Stanley Oil Co., Inc.

National Labor Relations Board - Board Decisions

Sep 6, 1974

213 N.L.R.B. 219 (N.L.R.B. 1974)

STANLEY OIL COMPANY, INC. 219
Stanley Oil Company, Inc. and Teamsters , Chauffeurs,
Warehousemen & Helpers Local Union No. 59, a/w
International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America. Case
1-CA-9386
September 6, 1974
DECISION AND ORDER
BY CHAIRMAN MILLER AND MEMBERS JENKINS
AND KENNEDY
On April 25, 1974, Administrative Law Judge Ben-
jamin A. Theeman issued the attached Decision in
this proceeding. Thereafter, the General Counsel filed
exceptions and a supporting brief, and the Respon-
dent filed a brief in opposition to the General
Counsel's exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings,' and
conclusions of the Administrative Law Judge and to
adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Rela-
tions Board adopts as its Order the recommended
Order of the Administrative Law Judge and hereby
orders that the complaint herein be, and it hereby is,
dismissed.
' The General Counsel has excepted to certain credibility findings made
by the Administrative Law Judge. It is the Board's established policy not to
overrule an Administrative Law Judge's resolutions with respect to credibili-
ty unless the clear preponderance of all of the relevant evidence convinces
us that the resolutions are incorrect. Standard Dry Wall Products, Inc., 91
NLRB 544, enfd. 188 F.2d 362 (C.A. 3). We have carefully examined the
record and find no basis for reversing his findings.
DECISION
(Respondent), has engaged and is engaging in unfair labor
practices within the meaning of Section 8(a)(1) and (5) of
the National Labor Relations Act, as amended 29 USC
§ 151, et seq. (the Act) by unlawfully (a) on or about October
4, 1973,2 and thereafter refusing to bargain with the Union
as the. exclusive representative of the unit of service employ-
ees; (b) on or about October 9, approaching a matter of
collective bargaining with a predetermined attitude not to
reach any agreement; (c) on or about October 12, bargain-
ing directly and individually with employees and granting
wage increases to such employees without notice to and
without the presence of the Union or its designated repre-
sentative; and (d) by letter dated October 12, terminating
the service employees without first bargaining with the
Union with respect to such decision or the effects of such
termination. Respondent denied committing the unfair la-
bor practices.
A hearing was held before me, the duly designated Ad-
ministrative Law Judge on February 6, 1974, in New Bed-
ford, Massachusetts. All parties appeared and were
represented by counsel. They were given full opportunity to
participate, adduce evidence, examine and cross-examine
witnesses, and argue orally. Briefs were submitted which
have been fully considered.
Upon the record in the case and from my observation of
the witnesses I make the following:
FINDINGS OF FACT
1. BUSINESS OF RESPONDENT
Respondent, a Massachusetts corporation, has main-
tained its principal office and place of business in New
Bedford, Massachusetts, where it is engaged in the sale and
distribution of petroleum and related fuel products.3
In carrying on its business, Respondent caused large
quantities of petroleum and fuel products to be purchased
and transported in interstate commerce from and through
other States than Massachusetts and from foreign countries,
and has continuously caused substantial quantities of petro-
leum and fuel oil products to be sold from said plant in
interstate and foreign commerce to other States than Mas-
sachusetts and to foreign countries.
Respondent annually imports products from points out-
side Massachusetts having a value in excess of $50,000 and
sells products and services annually in a gross value exceed-
ing $500,000.
It is found as admitted by Respondent that Respondent
is now and at all times material herein has been an employer
engaged in commerce within the meaning of Section 2(6)
and (7) of the Act.
STATEMENT OF THE CASE
BENJAMIN A. THEEMAN, Administrative Law Judge: The
complaint herein I alleges that Stanley Oil Company, Inc.
1 Based on a charge filed by Teamsters, Chauffeurs, Warehousemen &
Helpers Local Union No. 59, a/w International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America (the Union) on October
19, 1973.
II. THE UNION
It is found, as admitted , that the Union is now and at all
times material herein has been a labor organization within
the meaning of Section 2(5) of the Act.
Z All dates are in 1973 unless otherwise shown.
J On November 1, it discontinued the business of servicing heating equip-
ment. This action gave rise to issue (c) in this proceeding.
220 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Statement of the Issues
The issues are sufficiently set forth in the statement of the
case above.
B. The Union and the Unit
This proceeding deals with a unit of all service employees
of Respondent employed at its New Bedford operation ex-
clusive of office clerical employees, guards and all supervi-
sors as defined in Section 2(11) of the Act. Since May 12,
1965, the Union has been the exclusive bargaining agent for
the service employees unit 4 Contracts covering this unit
have been entered into between the Union and Respondent,
the last of which began October 31, 1970, and expired No-
vember 1, 1973.
For several years the Union has also been the exclusive
bargaining agent for a unit of truckdriver employees of
Respondent. Contracts for the latter unit have been entered
into between the Union and Respondent. The most recent
contract was executed as of November 1, 1973, to expire on
November 1, 1976.
Asalino "Ashley" Freitas, the Union's vice president and
business representative , negotiated contracts on behalf of
the Union. John G. Liarikos, general manager, represented
Respondent. He was a nephew to Stanley Panek, president
and owner of Respondent.
C. The Operation of the Service Department
Respondent's Service Department had three employees:
Dennis Borges ,6 Charles W. Knuckles, and David Mendes.
These men called on Respondent's customers in times of
need to service oil burners, supply parts and fuel, or render
other services to heating equipment.
Prior to February 15, Respondent did not charge its cus-
tomers for service. A charge was made if Respondent sup-
plied parts, which charge included a profit for Respondent.
Because of the energy crisis Respondent, about February
15, started to charge its customers for service at the rate of
$6 per hour for the call. But this charge was not made if the
call was caused by some act of Respondent, or its employ-
ees.
Respondent operated the service department as a conve-
nience for its customers. It always lost money on this service
even with the introduction of the charge in February .8
Respondent's fiscal year ran from October 1 to September
30. In 1973, an audit of Respondent's books in late October
or early November showed that the service department had
sustained a loss in excess of $33,000 9
The Union was certified after a Board conducted secret ballot election.
5 Prior to November 1972 there were four service employees.
6 Borges was in charge of the department. The question of his supervisory
captacity was not raised . Also, he was union shop steward.
Borges testified that for many years it was "a necessary evil, it was free,
and half a cent a gallon ... which is next to nothing."
8 Liarikos was complimentary of the manner in which Borges ran the
department.
Liarikos stated that in early October he had a rough idea of what the loss
Respondent had a history of using subcontractors to ser-
vice customers in addition to using the service employees.
During the summer, subcontractors were used when the
servicemen were not on night call. During the winter, sub-
contractors were called in when the service employees want-
ed a night off. The subcontractors billed Respondent for
services and Respondent in turn billed its customers. The
use of subcontractors increased in November 1972 when the
number of service employees was reduced. Respondent re-
duced the number of service employees and used subcon-
tractors with the full knowledge of the men and the Union.
D. Credibility Items
There is no essential dispute about the material facts in
this case. There is some dispute about certain minor mat-
ters. They are (1) a subject of conversation between Freitas
and Liarikos at the meeting they held on October 9 and the
same subject at a meeting at a later date between Liarikos
and the service employees; (2) a second subject of conversa-
tion in the October 9 meeting between Freitas and Liarikos;
and (3) the date of the meeting between Liarikos and the
three service employees.
As to item (1): Liarikos testified that at the meeting with
Freitas on October 9 and at a subsequent meeting with the
three service employees he made the statement that if the
Union agreed to Respondent's proposal, he would refer the
matter to his uncle Panek and try to get him to change his
mind about terminating the service department. Freitas did
not refer to this in his direct testimony. On cross-examina-
tion when asked if the conversation occurred he answered
"yes." On continued cross he changed his testimony to state
that Liarikos told him that if Freitas agreed, "we'd have a
contract." When asked again whether Liarikos stated he
would refer the matter to his uncle, Freitas testified, "No,
sir. I don't recall that." 10 Later in the hearing, Liarikos
was; that he did not know the exact amount until he received his accountant's
statement of audit. The statement was received after October 4, and he did
not have it with him when he met with Freitas on October 9. The loss figure
was less than in previous years and took into account the hourly charges
made in 1973.
10 Freitas' testimony follows:
Q. You say he put it on a take it or leave it basis and he said some-
thing to the effect that if your willing to take it-or if your not willing
to take it, they would close down, is that correct?
A. Yes sir, that is correct.
Q. Did he indicate that if you were willing to accept his proposal that
he would then discuss with Mr. Panek the, or make a recommendation
to Mr . Panek that they keep the service department in operation rather
than close it down?
A. Yes sir.
Q. And that's what he said?
A. If 1 would take it, we'd have a contract. I told him I couldn't do
it because I would have to see my men first.
Q. You remember his saying that if this proposal was agreeable to the
Union that he would recommend to Mr . Panek that they continue the
service department and sign a contract with you along the lines he had
proposed?
A. I would take it, that if I were to agree to that, we'd have a contract.
Q. Did he say you would have a contract or that he would recom-
mend it to Mr. Panek?
A. If we would agree to that we'd have a contract.
Q. I see . Did he also say he would recommend to Mr . Panek that they
keep the service department in operation and not close it down?
A. No, sir. I don't recall that.
STANLEY OIL COMPANY, INC. 221
testified that he told Freitas "that if we could come to some
understanding, perhaps I could get my uncle to reverse his
decision." He also testified that he told the service employ-
ees that he would try to get Panel: to reverse his decision to
close the service department if they accepted Respondent's
proposal. Borges and Knuckles testified at the hearing be-
fore Liarikos did. As the General Counsel points out they
made no mention of such discussion. They and Freitas were
present at the hearing after Liarikos testified. None of these
were called to rebut Liarikos' testimony. It was left unde-
nied on the record except for Freitas' inconsistent state-
ments under cross. The foregoing shows consistency in
Liarikos' testimony and inconsistency in the testimony of
Freitas, Borges and Knuckles. In consideration of the above
and the record as a whole Liarikos' testimony is credited
and it is found that he made the statement as indicated on
the two occasions.
As to item (2): Whether Liarikos told Freitas that Re-
spondent was losing money on the service department?
Freitas admitted that Liarikos told him (a) Respondent had
lost money in 1973 in connection with "the servicing of the
fishing fleet . . . when they were on strike for 8 weeks" and
(b) in effect, that Respondent would discontinue the service
department rather than pay the union demands which in his
opinion were way out of line. Liarikos testified that not only
did he tell Freitas about the loss due to the strike but he also
told him that Respondent could no longer support a losing
operation, i.e., the operation of the service department. It is
considered unnecessary to resolve this conflict. Whatever
was said it is clear the mention was made to the Union and
the Union was aware that Respondent was losing money in
a part of its operations and that Respondent was unwilling
to meet the union demands which would increase
Respondent's costs.
As to item (3): Borges and Knuckles testified that Liari-
kos came to the service department and spoke to the ser-
vicemen sometime before 1:30 p.m. Friday, October 12.
Neither was certain whether it was Wednesday or Thurs-
day. They do indicate they were shown a copy of the letter
dated October 11 or a draft of that letter to the Union
containing Respondent's counterproposal. Liarikos testified
the conversation occurred Friday morning, October 12. Li-
arikos also testified that he showed the men the counterpro-
posal to the Union. He did not specify when. The proposal
was dated October II and Liarikos stated that "he might
have showed the letter to [Borges] on the Wednesday," Oc-
tober 10. It is considered unnecessary to determine the exact
day this meeting occurred. The fact is clear that sometime
before 1:30 p.m. October 12, when Freitas held his second
meeting with the service employees, Liarikos had already
discussed with the service employees the respective de-
mands and counterdemands. If a finding is considered nec-
essary it appears the most reasonable time sequence that the
meeting occurred sometime on October 10.
The testimony of all witnesses has been considered. In
evaluating the testimony of each witness, demeanor was
relied on. In addition, inconsistencies and conflicting evi-
dence were considered. The absence of a statement of reso-
lution of a conflict in specific testimony, or of an analysis
of such testimony, does not mean that such did not occur.
See Bishop and Malco, Inc. d/b/a Walker's, 159 NLRB 1159,
1161. Further, to the extent that a witness is credited only
in part, it is done upon the evidentiary rule that it is not
uncommon "to believe some and not all of a witness's testi-
mony." N. L. R. B. v. Universal Camera Corporation, 179 F.2d
749, 754 (C.A. 2) revised and remanded on other grounds
340 U.S. 474.
E. The Union Requests a New Contract
By letter dated July 19, the Union notified Stanley Panek,
president of Respondent, that it wished to amend the terms
of the existing contract expiring November 1.11 On October
4, Freitas sent to Panek a proposal for the service depart-
ment and asked that a date be set to commence negotia-
tions .12 On October 9, Liarikos called Freitas to arrange a
meeting . Liarikos told Freitas he wanted to discuss a letter
Respondent had prepared advising its customers that it was
terminating the service department.
F. Respondent had Contemplated Closing
The question of closing down the service department had
been a topic of discussion between Panek and Liarikos for
several years. The advent of the "energy crisis" in 1973
created a situation in which Respondent was refusing "10
to 15 accounts a day" This created a condition where ac-
cording to Liarikos "getting supplies is a problem, not get-
ting customers to consume it." This economic condition,
shortage of supply and surplus of customers, and the de-
mand by the Union caused Panek and Liarikos to review
again the question of the losses due to the service depart-
ment.13 In preparation for the meeting with Freitas, Liarikos
prepared a draft of a letter to Respondent's customers stat-
ing:
We have, in the past, provided you with service to
your oil-burning equipment at what we considered a
reasonable cost to you. We felt that it was advanta-
geous to you to avail yourself of this service.
11 Appropriate notice was sent to the Federal Mediation and Conciliation
Service.
12 At the time , the Union made the same proposal to five other oil compa-
nies in the area . It contained the following items:
(a) A requirement that there be one serviceman for each 400 customers.
(Respondent would have had to hire another serviceman to meet this de-
mand.)
(b) Changes in standby time . (This did not apply to Respondent. The
Union was attempting to bring two other companies up to Respondent's
practice.)
(c) Increases in the hourly rate plus arrangements for cost -of-living in-
creases.
(d) A new vacation schedule.
(e) Changes in the rates for Health and Welfare Fund and the Pension
Fund.
( f) Provisions for sick leave.
i¢) A change in the length of time after notice for discharge or suspension.
This fact is supported by Borges ' testimony that he held conversations
with Liarikos a few days after October 4 but before the meeting between
Freitas and Liarikos . In these conversations the possibility of closing down
the service department was mentioned . Liarikos also mentioned "Things like
... he could not afford or go along with the [union] proposal, he would have
to get rid of the service department "
222 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
We are now , however , faced with a situation which
makes it virtually impossible to continue supplying effi-
cient service at a fair price . The union which represents
our servicemen has made such excessive demands upon
us that , in order to submit to these demands , we would
have to charge an exhorbitant and ridiculous price for
our service , or provide less adequate service.
We have no intention of taking unfair advantage of
our customers , by squandering their hard-earned dol-
lars, or contributing to the unhealthy rise of inflation
in this country . We are , therefore , discontinuing all
service to our customers effective November 1, 1973.
There are several excellent local companies who spe-
cialize in the servicing of oil-burning equipment; we
suggest that you contact one of them to arrange for the
maintenance and repair of your equipment.
G. The Discussions about the Contract
Liarikos and Freitas met on October 9. Liarikos showed
Freitas the proposed letter to Respondent's customers and
told Freitas that Respondent was willing to continue the
existing contract except that Respondent was willing to give
the men a 3-year wage increase totalling $1.45 payable at the
yearly rate of 50 cents, 50 cents, and 45 cents.
Part of this was an hourly wage increase, the remainder
was payment toward a health and welfare and/or a pension
fund. Liarikos told Freitas that Panek and he thought the
union proposal was out of line; that the men were good
workers, the company was happy with them, and if they
would accept Respondent's proposition he would try to talk
his uncle out of the idea of closing down the service depart-
ment even though Respondent was losing money.14 If the
men were not willing to accept Respondent's proposal, Re-
spondent was prepared to send the termination letter out to
its customers; that this was an ultimatum.15 Freitas told
Liarikos that from a money standpoint Respondent was "in
the ball park." The meeting ended with the understanding
that Freitas would discuss the proposition with the men the
next morning and let Liarikos know the results.16
Freitas met with the three servicemen at 7:30 a.m. on
October 10. The record does not show the discussion that
occurred. The result of the meeting was that the men decid-
ed, upon Freitas' recommendation, to ask Respondent to
put its proposal in writing. 17 Liarikos called Freitas shortly
after the meeting. Freitas told him nothing had been decid-
ed on because the Union had to have the counterproposal
in writing. Liarikos said he would send him the written
counterproposal.
Some time later Liarikos walked into the serviceroom
when the three service employees were present.18 He had
14 See sec . B above.
IS Some question exists as to whether Liarikos said "take it or leave it" or
used the word "ultimatum." He testified he "can't say that I didn ' t" use the
latter.
16 Liarikos said he would ask Borges to arrange the meeting and to notify
the other two men to be present.
17 The service employees returned to work after 8 a.m. Freitas spoke to
Liarikos about this and the latter agreed not to dock them for lateness.
with him a copy of his intended counterproposal to the
Union. Liarikos showed it to the men and told them that
was the best he could do.19 The letter then and in its final
form stated:
We are in receipt of your proposal for amendments
to our Servicemen's Agreement which expires Novem-
ber 1, 1973.
We cannot, for several reasons, most of which I ex-
plained to you at our last meeting, accept this proposal.
We are, however, prepared to amend the existing agree-
ment as follows:
1. Wage increase of $.35 per hour effective Novem-
ber 1, 1973, plus $.15 toward Health and Welfare and/
or Pension Fund.
2. Wage increase of $.35 per hour effective Novem-
ber 1, 1974, plus $.15 toward Health and Welfare and/
or Pension Fund.
3. Wage increase of $.30 per hour effective Novem-
ber 1, 1975, plus $.15 toward Health and Welfare and/
or Pension Fund.
4. All other terms and conditions of the existing
agreement shall remain unchanged.
I should appreciate your meeting with my Ser-
vicemen at 10:00 A.M. Friday, October 12, 1973, to
determine their wishes as respects this proposal.
The men stated that insofar as they were concerned it was
OK except for the fourth paragraph. They wanted the job
security that paragraph gave them. Liarikos told them that
was the deal the company could make, it couldn't be
changed and that it was an ultimatum; they could take it or
leave it. If they did take it he would talk to his uncle to get
him to reverse his decision about closing down the service
department.20 The men repeated it was acceptable except
for the last paragraph.
The proposal was put in final form in a letter to the Union
dated October 11 and contained the suggestion that Freitas
meet with the service employees at 10 a.m. on October 12.
On October 12, because of a conflict, Freitas met the
three employees in the serviceroom at 1:30 p.m. The men
agreed that they "were in the ball park" but did not wish to
forego the language protecting their jobs. The discussion
resulted in the decision that the men rejected Respondent's
proposal. Freitas left the plant.
H. Respondent Sends out Termination Letters
Shortly thereafter, Liarikos spoke with Borges at the
plant. He asked, "What did you people come up to?" Borges
told him speaking as the shop steward that they "turned it
is See sec . B above for discussion on the time this meeting occurred.
19 Borges testified that he believed that Liarikos had "met with the Presi-
dent [Panekl"
20 See section B above.
STANLEY OIL COMPANY, INC. 223
down on the wording." An hour later Borges was told by
Liarikos that he wanted the three men in his office at 4:30
p.m. Then and there he told the men it was too bad they
turned down the proposal and that they couldn't get togeth-
er; that they were good men and that while he did not want
to see the service department go; that's the way it will have
to be. He then gave each one a letter stating that their
services were no longer required after November 1 .11
Freitas later saw the termination letter. On October 15, he
wrote Respondent:
Borges and Mendes each went into business for himself as
independent servicemen.23 The three servicemen made ar-
rangements with Respondent to buy trucks. Only the deal
with Mendes was completed. After November 1, Respon-
dent discontinued all servicing, including its billing for serv-
ices 24 Respondent referred its service calls to Mendes and
Borges who handled them as independent operators . Borges
and Mendes were given permission by Respondent to enter
its premises at night to remove oil from Respondent's tanks
as needed 25
This letter is in regard to our brief meeting which was
held at the Holiday on October 9, 1973, with reference
to our Proposal for the Service Department employees.
On October 11th you mailed me a Counter Proposal,
and on October 12th I had a meeting with the ser-
vicemen at your place of business and I went over your
Counter Proposal with them.
Upon leaving Stanley Oil Company premises, a few
hours later, I was approached by one of your employ-
ees who showed me a letter with regard to the discon-
tinuation of your service department because our
demands were too unreasonable. We have not yet sat
down to negotiate, so how can you state that our de-
mands are unreasonable? We do however, feel that the
company is not bargaining in good faith.
I do feel that we should meet as soon as possible to
settle this matter.
By letter dated October 16, 1973, Respondent notified the
Union:
On October 12, 1973, we made a decision to discon-
tinue selling service to our fuel oil customers. We do
not, therefore, require the services of our Burner Ser-
vicemen after that date, and have notified them accord-
ingly. You may consider our counter-proposal to your
contract demands as permanently withdrawn.
1. Events After Termination of the Service Department
On October 15, Respondent notified its customers of the
termination of the service department by the letter quoted
in section F above.
On November 1,22 Borges , Mendes , and Knuckles left.
21 The letter read as follows:
Effective November I, 1973, we are discontinuing the servicing of
oil-fired equipment , and are, therefore abolishing our service depart-
ment . Your services will no longer be required after that date.
It is with deepest regret that we make this decision , as service has
always been a vital part of our organization , and the service department
a source of pride under Denny Borges.
I should like to take this opportunity to extend my sincerest gratitude
for the fine job you have done for this company, and for the devotion
to your duties, as well as the concern for our customers which you have
shown through -out your employment here.
I should be most pleased to recommend you for any position you
should choose to seek in the future . Wishing you good fortune in all your
future endeavors, we remain , [signed).
J. The Union and Respondent Meet After the Termination
On November 19, Coven, counsel for Respondent sent
the Union a letter reading as follows:
This office represents the above named Company in
connection with the Unfair Labor Practice charge filed
by you with the National Labor Relations Board.
Please be advised that the Company is prepared to
meet with you at a mutually convenient time for the
purpose of discussing with you any problems in con-
nection with the Company's discontinuance of its ser-
vice department. If you are interested in such a
meeting, please contact me in order to arrange an ap-
pointment.
As a result of the foregoing, a meeting occurred on De-
cember 4, attended by Freitas, Panek, Liarikos, and Coven.
Freitas asked if Respondent would reconsider reinstating
the service department and was advised that it would be
economically infeasible to do so. Freitas pointed out that it
would be a benefit to the customers and was told that Re-
spondent did not need to maintain a losing proposition; that
getting supplies was the problem, not customers. Liarikos
foresaw that the condition would last about 10 years and
could see no reason why they should reconsider. Panek
stated that if it turned out to be a mistake they would then
consider it. Freitas said he would do everything he could to
get the men back to work. The meeting ended with a request
by the Union as representative under the drivers contract.
The Union objected to the practice of Borges and Mendes
taking oil from Respondent's tanks at night and asked that
it be stopped. It stated it would not object if Respondent
maintained auxiliary tanks in Borges' and Mendes' yards
from which each could get his oil as needed.
There were no further meetings between the Union and
Respondent.
Analysis and Conclusions
The basic question to be resolved in this proceeding is
that of good-faith bargaining. Respondent is charged with
22 The charge in this case was filed on October 19.
23 Borges called himself Dennie's Burner Service . Knuckles tried indepen-
dent operation for I week and gave it up.
24 The record shows that Hathaway Oil, another company in the area, also
closed its service department about this time.
25 There is no evidence that this was other than a straight business relation-
ship . There was no doubt that the relationship between the employees and
Respondent was amicable before and after November I.
224 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
a lack of good faith. The evidence produced by the General
Counsel does not support the charge.
Respondent's Relationship With the Union
The Union representing two separate units of
Respondent's employees has dealt with Respondent at least
since May 1965. The record contains no evidence that dur-
ing this time the dealings were other than amicable or any
evidence of antiunion animus or action on the part of Re-
spondent. In fact the latest contract covering the drivers
unit was executed as of November 1, to continue for another
3 years.
The Economic Situation
Respondent stated that it had maintained the service de-
partment as a convenience for its customers and at a loss for
many years. The General Counsel in no way shook this
assertion. Respondent stated that in February 1973 it com-
menced making an hourly charge for services under certain
circumstances. The fiscal year ending October 1973, showed
the annual loss had been reduced but still was roughly in
excess of $33,000. This statement remained unchallenged.
Respondent stated that with the commencement of the oil
crisis in 1973 it had more customers than it could take care
of and the need to maintain a service department was no
longer a must. On the basis of the foregoing, Panek and
Liarikos concluded that they would terminate the service
department. It is found that the record as a whole shows
that as of the time Respondent considered closing its service
department there existed economic causes for so doing. The
General Counsel does not contest this conclusion.
Pretext
The General Counsel claims that the action to close the
service department was taken as "an afterthought or pre-
text" in order to get rid of the Union. The record does not
support this conclusion. Evidence of motivation is lacking.
The General Counsel points to the "timing of the events"
to support his conclusion. The record shows that Respon-
dent figured that the Union's demands would increase the
cost of maintaining the service department. The record
shows that Respondent was willing to take a certain amount
of increase and maintain the department but not to the full
extent requested by the Union. Rather than do so, Respon-
dent decided to close down the service department. It ap-
pears that such a decision necessarily had to be made after
the Union made its demands. Nothing in the decision indi-
cates that it was motivated by a desire to get rid of the
Union. Rather the record shows that Respondent was moti-
vated by the desire to cut its losses. Respondent said so in
its letter to its customers. The decision appears to stem from
economic motivation. This conclusion is fortified by the fact
that the oil crisis put Respondent in a better position to
make the move when it did. On the basis of the foregoing
and the record as a whole it is found that Respondent's
termination of the service department was not caused by
antiunion motivation.26
26 The record herein contains nothing that is considered "reminiscent of
Attitude of Nonagreement
The General Counsel contends that Respondent had a
predetermined attitude not to reach any agreement. The
record does not support this contention. The previous bar-
gaining history of Respondent is one of achieving agree-
ment. Witness the agreements in existence in the two units
since 1965. Respondent's nonobstructionist attitude is
brought into sharp focus by the agreement with the Union
for the drivers executed as of November 1, 1973.
As to the service department, Respondent's counterpro-
posal was a one-shot deal. Nevertheless, it was acceptable
to the men insofar as the money offer was concerned. The
men rejected it because of the insistence of Respondent that
the existing contract otherwise remain unchanged. The time
spent in actual bargaining on these issues was short, from
October 9 through October 12. But, as shown above, Re-
spondent decided that there was an economic need for a
quick resolution. Considering the above circumstances and
the record as a whole it is difficult to conclude that Respon-
dent approached the bargaining issues resolved not to con-
clude a bargain.
Bargaining on the Decision to Terminate
Was Not Necessary
The record shows that Panek and Liarikos arrived at the
decision to close the service department and then made the
Union aware of its decision. 21 This is clearly shown by
Liarikos' counterproposal to the men; if they accepted the
$1.45, he would get Panek to change the decision to termi-
nate the service department.
Respondent contends that this was an economic decision
and was not subject to the duty to bargain. Respondent cites
General Motors Corporation, GMC Truck and Coach Divi-
sion, 191 NLRB 951, 952 and Summit Tooling Company, et
al., 195 NLRB 479, 480.28 It is clear from the record that
Respondent by its decision made a major change in its
operations. By doing so, Respondent closed down part of its
plant (the service department) entirely, took itself out of the
servicing business, and performed no service function for its
customers, either by subcontract or otherwise,29 that might
use the skills of the employees of the service department.
Further, it is clear from the record that Respondent remains
in the business of oil supply and closed its service depart-
ment for economic reasons.
the policy adopted by General Electric Company known as 'Boulwarism"'
as asserted by the General Counsel. See General Electric Company, 150
NLRB 192, 207-213, fn. 116 (1969).
27 The General Counsel cites Walter Pape, Inc., 205 NLRB 719 (1973), in
support of its position. This case is inapposite. Therein Respondent kept
secret the fact that it had put through a deal to have its distribution routes
taken over by another company. It then presented the Union with a fail
accompli. The Board (a majority of the panel) held that "Respondent's failure
to [advise the Union] demonstrates that Respondent engaged in surface
bargaining with an intention of keeping the Union 'on a string' until its deal
was consummated."
2s Cf. Triplex Oil Refining Division of Pentalic Corporation, 194 NLRB 500,
502.
39 As shown above Respondent referred requests for service to indepen-
dent service companies.
STANLEY OIL COMPANY, INC. 225
Based on similar conditions the Board held in Summit,
supra at page 480 that Section 8(a)(5) and (1) of the Act had
not been violated. The Board said:
Contrary to the Trial Examiner, however, we do not
agree that the Respondent violated Section 8(a)(5) and
(1) of the Act by closing its manufacturing operation
without giving the Union an opportunity to bargain
concerning the decision to close. As set forth . . . such
decision involved a major change in the nature of the
Respondent's business, and, although the closing of the
Summit operation could be characterized as a partial
plant closing, its practical effect was to take the Re-
spondent out of the business of manufacturing tool and
tooling products. The part of the business that re-
mained, Ace Tool Engineering Co., Inc., is not engaged
in tool-and-die-making, manufactures nothing and has
little relationship to the work which was performed by
Summit nor does it utilize the skills of the employees
employed by Summit. In these circumstances, to re-
quire Respondent to bargain about its decision to close
out its manufacturing operation would significantly
abridge Respondent's freedom to manage its own af-
fairs. We do not believe that the Act contemplated
eliminating the perogative of an employer, as here, to
eliminate itself as an employer. Accordingly, we con-
clude that the Respondent did not violate Section
8(a)(5) and (1) of the Act by its unilateral decision to
close its manufacturing operation, and the complaint in
regard thereto is dismissed. [footnotes omitted.]
The Board in a later case emphasized that the key to the
action with regard to partial closing is "the perogative of an
employer . . . to eliminate itself as an employer." 30 It is
clear from the record herein that Respondent by its decision
and action resulting in the closing of the service department
took itself out of the business of servicing equipment and
severed completely its function as an employer of service
employees. It is therefore concluded that Respondent did
not violate Section 8(a)(5) and (1) of the Act by the above
unilateral decision and action.
Respondent Did Not Bypass the Union
The General Counsel contends that Respondent violated
Section 8(a)(5) and (1) by communicating directly with the
employees during collective-bargaining negotiations. In this
instance, the contention is not well founded. As a matter of
settled law, Section 8(a)(5) does not on a per se basis pre-
clude an employer from communicating, in noncoercive
terms, with the employees during negotiations. The fact that
an employer chooses to inform employees of the status of
negotiations, or of proposals previously made to the Union,
or of its version of a breakdown in negotiations will not
alone establish a failure to bargain in good faith.31 In this
30 See Royal Typewriter Company, etc., 209 NLRB No. 174, in particular in.
15, and the Board 's discussion of the decision on the scope of General Motors
Corporation supra, and its effect on Ozark Trailers Incorporated, et at.. 161
NLRB 561, 565-570.
31 N. L. R. B. v. Reed & Prince Manufacturing Company, 118 F.2d 874, 889
(C.A. 1).
instance , Liarikos discussed in the same manner with the
employees the same items he had discussed 2 or 3 days
previously with Freitas. Further, he showed them the coun-
terproposal in writing in keeping with their request that it
be put in writing . After they had seen it he promptly mailed
it 3 to Freitas. There is no indication in the foregoing that
Liarikos was attempting in any way to bypass Freitas or the
Union. This conclusion is supported by Respondent's long
and continuing history of negotiations with the same union
for two units of employees. The statements made by Liari-
kos to the men that (a) the counterproposal was an ultima-
tum, and (b) Respondent had decided to close down the
service department but if the employees accepted the coun-
terproposal he would try to get Panek to change that deci-
sion , had both been made to Freitas on the previous day.33
The record does not show that these statements were threats
to the employees to discourage their union support or not
made in good faith based on economic considerations. It is
undoubtedly true that an employer opens himself up to
suspicion of bad-faith bargaining when he deals directly
with employees during collective-bargaining negotiations
with their representative. But suspicion is an insufficient
basis for a finding of a violation. In the present instance, it
is found on the record as a whole that Respondent in deal-
ing directly with its employees as above set forth did not
evidence bad faith.
Bargaining on the Effects on the Employees
of the Closing
It is now well-settled law that Respondent was under a
continuing duty to bargain about the effects of its decision
to close its service department. See Interstate Tool Co., Inc.,
177 NLRB 686. Triplex Oil Refining Division, supra. Nothing
in the record herein shows that Respondent took any action
in violation of that duty, or took any action in derogation
of the Union's rights in that respect. The Union at no time
requested bargaining on the subject though it had positive
knowledge on October 12 that the service department was
being closed down effective November 1. Finally, by letter
on November 19, Respondent asked the Union to meet with
it for the "purpose of discussing . .. any problems in con-
nection with the Company's discontinuance of its service
department." A meeting took place about 3 weeks later. The
Union did not bring up the question of effects. There is no
explanation for its failure to do so, even though it did dis-
cuss the possible restoration of the service department. On
the other hand, the Union did discuss the use of the oil tanks
by the drivers in Respondent's yard as the representative of
the drivers' unit. This topic affected the activities of Borges
and Mendes as independent operators. Respondent did not
show any unwillingness to discuss these items. Thus, on the
record as a whole there is no showing that Respondent at
any time or in any way up to the time of the hearing refused
to bargain with the Union concerning the effects resulting
from the closing of the service department.
32 There is some indication that Borges hand-delivered it to Freitas.
33 The record does not clearly show that Freitas passed these statements
on to the employees in the 7:30 a.m. meeting on October 10.
226 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Upon the foregoing findings of fact and on the record as Upon the basis of the foregoing findings of fact and Ion-
a whole, I make the following:
CONCLUSIONS OF LAW
1. Respondent is, and at all times material herein has
been , an employer within the meaning of Section 2 (2) of the
Act, and engaged in commerce within the meaning of Sec-
tion 2(6) and (7) of the Act.
2. The Union is a labor organization within the meaning
of Section 2(5) of the Act.
3. The evidence fails to show that Respondent has violat-
ed the Act as alleged in the complaint.
34 The General Counsel apparently dropped the allegation that Respon-
dent "granted wage increases to such employees ." No evidence in support
was introduced nor was it discussed in the brief.
clusions of law, the entire record in this case , and to effectu-
ate the policies of the Act, I hereby issue the following
recommended:
ORDER 35
The complaint is dismissed in its entirety.
35 In the event .no exceptions are filed as provided by Section 102.46 of the
Rules and Regulations of the National Labor Relations Board the findings,
conclusions , and recommended Order herein shall , as provided in Section
102.48 of the Rules and Regulations , be adopted by the Board and become
its findings, conclusions , and Order, and all objections thereto shall be
deemed waived for all purposes.