recommend backpay for the laid-off
employees. The Charging Party further contends that
the judge should have recommended an extension of
its certification year.
The National Labor Relations Board has considered
the decision and the record in light of the exceptions
and briefs and has decided to affirm the judge’s rul-
ings, findings,2 and conclusions, to amend the rec-
ommended remedy, and to adopt the recommended
Order as modified. For the reasons set forth below, we
agree with the General Counsel and Charging Party
that the remedy for the Respondent’s unlawful unilat-
eral action should include a provision for full back-
pay.3
On November 19, 1991, the Board certified the
Union as representative of a unit of the Respondent’s
employees. On November 22, the Union requested bar-
gaining. Prior to the January 1992 commencement of
contract negotiations, however, the Respondent unilat-
erally laid off most unit employees for varying periods
up to 2 weeks in length. The Union did not learn about
the layoffs until a March 5, 1992 negotiating session.
Its attorney then informed the Respondent of the obli-
gation to bargain about layoffs. The Respondent’s rep-
resentative answered that he did not believe that he
had to do so.
The judge found, and it is not further contested here,
that the Respondent violated Section 8(a)(5) by laying
off unit employees without giving the Union notice
and an opportunity to bargain about the layoff decision
and its effects. The judge ordered the Respondent, inter
alia, to notify and bargain with the Union regarding
the decision and effects of any future economic lay-
offs. He declined, however, to order the Respondent to
give backpay to those employees whom it unlawfully
laid off. The judge reasoned that such a remedy
‘‘would serve no useful purpose and to the contrary,
might unduly harm the Respondent’s financial health
and jeopardize its employees’ jobs.’’ Furthermore, he
stated his belief that bargaining would not have
changed anything. The Respondent would still have
had to lay off employees for valid economic reasons
in December 1991. We disagree with the judge’s rea-
soning.
The traditional and appropriate Board remedy for an
unlawful unilateral layoff based on legitimate eco-
nomic concerns includes requiring the payment of full
backpay, plus interest, for the duration of the layoff.
Lapeer Foundry & Machine, 289 NLRB 952, 955–956
(1988). Contrary to the judge, this remedy does not re-
quire an antecedent finding that bargaining would have
prevented the layoffs. As stated in Lapeer,
First, requiring [such a] finding . . . requires the
Board or a court to engage in a post-hoc deter-
mination of the economic situation, instead of let-
ting the parties decide themselves at the time of
the layoff. This requirement thus unnecessarily in-
jects the Government into an area in which the
collective-bargaining process should be permitted
to function. Second, the requirement is contrary to
our customary policy to order a respondent to re-
store the status quo when the respondent has
taken unlawful unilateral action to the detriment
of its employees. The ‘‘consequences of Respond-
ent’s disregard of its statutory obligation should
be borne by the Respondent, the wrongdoer here-
in, rather than by the employees.’’ Hamilton Elec-
tronics Co., 203 NLRB 206 (1973).
Based on the foregoing rationale, we shall amend
the remedy, modify the recommended Order, and sub-
stitute a notice providing for full backpay relief to unit
employees unlawfully laid off by the Respondent in
the period from December 18, 1991, to January 6,
1992.4
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge as
modified below and orders that the Respondent,
Plastonics, Inc., Hartford, Connecticut, its officers,
1046 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 This remedy is intended to compensate for the loss of bargaining
leverage that the union might have possessed had bargaining oc-
curred before the action at issue was taken. See, e.g., Stevens Pon-
tiac-GMC, 295 NLRB 599, 602–603 (1989).
agents, successors, and assigns, shall take the action
set forth in the Order as modified.
1. Insert the following as paragraphs 2(b) and (c)
and reletter the subsequent paragraphs.
‘‘(b) Make whole, with interest, those unit employ-
ees who were laid off in the period from December 18,
1991, to January 6, 1992, for any loss of pay or other
employment benefits suffered as a result of this unlaw-
ful unilateral action.
‘‘(c) Preserve and, on request, make available to the
Board or its agents for examination and copying, all
payroll records, social security payment records, time-
cards, personnel records and reports, and all other
records necessary to analyze the amount of backpay
due under the terms of this Order.’’
2. Substitute the attached notice for that of the ad-
ministrative law judge.
CHAIRMAN STEPHENS, concurring.
For the reasons stated by the judge, I agree that it
is clear that even if the Respondent had given the
Union notice and an opportunity to bargain, layoffs
would not have been averted, albeit bargaining might
have affected the timing of individual employees’ lay-
offs and recalls. In such rare cases, I would ordinarily
be averse to granting an unlimited full backpay rem-
edy. However, in view of the fact that none of the lay-
offs exceeded 2 weeks, the employees here would re-
ceive backpay for the period of their layoffs even
under the more limited remedy given for an unlawful
failure to bargain over the effects of layoffs.
Transmarine Navigation Corp., 170 NLRB 389
(1968).1 Because the violations found by the judge in-
clude a refusal to bargain over the effects of the lay-
offs and because the full backpay remedy here would
not exceed the minimum 2-week backpay award im-
posed under the Transmarine precedent, I do not find
the backpay order in any way unreasonable.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this notice.
WE WILL NOT, without first giving notice and af-
fording Local 151, International Ladies’ Garment
Workers Union, AFL–CIO the opportunity to bargain
in good faith over our decision and its effects, lay off
our employees in the following unit:
All full-time and regular part-time production and
maintenance employees employed by us at our
Hartford, Connecticut facility; but excluding all
other employees, office clerical employees, and
guards, professional employees, and supervisors
as defined in the Act.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce our employees in the exercise
of the rights guaranteed them by Section 7 of the Act.
WE WILL give notice to the Union before we imple-
ment any future economic layoff and give the Union
the opportunity to bargain over that decision and its ef-
fects, unless we and the Union agree to a different pro-
cedure in a written collective-bargaining agreement.
WE WILL make whole, with interest, those employ-
ees whom we unilaterally laid off during the period
from December 18, 1991, to January 6, 1992, for any
loss of pay or other employment benefits suffered as
a result of our unlawful conduct.
PLASTONICS, INC.
John F. S. Gross, Esq., for the General Counsel.
Brian Clemow and Patrick J. McHale, Esqs., of Hartford,
Connecticut, for the Respondent.
DECISION
STATEMENT OF THE CASE
WALLACE H. NATIONS, Administrative Law Judge. Based
on a charge filed March 23, 1992, and amended on May 4,
1992, by Local 151, International Ladies’ Garment Workers
Union, AFL–CIO (the Union), the Regional Director for Re-
gion 34 issued a complaint and notice of hearing against
Plastonics, Inc. (Respondent or Company) on May 7, 1992.
The complaint alleges that Respondent has engaged in cer-
tain conduct in violation of Section 8(a)(1) and (5) of the
National Labor Relations Act (the Act). Respondent filed a
timely answer admitting certain factual complaint allegations,
including the jurisdictional allegations, but denying that it
committed any unfair labor practices.
A hearing was held in these matters in Hartford, Connecti-
cut, on September 21, 1992. Briefs were filed by the parties
on or about October 26, 1992. Based on the entire record,
including my observation of the demeanor of the witnesses
and after consideration of the briefs, I make the following
FINDINGS OF FACT
I. JURISDICTION
Respondent is a Connecticut corporation with an office
and place of business in Hartford, Connecticut, where it en-
gages in the nonretail sale and application of custom plastic
coatings. Respondent admits the jurisdictional allegations of
the complaint and I find that it is now, and has been at all
times material to this proceeding, an employer engaged in
1047PLASTONICS, INC.
commerce within the meaning of Section 2(2), (6), and (7)
of the Act.
II. THE INVOLVED LABOR ORGANIZATION
It is admitted and I find that the Union is a labor organiza-
tion within the meaning of Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
The complaint alleges that Respondent violated Section
8(a)(1) and (5) of the Act by refusing to bargain collectively
and in good faith with the Union by laying off its unit em-
ployees on or about December 19, 1991, without prior notice
to and without affording the Union an opportunity to bargain
with Respondent with respect to the layoff.
A. The Factual Circumstances Giving Rise to
the Controversy
As noted above, Respondent operates a facility in Hart-
ford, Connecticut, and is engaged in the nonretail sale and
application of custom plastic coating. Specifically, Respond-
ent coats wire baskets, door hardware, boot laces, and other
metal items sent to its facility by various customers. Once
coated, these items are sent back to the various customers for
sale to the ultimate consumer. Respondent’s president and
vice president are Robert and William Zimmerli, respec-
tively. Bruce Hallden is Respondent’s vice president and
treasurer. The Respondent had approximately 30 employees,
including about 23 production and maintenance employees,
at the time of the events in question.
On November 19, 1991, pursuant to a representation elec-
tion conducted on November 7, 1991, the Union was cer-
tified as the exclusive collective-bargaining representative of
the following employees (unit or unit employees):
All full-time and regular part-time production and
maintenance employees employed by [Respondent] at
its Hartford, Connecticut facility; but excluding all
other employees, office clerical employees, and guards,
professional employees, and supervisors as defined in
the Act.
On November 22, 1991, Alice Bethea, manager of the
Connecticut District Council, International Ladies’ Garment
Workers Union and lead negotiator for the Union in negotia-
tions with Respondent, requested in writing that Respondent
meet with the Union ‘‘as soon as possible at a mutually
agreed upon time and place, for the purpose of negotiating
a collective-bargaining agreement.’’ The letter also requested
that Respondent furnish certain information. Subsequent to
this letter, at a date most likely in January 1992, the parties
had a phone conversation in which a date and place were se-
lected for the first negotiation session.
Prior to this first meeting between the Respondent and the
Union, the Respondent laid off all of the bargaining unit em-
ployees, except maintenance employees, for an approximate
2-week period from late December 1991, until early January
1992.
Prior to the certification of the Union, the Respondent had
had two layoffs, one in February 1990 and one in September
of that year. The February 1990 layoff was caused by a lack
of orders from customers which resulted in one department
having nothing to do. At that time, Respondent laid off three
employees in the affected department for 5 to 10 working
days. In September 1990, the Company faced a similar situa-
tion and laid off four employees in one of its departments.
With respect to the December 1991 layoff, Respondent’s
vice president and treasurer, Hallden, testified that the Com-
pany was not in good financial shape, having not had a rea-
sonably profitable year in the last 4 or 5 years. In December
1991, the Company experienced difficulty meeting its pay-
roll, and was late in making its tax payments to the city of
Hartford. According to Hallden, the December holiday period
is traditionally a slow period for the Company and December
1991 was the slowest he had ever experienced in 25 years
with the Company. According to Hallden, many of its cus-
tomers shut down for 3 or 4 days during the holiday period.
Because of the slowdown in incoming orders the Respond-
ent began considering a layoff or an entire shutdown around
December 10 to 12, 1991. The Company’s salesforce spent
2 or 3 days phoning customers to determine whether they
were planning on sending in orders in the coming days and
weeks. From these efforts the Company learned that it was
going to receive very little business over the holiday period.
In addition to financial factors which caused the layoff, the
Respondent mentioned that it could use a layoff to repair a
tank which was leaking and needed repair. It is difficult to
keep production going while this tank is repaired as it feeds
other processes in the facility. Thus, during the December
layoff, a subcontractor made extensive repairs to the tank,
finishing on Thursday, January 2, 1992. This job involved
about 62 hours of labor. Though Respondent argues on brief
that this repair was a reason for the timing of the layoff, the
facts just do not support such an argument. The tank had
been leaking for months, and Hallden testified that the Com-
pany decided to repair the tank only after the layoff started
because it would be a good time to have the work done.
The decision to lay off was made on December 15. Ac-
cording to company documents, it laid off 21 unit employees
for varying periods of time beginning on December 18, and
ending on January 6, 1992. Eight employees were laid off on
December 18, five on December 19, 7 on December 23, and
one on December 24. The lengths of layoffs of individual
employees varied from 2 days to 10 days. The variance in
layoff time occurred because the Company laid off employ-
ees as their departments ran out of work. Some departments
had more work than others to finish. This was the same lay-
off procedure followed in the 1990 layoffs. Two unit mainte-
nance employees were not laid off. One nonunit office em-
ployee, Karen Johnson was laid off. This employee is
charged with receiving and processing orders for work and
entering them into the Company’s computer. She was laid
off from December 20 through January 6.
The first negotiation session between the parties was held
on January 28, 1992. To this point, the Union had received
no notice of the December layoff and it was not discussed
at this negotiating session. At the second negotiating session,
the Union introduced a comprehensive contract proposal.
Inter alia, it proposed with respect to seniority the following:
‘‘Employees shall be laid off in inverse order of seniority
and recalled in order of seniority, so long as the most senior
employee is able to do the available work. Seniority is meas-
ured from date of hire.’’ This is the only reference to layoffs
in the document. At about this time, the Company experi-
enced another slowdown in work which would affect some
1048 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
of the unit employees, and gave notice to the Union of its
intention to lay off such employees temporarily. The Union
chose not to bargain over this layoff decision or its effects.
This layoff was conducted pursuant to the procedures fol-
lowed in the earlier layoffs.
At a negotiating session held March 5, 1992, the Union
learned from the employees on the negotiating committee
that there had been a December layoff. The Union’s attorney
informed Respondent’s representatives that they were obli-
gated by law to negotiate over, inter alia, layoffs. William
Zimmerli responded for the Company saying he did not be-
lieve that he had to do that. In any event, there is no dispute
that no notice of the December layoff was given to the
Union prior to this March meeting, and obviously, the Union
was not afforded the opportunity to bargain over the decision
or its effects.
To date of hearing in this proceeding, about 12 negotiation
sessions had taken place and such negotiations were ongoing
at that time, though no full agreement had been reached on
a contract. According to Hallden, the parties had agreed to
seniority language and to a management-rights clause, which
in part allows management ‘‘[to] employ or transfer employ-
ees, or to layoff, terminate or otherwise relieve employees
from duty for a lack of work, or other legitimate reasons’’
The seniority language agreed to reads: ‘‘Seniority shall be
defined as an employees length of continuous service since
his/her most recent date of hire. In the event of layoff for
a lack of work or other reduction in force, the least senior
employees in the affected departments shall be laid off first,
unless otherwise agreed between the company and the Union,
provided the remaining employees are fully qualified to per-
form the remaining work without training. The company re-
serves the right not to observe the provisions of section two
in cases of layoffs of two working days or less.’’
B. The Legal Principles Involved and Conclusion with
Respect to the Complaint Allegations
The Board has consistently held that an employer’s deci-
sion to lay off employees for economic reasons is a manda-
tory subject of bargaining and that an employer must provide
notice to and bargain with the union concerning the decision
to lay off bargaining unit employees and the effects of that
decision. Lapeer Foundry & Machine, 289 NLRB 952
(1988). I believe that the layoff was motivated by economic
reasons, the loss of customer orders to sustain production,
and not by any change in the scope and direction of the busi-
ness. In the instant case, it is clear that the Respondent did
not give notice to the Union of its decision to lay off unit
employees and afford the Union an opportunity to bargain
over that decision and its effects. The Union gained knowl-
edge of the layoff and subsequent recall only months after
the event.
The Board has held that the establishment of ‘‘compelling
economic circumstances’’ may excuse a company’s failure to
bargain over a layoff decision, but that such an exception
shall only apply in ‘‘extraordinary situations.’’ Lapeer
Foundry, supra. I do not consider that Respondent’s decision
to repair a leaking piece of machinery to be such a compel-
ling circumstance, the decision coming as it did only after
the layoffs began. However, there is a question in my mind
whether the economic circumstances which existed were suf-
ficiently compelling to justify finding an exception to the
bargaining obligation. On December 10, the Company was
faced with a serious decline in orders, orders necessary to
sustain production as the Company evidently works only on
job orders and does not produce or coat products for inven-
tory. A canvass of its customers over the next 2 or 3 days
revealed that there would be an insufficient amount of busi-
ness to continue production and that employees would be
idled, at least for a period of time. This situation was com-
bined with an unquestioned, in this record, assertion that the
Company’s financial health was not good and it was having
difficulty making its payroll.
I believe that the circumstances are close to meeting the
exception, but are not so compelling as to excuse even giv-
ing notice to the Union of the intention to lay off unit em-
ployees. As stated by the Board in Lapeer Foundry
In light of the economic circumstances motivating a
company’s decision to lay off employees, however, we
will require that negotiations concerning this decision
occur in a timely and speedy fashion. Thus, should a
union fail to request bargaining in a timely fashion
once the company has provided it with notice of the
layoff decision, we will find that the company has satis-
fied its bargaining obligation.’’ [Id. at 954.]
I believe that the Respondent could have given notice and
engaged in timely bargaining over the decision before it
found it necessary to lay off its employees. It was protected
from inaction or delay on the part of the union as noted in
Lapeer Foundry, supra. Accordingly, I find that the Respond-
ent’s failure to give notice of its intention to lay off unit em-
ployees and allow the Union the chance to bargain over the
decision and its effects to be in violation of Section 8(a)(1)
and (5) of the Act.
CONCLUSIONS OF LAW
1. The Respondent, is an employer 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. By laying off its unit employees without giving notice
of its intention to do so to the Union and affording the Union
an opportunity to bargain in good faith over that decision and
its effects, the Respondent has engaged in conduct in viola-
tion of Section 8(a)(1) and (5) of the Act.
4. The unfair labor practices found to have been commit-
ted by Respondent affect commerce within the meaning of
Section 2(6) and (7) of the Act.
REMEDY
Having found that Respondent has engaged in conduct in
violation of Section 8(a)(1) and (5) of the Act, I recommend
that it be ordered to cease and desist therefrom and to take
certain affirmative action necessary to effect the policies of
the Act.
For reasons set forth below, I do not recommend that Re-
spondent be ordered to pay backpay to the affected unit em-
ployees. Based on this record, such a remedy would serve no
useful purpose and to the contrary, might unduly harm the
Respondent’s financial health and jeopardize its employees’
jobs. As the Board stated in Lapeer Foundry
1049PLASTONICS, INC.
1 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 Section 102.48 of the Rules,
be adopted by the Board and all objections to them shall be deemed
waived for all purposes.
2 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.’’
Having determined that an employer violates the Act by
failing to bargain over its decision to lay off employees,
we must formulate a remedy that addresses the wrong
committed. As the Supreme Court has observed, our
‘‘task in applying Section 10(c) is to take measures de-
signed to recreate the relationship that would have been
had there been no unfair labor practice.’’ [Citations
omitted. Id. at 955.]
I firmly believe that the affected employees would have
been laid off in virtually the same manner as they were with-
out bargaining, even if bargaining had occurred. There is no
assertion in this record that Respondent’s decision to effect
the layoff in question was motivated by anything but genuine
economic considerations. It had in the past laid off employ-
ees when a particular department ran out of work and it fol-
lowed this practice in December 1991. The only contact be-
tween the recently certified Union and the Company was
Bethea’s letter of November 22, seeking information and re-
questing that dates and places be set for bargaining over a
collective-bargaining agreement. There was no pattern to bar-
gaining established and Respondent’s management mistak-
enly believed that it was under no obligation to notify the
Union of its decision.
Would bargaining have changed the course of events given
the existing circumstances? Subsequent events would suggest
that it would not. The Company was again faced with reduc-
tion in workload in February 1992, and advised the Union,
during bargaining sessions, that it contemplated laying off
some employees for this reason. The Union made no attempt
to bargain over either the decision or its effects. The Com-
pany instituted the layoff following the the same procedures
it had followed in past layoffs. Subsequently, the parties
agreed to contract language that gives the Company the right
to effect layoffs for lack of work as a management right.
Moreover, this is not a case where there was a decision
to be made as to which employees would be laid off, or
whether hours could be cut to stretch out work, or some
other concessionary move made by the Union to eliminate
the need for the layoff. According to this record, the Com-
pany simply did not have any work for any of its production
employees.
This record is devoid of any suggestion that the Respond-
ent acted from any antiunion motivation and that there ex-
isted any alternative to layoff. The Union’s subsequent ac-
tions indicate that it recognizes the need for layoffs in the
face of lack of work and that it does not desire to bargain
over such decisions. Imposing a traditional make-whole rem-
edy would serve only to punish the Respondent and would
not serve the policies of the Act in my opinion.
I will recommend that the Respondent be ordered to give
notice to the Union before it implements any future eco-
nomic layoff and give the Union the opportunity to bargain
over that decision and its effects, unless the parties agree to
a different procedure in a written collective-bargaining agree-
ment.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended1
ORDER
The Respondent, Plastonics, Inc., Hartford, Connecticut, its
officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Laying off its unit employees without giving notice of
its intention to do so to the Union and affording the Union
an opportunity to bargain in good faith over that decision and
its effects.
(b) In any like or related manner interfering with, restrain-
ing or coercing its employees in the exercise of 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) Give notice to the Union before it implements any fu-
ture economic layoff and give the Union the opportunity to
bargain over that decision and its effects, unless the parties
agree to a different procedure in a written collective-bargain-
ing agreement.
(b) Post at its Hartford, Connecticut facility copies of the
attached notice marked ‘‘Appendix.’’2 Copies of the notice,
on forms provided by the Regional Director for Region 34,
after being signed by Respondent’s representative, shall be
posted by the Respondent immediately upon receipt and
maintained for 60 consecutive days in conspicuous places,
including all places where notices to employees are cus-
tomarily posted. Reasonable steps shall be taken by the Re-
spondent to ensure that the notices are not altered, defaced,
or covered by any other material.
(c) Notify the Regional Director in writing within 20 days
from the date of this Order what steps Respondent had taken
to comply.