Special Mine Services

National Labor Relations Board - Board Decisions

Aug 31, 1992

308 N.L.R.B. 711 (N.L.R.B. 1992)

711
308 NLRB No. 99
SPECIAL MINE SERVICES
1 The Respondent has excepted to some of the judge’s credibility
findings. The Board’s established policy is not to overrule an admin-
istrative law judge’s credibility resolutions unless the clear prepon-
derance of all the relevant evidence convinces us that they are incor-
rect. Standard Dry Wall Products, 91 NLRB 544 (1950), enfd. 188
F.2d 362 (3d Cir. 1951). We have carefully examined the record and
find no basis for reversing the findings.
The judge’s decision contains certain errors, which we correct
below. These errors do not affect our results. In par. 14 of sec. II
of the ‘‘Issues’’ section of his decision, the judge stated that ‘‘Randy
Orlandini had sat in on employment interviews.’’ We find that he
meant ‘‘Rick Orlandini.’’ In the fifth paragraph of sec. III of the
same section, the date ‘‘July 10, 1990’’ should read ‘‘July 12,
1990.’’ Finally, in the sixth paragraph of sec. IV of the same section,
the judge stated that the date the Union filed exceptions to the Re-
gional Director’s Report on Challenged Ballots and Objections was
‘‘May 20, 1991.’’ We find that date should read ‘‘May 29, 1991.’’
With regard to this error, the Respondent contends that the judge in-
ferred union animus by relying ‘‘heavily upon his erroneous finding
that the exceptions were filed prior to the date when [the Respondent
changed] its seniority policy from a plant-wide system to a depart-
ment-wide system.’’ We do not read the judge to have drawn this
inference. In any event, we have not relied on any such inference
in reaching our results. We have also added the standard injunctive
provision to the Order and notice.
2 The General Counsel excepts to the judge’s failure to order the
Respondent to reestablish and resume the connector work that it sub-
contracted for unlawful reasons. We find merit to this exception and
shall require restoration of the status quo ante in this respect. The
Respondent may introduce at compliance any evidence not available
prior to the hearing bearing on the appropriateness of this portion
of the remedy. See Lear Siegler Inc., 295 NLRB 857, 860–862
(1989).
Special Mine Services, Inc. and Southern Illinois
Laborers’ District Council, Laborers’ Inter-
national Union of North America, AFL–CIO
Special Mine Services, Inc., and Smith’s Machine
and Tool Shop, Joint Employers and Southern
Illinois Laborers’ District Council, Laborers’
International Union of North America, AFL–
CIO. Cases 14–CA–21389 and 14–CA–21458
August 31, 1992
DECISION AND ORDER
BY MEMBERS DEVANEY, OVIATT, AND
RAUDABAUGH
On April 2, 1992, Administrative Law Judge Wil-
liam A. Pope, II issued the attached decision. The Re-
spondent, Special Mine Services, Inc., filed exceptions
and a supporting brief, and the General Counsel filed
limited 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 briefs and has de-
cided to affirm the judge’s rulings, findings,1 and con-
clusions and to adopt the recommended Order as
modified.2
The judge found, and we agree, that the Respondent
subcontracted its connector manufacturing work and
laid off certain employees in violation of Section
8(a)(3) and (1) of the Act. The judge correctly ana-
lyzed the issue under the Board’s holding in Wright
Line, 251 NLRB 1083 (1980), enfd. 662 F.2d 899 (1st
Cir. 1981), cert. denied 455 U.S. 989 (1982). In con-
cluding that the General Counsel made a prima facie
showing that the Respondent’s actions were based on
union animus, the judge found that the Respondent’s
presettlement conduct (i.e., conduct occurring before a
settlement of other unfair labor practice charges in
September 1990) evidenced ‘‘strong union animus.’’
We agree. As stated by the judge, the Respondent’s
presettlement conduct consisted of ‘‘nearly classic ex-
amples’’ of unlawful surveillance, interrogation, and
discriminatory layoffs and discharges of employees.
This substantial evidence of union animus was prop-
erly considered by the judge and sheds considerable
light on the Respondent’s motivation in acting as it did
in April, May, and June 1991.
The Respondent contends that its postsettlement
conduct offers no basis for inferring that it acted from
union animus. Like the judge, we find that it does pro-
vide that basis. We particularly emphasize the strong
inference of antiunion motivation to be drawn from the
fact that the Respondent’s initial consideration of a
plan to subcontract work, and its decision to do so, oc-
curred in the second or third week of April 1991—
shortly after the Union filed its petition for certifi-
cation on March 8, 1991, and the parties entered into
a March 26 Stipulated Election Agreement. Although
the Respondent contends that it commenced a review
of operating costs in December 1990, the Respondent’s
president and part owner, Les Hunstman, admitted that
the Respondent began to consider subcontracting only
after the Union’s petition was filed.
Finally, the Respondent, in excepting to the judge’s
rejection of its rebuttal case, urges among other things
that the judge substituted his business judgement for
that of the Respondent. We disagree. The judge prop-
erly reviewed the Respondent’s evidence to determine
whether the Respondent established that it would have
acted as it did in the absence of the union activity. In
our view, the judge did not determine how the Re-
spondent should conduct its business—only whether it
met its burden under Wright Line. The Board is not re-
quired to accept self-serving declarations of motive.
see Shattuck Denn Mining Corp., 151 NLRB 1329
(1965), enfd. 362 F.2d 466 (9th Cir. 1966).
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Special Mine Services,
Inc., West Frankfort, Illinios, its officers, agents, suc-
712 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 The original complaint in Case 14–CA–21389 was filed on May
22, 1991.
2 Donald Smith, who acknowledged that he is the owner of Smith
Machine and Tool, was advised of his right to be represented by
counsel of his choice, at his own expense, but elected to proceed in
the hearing without counsel. He was afforded the opportunity to
cross-examine witnesses, and present witnesses and other evidence
on behalf of Smith Machine and Tool. He was also afforded the op-
portunity to make opening and closing statements and to file a writ-
ten brief. He chose to take none of these actions.
cessors, and assigns, shall take the action set forth in
the Order as modified.
1. Add the following as paragraph 1(c).
‘‘(c) In any like or related manner interfering with,
restraining, or coercing employees in the exercise of
the rights guaranteed them by Section 7 of the Act.’’
2. Add the following as paragraph 2(a) and reletter
subsequent paragraphs.
‘‘(a) Reestablish and resume its connector manufac-
turing operation at its West Frankfort, Illinios facility
consistent with the level and manner of connector op-
erations that existed at that facility prior to the unlaw-
ful relocation of equipment and transfer of such work
about May 4, 1991.’’
3. Substitute the attached notice for that of the
adminstrative law judge.
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.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representatives
of their own choice
To act together for other mutual aid or protec-
tion
To choose not to engage in any of these pro-
tected concerted activities.
WE WILL NOT transfer or subcontract operations and
effectively terminate our employees by placing them
on indefinite layoff because of their actions in joining,
supporting, or otherwise assisting a union for the pur-
pose of collective bargaining or other mutual aid or
protection.
WE WILL NOT in any like or related manner restrain
or coerce you in exercise of the rights guaranteed you
by Section 7 of the Act.
WE WILL reestablish and resume our connector man-
ufacturing operation at our West Frankfort, Illinois fa-
cility consistent with the level and manner of connec-
tor operations that existed at that facility prior to our
unlawful relocation of equipment and transfer of such
work on or about May 4, 1991.
WE WILL offer Ingram Morgan, Leslie Wood, Rob-
ert Dotson, Brent Wall, Fred Blades, Randy Orlandini,
David Cain, George Kirk, Danny Burnett, and James
Stratton immediate and full reinstatement to their
former positions or, if those positions no longer exist,
to substantially equivalent positions, without prejudice
to their seniority or any other rights or privileges pre-
viously enjoyed; and,
WE WILL make them whole for any losses they have
incurred as a result of the discrimination against them,
plus interest.
WE WILL remove from our files any reference to the
unlawful layoffs of Ingram Morgan, Leslie Wood,
Robert Dotson, Brent Wall, Fred Blades, Randy
Orlandini, David Cain, George Kirk, Danny Burnett,
and James Stratton, and notify them in writing that this
has been done and that the layoffs will not be used
against them in any way.
SPECIAL MINE SERVICES, INC.
Lucinda L. Flynn, Esq., for the General Counsel.
William W. Cody, Esq., of West Frankfort, Illinois, for the
Respondent Special Mine Services, Inc.
Donald Smith, of Royalton, Illinois, for the Respondent
Smith’s Machine and Tool Shop.
DECISION
WILLIAM A. POPE, II, Administrative Law Judge. In an
order consolidating cases, and a consolidated amended com-
plaint,1 filed on July 15, 1991, the Regional Director of Re-
gion 14 of the National Labor Relations Board (the Board)
charged that Respondent Special Mine Services, Inc. (Special
Mine Services), and Respondent Smith Machine and Tool
Shop (Smith Machine and Tool) are joint employers of the
employees of Respondent Smith Machine and Tool Shop,
and that Respondent Special Mine Services, Inc., violated
Section 8(a)(1) and (3), by laying off and refusing to rein-
state certain of its employees, because they engaged in con-
certed activities for the purpose of collective bargaining and
joined, assisted, or supported a union, and by ceasing pro-
duction of certain types of connectors and subcontracting the
work to Respondent Smith Machine and Tool Shop. The
original charge in Case 14–CA–21389 was filed on May 3,
1991; the original charge in Case 14–CA–21458 was filed on
June 12, 1991. Trial was held before Administrative Law
Judge William A. Pope, II, from July 31 through August 2,
1991, in Benton, Illinois.2
Background
Special Mine Services, Inc. is a privately held corporation
engaged in the manufacture, sale, and repair of mining sup-
plies and equipment. Its business falls into four main cat-
egories: (1) repair of batteries used in underground mining
operations; (2) manufacture and sale of electrical connectors
used in mining operations; (3) rebuilding and repair of dam-
713SPECIAL MINE SERVICES
3 West Frankfort, Illinois, is the only facility at which Special
Mine Services manufactures electrical connectors.
4 He started with Anextor Cable Service Company as manager of
its machine shop, and advanced to manager of the company.
5 The record is silent as to the role of Jim Rickert, the remaining
one-third owner of the Company, in the Company’s day-to-day oper-
ations.
6 Rick Orlandini worked for Anextor Cable Service Company for
15 to 16 years before going to work for Special Mine Services when
it purchased the assets of Anextor Cable Service Company.
7 The actual date of filing, according to the Regional Director’s
Report of May 17, 1991, was April 25.
8 The Regional Director’s report states that the results of the elec-
tion were 18 votes for the petitioner and 18 against, with 3 chal-
lenged ballots. The Regional Director approved the Union’s with-
drawal of its challenges to the three ballots, and ordered that the bal-
lots be opened and counted. The Regional Director recommended
that the Union’s objections be overruled in their entirety.
9 According to counsel for the General Counsel’s posthearing brief,
a certification of results of election issued on September 12, 1991.
aged electrical cable used in mining operations; and (4) retail
sale of a line of mining supply products purchased for resale
from other manufacturers and suppliers. Special Mine Serv-
ices operates facilities in four locations. At its corporate
headquarters in West Frankfort, Illinois, it maintains a ware-
house, and manufactures connectors,3 repairs batteries and
cables, and sells mining supplies. It also operates ware-
houses, sales offices, and battery repair facilities in Peters-
burg, Indiana, and Greenville, Kentucky, and a sales office
in Toronto, Canada.
The owners of Special Mine Services are Les Huntsman,
George Kee, and Jim Rickert, each of whom owns a one-
third interest in the Company. Les Huntsman, who holds a
degree in industrial engineering, worked for Anextor Cable
Service Company from 1976 until September 1983,4 when he
and George Kee started Special Mine Services and purchased
the assets of Anextor Cable Service Company. Les Huntsman
is the president and chief executive officer (CEO) of Special
Mine Services. George Kee is vice president of the Com-
pany, and participates in the day-to-day operation of the
Company, mainly in the area of sales.5
Respondent Special Mine Services admitted in its answer
that Les Huntsman and George Kee, and two of the Compa-
ny’s foremen, Brett Kee and Rick Orlandini, are supervisors
within the meaning of the Act. Brett Kee, who is the son of
George Kee, is the foreman in charge of cable repair at Re-
spondent’s West Frankfort, Illinois facility. Rick Orlandini is
foreman of the connector room and machine shop at Special
Mine Services’ West Frankfort facility.6
Smith Machine and Tool, a well-equipped machine shop
located in Royalton, Illinois, is owned and operated by Don-
ald Smith. Smith, who was employed by Special Mine Serv-
ices as a machinist for a period of a little over a year during
1986 and 1987, has operated Smith Machine and Tool since
approximately 1988. Smith Machine and Tool’s primary
business is fabricating parts and repairing equipment for coal
mines. Since 1988, Donald Smith has fabricated races (a
brass ring for ball bearings) for Special Mine Services. In
May 1991, Smith agreed to make electrical connector parts
for Special Mine Services. There is uncontroverted testimony
that Smith sold a 20-percent interest in his connector busi-
ness with Special Mine Services to Rick Orlandini for $1000.
On July 25, 1990, the Southern Illinois Laborers District
Council, Laborers International Union of North America (the
Charging Party), filed with the Board an unfair labor practice
charge, which was signed by Randy Mayhew, district orga-
nizer, charging that since on or about July 13, 1990, Special
Mine Services had discriminated against employees Fred
Blades and Danny Burnett by discharging them, and Brent
Wall, John Natyshok, Les Woods, and Herb Armes by laying
them off, in order to discourage them from joining and sup-
porting the union and engaging in other concerted activities.
That charge was subsequently settled by the parties on Sep-
tember 27, 1990.
On March 8, 1991, the Union filed a petition for certifi-
cation as representative for collective-bargaining purposes of
all employees of Special Mine Services employed at its West
Frankfort, Illinois facility, except clerical and professional
employees, guards, and supervisors.
On March 26, 1991, the Union and Special Mine Services
entered into a Stipulated Election Agreement providing that
a secret-ballot election would be held in the ‘‘Battery Repair
Department at Employer’s facility,’’ on April 19, 1991. The
appropriate collective-bargaining unit was described as:
All employees including battery repair, cable repair,
connector room, machine shop, maintenance, and ware-
house employed by the Employer at its West Frankfort,
Illinois facility, EXCLUDING office clerical and pro-
fessional employees, guards, and supervisors as defined
in the Act.
The payroll period for eligibility was the period ending
March 23, 1991.
On April 24, 1991, the Union filed7 objections to conduct
affecting results of the election which was held on April 19,
1991. The included verification was signed by the following
employees of Special Mine Services: Danny Burnett, Fred
Blades, Les Wood, Randy Orlandini, and Jeff Kennerly. The
Regional Director’s report on challenged ballots and objec-
tions, order, and recommendation was issued on May 17,
1991.8 The Union filed its exceptions to Regional Director’s
report on challenged ballots and objections, orders, and rec-
ommendations on May 20, 1991. At the time of the hearing,
the Union’s exceptions were still pending before the Board.9
Issues
a. Complaint. The consolidated amended complaint alleges
that between on or about April 26 and June 7, 1991, and
continuing, Respondent Special Mine Services violated Sec-
tion 8(a)(1) and (3) of the Act by laying off and refusing to
reinstate a number of its employees because they joined, as-
sisted, or supported the Union and engaged in concerted ac-
tivities; and, on or about May 4, 1991, by subcontracting out
unit work to Respondent Smith Machine and Tool. The em-
ployees laid off on or about April 26, 1991, were Ingram
Morgan and Leslie Wood; the employees laid off on or about
May 31, 1991, were Robert Dotson, Brent Wall, Fred Blades,
and Randy Orlandini; and, the employees laid off on or
about June 7, 1991, were David Cain, George Kirk, Danny
Burnett, and James Stratton. The complaint further alleges
that at all material times, Respondent Special Mine Services
controlled the labor relations policy of Respondent Smith
Machine and Tool and administered a common labor policy
714 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
10 Special Mine Services amended its answer at the hearing to
admit that the Charging Party Union is a labor organization within
the meaning of the Act. In its answer, which was not amended dur-
ing the hearing, Smith Machine and Tool denied that the Union is
a labor organization within the meaning of the Act. 11 251 NLRB 1083 (1980).
with Respondent Smith Machine and Tool for the employees
of Smith Machine and Tool, and Respondent Special Mine
Services and Respondent Smith Machine and Tool have been
joint employers of the employees of Respondent Smith Ma-
chine and Tool. Through the actions of Respondent Special
Mine Services, Respondent Smith Machine also violated Sec-
tion 8(a)(1) and (3) of the Act.
b. Answer. In its answer to the consolidated amended com-
plaint, as amended at the hearing, Respondent Special Mine
Services admitted the following allegations in the complaint
and denied all others:
(1) Filing and service of the charges;
(2) jurisdictional facts;
(3) that the Union is a labor organization within the mean-
ing of Section 2(2), (6), and (7) of the Act;
(4) that Les Huntsman, George B. Kee, Rick Orlandini,
and Brett Kee are supervisors and agents of Respondent Spe-
cial Mine Services within the meaning of Section 2(11) and
(13) of the Act;
(5) that on or about April 26, 1991, it laid off employees
Ingram Morgan and Leslie Wood;
(6) that on or about May 31, 1991, it laid off employees
Robert Dotson, Brent Wall, Fred Blades, and Randy
Orlandini; and,
(7) that on or about June 7, 1991, it laid off employees
David Cain, George Kirk, Danny Burnett, and James Strat-
ton.
In its answer to the consolidated amended complaint, Re-
spondent Smith Machine and Tool admitted that Donald
Smith is the owner of Respondent Smith Machine and Tool
and an agent and supervisor of it within the meaning of Sec-
tion 2(11) and (13) of the Act, the jurisdictional facts with
respect to Respondent Special Mine Services, and the layoff
of Special Mine Services employees, all as alleged in the
complaint. It denied filing and service of the charge, jurisdic-
tional facts with respect to it, that the Union is a labor orga-
nization within the meaning of the Act, and all other allega-
tions of the complaint.
c. General Counsel’s Position. As framed by the General
Counsel, the issues in this case are whether Respondent Spe-
cial Mine Services violated Section 8(a)(1) and (3) of the Act
by laying off employees on April 25 and 26, 1991, May 31,
1991, and June 7, 1991, because of their union activities; and
whether Respondent Special Mine Services and Respondent
Smith Machine and Tool are joint employers, and as joint
employers, violated Section 8(a)(1) and (3) of the act by
transferring connector work from Respondent Special Mine
Services to Respondent Smith Machine and Tool, thereby
providing Special Mine Services with a pretextual justifica-
tion for laying off four employees on May 31, 1991, and
four more employees on June 7, 1991. It is General Coun-
sel’s position that the Charging Party Union is a labor orga-
nization within the meaning of Section 2(5) of the Act,10 that
Respondent Smith Machine and Tool is an employer engaged
in commerce within the meaning of the Act, that Respondent
Special Mine Services laid off 10 of its employees in viola-
tion of Section 8(a)(1) and (3) of the Act, and that Respond-
ent Special Mine Services and Respondent Smith Machine
and Tool are joint employers, or in the alternative general
contractor and subcontractor, and that they violated Section
8(a)(1) and (3) of the Act by transferring work from Re-
spondent Special Mine Services to Respondent Smith Ma-
chine and Tool because of union activities by certain of Re-
spondent Special Mine Services’ employees.
d. Position of Special Mine Services. Respondent Special
Mine Services argues that it did not violate the Act when it
transferred work and laid off certain of its employees, as al-
leged in the consolidated amended complaint, and that Re-
spondent Special Mine Services and Respondent Smith Ma-
chine and Tool are not joint employers.
Respondent Special Mine Services contends that General
Counsel has failed to make a prima facie showing sufficient
to support an inference that the subcontracting of its connec-
tor work was motivated by antiunion considerations. Re-
spondent argues that its decisions to subcontract the connec-
tor work to Smith Machine and Tool and layoff certain of
its employees were based on legitimate, nondiscriminatory
business reasons, principally that its labor costs were too
high and erratic, orders were down, and it had space and
electrical service problems at its West Frankfort, Illinois fa-
cility, which it resolved by subcontracting the connector
work and transferring the equipment used for that purpose to
Respondent Smith Machine and Tool. Special Mine Services
argues that it has met its burden of proof under the Wright
Line11 doctrine by showing that the transfer of work and lay-
offs were for substantial business reasons and would have
taken place even in the absence of the alleged union activi-
ties of certain of its employees.
I.
Respondent Special Mine Services admitted in its answer,
as amended, that the Charging Party Union is a labor organi-
zation with the meaning of Section 2(5) of the Act, and that
it is an employer engaged in commerce within the meaning
of Section 2(2), (6), and (7) of the Act. Respondent Smith
Machine and Tool, however, denied both of these allegations
in its answer, and the denials remain a part of the record.
Smith Machine and Tool, represented by its owner, Donald
Smith, who appeared pro se, however, offered no evidence
on either issue.
The most recent constitution of the Laborers’ International
Union of North America, as amended on September 8–12,
1986, of which the Southern Illinois Laborers’ District Coun-
cil is a part, states that its purpose is to organize workers
into bargaining units, and secure recognition by employers of
the workers’ right to engage in collective bargaining for the
purpose of promoting or establishing appropriate wages,
fringe benefits, training, hours of employment, and working
conditions. This unrebutted evidence of the Union’s labor or-
ganization status is sufficient to establish that it is a labor or-
ganization within the meaning of Section 2(5) of the Act.
Texas Institute for Rehabilitation, 228 NLRB 578 (1977).
Invoices admitted into evidence show that between June
10 and July 3, 1991, Respondent Smith Machine and Tool
shipped finished connectors valued at $8,753.80 to Respond-
ent Special Mine Services. As argued by General Counsel,
projected over a 12-month period, at that rate Respondent
715SPECIAL MINE SERVICES
12 Respondent Special Mine Services admitted its status as an em-
ployer within the meaning of Sec. 2(2), (6), and (7) of the Act.
13 Citing NLRB v. Browning-Ferris Industries, 691 F.2d 1117 (3d
Cir. 1982), and Laerco Transportation & Warehouse, 269 NLRB
324 (1984), the Board said in TLI, Inc., that to find joint employer
status, ‘‘there must be a showing that the employer meaningfully af-
fects matters relating to the employment relationship such as hiring,
firing, discipline, supervision, and direction.’’
14 Ingram ended his employment by Donald Smith in a dispute
over wages.
15 Rick Orlandini worked for Anextor Cable Service for 16 years,
until its assets were purchased by Special Mine Services, and was
a foreman when Anextor was sold. He started working for Special
Mine Services in 1987, and 6 or 7 months later was made supervisor
or foreman of the connector room and machine shop.
16 According to Orlandini, around mid-April to the third week of
April 1991, he reported to Les Huntsman that Donald Smith was in-
terested in making connector parts for Special Mine Services.
Orlandini said that prior to that he had told Huntsman that he and
his brother, Randy Orlandini, were interested in making the parts,
but that he had abandoned the idea because he and his brother
lacked the facilities and the equipment.
Smith Machine and Tool would ship finished connectors val-
ued at over $100,000 to Respondent Special Mine Services
for resale from its sales facilities in Illinois, Indiana, Ken-
tucky, and Canada. On that evidence, I find that Respondent
Smith Machine and Tool is an employer engaged in com-
merce within the meaning of Section 2(2), (6), and (7) of the
Act.
II.
General Counsel argues that Special Mine Services and
Smith Machine and Tool are joint employers. The Board
having asserted jurisdiction over an employer in a joint em-
ployer relationship if at least one of the employers meets the
Board’s jurisdictional standard, and Special Mine Services
having admitted that it is an employer within the meaning of
the Act,12 General Counsel concludes that Smith Machine
and Tool also is an employer within the meaning of the Act.
The Board has said that ‘‘it will find joint employer status
where it can be shown that two or more employers ‘co-deter-
mine those matters governing essential terms and conditions
of employment.’ NLRB v. Browning-Ferris Industries, 691
F.2d 1114, 1124 (3d Cir. 1982).’’ Ryder System, 280 NLRB
1024 (1986); TLI, Inc., 271 NLRB 798 (1984);13 C. R.
Adams Trucking, 262 NLRB 563 (1982); Manpower Inc. of
Shelby County, 164 NLRB 287 (1967). In Chesapeake
Foods, 287 NLRB 405, 407 (1987), the Board said:
[T]he appropriate test for ascertaining joint employer
status is whether two separate entities share or codeter-
mine ‘‘those matters governing the essential terms and
conditions of employment’’ and to establish such status
‘‘there must be a showing that the [alleged joint] em-
ployer meaningfully affects matters relating to the em-
ployment relationship such as hiring, firing, discipline,
supervision and direction.’’
In 373-381 South Broadway Associates, 304 NLRB 1108
(1991), the Board said that ‘‘it is well established that the
commerce data of joint or single employers may appropriate
be combined for jurisdictional purposes.’’
Donald Smith is the founder and owner of Smith Machine
and Tool, which he started in 1988, after he left a year’s em-
ployment as a machinist with Special Mine Services. He tes-
tified that he started with a little shop behind his house, then
purchased the property in Royalton, Illinois, upon which
Smith Machine and Tool is currently located, when it be-
came available. He owns all of the equipment in the shop,
except for certain equipment which he obtained from Special
Mine Services in 1991. He testified that he accumulated the
equipment over a period of years, and values it at $150,000
to $200,000. He owns a truck which he uses in his business
to pick up and deliver parts. He stated that his net income
from the shop for 1990 was $30,000 to $40,000.
Smith operated Smith Machine and Tool for approximately
a year before he did any work for Special Mine Services. His
customers included several mines, for which he fabricated
parts and repaired equipment, as well as other local busi-
nesses for which he performed machine shop work.
Sometime in 1990, Smith Machine and Tool began making
ring races (for ball bearings) for Special Mine Services.
Using different machining techniques, Donald Smith was
able to make one more race than Special Mine Services
could from the same amount of stock. Special Mine Services
provided the stock, and Smith Machine and Tool charged
only for labor. In March 1990, Donald Smith submitted a
proposal to Special Mine Services to make a nylon sleeve
and coupling used for weather proofing cables. He said he
could make them cheaper than Special Mine Services could.
He started making them, but stopped after he got equipment
from Special Mine Services and started making connector
parts in 1991.
Until he started making connector parts for Special Mine
Services in 1991, Donald Smith operated Smith Machine and
Tool by himself for the most part. For a time after leaving
Special Mine Services and starting his own business, Smith
employed a salesman who solicited work for him from var-
ious mines and from Special Mine Services. From approxi-
mately March to May 1990, he employed Ingram Morgan as
a machinist.14 Morgan later worked for Special Mine Serv-
ices from December 16, 1990, until he was laid off on April
25, 1991. Dana Brandon has worked part-time for Smith for
2 years, as a secretary. About the time he started making
connectors for Special Mine Services, he hired his daughter-
in-law, Gail D. Smith, to handle the payroll.
Donald Smith testified that Rick Orlandini, who is em-
ployed by Special Mine Services as foreman of the connector
room-machine shop,15 lives in Royalton, Illinois, and that he
has known him all of his life. He stated that Rick Orlandini
first mentioned the possibility of going into business with
him in August 1990. In April 1991, Orlandini asked him if
he would be interested in making connector parts for Special
Mine Services, and Smith replied that he would.16 In May
1991, Smith met with Orlandini and Les Huntsman, the
president and financial officer, as well as one-third owner, of
Special Mine Services, who showed him a ‘‘price book’’ list-
ing the cost to Special Mine Services of making connector
parts. Smith told Huntsman that he could make the parts
cheaper, and agreed to Huntsman’s proposal that Smith Ma-
chine and Tool manufacture connector parts for 5 percent
716 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
17 Smith testified that he did not actually know what Special Mine
Services’ costs for manufacturing connectors were when he entered
into the oral agreement in May 1991, but he knew he could make
them cheaper because his building was paid for, his overhead was
lower, and he was not going to use as many employees. He said that
he probably did not know at that time what his actual costs of manu-
facture would be.
18 The air compressor was also useful for other work performed
by Smith Machine and Tool.
19 Smith stated that Special Mine Services had trouble putting the
machine into operation, and as of the time of the hearing, it was not
yet in service at Smith Machine and Tool.
20 Donald Smith testified that he had observed operation of the
machinery used in connector manufacturing, but had not done the
work himself. He described the operations as ‘‘not very sophisti-
cated,’’ and something which could be learned very quickly.
21 Frain apparently had worked for Donald Smith before on an
intermittent, part-time basis, when Smith needed help on a big job.
22 There was testimony that Donald Smith also terminated the em-
ployment of Michael Brayfield for unacceptable work.
23 Smith said he had first contacted Farmer’s Union about the hir-
ing people for the training program about a year before he started
doing work for Special Mine Services. He contacted them again
when he received the injection machine from Special Mine Services.
less than Special Mine Services’ cost of manufacture.17 Ac-
cording to Donald Smith, his agreement with Special Mine
Services was initially oral, but Les Huntsman and he later
signed a letter of agreement (the date on which the letter of
agreement was signed is shown as June 18, 1991, but the let-
ter shows that it was prepared on May 4, 1991), which pro-
vides, as follows:
Special Mine Services agrees to provide Smith Ma-
chine and Tool Company such pieces of manufacturing
equipment as may be required to manufacture molded
electrical rubber connectors exclusively for Special
Mine Services.
Smith Machine and Tool Company agrees to provide
labor necessary to produce and maintain all manufactur-
ing equipment necessary to manufacture in good work-
ing condition at Smith Machine and Tool Company’s
expense and will use this equipment to produce parts
exclusively for Special Mine Services.
The price of all manufacture parts is to be deter-
mined and is agreed to be the cost to manufacture by
Special Mine Services less 5%.
Smith sold Randy Orlandini a 20-percent interest in the
connector business with Special Mine Services for $1000,
and hired Orlandini to act as his quality control supervisor
at the rate of $150 per week. Smith denied that taking
Orlandini as a part-owner and quality control supervisor was
part of his deal with Special Mine Services. Smith said he
entered into the arrangement with Rick Orlandini because
Orlandini would know whether the parts being made by
Smith Machine and Tool were good or bad, something Don-
ald Smith would not be able to ascertain. He said that he
asked Rick Orlandini if ‘‘he would be my quality control
man.’’
Smith stated that he used the $1000 which he received
from Orlandini as partial payment for an air compressor
which he needed to operate the injection machine used in
connector manufacturing operations.18 Smith testified that he
also had to increase the electrical service to his building for
connector manufacturing operations.
Beginning around June 1, 1991, Special Mine Services
transferred equipment valued at $25,000 to $30,000 to Smith
Machine and Tool, including a conveyer oven, injection ma-
chine, six vulcanizers, three tables, and molds which go with
the injection machine, all of which are used in the manufac-
ture of electrical connectors for Special Mine Services. Prior
to June 1991, Smith received an automatic screw machine
from Special Mine Services for use in making pins for con-
nectors.19 Smith admitted that he does not pay anything to
use the equipment.
The first employee hired by Smith to do connector manu-
facturing work was Randy Orlandini, Rick Orlandini’s broth-
er, who was hired on June 3, 1991. He had worked for Spe-
cial Mine Services as an injection machine operator, making
connector parts, until he was laid off on May 31, 1991.
Randy Orlandini’s starting pay at Smith Machine and Tool
was $8 per hour. Another former Special Mine Services em-
ployee experienced in use of the injection machine hired by
Smith was Leslie Wood, who was hired on June 7, 1991.
Wood had been laid off by Special Mine Services on April
26, 1991. While employed by Special Mine Services, Wood
had been paid $7 per hour, plus benefits, including medical
insurance and vacation. As an employee of Smith Machine
and Tool, he receives an hourly wage of $7, with no benefits
other than holiday pay, for doing the same type of work as
he did for Special Mine Services. According to Donald
Smith, Leslie Wood and Randy Orlandini are ‘‘more or less
like group leaders,’’ who train new employees.20 Smith said
that he pays Randy Orlandini and Leslie Wood more than
other employees because they are acquainted with the work.
Other employees hired by Smith Machine and Tool to per-
form connector manufacturing operations were Michael L.
Brayfield, hired on June 4, 1991, at $4.50 per hour; Wesley
Frain,21 hired on June 4, 1991, at $4.50 per hour; Shawn
Walker, hired on June 4, 1991, at $4.50 per hour; and, Jesse
D. Yates, hired on June 4, 1991, at $4.50 per hour, and let
go on July 29, 1991, because of ‘‘poor production, too many
mistakes, and bad parts.’’22
Smith hired Brayfield, Frain, Walker, and Yates through a
subsidized job training program operated by the Farmer’s
Union.23 Under that program, Farmer’s Union paid one-half
of the wages of the trainees for 6 months, after which the
employer would have to pay all of the employees’ wages.
Smith stated that he was able to save money through the ar-
rangement.
Smith admitted that Randy Orlandini had sat in on em-
ployment interviews with Brayfield, Frain, Walker, and
Yates, but not on Smith’s interviews with Randy Orlandini
and Leslie Wood. Smith said that he did not ask Orlandini
to sit in on the interviews, but let him because he is a part-
owner. Smith stated, however, that he may have asked Rick
Orlandini if Randy Orlandini would be interested in working
for ‘‘us,’’ because Rick Orlandini was familiar with the
work. According to Smith, Randy Orlandini filed an applica-
tion and was interviewed before production started. He said
there was no doubt that he would hire Randy Orlandini, be-
cause of his familiarity with the work.
Rick Orlandini acknowledged that Donald Smith may have
asked him if he cared whether his brother, Randy Orlandini,
and Leslie Wood went to work for Smith Machine and Tool.
717SPECIAL MINE SERVICES
24 Otherwise, Smith said, he would have to get up at 5:30 a.m. or
6 a.m. to do it, because the machines have to warm up for an hour
and if they are not turned on until the employees come in at 7 a.m.,
they would have to wait until 8 a.m. to start work.
Rick Orlandini stated that he told Smith that was up to him,
and he did not care. Rick Orlandini also said that he had
probably said ‘‘yes’’ when Smith asked him after the inter-
views of the other four employees if he thought Smith had
hired ‘‘a good bunch of employees.’’
Les Huntsman, the president of Special Mine Services, de-
nied that he had anything to do with hiring of personnel by
Donald Smith, or setting the employees’ wage rates.
Smith stated that applications for employment by Smith
Machine and Tool are submitted to him or his secretary. He
said that employees ask him when they want time off. He
said that he makes the decisions on who to hire or who to
fire, what benefits the employees will get, and what their
hours will be. According to Smith, he set the employees’
work hours from 7 a.m. to 3:30 p.m., after he asked Randy
Orlandini what the hours should be and Orlandini said those
hours would be fine with him.
Les Wood, after being laid off by Special Mine Services,
filed an employment application with Donald Smith, and was
interviewed by Smith, who told him what his rate of pay
would be. Wood stated that he gets instructions each day
concerning what work to do in a note left by Rick Orlandini.
He acknowledged that he goes to Smith if he wants time off.
Wood said that he complained to Rick Orlandini about want-
ing time off and changing the work hours, but he never com-
plained to Orlandini about his pay. He also complained to
Orlandini about problems with the injection machine and the
people he worked with. On the other hand, Wood said that
he told Donald Smith that Smith Machine and Tool made a
better product than Special Mine Services, and had a higher
production rate.
Rick Orlandini stated that he brought it to Donald Smith’s
attention that the two employees fired by Smith (Brayfield
and Yates) had produced bad parts. Donald Smith, however,
said that he had made the decision to fire Brayfield and
Yates, and Orlandini did not learn of it until later during the
day Smith fired them.
As described by Donald Smith and Rick Orlandini,
Orlandini, who lives in Royalton, the small town in which
Smith Machine and Tool is located, stops by Smith Machine
and Tool in the morning, on his way to his job with Special
Mine Services, and turns on the machines used to make con-
nectors so that they will be warmed up and ready to use
when Smith’s employees report for work.24 He stops at
Smith Machine and Tool each evening to inspect the produc-
tion for the day, and leaves a note for the employees in-
structing them what parts to make for Special Mine Services
the next day. Donald Smith stated that sometimes his sec-
retary brings orders back from Special Mine Services after
delivering completed parts. When that happens, Donald
Smith posts the orders on the bulletin board.
Smith agreed that Rick Orlandini told him which parts
were bad, but he did not instruct Smith to warn the employ-
ees or take other action. According to Smith, Orlandini just
told him that the parts were bad, and let Smith take it from
there. Smith stated that he also received reports from Randy
Orlandini and Leslie Wood when the other employees’ work
was bad.
Orlandini said that he may have instructed Donald Smith
to tell an employee he need to be shown how to make a part
correctly, and on one occasion, he told Smith to tell an em-
ployee that he had put the wrong color code on a pump.
Orlandini said that Les Huntsman was aware of that incident,
and that Les Huntsman expected him to make sure the parts
produced at Smith Machine and Tool were manufactured
correctly.
On this evidence, I conclude that Special Mine Services
and Smith Machine and Tool are not joint employers. The
test to be applied in making such a determination is whether
the two employers share or codetermine ‘‘those matters gov-
erning essential terms and conditions of employment.’’
Chesapeake Foods, supra. Applying that test, I find that it
is clear from the record that Special Mine Services does not
share or codetermine the essential terms and conditions of
employment of Smith Machine and Tool’s employees en-
gaged in making connector parts for Special Mine Services.
It is clear that Special Mine Services’ only interest is in re-
ceiving completed connectors for the agreed price. Special
Mine Services appears to have no interest in who or how
many workers Smith Machine and Tool, or how much Smith
Machine and Tool’s employees are paid, what benefits they
receive, or what the other terms and conditions of their em-
ployment are. Therefore, it is clear that Special Mine Serv-
ices does not have sufficient indicia of control over those
employees to support a joint employer finding.
The contracting out, or subcontracting, by Special Mine
Services of the manufacture of connectors to Smith Machine
and Tool was an arm’s-length transaction between the two
employers, insofar as Smith Machine and Tool is concerned.
Whether for good or bad reasons insofar as the National
Labor Relations Act is concerned, Les Huntsman, concluded
that it was to Special Mine Services’ advantage to sub-
contract the manufacture of connectors. But, whatever Hunts-
man’s reasons may have been, insofar as Donald Smith was
concerned, it appears that it was strictly a business arrange-
ment from which he expected to make a profit.
Rick Orlandini, foreman of Special Mine Services’ con-
nector room and machine shop, who supervised the manufac-
ture of connectors by Special Mine Services, was aware of
Huntsman’s interest in subcontracting connector manufactur-
ing operations, and told Huntsman that he thought that he
and his brother, Randy Orlandini, could do the work. Rick
Orlandini stated that after looking into the possibility further,
he abandoned the idea because he lacked the necessary
equipment and facilities. Upon determining that he could not
put together a feasible proposal to manufacture connectors
for Special Mine Services, Rick Orlandini, acting apparently
on his own initiative, contacted Donald Smith, who was al-
ready successfully performing machining work for Special
Mine Services, and ascertained from Smith that he would be
interested in making connectors for Special Mine Services.
Orlandini communicated Smith’s interest to Les Huntsman,
and from there on the arrangement was concluded between
Huntsman and Smith.
Huntsman proposed to Smith that Smith Machine and Tool
make connectors for 5 percent less than what Huntsman,
alone, determined Special Mine Services’ cost of manufactur-
ing the same items to be. The agreement which Huntsman
718 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
concluded with Donald Smith allowed Smith to use equip-
ment, which Special Mine Services already had, and raw ma-
terials which it provided, solely for the purpose manufactur-
ing connector parts for Special Mine Services. Maintenance
of the equipment and the cost of electricity to run the equip-
ment were Smith Machine and Tool’s responsibility. The
venture posed little risk to Donald Smith and Smith Machine
and Tool. He was not required to make any capital invest-
ment of his own to get the connector manufacturing business
(except possibly the cost of an air compressor, which was
largely paid by Rick Orlandini, in return for a share in the
connector manufacturing business). His agreement with Spe-
cial Mine Services was not for any set period, and like Spe-
cial Mine Services, he could terminate it at will. It was a
safe assumption by Donald Smith that he would be able to
produce connectors for Special Mine Services at a cost sub-
stantially below Special Mine Services’ cost. As noted, the
arrangement required no capital investment by him for ma-
chinery or raw materials. His labor costs could be expected
to be substantially lower than those of Special Mine Services
for the same work. Smith hired fewer employees than Spe-
cial Mine Services had used, and paid them less in wages
and benefits. Where he paid the same hourly rate to two
former employees of Special Mine Services, he did not pay
them the same benefits, such as vacations and health insur-
ance, as Special Mine Services had paid. Four of the employ-
ees Smith initially hired and used were hired at a lower wage
of $4.50, one-half of which was paid by a job training pro-
gram, and he did not provide them with any benefits, such
as vacations or health insurance. Considering these factors, it
is apparent that Smith Machine and Tool’s labor costs would
be lower than those of Special Mine Services for hiring the
same employees.
Although a foreman for Special Mine Services, Rick
Orlandini was not part of the upper management of the Com-
pany. Management decisions and policy were clearly made
and established by Les Huntsman, possibly with input and
coordination with his two partners. In suggesting Donald
Smith to Huntsman, Orlandini acted on his own, for, as it
turned out, his own monetary gain. It is not unreasonable to
conclude that in return for suggesting Smith’s name to
Huntsman, Donald Smith allowed Rick Orlandini to buy a
20-percent interest in the connector business for the rel-
atively nominal sum of $1000, and agreed to pay Orlandini
$150 per week to act as quality control inspector. The ven-
ture was a purely private one between Randy Orlandini and
Donald Smith. While selling Rick Orlandini a 20-percent in-
terest in the connector business and paying him a salary of
$150 per week for his services as quality control inspector
could be construed as something in the nature of a kickback
to Orlandini, there is no evidence suggesting that Les Hunts-
man was part of the arrangement or had required Donald
Smith to sell Orlandini an interest in the business or pay him
a weekly salary as quality control inspector. It was, in short,
a private business arrangement between Orlandini and Smith.
The potential for a conflict of interest with his full-time
employment with Special Mine Services is evident in this sit-
uation, but there is nothing in the record indicating that Les
Huntsman, and Special Mine Services, were unaware of
Orlandini’s financial interest in the manufacture of connec-
tors by Smith Machine and Tool. Indeed, there is evidence
that Les Huntsman knew of the arrangement, and expected
Orlandini to inspect the product manufactured by Smith Ma-
chine and Tool to ensure that the connectors were made
properly. There is no evidence required that Orlandini be
given an interest in Donald Smith’s business or that he be
paid by Smith to act as quality control inspector.
The essential terms and conditions of employment by
Smith Machine and Tool of employees involved in manufac-
turing connectors were set by Donald Smith. Although Rick
Orlandini, a 20-percent owner of Smith Machine and Tool’s
connector business, was present when Smith interviewed four
of the employees hired by Smith Machine and Tool to do
connector work, his presence was essential. It appears from
the record that the decisions concerning who would be hired
by Smith Machine and Tool were made by Smith, and con-
curred in after the fact by Orlandini. There is no evidence
that Orlandini played any role other than an advisory one in
the hiring of employees. There is, moreover, no evidence that
he played any significant role in setting wages, benefits,
work hours, or other terms and conditions of employment for
the six employees hired by Smith Machine and Tool to make
connectors for Special Mine Services.
Neither is there any evidence that Orlandini played any
significant part in discharge of employees by Donald Smith.
Although he inspected connectors made by Smith Machine
and Tool employees, and rejected some which were not
made properly, there is no evidence that Orlandini did any-
thing more than report the results of his quality control in-
spections to Donald Smith. He left it up to Smith to deter-
mine what to do about unacceptable quality work.
To the extent that Rick Orlandini had any part in the man-
agement of connector manufacturing operations by Smith
Machine and Tool, he acted out a personal financial interest
in the operations, as 20-percent owner of Smith Machine and
Tool’s connector business and as a paid quality control in-
spector, a function for which he was paid $150 per week by
Smith Machine and Tool to perform. There is no evidence
that Rick Orlandini acted in the interest of or at the direction
of Special Mine Services. His actions were motivated by per-
sonal concerns, partially for personal economic gain, and par-
tially to protect his own full-time employment by Special
Mine Services by making sure that the connectors manufac-
tured by Smith Machine and Tool, which he had rec-
ommended to Huntsman of Special Mine Services, were of
acceptable quality.
The evidence is insufficient to establish that Special Mine
Services had any interest in or control over setting the terms
and conditions of employment by Smith Machine and Tool
for its employees involved in making connectors for Special
Mine Services. The price which Special Mine Services
agreed to pay Smith Machine and Tool for connectors was
set in advance by agreement. The price Special Mine Serv-
ices was entirely independent of Smith Machine and Tool’s
labor and other costs. It was immaterial to Special Mine
Services who Smith Machine and Tool hired or fired, or
what the employees were paid, or what the other terms and
conditions of their employment were. Not only is there an
absence of any evidence that Special Mine Services had any
interest in the essential terms and conditions of Smith Ma-
chine and Tool’s employees, neither is there any evidence
that Special Mine Services, or any of its management, at-
tempted to or actually did exercise any control over those
employees or the terms and conditions of their employment.
719SPECIAL MINE SERVICES
25 Mayhew testified that he was first contacted by Special Mine
Services’ employees on or about July 10, 1990.
In these circumstances, I find that Respondent Special
Mine Services and Respondent Smith Machine and Tool are
not joint employers of Smith Machine and Tool’s employees.
III.
On the morning of April 6, 1990, Fred Blades and Danny
L. Burnett, two employees of Special Mine Services at its
West Frankfort, Illinois facility, were told by Rick Orlandini
to go to Les Huntsman’s office. Also present was George
Kee, vice president of Special Mine Services and a one-third
owner of the corporation. Huntsman told them that on the
previous Friday, he had received a telephone call in which
the caller related that Blades and Burnett had been heard
talking at a party or gathering about starting a union and
their feelings that a union was needed. Huntsman told them
that he had received the same information on Saturday from
an employee who had stopped by his house.
Before summoning Blades and Burnett to his office on
April 6, Huntsman testified, he discussed the information he
had received about their union sympathies with George Kee.
According to Huntsman, he and George Kee knew they
could not threaten or coerce employees because of their
union activities, or take away their jobs, but, he said, they
did not know whether they could talk to them about their
union involvement. He said they agreed between themselves
that although they did not know whether they were permitted
to talk to employees about their union involvement, they
would talk to Burnett and Blades anyway, because it was im-
portant to them to find out if the two employees had been
thinking about a union, and if so, what shortcomings in their
employment caused them to think that way.
Huntsman acknowledged that he told Burnett and Blades
that he would like to know if they were involved in union
activities, and related the information he had received the
preceding Friday and Saturday. Both of the employees re-
sponded ‘‘no’’ to the question. Huntsman told them that was
fine, because he did not think that ‘‘we need a union here,’’
and he would take their word.
Burnett’s testimony, which I find credible, differed from
Huntsman’s only in the degree of union animus exhibited by
Huntsman during the meeting on April 6, 1990. Burnett testi-
fied that Huntsman said he did not like unions and if there
was a union, things would change dramatically. He told them
if they did not like the way he and George Kee ran things,
they ‘‘could hit the door.’’ Huntsman asked them if they had
any problems. Fred Blades, whose testimony I also find cred-
ible, gave essentially similar testimony concerning Hunts-
man’s remarks. Blades and Burnett said they denied any
union involvement.
On or about July 10, 1990, Randall J. Mayhew, a district
organizer for the Southern Illinois Laborers’ District Council,
met with a group of employees of Special Mine Services at
the Union’s district office in West Frankfurt, Illinois, located
approximately 3 miles from Special Mine Services’ West
Frankfort facility.25 Special Mine Services employees who
attended the meeting included John Natyshok, Steve Reiger,
Brent Wall, Leslie Wood, Fred Blades, Danny Burnett, and
Ron Innis. At the meeting, Mayhew passed out union pref-
erence cards, some of which were signed by Special Mine
Services employees and returned on the meeting to Mayhew.
A total of 16 signed cards were returned to Mayhew.
Some of them were turned in by the signers to Mayhew at
the meeting on July 12, 1990, others were turned in later
through a union organizing committee. Cards signed by Fred
W. Blades, Danny Burnett, Brent A. Wall, and Ronald E.
Innis were turned in to Mayhew at the meeting on July 12,
1990.
Danny L. Burnett testified that he drove his personal vehi-
cle to the meeting at the Union’s office. He stated that while
he was at the Union’s office, he saw George Kee, one of the
owners of Special Mine Services, drive by in his Lincoln.
The next day, July 13, 1990, Burnett passed out union cards
in Special Mine Services’ parking lot. Fred Blades also at-
tended the July 12, 1990, meeting. He, too, said that he saw
George Kee drive by in front of the Union’s office. Brent
Wall, also an employee of Special Mine Services who at-
tended the July 12, 1990, meeting, saw Brett Kee, a Special
Mine Services foreman, and the son of George Kee, driving
in the vicinity of the Union’s office. The next day, July 13,
Brett Kee asked him, ‘‘How was the union meeting?’’
Sometime after lunch on July 13, 1990, the day following
the union meeting, Les Huntsman held a meeting with all of
the employees of Special Mine Services, including salesmen
and foremen. Huntsman first asked who was spokesman for
the group. When he received no answer to that question, he
asked if anyone had any problems. That question also went
unanswered. Huntsman said that he had problems. He told
the employees he had been good to them, and that they
would not find a better employer. He said that there would
be drastic changes that afternoon.
Later that afternoon, Huntsman laid off four employees
and terminated two employees. At about 3 p.m. that after-
noon, Huntsman summoned six employees to his office.
Danny L. Burnett testified that Huntsman said that ‘‘Due to
slow mine conditions, I’m going to have to lay you guys
off,’’ and he also said, ‘‘We’ll let the guys with least senior-
ity go first.’’ Huntsman laid off Brent Wall, John Natyshok,
Herb Armes, and Leslie Wood. After those four employees
were given their paychecks by George Kee and were dis-
missed, Huntsman told Danny L. Burnett and Fred Blades
that they were fired. Of the six employees, only Herb Armes
had not attended the union meeting on July 12, 1990, and
signed a union preference card.
Danny L. Burnett testified that Huntsman said, ‘‘You two
guys are a different story. You two guys are fired.’’ When
Burnett asked for an explanation, Huntsman said that they
had lied in April about contacting the Union. When Blades
denied that they had contacted the Union, Huntsman said,
‘‘That’s bullshit.’’ George Kee said they knew it for a fact.
Huntsman said that he could no longer trust them, and he
was afraid they would sabotage the connectors.
In his testimony, Les Huntsman admitted that after lunch
on July 13, 1990, he told Rick Orlandini and the other fore-
men to get the employees together. He admitted that he
asked the assembled employees who their spokesman was
and whether they had any problems. He said that he told
them something was bothering him, and made a speech about
the benefits the Company provided them without any nego-
tiation. He said that the company gave the benefits it could
afford. At the end of the meeting, he said that some changes
720 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
26 Similar language may be found in the Board’s decision in Law-
yers Cooperative Publishing Co., supra, also cited by counsel for the
General Counsel.
would be made that afternoon. Later that afternoon, Hunts-
man said, four employees were laid off and two employees
were terminated. Between 3 and 3:30 p.m., he instructed
Rick Orlandini to send in the five out of the six who worked
in his department, and he instructed Brett Kee, also a fore-
man, to send in the one employee of the six who worked in
his department.
Huntsman testified that the reason for the layoffs was that
work orders and sales were down and inventory was up. As
his reason for firing Blades and Burnett, Huntsman said that
he could not trust them and feared that would sabotage con-
nectors or equipment. He said that they lied to him, and he
could not trust someone who does not tell the truth. He de-
nied that he terminated them because of their union activi-
ties. He explained that on the morning of July 13, 1990,
George Kee, Brett Kee, and Jim Short told him that Blades
and Burnett, and some others, not identified, had been at a
union meeting on July 12. Huntsman said that he and Rick
Orlandini had concluded the meet must have involved forma-
tion of a union. He admitted that he said, ‘‘bullshit’’ when
Burnett and Blades denied on July 12 that they were in-
volved in union activities.
Danny L. Burnett and Fred Blades returned to work for
Special Mine Services on September 4, 1990. Les Wood was
recalled 2 days after he was laid off, and Brent Wall was re-
called on August 8, 1990
On July 25, 1990, the Union filed an unfair labor practice
charge against Special Mine Services, alleging that employee
Fred Blades and Danny Burnett were discharged and Brent
Wall, John Natyshok, Les Wood, and Herb Armes were laid
off because of their union activities. The charge was resolved
by agreement on September 27, 1990.
The General Counsel argues that even though the events
of April and July 1990 were resolved by agreement, they can
be used to show that knowledge and union animus were mo-
tives in the layoffs of April, May, and June 1991. In support
of this proposition, General Counsel cites Host International,
290 NLRB 442 (1988); Lawyer’s Cooperative Publishing
Co., 273 NLRB 129, 130 fn. 4 (1984); Steve’s Sash Co., 164
NLRB 468, 476 (1976).
Respondent Special Mine Services, citing Hollywood Roo-
sevelt Hotel Co., 235 NLRB 1397 (1978); Ventura Coastal
Corp., 264 NLRB 291 (1982); and Leeward Nursing Home,
278 NLRB 1058 (1986), strongly objects to introduction evi-
dence of allegations of discriminatory conduct occurring
prior to the September 27, 1990 settlement. Special Mine
Services contends that the alleged unlawful conduct has been
remedied, and, furthermore is stale and too remote, and
moves to strike the testimony.
Respondent Special Mine Services’ actions constitute near-
ly classic examples of unlawful surveillance, interrogation,
and discriminatory layoffs and discharges of employees be-
cause they engaged in protected union activities, all in viola-
tion of Section 8(a)(1) and (3) of the Act. These actions, un-
dertaken by Special Mine Services’ president and chief exec-
utive officer, and its vice president, clearly demonstrate
strong union animus on the part of Special Mine Services’
top management, and amounted to nothing less than an at-
tempt to frighten and intimidate Special Mine Services’ re-
maining employees into abandoning any further union activi-
ties, by making an example of the six employees who were
laid off or discharged, all but one of whom had attended a
union meeting the night before and had signed union pref-
erence cards. The threatening message being sent by Hunts-
man and Vice President Kee was anything but subtle, and
was one which the employees could hardly miss.
The fact that Respondent Special Mine Services’ July
1990 conduct was the subject of a settlement agreement, and
is not alleged in the complaint to be violations of the Act
for which a remedial order is being sought, does not make
the conduct inadmissible for any purpose. As stated by the
Board in Host International, supra, 290 NLRB at 442:26
[W]e agree with the judge that the Respondent’s
presettlement conduct may properly be considered as
background evidence to establish the motive for Re-
spondent’s postsettlement conduct in this case. Thus al-
though the 1981 discharges of Rizzo and Sarubbi can-
not be made the basis of a remedial order because of
the settlement, the events surrounding those discharges
can be used to shed light on the Respondent’s reasons
for refusing to hire them in 1985. We also agree with
the judge’s finding that the Respondent’s refusal to hire
Rizzo and Sarubbi in 1985 was not simply the natural
result of their original discharges, but rather was a new
and independent act of discrimination that occurred
after the settlement and, therefore, could be litigated.
Respondent Special Mine Services’ reliance upon the
Board’s holding in Hollywood Roosevelt Hotel Co., supra, is
misplaced. In that case, the Board noted that there are excep-
tions to the ‘‘general rule that a settlement agreement with
which the Parties have complied bars subsequent litigation of
presettlement conduct alleged to constitute unfair labor prac-
tices,’’ and went on to hold that the case before it did not
fall within any of the exceptions. Unlike the instant case, in
that case a remedial order was sought concerning
presettlement conduct on grounds that the settlement should
be set aside.
Here, in contrast, the General Counsel does not seek to set
aside the settlement, and the presettlement conduct of Re-
spondent Special Mine Services was not litigated as the basis
for a remedial order. Rather, the presettlement conduct was
offered as background evidence to establish that union ani-
mus motivated its new and independent postsettlement con-
duct, which is alleged to be the basis for a remedial order.
The postsettlement permanent layoffs of some of the same
employees laid off or discharged in the presettlement actions
are alleged to be new and independent acts of discrimination
which occurred after the settlement. I find this to be a proper
use of evidence of presettlement conduct.
As background evidence of union animus, I find the evi-
dence of Respondent Special Mine Services’ presettlement
conduct to be neither too remote or stale. Respondent’s ac-
tions in laying off or discharging its employees on July 13,
1990, did not terminate the Union’s activities at Respond-
ent’s plant nor did it prompt all of those employees who had
expressed an interest in or preference for the Union to with-
draw their support. Further, the settlement did not take place
721SPECIAL MINE SERVICES
27 It appears that the Union declined Respondent Special Mine
Services’ suggestion in the interim that an election be held.
28 As noted earlier, as early as April 6, 1990, Huntsman had inter-
rogated two of his employees, Fred Blades and Danny Burnett, about
whether they had been engaging in union activities.
29 There were 18 votes for the petitioner, 18 votes for the Com-
pany.
30 The certification, which is referred to in General Counsel’s
brief, is not a part of the record.
until September 27, 1990, and on March 8, 1991,27 the
Union filed a petition for certification, which led to an elec-
tion and further objections and exceptions by the Union.
Clearly, the union activities among Respondent Special Mine
Services employees at its West Frankfort facility, which were
first reported to Les Huntsman in April 1990, and were con-
firmed by unlawful surveillance on July 13, 1990, continued
unabated, and resulted in an election, followed by objections
and exceptions, and alleged new and independent
postsettlement violations of the Act, which are the basis for
this case and the remedial order which General Counsel
seeks.
Respondent Special Mine Services’ motion to strike is de-
nied.
IV.
General Counsel contends that Respondent Special Mine
Services violated Section 8(a)(3) and (1) by laying off 10
employees between April and June 1991, because of its em-
ployees’ union activities, and by transferring or subcontract-
ing its connector manufacturing work to Smith Machine and
Tool because of union activities by its employees.
The General Counsel has the initial burden of establishing
a prima facie case that an employee was discharged or laid
off by his employer because of union animus. Wright Line,
251 NLRB 1083 (1980), enfd. as modified 662 F.2d 899 (1st
Cir. 1981), cert. denied 455 U.S. 989 (1982). As part of the
prima facie case, the General Counsel must prove that the
employee engaged in union or other protected activity, that
the employer had knowledge of the employee’s union or
other protected activity, and that the employee was dis-
charged or laid off from his employment because of union
animus or other unlawful motive, in violation of Section
8(a)(3). Inference of unlawful discrimination against an em-
ployee may be drawn from an employer’s hostility toward
the union, and coincidence between the employee’s union ac-
tivities and his discharge. Lemon Drop Inn v. NLRB, 752
F.2d 323, 325 (8th Cir. 1985). Union animus can be inferred
from circumstantial evidence. Abbey’s Transportation Serv-
ices v. NLRB, 837 F.2d 575 (2d Cir. 1988). Unlawful moti-
vation may be inferred from the timing of an employer’s ac-
tion. Lemon Drop Inn v. NLRB, supra. Another factor from
which unlawful motivation may be inferred is the pretextual
nature of an employer’s asserted reasons for his actions.
T.M.I., 306 NLRB 499 (1992); Dorothy Shamrock Coal Co.,
279 NLRB 1298 (1986). Where there is a mass layoff to dis-
courage union activity, it is not necessary for the General
Counsel to prove the employer’s knowledge of a specific em-
ployee’s opinion as to the union. Ballou Brick Co. v. NLRB,
798 F.2d 339 (8th Cir. 1986). Once the General Counsel has
met his burden of establishing a prima facie case of dis-
charge or other discrimination because of union animus, the
burden then shifts to the employer to show as an affirmative
defense that the employee would have been discharged or
laid off regardless of his union activity. Wright Line, supra.
The Board has found that discriminatory relocation of
work and discriminatory subcontracting violate Section
8(a)(3) when motivated by union animus. Lear Siegler, Inc.,
295 NLRB 857 (1989).
There can be no doubt that Respondent Special Mine Serv-
ices was aware of union activity by its employees at its West
Frankfort facility by July 12, 1990, at the latest, and prob-
ably as early as the first week of April 1990.28 On July 12,
1990, its vice president, George Kee, and a supervisor, Brett
Kee, unlawfully surveilled a union meeting attended by a
number of Special Mine Services employees, including
Danny Burnett and Fred Blades. The next day, President
Huntsman, clearly upset by discovery that some of his em-
ployees had attended a union meeting, threatened his assem-
bled employees that there would be changes that afternoon.
Later that afternoon, he made good on that threat by laying
off a number of employees and discharging Burnett and
Blades, ostensibly because they were untruthful when they
denied being involved in union activities in April 1990, when
he had unlawfully interrogated them. These precipitous ac-
tions could have no purpose other than to eliminate the two
employees identified as union supporters, and discourage the
remaining employees from supporting the union. Huntsman’s
actions on July 13, 1990, clearly demonstrate union animus
on his part and by Respondent Special Mine Services.
Respondent Special Mine Services efforts on July 13,
1990, to suppress union activity failed, however. The Union
filed an unfair labor practice charge over the discharges, and
the Respondent reemployed Burnett and Blades as part of a
settlement of that charge, in September 1990. The Union
continued its efforts to organize Special Mine Services’ em-
ployees, and on March 8, 1991, petitioned for certification as
collective-bargaining representative of Respondent Special
Mine Services’ employees doing battery repair, cable repair,
connector room, machine shop, maintenance, and warehouse
work at Respondent’s West Frankfort facility. On March 26,
1991, the Union and Special Mine Services entered into a
Stipulated Election Agreement providing for an election to
be held on April 19, 1991.
The election resulted in a tie,29 with three challenged bal-
lots. On or about April 24, 1991, the Union filed ‘‘Objec-
tions to the Conduct of the Election.’’ Respondent’s employ-
ees Danny Burnett, Fred Blades, Les Wood, Randy
Orlandini, and Jeff Kennerly signed the verification which
was part of the pleading. The Union’s objections centered on
allegedly ‘‘false and coercive assertions’’ made by of Les
Huntsman before the election. On May 6, 1991, the Union
withdrew its challenges to three of the ballots. On May 17,
1991, the Regional Director for Region 14 issued the ‘‘Re-
gional Director’s Report on Challenged Ballots and Objec-
tions, Order, and Recommendations,’’ approving the Union’s
withdrawal request and recommending that the Union’s ob-
jections be overruled in their entirety, and ordering that the
ballots which had been challenged be opened and counted.
Subsequently, on May 20, 1991, the Union filed exceptions
to the Director’s Report. A ‘‘Certification of Results of Elec-
tion’’ was issued after the trial of this case, on September
12, 1991.30
722 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
31 The layoff notice states that ‘‘We have tried to adopt a policy
that is both fair and allows the company to operate efficiently,’’ but
no reasons are given to explain why the Respondent found it nec-
essary to change the policy previously in effect.
32 Morgan testified that three other connector room employees had
less seniority than he. It appears that two of the three employees,
Mike Campbell and Bob Dotson, may have had a break in their em-
ployment with Special Mine Services, and that their seniority date,
as calculated by Special Mine Services, was their original starting
date. The name of the third employee named by Morgan, Joe Wag-
ner, does not appear on the seniority list of May 24, 1991, admitted
into evidence as G.C. Exh. 12. The name, ‘‘Robert Wagner,’’ ap-
pears on the list as a warehouse employee. It cannot be determined
from the record if ‘‘Joe’’ and ‘‘Robert’’ Wagner are the same per-
son.
33 Ingram Morgan had attended the union meeting on July 12,
1990, and was known to Rick Orlandini, one of Respondent’s fore-
men, to be a ‘‘union man.’’ Morgan and Orlandini lived in the same
town, and carpooled to work at Special Mine Services. Orlandini ad-
mitted in his testimony during the hearing that he had probably told
Morgan that he knew Morgan was a union man and would probably
vote for the Union. Orlandini admitted that he had passed that infor-
mation to Huntsman.
34 Leslie Wood had attended the July 12, 1990 union meeting and
was laid off by Huntsman the next day.
35 Huntsman testified that Jeff Kennerly, the fifth signer of the
Union’s exceptions, quit on April 19.
36 Although the Regional Director found no violations of the Act
in Respondent Special Mine Services’ preelection activities to which
the Union objected, it is evident from the Regional Director’s Report
that the Respondent opposed the Union, and communicated its oppo-
sition to its employees.
In a notice to its employees, dated May 24, 1991, which
was posted at Respondent Special Mine Services’ West
Frankfort facility, Respondent announced that it was adopting
a layoff policy providing that layoffs ‘‘are to be made on the
basis of seniority hire date of the employee Department,’’
with the last person hired in the department to be laid off
first. According to the notice, the departments at Respond-
ent’s West Frankfort facility were battery repair, cable repair
and maintenance, connector room, machine shop, and ware-
house. Where a temporary layoff was caused by a temporary
condition, temporary assignments to other departments could
be made without regard to seniority. The notice further pro-
vided that an employee with special training or skills could
be retained out of seniority order, and employees laid off for
a period of up to 6 months would be considered for recall
to their former department in the order of the person laid off
most recently being recalled first. No reasons were given to
explain to the employees why Respondent was changing its
layoff policy from plantwide seniority to department senior-
ity.31
On April 25 and 26, 1991, Respondent laid off two of its
employees, Ingram Morgan and Leslie Wood, both of whom
were employed in the connector room. According to a se-
niority list dated May 24, 1991, prepared by Respondent,
Morgan Ingram was the least senior employee in the connec-
tor room, and Leslie Wood was next to least senior.32 It also
appears from the seniority list that they were the two least
senior employees on a plantwide basis.
On May 31, 1991, Respondent laid off connector room
employees Robert Dotson, Fred Blades, and Randy
Orlandini, and machine shop employee Brent Wall. Accord-
ing to the seniority list prepared by Respondent, all four
were the least senior employees in their departments. Fred
Blades and Randy Orlandini were not the least senior em-
ployees on a plantwide basis.
On June 7, 1991, Respondent laid off connector room em-
ployees David Cain, George Kirk, and Danny Burnett, and
machine shop employee James Stratton. The four employees
were the least senior employees remaining in their depart-
ments. They were not the least senior on a plantwide basis.
Prior to the series of 3 layoffs, there were 12 employees
in the connector room and 9 employees in the machine shop.
The layoffs reduced the employee complement in the con-
nector room to four employees and the employee com-
plement in the machine shop to seven employees.
Using the department seniority layoff system adopted by
Respondent on May 24, 1991, in order to reach Fred Blades,
one of the two employees it had unsuccessfully tried to dis-
charge on July 13, 1990, on the connector room seniority
list, it was necessary to first layoff Morgan Ingram, Leslie
Wood, and Robert Dotson, which Respondent did. In order
to reach Danny Burnett, the second employee Respondent
had unsuccessfully tried to discharge on July 13, 1990, on
the connector room seniority list, after Fred Blades was laid
off, it was first necessary to lay off Randy Orlandini, David
Cain, and George Kirk, which Respondent also did. Thus,
Danny Burnett, with a hire date of July 1, 1987, was the last,
and most senior employee in the connector room to be laid
off. By means of the layoffs in April, May, and June 1991,
Respondent for the second time removed Burnett and Blades
from its payroll, as well as three other known union support-
ers, Ingram Morgan,33 Leslie Wood,34 and Randy Orlandini,
the latter two having signed the Union’s objections to the
conduct of the election filed on April 24, 1991.35
An inference that Respondent was motivated by union ani-
mus in the layoffs during April, May, and June 1991, may
be drawn from Respondent’s prior unsuccessful effort to dis-
charge Blades and Burnett because of union animus and
union activities by its employees, and its continued opposi-
tion to the Union during the period leading up to the April
19, 1991 election. A further inference of union animus can
be drawn from the coincidence between the failure of the
Union to win a majority in the election of April 19, 1991,
and the apparent favorable outcome of the election to the Re-
spondent, and the layoffs which began less than a week after
the election. The timing of the layoff policy changes, sub-
contracting out of plant work, and layoffs, all of which oc-
curred rapidly over a period of less than 2 months following
the April 1991 election, supports an inference that the strong
union animus displayed by Respondent Special Mine Serv-
ices during the period from April to July 1990, continued
unabated through the election on April 19, 1991,36 and moti-
vated its postelection actions.
It is apparent from the results of the election, the Union’s
withdrawal of challenges to three ballots, and the Regional
Director’s recommended Order finding no reason to set aside
the election, that the Respondent, which had actively op-
posed the Union in the election, emerged from the election
in a much stronger position than the Union. In the cir-
cumstances, the Respondent could reasonably conclude that
when the three ballots challenged unsuccessfully by the
Union were counted, the Respondent might very well win the
election. Further, even if the Board were to reverse some or
all of the Regional Director’s findings and recommendations
723SPECIAL MINE SERVICES
37 Also referred to as the tunnel oven. This was a new piece of
equipment intended to be used to cure urethane connector parts
made by the injection machine. There was testimony that the oven
used more electricity than was available in the connector room when
other electrical equipment was in use, and that the oven was bulky
and caused a space problem in the connector room.
38 Huntsman said that the November 1990 financial report showed
a higher than normal profit, but the Company was having trouble
paying its bills.
39 Similar to production sheets he had used at Anextor Cable Serv-
ice Company.
40 Huntsman testified that he could tell exactly what the costs were
for commodity items which Special Mine Services purchased for re-
sale, but not for items which Special Mine Services manufactured.
Lack of reliable cost information for products sold by Special Mine
Services was of concern to potential buyers of the Company.
41 Huntsman said that he had shut down the injector machine on
April 26, 1991, and it had not run continuously since then, because
it was not needed. He said he was not sure if he had enough connec-
tor work to subcontract out as of May 4, but he expected that suffi-
cient work would become available.
at some later time, the Respondent could reasonably con-
clude that the worst that could happen, from its point of
view, would be that the election would be set aside and a
new election ordered. If, in the meantime, it was able to
eliminate some of the Union’s supporters, it would be un-
likely that the lesson would be lost on the remaining employ-
ees, and that they would risk their jobs by voting for the
Union in sufficient numbers for the Union to win a second
election. Under these conditions, I find that it is inferable
from the evidence that the Respondent felt that after the elec-
tion was an opportune time to terminate the employment of
a number of union supporters, and discourage its remaining
employees from engaging in further union activities.
In May and early June 1991, Respondent Special Mine
Services moved the specialized equipment used to make cer-
tain kinds of connectors from its West Frankfort facility to
Smith Machine and Tool’s facility in Royalton, approxi-
mately 26 miles distant, and subcontracted out the connector
manufacturing work to Donald Smith, the owner of Smith
Machine and Tool. The subcontracting of the connector work
and transfer of the machinery used in the connector manufac-
turing process are cited by Respondent as reasons justifying
the layoff of employees in the connector room and machine
shop in May and June 1991. Although they were called lay-
offs at the time, it is clear that they were permanent layoffs,
because Respondent Special Mine Services had subcontracted
out the work that the laid-off employees used to do. I find
from the timing of this action, which Respondent took short-
ly after the apparently favorable to its outcome of the April
19, 1991 election, that it is inferable that Respondent was
motivated by union animus.
I find that the General Counsel has produced sufficient cir-
cumstantial evidence to establish a prima facie case that in
April, May, and June 1991, Respondent Special Mine Serv-
ices permanently laid off 10 of its employees in the Connec-
tor Room and Machine Shop because of union animus. Hav-
ing failed in July 1990 to terminate the employment of two
known union supporters, Fred Blades and Danny Burnett,
Respondent, which had communicated its opposition to the
Union quite emphatically to its employees, moved quickly
following the April 19, 1991 election to change its layoff
policy from one based on plant seniority to one based on di-
vision seniority, subcontract out most of the work of the con-
nector room, and layoff known union supporters employed in
the connector room and machine shop, including Fred Blades
and Danny Burnett. Also laid off were Randy Orlandini and
Les Wood, both of whom had signed the Union’s objections
to the conduct of the election, and in doing so, had identified
themselves as union supporters. The remaining employees
laid off during that period of time were discriminatorily laid
off by Respondent in order to reach Fred Blades and Danny
Burnett under the newly established layoff policy. Under
these circumstances, it is irrelevant whether they favored or
were opposed to the Union.
V.
Respondent Special Mine Services contends that it has met
its burden under Wright Line, supra, by producing evidence
establishing that the subcontracting of connector manufactur-
ing work to Smith Machine and Tool and the layoffs in
April, May, and June 1991 were prompted by substantial
business concerns and would have taken place even in the
absence of its employees’ union activities. These concerns
included reduced orders for connectors and lack of work for
employees in the connector room and the machine shop, a
large inventory of various kinds of connectors which could
be used to fill new orders, inadequate space and electrical
problems which Respondent experienced in trying to put a
new oven37 into operation in the connector room, and sav-
ings in manufacturing costs (primarily labor costs) and reso-
lution of the problems associated with the new oven which
could be realized through subcontracting connector manufac-
turing work to Smith Machine and Tool.
According to testimony from President Huntsman, after
meeting with accountants in December 1990 concerning high
operating costs,38 in January 1991, he introduced the use of
production sheets39 to determine the labor costs for making
connectors. His analysis of the production sheets showed that
the labor costs were erratic, with unexplained variances in
the time it took employees to make the same parts.40 Some-
time prior to May 4, 1991, he said, he concluded that one
way to obtain fixed manufacturing costs was to subcontract
out the manufacturing of connectors. After soliciting a bid
from at least one other possible subcontractor, on May 4,
1991, he decided to subcontract the connector work to Smith
Machine and Tool for 5 percent less than the amount he esti-
mated that it cost Special Mine Services for labor to manu-
facture the same part.41 Huntsman said that he did not sell
the equipment used to manufacture connectors to Donald
Smith, because he did not want Smith to be able to use the
equipment to make connectors for Special Mine Services’
competitors. Instead, title to the equipment was retained by
Special Mine Services, and Huntsman said that he told Don-
ald Smith that anything manufactured with the equipment
had to go back to Special Mine Services.
Huntsman testified that orders were erratic in 1991, show-
ing a steady decline steadily after March 1991. He said that
Ingram Morgan and Leslie Wood were laid off on April 26,
1991, not necessarily because there was a lack of work, but
because the equipment which they operated, the injection
machine, was shut down until the problems in putting the
tunnel oven into operation were resolved.
The decision to change from plantwide seniority to depart-
ment seniority as the method used to determine layoffs was
724 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
42 Huntsman did not explain why a layoff was not needed on May
24, but 7 days later, on May 31, there was such a large inventory
of connectors that there was no need to make more and presumably
a layoff would have been needed, even if the injection machine had
not been transferred to Smith Machine and Tool.
43 Orlandini gave testimony concerning the amount of work in-
volved in making some of the parts, but not with respect to most
of the parts. There is no basis, even when his testimony and the
records are considered together, for determining what any particular
employees or even group of employees were doing, or not doing, on
any particular day or during any particular week.
44 Huntsman identified G.C. Exh. 31 as the ‘‘sales by month and
employees that were employed at the end of that particular month.’’
Elsewhere in his testimony he answered in the affirmative to ques-
tions posed by counsel for the General Counsel incorporating ref-
erences to the sales figures as connector sales. The entry for April
1991 reflects sales of $166,778, 21 employees, and sales per em-
ployee of $7942. G.C. Exh. 29, a seniority list bearing the date
‘‘4/22/91,’’ shows a total of 21 employees in the connector room
and machine shop, combined. From this, I conclude that G.C. Exh.
31 does represent sales of connectors, which are produced through
the combined efforts of the connector room and machine shop.
made before the May 1991 layoffs. Huntsman testified that
on the advice of the Company’s attorney, he made the deci-
sion to change the seniority system jointly with his depart-
ment heads and his partner, George Kee, in a meeting on
May 24, 1991. At that time, Huntsman testified, there was
no need for a layoff. He said that he was trying to get things
lined up if the need for another layoff should arise.
By the time of the May 31 and June 7, 1991 layoffs,
Huntsman testified, he had already moved some of the equip-
ment used to manufacture connectors to Smith Machine and
Tool. However, he said, even though the injection machine
had been taken to Smith Machine and Tool, there would
have been no work for the employees who were laid off be-
cause there was a large inventory of connector parts available
to fill orders.42 He said the employees were surplus and were
laid off because the work was transferred elsewhere. Hunts-
man stated that Special Mine Services did not maintain in-
ventory records for connectors during the April to June 1991
period, and that he did not have inventory figures available
to him prior to either the May 31 or the June 7, 1991 layoffs.
Huntsman said that a notice announcing the layoff of four
employees was posted on May 30, 1991. He said that work
was slow during the week because orders had not come in
and the shelves were full. He said that he talked to Rick
Orlandini during the preceding week, and concurred with
Orlandini that the amount of work available did not justify
keeping the number of people left in the connector room and
the machine shop.
The layoff of June 7, 1991, according to Huntsman, was
prompted by an observation reported to him by George Kee
that men were standing around in the connector room with-
out anything to do. Huntsman said that he met with George
Kee and Rick Orlandini, the foreman of the connector room,
and they jointly decided another layoff was needed. Hunts-
man said that he did not know how much work was avail-
able, but accepted George Kee’s input and decided another
layoff was needed.
Rick Orlandini, foreman of the connector room, testified
that orders declined during the period from March to June
1991. Because of the low number of orders which he re-
ceived from the salespeople, he had a hard time finding work
to keep his employees busy. He kept records of incoming or-
ders on handwritten sheets, but kept no inventory records.
His handwritten order sheets for the period from March 13
to June 26, were introduced into evidence. He said that he
kept order sheets for 3 months before discarding them, and
his order sheets prior to March 13 were not available. He
said that 40 to 50 orders a month was good, and that 15 or-
ders in a month was a bad month. He acknowledged that his
brother, Randy Orlandini, an injection machine operator,
worked overtime 1 hour each day during the week of April
25, 1991. He did not explain why there was a need for one
injection machine operator to work overtime during a week
when two other injection machine operators were laid off and
the injection machine was supposedly taken out of service
while the new oven was being installed.
Orlandini’s handwritten order sheets afford little support
for his testimony that lack of new orders and excess inven-
tory on hand resulted in lack of work for Respondent Special
Mine Services’ employees in the connector room and ma-
chine shop during the April to June 1991 period. The hand-
written order sheets which he kept are, at best, inconclusive.
They apparently do not reflect all connector orders worked
on by Respondent’s employees during each of the months
from March to June 1991, and they do not show which parts
were filled by manufacturing new parts and which were
filled from inventory. Further, in the absence of any inven-
tory records, it cannot be ascertained how much inventory
was on hand at any point, how rapidly that inventory was
being depleted, and how long it would last without being re-
plenished by manufacturing more connectors. To the extent
that Orlandini’s handwritten order sheets do reflect new or-
ders received during the period they cover, overall they do
not show how much work there was to making the parts in-
volved,43 and, in any event, they appear to indicate numbers
of orders during the months covered which are closer to the
40 to 50 orders which Orlandini said represented a good
month than the 15 orders which he said represented a bad
month. Even more significantly, perhaps, Respondent was
unable to produce any records of orders in earlier months
against which the order sheets admitted into evidence can be
compared. For these reasons I find the handwritten order
sheets kept by Orlandini are entitled to little weight.
Respondent’s contention that orders for connectors, in par-
ticular, declined during the March to June 1991 period, ap-
pears to be inconsistent with the Company’s records of con-
nector sales per month, as reflected in General Counsel’s Ex-
hibit 31.44 As reflected in that exhibit, which also includes
the number of employees and the dollar value of sales per
employee, Respondent’s connector sales per month for the
year ending June 1991 were:
July 1990 $114,915
August 1990 131,544
September 1990 129,921
October 1990 188,617
November 1990 152,217
December 1990 112,211
January 1991 138,345
February 1991 142,410
March 1991 165,496
April 1991 166,778
725SPECIAL MINE SERVICES
May 1991 $166,778
June 1991 112,587
The June 1991 connector sales were in the range of sales in
July and December 1990, while the March, April, and May
1991 sales were exceeded only by the October 1990 sales.
Although these figures do not indicate which sales were
filled from stock and which were filled by manufacturing the
ordered part, the linkage of the sales figures to sales per em-
ployee in the connector room and machine shop suggests
sales are related to manufacturing activities, or, stated dif-
ferently, to orders. The sales figures, therefore, are inconsist-
ent with Respondent’s claim that orders for connectors de-
creased beginning in March 1991. The sales figures for
March through May 1991, show no decline. Since the last
layoff occurred on June 7, 1991, the June sales figures,
which were not available to Huntsman at the time he made
the layoff decision, are largely irrelevant.
It is evident from the record that layoff and subcontracting
decisions Respondent Special Mine Services were made by
its president, Les Huntsman. It is equally clear from the
record that in making the layoff decisions, Huntsman, if his
own testimony is to be believed, lacked detailed day-to-day
knowledge of how much work was available in the Connec-
tor Room and Machine Shop. He testified that he variously
looked at Orlandini’s handwritten order sheets, queried
Orlandini about how much work there was, and accepted
‘‘input’’ from Vice President George Kee. Several attempts
by Respondent Special Mine Services to introduce into evi-
dence various business records prepared after the fact and in
anticipation of litigation were rejected during the hearing. I
find no reason to reverse those rulings, since the issue here
is one of the decision-maker’s motives at the time he made
the decisions based on the information which he had avail-
able to him at the time he made the decisions. Although Re-
spondent Special Mine Services now contends that the lay-
offs were justified by reduced orders, excess inventory, and
lack of work, those were not the primary reasons for the lay-
offs given by Huntsman in his testimony. He testified that
he made the decision to lay off Morgan and Wood on April
26, 1991, not necessarily because of lack of work, but be-
cause the injection machine which they operated was shut
down while a new experimental oven was being installed.
And, as he candidly further admitted, by the time of the May
31 and June 7, 1991 layoffs, he had already moved the injec-
tion machine to Smith Machine and Tool, and the employees
who used to work in the manufacturing process in which it
was used, were surplus and were laid off because the work
was transferred elsewhere.
The logic of that last statement is, of course, unassailable.
Once the machines which they operated were transferred
elsewhere, the employees who formerly operated them were,
indeed, likely to be surplus. The issue that remains, there-
fore, is whether Huntsman’s decision to lay off Morgan and
Wood on April 26, 1991, and his decision on May 4, 1991,
to subcontract the connector work to Smith Machine and
Tool, thus making a number of employees surplus, were mo-
tivated by his employees’ union activities. If Huntsman was
motivated by union animus to subcontract the work to Smith
Machine and Tool, then the employees whom he laid off be-
cause they were made surplus by the subcontracting were
also laid off for unlawful reasons. It is Respondent’s burden,
at this point, to show that Huntsman’s motives were not un-
lawful, or that the layoffs would have taken place even in
the absence of protected activities.
Huntsman’s explanation that he laid off Morgan and
Wood, both of whom were known union supporters, not nec-
essarily because of lack of work, but because the injection
machine which they operated was shut down while a new ex-
perimental oven was being installed, is insufficient to over-
come the inference which can be drawn from the coincidence
between renewed union activities and Union’s failure to win
the election. The timing of the layoffs supports an inference,
which at this point is unrebutted, that he laid them off be-
cause of their union activities and sympathies at the earliest
opportunity after the Union failed to win the election.
The explanation offered by Huntsman for his decision to
subcontract connector manufacturing operations to Smith
Machine and Tool is not persuasive. The record, particularly
the testimony of Rick Orlandini, strongly indicates that
Huntsman first brought up the possibility of subcontracting
connector manufacturing work in April 1991, long after the
Union had petitioned for certification in March. There is
some evidence that he solicited a bid from a person named
Bill Mooreman, no time was given and no details of the so-
licitation were offered. According to testimony by Rick
Orlandini, he became aware in April 1991 of Huntsman’s in-
terest in subcontracting the work, and considered taking it on
with his brother before contacting Donald Smith to determine
if he was interested. But, by April 1991, Huntsman was well
aware of the Union’s renewed activities, since the Union had
filed its petition for certification on March 8, 1991, and Re-
spondent had entered into a stipulated election agreement
with the Union on March 26, 1991, providing for an election
to be held on April 19, 1991. Insofar as the record shows,
therefore, Huntsman first began considering subcontracting
after he learned of the Union’s petition for certification, and
he carried through with subcontracting the connector work to
Smith Machine and Tool on May 4, 1991, approximately 2
weeks after the election in which the Union had failed to
gain a majority vote. This chronology does nothing to refute
the inference that the subcontracting was motivated by the
employees’ union activities which can be drawn from the co-
incidence between the subcontracting and the renewal of the
Union’s organizing attempt and the election, or that Hunts-
man would have subcontracted the connector manufacturing
work to Smith Machine and Tool even in the absence of his
employees’ union activities.
Similarly unpersuasive is the economic justification of-
fered by Huntsman for the subcontracting agreement he en-
tered into with Smith Machine and Tool. According to his
testimony, his objectives in subcontracting the work were to
stabilize his manufacturing costs and reduce his labor costs.
While the agreement with Smith Machine and Tool may
seem to achieve those goals, the savings realized by Re-
spondent appear to be relatively small, amounting to only a
5-percent reduction from Special Mine Services’ production
costs. No estimate of the value of the projected savings to
Special Mine Services was offered. Compared to the small
percentage of anticipated savings, Special Mine Services ap-
pears to have made a disproportionate capital investment in
Smith Machine and Tool’s plant. Under the agreement, Spe-
cial Mine Services furnished Smith Machine and Tool with
all of the machinery and equipment needed to manufacture
726 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
45 There is evidence in the record that Donald Smith had to have
increased electrical service installed in his building to operate the
oven.
connectors, at no cost or rental to Smith Machine and Tool,
other than maintenance costs which Smith Machine and Tool
agreed to assume. The value of the equipment which Special
Mine Services transferred to Smith Machine and Tool was
estimated at $25,000 to $30,000. The record further indicates
that Special Mine Services supplies Smith Machine and Tool
with the raw materials necessary to manufacture the connec-
tors. The anticipated economic benefits to Special Mine
Services do not appear to be significant enough to overcome
the adverse inference which can be drawn from the timing
of the subcontracting action, nor do they appear to so bene-
ficial to Special Mine Services that it would have subcon-
tracted the work even in the absence of its employees’ pro-
tected union activities.
In addition to anticipated economic benefits, Huntsman
testified that subcontracting the connector work and transfer-
ring the equipment, including the new tunnel oven, to Smith
Machine and Tool solved space and electrical problems Spe-
cial Mine Services unexpectedly encountered when it at-
tempted to install and operate the new tunnel oven at its
West Frankfort facility. According to Huntsman, Special
Mine Services did not have adequate space for the oven in
the connector room, and its building lacked adequate elec-
trical power to operate it. Smith Machine and Tool, on the
other hand, had adequate building space and had, or could
easily get, adequate electrical power.45
While indeed there is evidence in the record that the oven,
as installed, protruded into an aisleway, and that electrical
problems were encountered in putting the oven into oper-
ation, I find no evidence to support the conclusion that either
the space or electrical problems were so vexatious or unan-
ticipated that they could not be solved by Special Mine Serv-
ices at its West Frankfort facility. It appears from the record
that the oven was specially built to Special Mine Services’
specifications, at considerable cost, and considering that, it is
a reasonable inference that the project was not entered into
by Special Mine Services on the spur of the moment, without
any planning as to where the oven would be located or what
its electrical power requirements might be. Not to have con-
sidered such patently elementary factors would seem to be an
example of gross mismanagement. There is also evidence in
the record that the location of the oven in Special Mine Serv-
ices’ building was temporary, and there is no evidence that
adequate permanent space for it could not be obtained by re-
arranging other equipment and fixtures. While it may be that
more heat generated by electrical power than anticipated was
needed to reach the desired heat in the oven, there is no evi-
dence that additional electrical service could not be obtained
for the building sufficient to meet the electrical current re-
quirements of all of the equipment operated in the building,
particularly since Donald Smith did precisely that in order to
operate the oven in his building.
I find that Respondent Special Mine Services has not
shown that it would have subcontracted its connector manu-
facturing work to Smith Machine and Tool on May 4, 1991,
and permanently laid off a total of 10 of its employees on
April 26, May 31, and June 7, 1991, had its employees not
engaged in union activities. Respondent has failed to carry
its burden under Wright Line, and its actions violated Section
8(a)(1) and (3).
CONCLUSIONS OF LAW
1. Respondent Special Mine Services, Inc. and Respondent
Smith Machine and Tool Shop are employers engaged in
commerce within the meaning of Section 2(2), (6), and (7)
of the Act.
2. The Southern Illinois Laborers’ District Council, Labor-
ers’ International Union of North America, AFL–CIO the is
a labor organization with in the meaning of Section 2(5) of
the Act.
3. Respondent Special Mine Services, Inc. and Respondent
Smith Machine and Tool Shop are not joint employers of the
employees of Smith Machine and Tool Shop.
4. By laying off employees Ingram Morgan and Leslie
Wood on or about April 26, 1991, because its employees
joined, supported, and/or assisted a union, Respondent Spe-
cial Mine Services, Inc. violated Section 8(a)(1) and (3) of
the Act.
5. By transferring or subcontracting production of elec-
trical connectors on or about May 4, 1991, to Smith Machine
and Tool Shop, because the employees of Respondent Spe-
cial Mine Services, Inc. joined, supported, and/or assisted a
union, Respondent Special Mine Services, Inc., violated Sec-
tion 8(a)(1) and (3) of the Act.
6. By laying off employees Robert Dotson, Brent Wall,
Fred Blades, and Randy Orlandini on or about May 31,
1991, because its employees joined, supported, and/or as-
sisted a union, Respondent Special Mine Services, Inc. vio-
lated Section 8(a)(1) and (3) of the Act.
7. By laying off employees David Cain, George Kirk,
Danny Burnett, and James Stratton on or about June 7, 1991,
because its employees joined, supported, and/or assisted a
union, Respondent Special Mine Services, Inc. violated Sec-
tion 8(a)(1) and (3) of the Act.
8. The aforesaid unfair labor practices affect commerce
with the meaning of Section 2(6) and (7) of the Act.
9. Respondent Smith Machine and Tool Shop has not vio-
lated Section 8(a)(1) and (3) of the Act, as alleged.
REMEDY
Having found that Respondent Special Mine Services, Inc.,
has engaged in unfair labor practices in violation of Section
8(a)(1) and (3) of the Act, I recommend that the Respondent
be ordered to cease and desist, and to take certain affirmative
action designed to effectuate the purposes of the Act.
The Respondent Special Mine Services, Inc., having com-
mitted certain unfair labor practices in violation of Section
8(a)(1) and (3) of the Act, shall be ordered to cease and de-
sist from engaging in those unfair labor practices.
The Respondent Special Mine Services, Inc., having
discriminatorily laid off employees Ingram Morgan, Leslie
Wood, Robert Dotson, Brent Wall, Fred Blades, Randy
Orlandini, David Cain, George Kirk, Danny Burnett, and
James Stratton, shall be ordered to offer them full and imme-
diate reinstatement to their former positions, or, if those posi-
tions are not available, to substantially equivalent positions,
without prejudice to their seniority rights and privileges, and
make them whole, with interest, for any loss of earnings and
other benefits which they may have suffered by reason of
their layoffs, with backpay and interest to be computed in the
727SPECIAL MINE SERVICES
46 In accordance with the Board’s decision in New Horizons for
the Retarded, supra, interest on and after January 1, 1987, shall be
computed at the ‘‘short-term Federal rate’’ for the underpayment of
taxes as set out in the 1986 amendments to 26 U.S.C. § 622. Inter-
est accrued before January 1, 1987, shall be computed in accordance
with Florida Steel Corp., 231 NLRB 651 (1977).
47 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.
48 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.’’
manner prescribed in F. W. Woolworth Co., 90 NLRB 289
(1950), and New Horizons for the Retarded, 283 NLRB 1173
(1987).46
The complaint against Respondent Smith Machine and
Tool Shop shall be dismissed in its entirety.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended47
ORDER
The complaint against Respondent Smith Machine and
Tool Shop in Case 14–CA–21458 shall be dismissed in its
entirety.
The Respondent, Special Mine Services, Inc., West Frank-
fort, Illinios, its officers, agents, successors, and assigns,
shall
1. Cease and desist from
(a) Transferring or subcontracting operations and effec-
tively terminating employees by placing them on indefinite
layoff because of the employees’ actions in joining, support-
ing, or otherwise assisting a union for the purpose of collec-
tive bargaining or other mutual aid or protection.
(b) Laying off employees because they join, support, or
otherwise assist a union for the purpose of collective bargain-
ing or other mutual aid or protection.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Offer Ingram Morgan, Leslie Wood, Robert Dotson,
Brent Wall, Fred Blades, Randy Orlandini, David Cain,
George Kirk, Danny Burnett, and James Stratton immediate
and full reinstatement to their former positions or, if those
positions are no longer exist, to substantially equivalent posi-
tions, without prejudice to their seniority or any other rights
or privileges previously enjoyed, and make them whole, with
interest, for any loss of earnings or other benefits suffered
as a result of the discrimination against them, in the manner
set forth in the remedy.
(b) Remove from its files any reference to the unlawful
layoffs of Ingram Morgan, Leslie Wood, Robert Dotson,
Brent Wall, Fred Blades, Randy Orlandini, David Cain,
George Kirk, Danny Burnett, and James Stratton, and notify
them in writing that this has been done and that the layoffs
will not be used against them in any way.
(c) 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
amount of backpay due under the terms of this Order.
(d) Post at its West Frankfort, Illinois, facility copies of
the attached notice marked ‘‘Appendix.’’48 Copies of the no-
tice, on forms provided by the Regional Director for Region
14, after being signed by the Respondent’s authorized rep-
resentative, shall be posted by the Respondent immediately
upon receipt and maintained for 60 consecutive days in con-
spicuous places including all places where notices to employ-
ees are customarily posted. Reasonable steps shall be taken
by the Respondent to ensure that the notices are not altered,
defaced, or covered by any other material.
(e) Notify the Regional Director in writing within 20 days
from the date of this Order what steps the Respondent has
take to comply.