The Denham Co.

National Labor Relations Board - Board DecisionsOct 29, 1973

206 N.L.R.B. 659 (N.L.R.B. 1973)

THE DENHAM COMPANY 659 No H . Denham and Geraldine A. Denham, d/b/a The Denham Company and Creamery , Condensery Em- ployees & Drivers Union, Local 517, International Brotherhood of Teamsters, Chauffeurs, Warehouse- men & Helpers of America . Case 20-CA-5734 October 29, 1973 SUPPLEMENTAL DECISION AND ORDER By CHAIRMAN MILLER AND MEMBERS FANNING AND JENKINS On December 24, 1970, the National Labor Rela- tions Board issued its Decision and Order I in the above-entitled proceeding, finding that Respondent had engaged in unfair labor practices in violation of Section 8(a)(5) and (1) of the Act and ordering that it cease and desist therefrom and, upon request, bargain collectively with the Union as the exclusive represen- tative of all employees in the appropriate unit, and honor and abide by the collective-bargaining agree- ment executed by the Union and Respondent's prede- cessor. The Board also ordered Respondent to make restitution to employees for any losses suffered by virtue of Respondent's failure to abide by the collec- tive-bargaining agreement or by its institution of cer- tain unilateral changes. In light of the Supreme Court's opinion in N.L.R.B. v. Burns International Se- curity Services, Inc., 406 U.S. 272 (1972), enforcement of the Board's Order, except insofar as it required Respondent to abide by the collective-bargaining agreement executed between Respondent's predeces- sor and the Union, was granted on November 3, 1972, by the United States Court of Appeals for the Ninth Circuit 2 Subsequently, Respondent petitioned the Su- preme Court of the United States for certiorari, and, on April 23, 1973, the Supreme Court granted Respondent's petition, vacated the court of appeals judgment, and remanded the proceeding to that court with instructions to remand the case to the Board for such further proceedings as may be appropriate, in light of N.L.RB. v. Burns International Security Serv- ices, Inc., supra; Federal Trade Commission v. Sperry & Hutchinson Co., 405 U.S. 233, 245-250 (1972); Secu- rities and Exchange Commission v. Chenery Corpora- tion, 318 U.S. 80, 87-88 (1943). On June 6, 1973, the court of appeals issued an order which remanded the case to the Board. 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- ' 187 NLRB 434. 2 469 F.2d 239. thority in this proceeding to a three-member panel. In its original decision in this case, the Board found that Respondent violated Section 8(a)(5) and (1) of the Act by refusing to bargain collectively with the Union, by refusing to abide by its predecessor's col- lective-bargaining contract with the Union, and by unilaterally changing the wages and conditions of em- ployment of its employees. In light of Burns, the find- ing that Respondent violated Section 8(a)(5) and (1) by refusing to adhere to the predecessor's collective- bargaining contract cannot stand. Accordingly, this finding is hereby rescinded. However, the Board ad- heres to its other findings that Respondent violated Section 8(a)(5) by refusing to bargain with the Union on or about July 28, 1969, and thereafter, and making certain unilateral changes in working conditions on or after July 28, 1969, as set forth hereinafter. Under the teaching of the Supreme Court in Burns, a successor-employer is ordinarily free to set initial terms on which it will hire the employees of the prede- cessor without first consulting the union representing these employees, as, until it has hired a full comple- ment of employees, it will not be evident whether that union is also the majority representative of the successor's employees. The Court's decision goes on to say, however, that where it is "perfectly clear that the new employer plans to retain all of the employees in the unit" 3 his duty to consult with their union before setting any initial terms of employment ma- tures at that time. The refusal of Respondent to bargain with the Union is not in dispute. On July 28, 1969, the date of the transfer of ownership of the plant, Respondent's supervisor, King, in a speech to the unit employees, announced a unilateral reduction in pay and other benefits. Also, Respondent arranged at this time a presentation by an independent insurance agent who informed the employees that the union health plan would hereinafter be supplanted by a management health plan of lesser scope. In the ensuing few days, King approached various employees on an individual basis and advised them as to how their wages and fringe benefits were to b adjusted downward. While Respondent's president, Denham, assured union agents during this time that he would recognize the Union and honor the predecessor's collective-bar- gaining agreement if the employees still desired union representation, he called an employee meeting on Au- gust 8 at which time he assured the employees of year-round work and a Christmas bonus, but warned them that he would close the plant within 15 days if the employees "went Union." The crucial question, in deciding whether or not Respondent violated the Act, is whether the facts ' 406 U.S. at 294-295. 206 NLRB No. 75 660 DECISIONS OF NATIONAL LABOR RELATIONS BOARD bring this case into that class described by the Su- preme Court in which it is perfectly clear that the employer plans to take over the entire work force and, therefore, must bargain with the union about the ini- tial terms of employment. We find they do. The record is devoid of any evidence indicative of a conditional offer of employment. There was no hia- tus in operations during which Respondent inter- viewed incumbent employees, or others, for the jobs to be-filled before it decided whom it would hire. On the contrary, all available evidence indicates that Re- spondent, on July 28, 1969, the date of formal take- over, planned to retain all of the incumbent employees in the unit. One of the express conditions of takeover imposed by the predecessor-employer, Swift & Company (hereinafter Swift), was that Re- spondent retain Swift's employees for a minimum pe- riod of 30 days. The record further reveals that, pursuant thereto, all of the unit employees remained on the plant payroll after the takeover date without any interruption in employment. Finally, the subse- quent communications between Respondent and its employees regarding the unilateral changes in wages and working conditions reflect an intention by Re- spondent to deal with them as already hired workers with indefinite tenure, unless; of course, they "went Union." As Respondent planned, as of July 28, 1969, to retain all of the unit employees previously employed by Swift, and did indeed so retain them, an obligation to consult with their bargaining representative before setting initial terms of employment matured at that time. By failing to honor this obligation, we find that Respondent violated Section 8(a)(5) and (1) of the Act 4 Accordingly, we reaffirm that portion of our original Order, which includes requiring Respondent to bargain with the Union and make restitution for any benefits which may have been lost by virtue of the unilateral changes in the terms and working condi- tions of employment as set forth in our original Deci- sion and Order.5 ORDER have suffered as a result of Respondent's unilateral implementation of rates of pay, wages, and other con- ditions of employment on or after July 28, 1969, with interest at 6 percent per annum, and continue such payments until such time as Respondent negotiates in good faith with the Union to agreement or, to im- passe." 3. Substitute the attached notice for that attached to our original Order. 4 Howard Johnson Company, 198 NLRB No 98. Although Respondent agreed with Swift to continue the employment of unit employees for a mini- mum of 30 days , there is no indication that Respondent regarded these 30 days as a probationary penod for the unit employees. Neither its actions nor its communications with the employees evince such a state of mind. Indeed, given the fact that Denham, as the former plant manager of Swift, was undoubtedly familiar with the relative capabilities of each-of the unit employ- ees, it is unlikely that he would ever find it necessary to utilize such a probationary penod. 5 It is our understanding that only such parts of our original Decision and Order as pertained to the Supreme Court's decision in Burns, supra, were remanded to us by the Court for our further consideration. Accordingly, we have considered further only those portions of our Decision . We adhere, of course, to all our other earlier findings , which we note were enforced by the decision of the court of appeals in its decision of November 3, 1972. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government We hereby notify our employees that: WE WILL NOT refuse to bargain collectively, upon request, with Creamery, Condensery Em- ployees & Drivers Union, Local 517, Internation- al Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America, as the ex- clusive bargaining representative of our employ- ees in the following appropriate unit: All our production and maintenance employ- ees and truckdrivers employed at our Hanford plant, excluding office clerical employees, guards and supervisors as defined in the Act. Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Rela- tions Board hereby orders its Decision and Order of December 24, 1970, be amended as follows: 1. Delete paragraph 1(c) of the Board's Order and reletter the succeeding paragraphs accordingly. 2. Delete paragraph 2(c) of the Board's Order and reletter the succeeding paragraphs accordingly; sub- stitute the following for paragraph 2(b): "(b) Make whole the employees in the appropriate unit for any loss of pay or other benefits they may WE WILL NOT unilaterally change wages, hours, or conditions of employment in derogation of the rights of the Union and our employees under the Act. WE WILL NOT threaten to close our plant and to become a distributing plant if our employees choose the Union. 'WE WILL NOT promise our employees benefits if they stay out.of the Union. WE WILL NOT interrogate our employees about THE DENHAM COMPANY their union sympathies. WE WILL NOT in any manner interfere with, re- strain, or coerce our employees in the exercise of their rights to join or assist the Union or other- wise engage in activities protected by the Act. WE WILL bargain collectively, upon request, with the Union. WE WILL make whole all employees in the ap- propriate unit described above for any loss of pay or other benefits they may have suffered as a result of our implementation of rates of pay, wag- es, and other terms and conditions of employ- ment on or after July 28, 1969. lvo H. DENHAM AND GER- ALDINE A. DENHAM, D/B/A 661 THE DENHAM COMPANY (Employer) Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, or covered by any other material. Any questions concerning this notice or compli- ance- with its provisions may be directed to the Board's Office, 1,3050 Federal Building, 450 Golden Gate Avenue, Box 36047, San Francisco, California 94102, Telephone 415-556-3197.