Townhouse T.v.& Appliances

National Labor Relations Board - Board Decisions

Sep 27, 1974

213 N.L.R.B. 716 (N.L.R.B. 1974)

716 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Townhouse T. V. & Appliances and Chicago Truck
Drivers, Helpers & Warehouse Workers (Indepen-
dent) and Charles Freskos . Cases 13-CA-12663 and
13-CA-12864
September 27, 1974
DECISION AND ORDER
BY CHAIRMAN MILLER AND MEMBERS JENKINS AND
KENNEDY
On April 29, 1974, Adminsitrative Law Judge
George Christensen issued the attached Decision in
this proceeding. Thereafter, the General Counsel, the
Union, and the Respondent filed exceptions and sup-
porting briefs.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au=
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings, and
conclusions of the Administrative Law Judge only to
the extent consistent herewith.
We agree with the 8(a)(1) and (3) findings of the
Administrative Law Judge except in one particular;
namely, his failure to include Charles Freskos among
the employees discharged in violation of Section
8(a)(3) and (1) of the Act. Charles Freskos had recent-
ly changed from full-time to part-time employment,
and at the time of the hearing had worked only l day
in his new capacity. On that day, he did not perform
delivery and installation work but instead, utilizing a
company truck, picked up stock from Respondent's
warehouse and brought it to the store, uncrated same
to prepare it for delivery, cleaned merchandise,
changed refrigerator doors (from right to left), in-
stalled icetrays, and performed similar duties. He tes-
tified, however, that during his previous part-time
employment by Respondent (prior to the summer of
1973) he had spent 25 to 30 percent of his time per-
forming delivery and installation work.
Elinor Newhouse, an officer of Respondent, gave
Michael Freskos, Charles Freskos' brother, his final
paycheck on Saturday, September 15, 1973, and asked
him to have his brother Charles call her. Charles Fres-
kos received her message the next day. He called
Respondent's store on Monday, September 17, and
spoke not with Elinor Newhouse but with Jim Sarlo,
Respondent's vice president. Charles Freskos testified
about his discharge as follows, "I asked him what he
wanted. He said that he no longer needed my services,
there was no work for me to do." The testimony of
Michael Moore, Respondent's president, throws addi-
tional light on the aforementioned discharge. Moore
admitted that Respondent did not need the services of
Charles Freskos any longer for the same reason that
it did not need the services of delivery and installation
drivers Michael Freskos, Oliva, Ostrick, and Taormi-
no, who, the Administrative Law Judge found, had
been discriminatorily discharged. This reason, as
found by the Administrative Law Judge, was
Respondent's decision to contract out delivery and
installation work to avoid recognizing and bargaining
with the Union. Accordingly, we find that Charles
Freskos was discharged in violation of Section 8(a)(3)
and (1) of the Act.
THE REMEDY
Having found that Respondent has engaged in cer-
tain unfair labor practices, we shall order it to cease
and desist therefrom and to take certain affirmative
action necessary to effectuate the policies of the Act.
Although the Administrative Law Judge found that
Respondent had contracted out its installation and
delivery work, discharged its delivery employees, and
sold its trucks in order to avoid bargaining with the
Union in violation of Section 8(a)(3) and (1) of the
Act, he refused to require Respondent to reinstate its
former delivery operation together with the discrimi-
natorily discharged employees who had performed
such operations. The General Counsel has excepted to
this omission. We find merit in the exception.
The Administrative Law Judge apparently was in-
fluenced in his denial of the reinstatement remedy
requested by the General Counsel by Respondent's
statement that the economic burden of purchasing
new trucks and resuming its delivery-installation op-
erations would endanger the continued viability of
Respondent. No evidence was offered to support this
statement. An official of Rizzo Bros. to whom Re-
spondent subcontracted the delivery and installation
work testified that Respondent's oral contract with
Rizzo Bros. may be terminated at any time by Re-
spondent. In order to resume deliveries, Respondent
need not purchase new trucks. Leasing may do as
well. We perceive no undue hardship in requiring Re-
spondent to reestablish the status quo ante. To the
extent that the reinstatement remedy may be finan-
cially burdensome, Respondent's illegal conduct was
the cause of it. Not to require Respondent to resume
its former operations and reinstate the discriminatori-
ly discharged employees would not completely reme-
dy Respondent's unfair labor practices. If there is
hardship caused by this remedy, it is only fair that the
wrongdoer rather than the wronged should bear it.
Moreover, a meaningful bargaining order can be fash-
213 NLRB No. 102
TOWNHOUSE T. V. & APPLIANCES 717
ioned only by directing Respondent to reinstate the
former delivery system and the discriminatorily dis-
charged employees.'
Accordingly, we shall order Respondent to reestab-
lish its delivery operation and reinstate its delivery
employees. We shall also award them backpay based
on the earnings which they normally would have re-
ceived from the date of their discharge to the date of
Respondent's offer of reinstatement, less any net in-
terim earnings, which shall be computed on a quarter-
ly basis in the manner set forth in F. W. Woolworth
Company, 90 NLRB 289 (1950), with interest at the
rate of 6 percent per annum as set forth in Isis Plumb-
ing & Heating Co., 138 NLRB 716 (1963).
As we have decided to order Respondent to resume
its delivery operation and reinstate the discriminatori-
ly discharged employees, we shall also order Respon-
dent to bargain collectively with the Union as the
representative of its employees in the appropriate
unit, and embody any understanding reached in a
signed agreement.2
AMENDED CONCLUSIONS OF LAW
We adopt the Administrative Law Judge's Conclu-
sions of Law with the following modifications:
1. In Conclusion of Law 7 insert "C. Freskos" be-
tween "M. Freskos" and "Oliva."
2. Delete Conclusion of Law 8 and renumber the
following conclusions accordingly.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Rela-
tions Board hereby orders that the Respondent,
Townhouse T. V. & Appliances, Chicago, Illinois, its
officers, agents, successors, and assigns , shall:
1. Cease and desist from:
(a) Interrogating its employees concerning their
union membership and activities.
(b) Discouraging membership in Chicago Truck
1American Needle & Novelty Company, 206 NLRB 534 (1973); Walker
Company, 183 NLRB 1322 (1970).
2 Respondent 's unfair labor practices destroyed the Union's majority and
made a fair election impossible . Accordingly, a bargaining order remedy is
clearly warranted under the Supreme Court's decision in N.L.R.B. v. Gissel
Packing Co., Inc., 395 U.S. 575 (1969). However, in the light of Steel-Fab, Inc.,
212 NLRB No. 25 ( 1974), we do not adopt the Administrative Law Judge's
finding of an 8(a)(5) violation as a predicate for the bargaining order remedy.
For the reasons set forth in his concurring and dissenting opinion in
Steel-Fab, Inc., supra, Member Jenkins would find a violation of Sec . 8(a)(5),
as did the Administrative Law Judge.
Drivers, Helpers & Warehouse Workers (Indepen-
dent), or any other labor organization, by discharging
or otherwise discriminating against employees in re-
gard to hire or tenure of employment, or any term or
condition of employment.
(c) In any other manner interfering with, restrain-
ing, or coercing its employees in the exercise of their
rights under Section 7 of the Act.
2. Take the following affirmative action which the
Board finds will effectuate the policies of the Act:
(a) Reestablish its own delivery and installation
operations and offer to Charles Freskos, Mike Fres-
kos, Samuel Oliva, George Ostrick, and Frank Taor-
mino immediate and full reinstatement to their former
jobs or, if those jobs no longer exist, to substantially
equivalent positions, without prejudice to their senior-
ity or other rights and privileges, and make each of
them whole for any loss of earnings he may have
suffered in the manner provided in the section of this
Decision and Order entitled "The Remedy."
(b) Preserve and, upon 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.
(c) Upon request, bargain collectively with Chica-
go Truck Drivers, Helpers & Warehouse Workers (In-
dependent) as the exclusive bargaining representative
of all the employees in the appropriate unit, and em-
body any understanding reached in a signed agree-
ment.
(d) Post at its premises in Chicago, Illinois, copies
of the attached notice marked "Appendix."3 Copies of
said notice, on forms provided by the Regional Direc-
tor for Region 13, after being duly signed by
Respondent's representative, shall be posted by Re-
spondent immediately upon receipt thereof, and be
maintained by it for 60 consecutive days thereafter, in
conspicuous places, including all places where notices
to employees are customarily posted. Reasonable
steps shall be taken by it to insure that said notices are
not altered, defaced, or covered by any other material.
(e) Notify the Regional Director for Region 13, in
writing, within 20 days from the date of this Order,
what steps the Respondent has taken to comply here-
with.
3 In the event that 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"
718 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT interrogate our employees con-
cerning their union membership and activities.
WE WILL NOT discourage membership in Chica-
go Truck Drivers, Helpers & Warehouse Work-
ers (Independent), or any other labor
organization, by discharging our employees, or in
any other manner discriminating against them in
regard to their hire or tenure of employment, or
any term or condition of employment.
WE WILL NOT In any other manner interfere
with, restrain, or coerce our employees in the
exercise of their rights under Section 7 of the Act.
WE WILL bargain, upon request, with the
above-named Union as your exclusive represen-
tative in the appropriate unit with respect to wag-
es, hours, and other terms and conditions of
employment, and, if an understanding is reached
embody it in a signed agreement. The appropri-
ate unit is:
All truck drivers and helpers employed at
our facility located at 7243 West Touhy Ave-
nue, Chicago, Illinois, who are performing the
work of delivering and installing appliances,
excluding office clerical employees, salesmen,
service repairmen, professional employees,
guards and supervisors as defined in the Act.
WE WILL reestablish our own delivery and installa-
tion operations and WE WILL offer to Charles Freskos,
Mike Freskos, Samuel Oliva, George Ostrick, and
Frank Taormino immediate and full reinstatement to
their former jobs or, if those jobs no longer exist, to
substantially equivalent positions, without prejudice
to their seniority or other rights and privileges, and
make each of them whole for any loss of pay he may
have suffered as a result of our discrimination against
him with interest at 6 percent.
All our employees are free to become, remain, or to
refrain from becoming or remaining members in good
standing of any labor organization.
TOWNHOUSE T. V. & APPLI-
ANCES
(Employer)
(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,
defaced, 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, Everett McKinley Dirksen Building,
Room 881, 219 South Dearborn Street, Chicago, Illi-
nois 60604, Telephone 312-353-7572.
DECISION
STATEMENT OF THE CASE
GEORGE CHRISTENSEN, Administrative Law Judge: On Jan-
uary 22, 23, 29, and 30, 1974, I conducted a hearing at
Chicago, Illinois, to try issues raised by complaints issued
on November 9, 1973, and January 8, 1974, on the basis of
a charge filed by the Union in Case 13-CA-12663 on Sep-
tember 27, 1973, and a charge filed by C. Freskos in Case
13-CA-12864 on December 6, 1973.'
Due to common issues of fact and law, an order was
issued by the Region on January 8, 1974, consolidating the
two cases for purposes of hearing and decision.
The complaints allege that the Company violated: (1)
Section 8(a)(1) of the National Labor Relations Act, as
amended (hereafter called the Act), by coercive interroga-
tion of employees concerning their and other employees'
union activities; (2) Section 8(a)(3) and (1) of the Act, by
contracting out its delivery work and discharging its deliv-
ery employees because the latter sought union representa-
tion; and (3) Section 8(a)(5) and (1) of the Act, by
destroying the Union's majority representative status
among its delivery employees by coercively interrogating
them and contracting out their work and discharging them
on learning that a majority had designated the Union as
their collective-bargaining representative, without prior
bargaining with the Union.
The Company concedes it contracted out its delivery op-
erations and terminated its delivery employees, but denies
it was discriminatorily motivated in doing so, denies any
coercive interrogation, disputes the inclusion of C. Freskos
within a unit consisting of its delivery employees, and denies
that it violated the Act.
The issues are:
1. What employees were properly includable within a
unit consisting of the Company's delivery employees.
2. Whether the Union represented a majority of the
Company's delivery employees when it asked the Company
for recognition as the employees' exclusive collective-bar-
gaining representative.
3. Whether the Company coercively interrogated its em-
ployees and thereby violated Section 8(a)(1) of the Act.
Dated By ' Read 1973 after all subsequent date references omitting the year.
TOWNHOUSE T. V. & APPLIANCES
4. Whether the Company contracted out its delivery
work and discharged its delivery employees to avoid recog-
nizing the Union and bargaining over its contract proposals
and thereby violated Section 8(a)(3) and (1) of the Act.
5. Whether the Company violated Section 8(a)(5) and (1)
of the Act by contracting out its delivery work and discharg-
ing its delivery employees without prior bargaining with the
Union.
The parties appeared by counsel at the hearing and were
afforded full opportunity to adduce evidence, examine and
cross-examine witnesses , argue and file briefs. Briefs have
been received from the General Counsel, the Union and the
Company.
Based upon my review of the entire record, observation
of the witnesses , perusal of the briefs and research, I enter
the following:
FINDINGS OF FACT
1. JURISDICTION AND LABOR ORGANIZATION
The complaints alleged, the Company admitted,' and I
find that the Company at all times pertinent was an employ-
er engaged in commerce in a business affecting commerce
and the Union was a labor organization, as those terms are
defined in Section 2(2), (5), (6), and (7) of the Act.
II. THE ALLEGED UNFAIR LABOR PRACTICES
A. Introduction
Since 1959, the Company has been a retail seller and
servicer of T. V. sets, refrigerators, stoves, air conditioners,
driers, washers, and other appliances.
At all pertinent times its corporate hierarchy consisted of
Michael Moore, president, Jim Sarlo, vice president, How-
ard Newhouse, treasurer, and Elinor Newhouse, secretary,
with Moore owning 100 percent of the stock of the corpora-
tion and actively heading its operation; Sarlo acting as a
salesman and delivery supervisor; Howard Newhouse al-
most exclusively engaged in sales; and Elinor Newhouse
acting as bookkeeper. The Company also employed Ray
Kreissman as service manager and Ralph Jankowski as
sales manager.3
At times pertinent to this Decision, the balance of the
work force consisted of four regular full-time driver-instal-
lers-Michael Freskos, Sam Oliva, George Ostrick, and
Frank Taormino; approximately eight T.V. and appliance
service or repairmen; four office clerical employees; one
general utility man; one salesman; and C. Freskos (whose
status will be determined further in this Decision.)
Between the time it commenced business and through
August of 1973, no union ever represented any of the
Company's employees.
2 The Company amended its answer at the outset of the hearing to admit
that the Union was a labor organization as defined in the Act.
3 It was stipulated that Moore, Sarlo, the two Newhouses , Kreissman, and
Jankowski were supervisors and agents of the Company acting on its behalf
at all pertinent times.
719
B. The Unit (August 30)
From the time it started business through September 11,
the Company delivered and installed the appliances pur-
chased from it with its own vehicles and its own driver-
installers.
On August 30, the Company employed four regular full-
time driver-installers; i.e., M. Freskos, Oliva, Ostrick, and
Taormino.
The General Counsel, the union, and the Company agree
that a unit consisting of all truckdrivers and helpers of the
Company who deliver and install appliances who are em-
ployed at the Company's facility located in Chicago, Illi-
nois , exclusive of office clerical employees, salesmen,
service repairmen, professional employees, guards and su-
pervisors, as defined in the Act, constitute a unit appropri-
ate for collective-bargaining purposes within the meaning of
Section 9(b) of the Act.
They also agree that M. Freskos, Oliva, Ostrick, and
Taormino are properly includable within that unit.
A dispute arises as to whether or not C. Freskos should
be included.
C. Freskos worked full time for the Company during the
summer of 1973. He spent most of his time that summer
working as a driver-installer.4
In the latter part of August, and prior to August 30, C.
Freskos told Elinor Newhouse he was starting school in a
few weeks (at the Chicago Academy of Fine Arts), and
would have to quit his employment. Mrs. Newhouse asked
him what days he had classes. He replied that he had classes
on Monday, Wednesday, and Friday. Mrs. Newhouse
asked him if he wanted to work on the days he did not have
classes . He replied that he would like to work, he could use
the income. Mrs. Newhouse offered to employ him on Tues-
days, Thursdays, Saturdays, and any other days he didn't
have to go to school. C. Freskos accepted the offer, but
asked for some time off before assuming his part-time du-
ties . Mrs. Newhouse consented.
C. Freskos did not work during the week of September
2-8. He reported for work at his part-time job on Tuesday,
September 11. On that day, he was not assigned to perform,
and did not perform, any delivery or installation work. He
picked up stock from the warehouse, brought it to the store,
and readied it for delivery by uncrating it, cleaning it,
changing doors, installing icetrays, etc. He did not work on
Thursday, September 13. His mother called the store and
reported that he was ill. On Saturday, September 15, he did
not report for work due to his having to perform reservist
duty at the Naval Air Reserve Station.
On Sunday, September 16, his brother, M. Freskos, told
him that Mrs. Newhouse wanted him to telephone her.5 On
Monday, September 17, he telephoned the store and talked
to Jim Sarlo. Sarlo informed him his services were no longer
needed, there was not enough work to justify his continued
employment.
While it is clear that C. Freskos was within the unit during
4It was so testified by C. Freskos and his testimony was corroborated by
Moore.
5 M. Freskos went to the store Saturday, September 15, to pick up his
paycheck . While he was at the store , Elinor Newhouse asked him to have his
brother call her.
720 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
the summer of 1973, inasmuch as he worked the majority of
his time as a driver-installer, the evidence is inconclusive on
the question of whether that would have continued to be the
case following his change from full to part-time work status.
On the one day he worked as a part-time employee follow-
ing his full-time summer employ, his duties were general in
nature, more those of a utility man than a driver-installer.6
I therefore find and conclude that the record fails to
establish that after late August, when C. Freskos changed
to part-time work status, C. Freskos was properly includa-
ble in the unit.
While some evidence was offered in the course of the
hearing concerning the possible inclusion of company em-
ployees Michael Santo, Scott Wojtas, and J. Kowalewski
within the unit, no contentions to this effect were advanced
by any of the parties in their briefs. These persons shall,
therefore, also be excluded from the unit.
I therefore find and conclude that on and after August 30,
the Company employees properly includable within the unit
specified above were M. Freskos, Oliva, Ostrick, and Taor-
mino.
C. The Union's Representative Status (August 30)
Oliva and Ostrick were former members of the Union.
On or about August 28, they decided to explore the possi-
bility of securing union representation. Ostrick telephoned
the Union's president and expressed their interest in secur-
ing representation by the Union, The union president
agreed to have one of the Union's field representatives meet
with Oliva and Ostrick the next morning, August 29. The
meeting was held as scheduled. The union field representa-
tive who attended was Anthony Cullotta. Cullotta explained
the procedure for securing union representation (signing
union authorization cards), explained the terms of the stan-
dard union contracts and gave Ostrick four authorization
cards. Ostrick gave the cards to Oliva. Oliva and Ostrick
scheduled an August 30 meeting with Taormino and M.
Freskos. At that meeting, Oliva and Ostrick informed Taor-
mino and M. Freskos of the rates of pay, wages, hours, and
working conditions contained in the Union's standard con-
tracts. All four discussed the pros and cons of union repre-
sentation and agreed to seek it. Oliva produced the cards
and all four signed them in each other's presence. Oliva
retained the signed cards.
On September 4, Ostrick telephoned Cullotta and ar-
ranged a meeting with him for September 5. Oliva and
Ostrick met with Cullotta on September 5 and Oliva turned
the four signed cards over to Cullotta. Cullotta stated he
would contact the Company later that day to request recog-
nition and, if it was declined, he would file with the National
Labor Relations Board.
Based upon the foregoing, I find and conclude that at all
times since August 30, the Union has been the duly desig-
nated collective-bargaining representative of all of the
Company's drivers and/or helpers within the unit herein-
above specified.
6 C. Freskos also testified that during his previous part-time employment
by the Company (prior to the summer of 1973), he spent 25-30 percent of
his time on deliveries.
D. The September 5 Recognition and Bargaining Demand
Following his September 5 receipt of signed authorization
cards from the four company driver-installers, Cullotta, ac-
companied by a second field representative of the Union,
Robert Nowak, went to the company store. Nowak asked
Elinor Newhouse to see the company owner. She replied he
was on the telephone and would see them in a few minutes.
Shortly thereafter, Moore approached Cullotta and Nowak,
identified himself, and asked what they wanted. Nowak
identified himself and Cullotta as union field representa-
tives. Cullotta advised Moore that the Company's delivery-
men had signed cards authorizing the Union to represent
them and asked Moore to recognize the Union as their
collective-bargaining representative. Moore stated the
Company did not have any drivers, it only had installers.
Cullotta replied that the Union classified the two delivery-
men and their two helpers as drivers and helpers. Cullotta
then handed Moore three documents, the Union's standard
April 1, 1970-March 31, 1973, contract, an April I-June 30,
1973 interim agreement, and a letter of understanding con-
taining contract changes and extending the basic contract
and asked Moore to sign them. Moore refused, stating he
was going to get rid of the drivers and have the hauling of
his merchandise done by an outside hauler. Cullotta then
stated he wanted to leave the documents anyway, and asked
Moore to review them and telephone him. Moore stated
there was no need to do so, he was going to contract out his
delivery work. Cullotta commented that if he did so, the
drivers had better be union. As the two union representa-
tives left, Nowak asked Moore not to take any action
against his drivers, they had the right to join the Union.
E. The Alleged September 5 8(a)(1) Violation
At approximately 5 p.m. the same day (September 5) that
Moore received the Union's recognition and bargaining de-
mands, Oliva and Ostrick entered the store on completing
their deliveries for the day. Howard Newhouse instructed
them to report to Moore's office, and accompanied them
there. At the commencement of the conference, Moore, H.
Newhouse, Oliva, and Ostrick were present. H. Newhouse
remained approximately 15 minutes and left. About 5 min-
utes after H. Newhouse left, E. Newhouse entered and re-
mained about 10 minutes. Ostrick remained for
approximately the first 30 minutes of the conference. Dur-
ing the balance of the conference, only Oliva and Moore
were present.
Moore opened the conference by indicating he had re-
ceived the Union's request for recognition and bargaining
earlier that day. He stated he had spoken with his lawyer,
that his lawyer had advised him to give the men the silent
treatment. He stated he was shocked that the men had not
come to him before going to the Union, and asked how the
Union got in. Ostrick told Moore that he and Oliva had
been stopped sometime previously by a union representa-
tive and asked to produce union cards and decided to seek
union representation. Moore stated he could not afford to
pay the Union's pay scale.' Moore also stated it was costing
' At the time, M. Freskos and Taormino received $3.50 per hour, Oliva
TOWNHOUSE T. V. & APPLIANCES 721
him more to operate his own trucks than it would to con-
tract out his delivery service for performance by outside
haulers. Ostrick replied that other retailers performed deliv-
eries with their own employees and trucks, and that their
drivers were union-represented. Moore answered that the
retailers in question had larger volume. Moore went on to
state he didn't see how he could tell customers there would
be no deliveries on certain of the holidays called for in the
union contract. Ostrick stated he had no answer to that.
Moore asked if the men had signed cards for the Union, and
if they signed them voluntarily. Ostrick replied all four
signed, and all four signed voluntarily. Oliva corroborated
Ostrick's statement. Ostrick stated that if Moore felt he
couldn't afford to operate two trucks, why not try operating
one truck under union scales. Moore replied he didn't think
this suggestion worthwhile, he would give the trucks to Os-
trick and let Ostrick operate them. Ostrick stated he did not
have the means to do that. Ostrick suggested that Moore try
concentrating his deliveries, then he and Oliva could make
more stops, that currently they were scattered. Moore re-
plied that Oliva and Ostrick handled their usual number of
deliveries that day and he didn't think they would be able
to handle any more. Moore commented that former em-
ployees who became dissatisfied with their payscales left the
Company and went elsewhere to get better paying jobs.
Ostrick replied he liked his job with the Company. Moore
noted the Union proposed a trust-funded health and wel-
fare plan and he and Ostrick got into a discussion concern-
ing what Ostrick would do about his current hospital
coverage (Ostrick's wife was disabled and in a hospital.)
Ostrick asked if he could pick up the Travelers Insurance
coverage carried by the Company (Ostrick paid $11 depen-
dent coverage and the Company paid $8 to cover Ostrick.)
Moore stated he did not think Ostrick could pick up the
Travelers hospital coverage. Moore asked Ostrick what Os-
trick would do in his place. Ostrick replied that he would
join (recognize) the Union. Moore asked Oliva the same
question, and received the same answer.8
While Moore made no direct threats of economic retalia-
tion against the four driver-installers for having sought and
secured union representation, the Board has nevertheless
held that interrogation of employees concerning whether
they had joined the Union and their reasons therefore, with-
out advising the interrogated employees no reprisals were
contemplated is violative of Section 8(a)(1) of the Act .9
Based on the foregoing, I find and conclude that by
Moore's September 5 interrogation of Oliva and Ostrick
concerning their and the other drivers' union membership
received $4 per hour and Ostrick received $4.25 per hour. The Union scale
for drivers was $6.24 and for helpers $6.01 per hour.
8 The foregoing findings are based upon the testimony of Oliva and Os-
trick. Moore differed in only one aspect-he testified that he told Oliva and
Ostrick he had already contracted out the Company's delivery service.
Oliva's denial that Moore made such a statement is credited. Oliva's testimo-
ny was forthright and direct, and it does not appear reasonable that Moore
would try to argue Ostrick and Oliva out of supporting the Union 's contract
proposals, offer his trucks to Ostrick, and ask Oliva and Ostrick what they
would do in his position, if he had already contracted out his delivery service.
Neither Elinor Newhouse nor Howard Newhouse corroborated Moore's tes-
timony.
9 N.L.R.B. v. Super Toys, Inc., 458 F.2d 180 (C.A. 9, 1972); Struksnes
Construction Co., Inc., 165 NLRB 1062.
and activities and the reasons therefor without announcing
that economic reprisals were not contemplated for their
engaging in such activities, the Company violated Section
8(a)(1) of the Act.
F. The September 6 Company Arrangement for Outside
Performance of its Delivery Installation Service
The morning following his receipt of the union demands
and verification that all four of the Company's driver-instal-
lers had voluntarily signed cards authorizing the Union to
represent them, Moore telephoned David Magee, secretary-
treasurer of Rizzo Brothers Haulers and general manager of
that company. Rizzo warehoused the Company's inventory
until August 31, when Rizzo moved its warehouse opera-
tions closer into Chicago and the Company shifted its in-
ventory to another warehouse in the northwest suburbs
(Des Plaines, Illinois) where most of its sales were made.
Prior to the warehouse change, Magee tried to persuade
Moore to let Rizzo both continue to do the Company's
warehousing and pick up his delivery and installation work.
Moore informed Magee that he was having trouble with
the Union, verified that Rizzo's drivers were union-repre-
sented, and asked Magee when he could provide a truck,
driver, and helper. 10 Magee stated he could provide a truck,
driver, and helper the following Wednesday, September 12
(Rizzo's workweek runs from Wednesday through Thurs-
day). Moore stated that would be fine, he would discharge
his drivers on Tuesday, September 11, and Rizzo could start
making his deliveries on Wednesday, September 12. Moore
also tried (unsuccessfully) to persuade Magee to buy his
trucks. Moore did not seek any bids from any other haulers
for the work.
G. The September 10 Warning
On September 10, Company Sales Manager Jankowski
accosted Ostrick and told him the drivers shouldn't have
brought in the Union, on the following day the Company
was going to go out of the delivery business.
H. The September 11 Discharges
On Tuesday, September 11, when Taormino and M. Fres-
kos finished their deliveries for the day (at approximately
4:30 p.m.), Sarlo told them Moore wanted to see them at his
office. Sarlo, the two Newhouses, Taormino and M. Freskos
were present in Moore's office during the ensuing conversa-
tion.1 Moore informed the two drivers that the Company
was not going to do any more trucking, Magee was taking
over deliveries. Taormino asked whether Moore was firing
them or laying them off. Moore replied they could take it
any way they liked. Taormino asked if they were being let
go because of the Union. Moore did not answer him. Taor-
mino then asked if it was because of the $6 (union) rate.
Moore replied that he was wondering how to pay them now.
Taormino asked whether it wouldn't be cheaper to keep his
own trucks. Moore replied it would not, reciting his insur-
10 Magee had previously told Moore that Rizzo would charge him $160 per
da^ for one truck, driver, and helper, plus $24 for each overtime hour.
1 Sarlo and the two Newhouses did not remain throughout the conference.
722 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ante, license , and repair costs. Taormino disagreed with
Moore about his costs. M. Freskos reiterated Taormino's
inquiries concerning whether he and Taormino were dis-
charged because of the Union and the $6 rate. Moore stated
that he could not afford the $6 rate. Taormino stated that
since he had dependents , it was unfair to discharge him
without any notice, to which Moore replied it was a last-
minute decision between Moore and Magee.
Oliva and Ostrick came to the store after completing their
deliveries, arriving approximately an hour after Taormino
and M. Freskos. Sarlo told them that Moore wanted to see
them. Moore came out of his office and saw them down in
the store. He advised them the Company was going out of
the trucking business and Ostrick asked whether they were
fired or laid off. Moore replied they could call it whatever
they wished, he could not afford to pay them what they were
asking for and they had him legally tied up. Oliva asked
when they could get their checks, and Moore replied they
could pick them up the following Saturday.
1. The Alleged September 11 8(a)(1) Violation
On the same day his brother, M. Freskos, and the other
drivers were discharged (September 11), C. Freskos was at
the store working on his first part-time day. Elinor New-
house approached him and asked him what was going with
the drivers. C. Freskos replied he didn't know too much, he
was not concerned in it . Mrs. Newhouse asked him whether
he thought it was sneaky for the drivers to go behind the
Company's back and join the Union, didn't Freskos think
they should have come to her or Mike Moore first and
discussed the matter with them? C. Freskos replied that it
may have been sneaky, but if they had come to her or Moore
first, they would have been fired. He further stated that
Mike enjoyed working for the Company, but couldn't live
on what the Company was paying. Mrs. Newhouse replied
that the Company intended to give everybody a raise after
the big sale (in September). C. Freskos asked how they were
supposed to know that, if she didn't tell them. Mrs. New-
house then asked C. Freskos if he considered the work hard
and C. Freskos replied that he did not.
The conversation between Elinor Newhouse and C. Fres-
kos does not appear to be an interrogation, but more of a
conversational exchange concerning Mrs. Newhouse 's reac-
tion to the dispute between the drivers and the Company.
I therefore find and conclude that the Company did not
violate Section 8(a)(1) of the Act by Elinor Newhouse's
September 11 conversation with C. Freskos.
J. The Commencement of Outside Delivery Service and
Truck Sales
On Wednesday, September 12, Rizzo began handling de-
livery and installation services for the Company with one
truck, one driver, and one helper on a 6-day basis , Monday
through Saturday. Rizzo kept the truck at the Company's
parking lot and the drivers arrived at the company store
each morning, assisted in the loading, carried out the day's
deliveries, brought the truck back, and left the store's prem-
ises in their own cars.
Shortly after Rizzo began his deliveries, Nowak came to
the store area and observed that Rizzo was performing de-
liveries . He thereupon filed the charge in Case 13-CA-
13663.
On September 20, the Company sold the two trucks for-
merly operated by M. Freskos, Oliva , Ostrick , and Taormi-
no in its delivery and installation service.12
K. The Company's Economic Defenses
Moore testified that in 1971, the Company lost $80,000
and, in 1972, $10,000. In early 1973, the Company sub-
scribed to an electronic data processing (EDP) service of-
fered by the National Appliance Radio and T.V. Dealers
Association (NARDA), of which it was a member. The
executive vice president of NARDA, Jules Steinberg, ad-
vised Moore in June that, based on the EDP analysis of data
submitted by the Company for the preceding month, its
gross profit margin of 15 to 17 percent was substantially
below the level (25 percent) necessary to secure reasonable
net profits.
Steinberg met with Moore that month to review the EDP
report and explore means for alleviating the Company's
financial problems. It was ascertained that prices could not
be increased for competitive reasons and that advertising
costs could not be reduced without losing sales volume.
They also discussed rent, utility, telephone, labor, delivery,
and other costs. Steinberg suggested that Moore review
costs to see where they could be lowered and suggested that
Moore, inter alia, check to see if it might be cheaper to
contract out his delivery-installation service.
In July, following receipt and analysis of the Company's
June data, Steinberg again contacted Moore and advised
him his June gross profit margin was no better than that for
May. He again urged Moore to take steps to lower his costs.
Moore replied he was checking his costs (utilities , telephone,
etc.), including the cost of his delivery operations, with a
view towards possibly contracting out the latter.
Moore did make a study of his delivery costs, and figured
it was costing the Company approximately $1,300 per week
therefor. In earlier discussions 13 Magee quoted Moore a
price of $160 per day or $960 a week 14 for the use of a truck
and crew for his deliveries and installations, excluding over-
time." Moore therefore concluded that it would be uneco-
nomical to go to outside hauling, since the use of two Rizzo
trucks and crews to replace his own would cost him another
$620 per week.
Moore testified he reversed his thinking and decided to
accept Magee's proposal for assuming his delivery-installa-
tion service when, in late July, Magee advanced the argu-
ment that Rizzo could handle his deliveries and installations
with one truck and crew, and guarantee 13 deliveries per
day, which would mean a saving of $340 per week. He
testified that he discussed the change with the two New-
houses and Sarlo in August and, despite their skepticism
12 The Company retained a pickup truck and several vans used in its
business.
13 Magee had been trying to sell Moore on having Rizzo do both his
warehousing and delivery- installations since Spring.
14 Based on the Company's regular 6-day weekly delivery schedule.
15 At $24 per hour.
TOWNHOUSE T V. & APPLIANCES
that Rizzo could make 13 deliveries per day, decided late
that month to discontinue his delivery-installation service,
terminate M. Freskos, Oliva, Ostrick, and Taormino, sell his
two large trucks, and have Rizzo assume his deliveries and
installations with one truck and crew. He further testified
that he communicated this decision in late August to the
two Newhouses and Sarlo, to Steinberg, to John Sawyer,
sales manager for Bill Becker Chevrolet (where he pur-
chased the two large trucks), and to Magee.
I do not credit Moore's assertion that he decided in Au-
gust to contract out his delivery and installation service.
Despite alleged 16 losses in 1971 and 1972 and gross profits
in June and July running below NARDA-recommended
standards, Moore managed to maintain an excellent life-
style 17 and admittedly gave no consideration to having
others do his deliveries and installations until (supposedly)
dust prior to the unionization of his driver-installers.
Without documentary evidence, it is impossible to de-
termine whether the Company maintained a positive cash
flow during the period in question (January 1971 through
July 1973), but it is reasonable to infer from the fact the
Company was still in business on the latter date that this was
so. Steinberg conceded that at least one-third of his mem-
bers utilizing EDP realized less than a 25-percent gross prof-
it (the average figure for the group) but, due to variations
in accounting practices, a gross of 15-17 percent could still
result in a net profit (and certainly a positive cash flow).
Moore stated he based his decision on Magee's represen-
tation that Rizzo could average 13 deliveries ier day. Even
if this were true, and I find that it was not,l 13 deliveries
per day would not equal the Company's August delivery
schedules,19 and there was a heavy sale 20 coming up in
September, which would normally increase the number of
deliveries required. In addition, it is difficult to reconcile
Moore's testimony that he made his decision to contract out
his hauling in August with his September 5 efforts to per-
suade Oliva and Ostrick to abandon their efforts to secure
higher wages, etc., through union representation, his offer of
his trucks to Ostrick, and his appeal asking them what they
would do if faced with the Union's demands on their behalf
and his September 11 comments that he was discharging
Oliva and Ostrick because they had him legally tied up 2
and he did not want to pay the union wage scale, and his
September 6 reference to his union problem, ascertainment
16 No documentary evidence was produced to support Moore 's assertion
to this effect.
17 Moore testified he defended his Cadillac , expensive clothing, luxurious
home, etc , to Ostrick and Oliva on the ground it was necessary to maintain
his image as a successful businessman
is Magee testified that he told Moore that Rizzo could make 10 to 12
deliveries per day, and that testimony is credited
19 Ostnck's testimony that he and Oliva averaged 8-10 deliveries per day
is credited, apparently in one load to the more scattered and outlying delivery
points, as well as Taormino 's testimony that he and M Freskos made three
or four round trips per day on the close -in deliveries , which leads to a
reasonable inference that the latter equaled or exceeded the Ostrick-Oliva
daily average Thus the Company's two trucks and crews were averaging
16-20 deliveries per day, as contrasted to Magee's estimated 10-12
20 C Freskos ' testimony that Elinor Newhouse informed him on Septem-
ber II that a big sale was coming up has been credited above.
21 Presumably because of the RC petition and/or his lawyer's advice con-
723A
that Rizzo's crews were union-represented and insistence on
securing a truck and crew as quickly as possible.
In addition, it is noted that Moore's testimony was self-
serving, inadmissible on a technical application of the hear-
say rule,22 and inadequately supported.
His testimony that he conferred with the two Newhouses
and Sarlo and, despite their skepticism that Rizzo could
maintain the Company's delivery schedules, secured their
agreement with his decision to contract out such services in
August was not corroborated by H. Newhouse, who was
called by the Company as a witness, or by E. Newhouse and
Sarlo, who were not produced. While Steinberg corroborat-
ed Moore's testimony that Moore telephoned him in August
to advise Steinberg that he had decided to contract out his
delivery service, I do not credit that testimony and find that
Steinberg must have been mistaken as to the date of such
conversation, on the ground that the circumstances related
heretofore render it incredible that it occurred prior to Sep-
tember 5 and Moore's failure to mention this in his pretrial
affidavit, which refers to the earlier Steinberg conversations.
I find Sawyer's testimony totally unreliable, and do not
credit it, inasmuch as it appears incredible that Moore
would have sought to sell his trucks in July, as testified by
Sawyer, before he had even considered going to outside
trucking, and Sawyer's demeanor and testimony, which was
generally hesitant and shifting. With reference to Magee,
Magee testified that his August conversation with Moore
was ambiguous and "left hanging" the question of Moore's
hire of one of his trucks and crews. It is further noted that
all of the above witnesses were business associates depen-
dent on Moore and the Company either for employment or
business income and their testimony falls in the same cate-
gory as Moore's testimony with regard to its self-serving and
technical hearsay character.
L. Analysis and Conclusions Regarding the Alleged
8(a)(3) and (5) Violations
Based on the foregoing findings, I find and conclude that
Moore contracted out the Company's delivery and installa-
tion services on September 6, discharged M. Freskos, Oliva,
Ostrick, and Taormino on September 11, and sold his trucks
on September 20 to avoid recognizing the Union as the
collective-bargaining representative of these four men and
bargaining with the Union over its contract proposals.
I further find and conclude that by Moore's discharge of
M. Freskos, Oliva, Ostrick, and Taormino for the above
reasons, the Company violated Section 8(a)(1) and (3) of the
Act.
I also find and conclude on the basis of the foregoing
findings that by contracting out its delivery service, dis-
charging its delivery employees, and selling the trucks they
operated on learning that its delivery employees had desig-
nated the Union as their collective-bargaining representa-
tive, without bargaining with the Union concerning its
cerning the Act Moore mentioned having conferred with his lawyer about
the Union at the September 5 conference )
2i Against the admissibility of statements made outside the presence of the
opposing party or parties
723B DECISIONS OF NATIONAL LABOR RELATIONS BOARD
decision to contract out such work and the economic effect
of its action on the delivery employees, the Company violat-
ed Section 8(a)(1) and (5) of the Act 23
CONCLUSIONS OF LAW
1. At all times pertinent, the Company was an employer
engaged in commerce in a business affecting commerce and
the Union was a labor organization , as those terms are
defined in Section 2(2), (5), (6), and (7) of the Act.
2. At all times pertinent Moore, H. Newhouse, E. New-
house, Sarlo, and Jankowski were representatives and
agents of the Company acting on its behalf.
3. A unit consisting of all truckdrivers and helpers of the
Company who deliver and install appliances who are em-
ployed at the Company's facility located in Chicago, Illi-
nois , excluding office clerical employees, salesmen , service
repairmen , professional employees, guards and supervisors
as defined in the Act, at all times pertinent constituted a unit
appropriate for collective-bargaining purposes within the
meaning of Section 9(b) of the Act.
4. At all pertinent times M. Freskos, Oliva, Ostrick, and
Taormino were within the bargaining unit just specified.
5. At all times since August 30 the Union has represented
the Company employees within the unit specified above.
6. By Moore's September 5 interrogation of Oliva and
Ostrick concerning their union membership and activities,
the Company violated Section 8(a)(1) of the Act.
7. By Moore's September 11 discharge of M. Freskos,
Oliva, Ostrick, and Taormino to avoid recognizing the
Union as their collective-bargaining representative and bar-
gaining with the Union over its contract proposals, the
Company violated Section 8(a)(1) and (3) of the Act.
8. By Moore's contracting out of work performed by M.
Freskos, Oliva, Ostrick, and Taormino and discharging
them following receipt of the Union's recognition request,
and Moore's learning that all of them had authorized the
Union to represent them, but without prior bargaining with
the Union concerning his decision to contract out their
work or the economic effects thereof on them, the Company
violated Section 8(a)(1) and (5) of the Act.
9. The Company did not otherwise violate the Act.
10. The unfair labor practices specified above affect
commerce, as that term is defined in the Act.
23I reject the company contention that the Union waived its right to
bargain concerning these subjects by its representatives ' failing to request
bargaining thereupon when Moore , on receipt of the Union's September 5
request for recognition and contract proposals , announced he was going to
get rid of his deliverymen and contract out their work . The union representa-
tives requested that Moore telephone them when he was ready to discuss the
contract proposals ; one of those contract proposals would prohibit contract-
ing out work currently performed by unit employees if it resulted in the layoff
of any unit employee.
THE REMEDY
With respect to the 8(a)(1) violation, it shall be recom-
mended that the Company be ordered to cease and desist
from interrogation of its employees concerning their union
membership or activities and any other interference with its
employees' Section 7 rights under the Act, and to post a
notice to its employees to that effect.
With respect to this 8(a)(3) and (5) violation, the General
Counsel requests that I recommend to the Board the entry
of an order requiring the Company to recall the four dis-
chargees, at their former rates of pay, etc., to repurchase two
trucks of a similar size as those operated by the four dischar-
gees prior to their discharge, and to resume its delivery and
installation operations with the four dischargees manning
the two trucks in question, and make the four dischargees
whole for any wage or benefit losses to the date of their
recall. The General Counsel further requests that I recom-
mend to the Board the entry of an order requiring the Com-
pany to meet and bargain with the Union concerning, inter
alia, its decision to contract out its delivery and installation
work and the economic consequences of such action on the
employees performing it.
The Company states that the economic burden of pur-
chasing new trucks and resuming its delivery- installation
operations would endanger the continued operations of the
Company, and requests a less burdensome remedy.
To grant the General Counsel's requested remedy would
only require the Company to repurchase or lease trucks and
rehire the four dischargees for a period ending in either an
impasse or agreement with the Union concerning its deci-
sion to subcontract, the economic effects of thai decision on
those dischargees and the balance of the Union's contract
proposals (which would irclude the rates of pay, etc., of the
dischargees upon reinstatement). The same result may be
achieved by granting the four dischargees backpay for all
wage and other benefit losses suffered by them at the levels
they enjoyed on discharge, from the date they were dis-
charged to the date of impasse or agreement.
To accomplish the purposes of the Act and avoid unnec-
essary economic complications, I therefore shall recom-
mend to the Board that an order be entered directing the
Company to bargain with the Union at its request concern-
ing the continued viability of the Company's decision to
contract out its delivery-installation work, the wage rates,
etc., of the dischargees in the event they are reinstated, etc.,
and directing the Company to make the dischargees whole
for such wage and other benefit losses they have suffered
dated from the date of their discharge (September 11) to the
date the Union and the Company have bargained either to
an impasse concerning the above subjects or reached agree-
ment with regard thereto, with backpay computed as pre-
scribed in F. W. Woolworth Co., 90 NLRB 286 (1950), and
interest thereon at 6 percent per annum, computed in the
manner set forth in Isis Plumbing and Heating Co., 138
NLRB 716 (1963).
[Recommended Order omitted from publication.]