A-1 Schmidlin Plumbing & Heating Co. And Schmidlin, Inc.

National Labor Relations Board - Board Decisions

Jul 29, 1987

284 N.L.R.B. 1506 (N.L.R.B. 1987)

1506 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
A-1 Schmidlin Plumbing & Heating Company and
Schmidlin' , Inc. and Local Union No. 1076,
International Brotherhood of Electrical Work-
ers. Case 8-CA-18288
29 July 1987
DECISION AND ORDER
BY MEMBERS JOHANSEN, BABSON, AND
STEPHENS
On 25 August 1986 Administrative Law Judge
Richard H. Beddow Jr. issued the attached deci-
sion. The General Counsel and the Charging Party
(the Union) filed exceptions and supporting briefs,
and the Respondent, Schmidlin, Inc. (Schmidlin),
filed an answering brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge's rulings, findings, and
conclusions only to the extent consistent with this
Decision and Order.
1. We fmd that Schmidlin violated Section
8(a)(1) by stating to employees, including James
Neary, that they could not be hired if they re-
mained with the Union, even if it accompanied the
statement with the explanation that Schmidlin did
not have a contract with the Union. 1 The state-
ment, conditioning employment on giving up union
membership or activity, reasonably tended to inter-
fere with, restrain, and coerce employees in the ex-
ercise of Section 7 rights.
Although the complaint did not allege the state-
ment as an 8(a)(1) violation, near the close of the
hearing the General Counsel moved to amend the
complaint to add the allegation. The judge denied
the motion, and we disagree with his ruling. The
statement in question relates to the complaint alle-
gation that Schmidlin denied employment to James
Neary, in violation of Section 8(a)(3), and was fully
litigated at the hearing. Schmidlin's president ac-
knowledged making the statement and was exam-
ined about it by Schmidlin's counsel. In the cir-
cumstances, we find that Schmidlin is not preju-
diced by amending the complaint as the General
Counsel requests.
1 By prehearing affidavit to the Board, Charles Schmidlin, president
and co-owner of Schmidlin, stated: "I told them we would be nonunion
and they should do whatever they had to do. I told them if they wanted
to stay with the Union we wouldn't be hiring them." At hearing he testi-
fied: "I told them that I couldn't hire them if they were union people,
due to the fact that I didn't have an agreement with the union. . . that if
they were going to stay with the union, that I couldn't hire them because
I didn't have a contract with the union."
2. We fmd that Schmidlin violated Section
8(a)(3) by denying employment to James Neary.
In late December 1984 Charles Schmidlin, who
was vice president and service manager of A-1
Schmidlin Plumbing & Heating Company (A-1),
told all A-1 employees that Schmicllin would hire
them if they wanted to work for Schmidlin, and of-
fered them job applications. At the same time he
told three employees who were members of the
Union (Roy Williams, Ed Vaculik, and Neary) that
Schmidlin was nonunion. As found above, he also
told them they could not be hired if they remained
with the Union. 2 After consulting with the union
business agent, Neary, who was a union steward,
did not file an application, but reported for work at
starting time on each of the first 3 days Schmidlin
operated, 2, 3, and 4 January 1985. He received no
work assignments, though other employees did,
and left after a few hours each day. While at the
Schmidlin facility, Neary conversed with Charles
Schmidlin, who made the work assignments, but
they did not discuss Neary's employment situation.
On 3 January 1985 the union business agent
spoke to Kathleen Vaculik, A-l's corporate secre-
tary and Schmidlin's officer manager, in response
to a letter the Union had received informing it of
A-1's closing. When he asked about the status of
the Union's members, including Neary, Vaculik
told him that Neary "had to work things out."
We conclude that Schmidlin conditioned Neary's
employment on his abandonment of the Union, an
unlawful condition that Neary was not required to
accept. See Cascade Painting Co., 277 NLRB _927
(1985). Consequently, the denial of employment to
Neary was violative of Section 8(a)(3).
3. We find, contrary to the judge, that Schmidlin
is a successor employer to A-1 and had a bargain-
ing obligation to the Union from the time Schmid-
lin began operations.3
A-1, which was engaged in the sale, installation,
and servicing of heating and air-conditioning equip-
ment, operated from 1960 through December
2 Neary testified that Charles Schmidlin told him that he "would have
to fill out a job application and get a withdrawal card from the union."
Neary then stated he wanted to talk to the union business agent.
3 We agree with the judge, however, that there is insufficient evidence
to support a finding that A-1 and Schmidlin are alter egos. Therefore,
because we find Schmidlin to be only a successor employer, our order
does not bind it to the collective-bargaining agreement, but gives the bar-
gaining order and status quo ante remedy that is appropriate under the
circumstances. See NLRB v. Burns Security Services, 406 U.S. 272, 281-
291 (1972); L.A.I. Medical Clinic, 248 NLRB 861, 864-865 (1980).
284 NLRB No. 144
A-1 SCHMIDLIN PLUMBING CO. 1507
1984.4 It was signatory to an association5 contract
with the Union and Plumbers Local 50, 6 effective
1 July 1982 through 30 June 1985, which covered
employees engaged in the installation and service
of automatic heating and air-conditioning equip-
ment and controls. 7 On 8 August 1984 it signed an
assent to the agreement, effective 1 August 1984
through 30 June 1986.
Schmidlin was incorporated in November 1984
by Charles and Walter Schmidlin, with each
owning 50 percent of the stock. On 27 December
1984 the stockholders of A-1 and of Schmidlin
reached an agreement by which Charles and
Walter Schmidlin purchased from Mary Lucille
Sclamidlin the property occupied by A-1; 8 Schmid-
lin purchased A-1's assets, including A-1's name,
good will, customer list, motor vehicles, office sup-
plies and equipment, tools and inventory, and ac-
counts receivable; and Sclunidlin assumed A-1's
debts to suppliers.
A-1 ceased business on 31 December 1984, and
Schmidlin began operations on 2 January 1985,
performing the heating and air-conditioning serv-
ices that A-1 had, from the A-1 location, and serv-
ing the same customers. 6 It assumed A-I's payroll
4 At the time it ceased operations Mary Lucille Schmidlin was its
president and majority stockholder with 66 shares; Charles Schmidlin
was vice president and service manager with 4 shares; Kathleen Vannlik,
daughter of Mary Lucille Schmidlin, was corporate secretary with 4
shares. At an earlier period Walter Schmidlin, Charles' brother, had
owned 4 shares, but liquidated his shares and went into a similar business
independent of A-1.
Toledo Heating and Air Conditioning Contractors Association.
6 Plumbers and Steamfitters Local Union No. 50 of the United Asso-
ciation of Journeymen & Apprentices of the Plumbing and Pipe Fitting
Industry of the United States and Canada.
The judge denied the General Counsel's motion to amend the com-
plaint to include Plumbers Local 50 as joint representative of the appro-
priate bargaining unit, and the General Counsel has not excepted to the
judge's ruling. Nevertheless, we shall order Respondent Schmidlin to rec-
ognize and bargain with both Plumbers Local 50 and Electrical Workers
Local 1076. We note that the joint representative status of the Unions is
clearly established by the record based on the predecessor employer's
recognition of both Unions as the joint collective-bargaining representa-
tive of the unit employees and the pertinent collective-bargaining agree-
ment which was submitted as a joint exhibit. In the circumstances here,
our Order properly remedies the consequences of the violations found.
7 The 1982-1985 contract describes the unit as follows:
It is agreed that workmen covered by this Agreement are those en-
gaged in the installation and service of automatic heating and air
conditioning equipment and controls, including all types of oil burn-
ers, gas burners, stokers, electric furnaces, air conditioning and auto-
matic control systems, solar heat systems, and the installation and
service of refrigeration systems.
'Until the transfer was completed, in April 1985, Schmid1M leased the
A-1 facility, although no written lease agreement was executed.
9 Walter Schmidlin brought to Schmidlin accounts from his former
business, which made up approximately 25 percent of SchmidIM's cus-
tomers. In any event, as the Supreme Court had recently made clear,
changes related to sales or marketing of an entity's products or services
are not determinative in a successorship inquiry if there is no showing
that those changes have affected the employer-employee relationship.
NLRB v. Fall River Dyeing & Finishing Corp., 107 S.Ct 203 (1987).
obligations, A-1's work in progress, and A-1's war-
ranty obligations at no cost to customers. Charles
Schmidlin was company president and responsible
for day-to-day management of the service and in-
stallation operations as he had been as vice presi-
dent for A-1. He hired, fired, and disciplined unit
employees and assigned their work. Walter
Schmidlin was vice president and secretary-treasur-
er. He directed his attention to the store and office
and at times assisted with the service and installa-
tion operations. Kathleen Vaculik was office man-
ager.
We conclude from these facts that, despite the
corporate change, there was substantial continuity
in the employing enterprise from A-1 to Schmidlin.
The nature of the business remained the same; it
used the same vehicles and facilities; it had the
same management representative in charge of serv-
ice and installation work; employee jobs were sub-
stantially unchanged, and it served substantially the
same customers in the same geographic area with
no hiatus in operations.
We conclude, also, that there was continuity of
the business' work force. As stated above, Charles
Schmidlin, in late December 1984, told all A-1 em-
ployees that Schmidlin would hire them if they
wanted to work for Schmidlin, and Schmidlin did
hire all A-1 employees except James Neary who
we have found was denied employment in violation
of Section 8(a)(3). From the time Schmidlin began
operations former A-1 employees constituted a ma-
jority of its employee complement" and a majori-
ty of the bargaining unit" employees."
10 Jt. Exh. 13, prepared about February or March 1985, according to
Charles Schmidlim lists all A-1 and all Schmidlin employees, giving the
month and year of their hire and their job classifications. It shows that in
January 1985 Schmidlin had 17 employees, 12 of whom appear on the list
of A-1 employees. The 12 are: Rita Bayer, Bruce Day, Roger Duncan,
Keith Elliott, Douglas Lynch, Brian Machcinski, Robert Newman, Jef-
frey Rogge, Charles Sclunidlin, Geneva Stevenson, Ed Vaculik, and Roy
Williams. The five employees Schmidlin had in January who are not on
the A-1 list are: Walter Schmidlin, co-owner; Erika Sclunidlim part-time
office employee; Mark Ferguson, part-time store employee; James Lewis,
part-time warehouseman and helper to heating mechanics; and Richard
Bartkiewicz, part.time heating mechanic.
11 The bargaining unit described in the collective-bargaining agree-
ment covers employees engaged in heating and air-conditioning installa-
tion and service operations without designating particular job classifica-
tions. It appears to include heating mechanics, plumbers, warehousemen,
and helpers who the record shows engaged in installation and service
work. According to Neary, he worked at A-1 as a heating and air-condi-
tioning technician, and Ed Vaculik, Roger Duncan, and Roy Williams
did the same work be did. On It. Exh. 13 Vaculik is listed as' an A-1
heating mechanic and Schrmdlin service manager and store manager.
Roy Williams is shown as an A-1 heating mechanic and Schmidlin ware-
house manager. Roger Duncan is shown as a plumber for A-1 and for
Schmidlin. G.C. Exh. 6, discussed below, shows that Williams, Duncan,
and Vaculik perfomed installation and service work for Schmidlin during
the period January through September 1985.
12 We disagree with the judge's interpretation of G.C. Exh. 6 and his
conclusion that the majority of Schmidlin's unit employees constitutes a
new work force.
Continued
1508 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
Moreover, in view of Charles Schmidlin's state-
ment that Schmidlin would hire all A-1 employees
who wanted employment, and in view of Schmid-
lin's immediate employment of all A-1 employees
except Neary, we find that Schmidlin planned to
retain all A-1 employees, and its obligation to the
Union as a successor employer applied from the
time it began operations. Therefore, it was obligat-
ed to consult with the Union in establishing initial
terms and conditions of employment."
Accordingly, we fmd that Schmidlin violated
Section 8(a)(5) and (1) by refusing to recognize and
bargain with the Union, 14 and by unilaterally
changing terms and conditions of employment.15
AMENDED CONCLUSIONS OF LAW
We substitute the following paragraphs for the
judge's Conclusions of Law 3, 4, and 5:
"3. The following employees of Schmidlin con-
stitute a unit appropriate for the purposes of collec-
tive bargaining within the meaning of Section 9(b)
of the Act:
All employees engaged in the installation and
service of automatic heating and air condition-
ing equipment and controls, including all types
of oil burners, gas burners, stokers, electric
furnaces, air conditioning and automatic con-
trol systems, solar heat systems, and the instal-
lation and service of refrigeration systems.
Such defined work shall be limited as follows:
Heating Systems-1,000,000 B.T.U.
Air Conditioning Systems-30 Tons
G.C. Exh. 6 gives a summary of Schmidlin job orders for the months
January through September 1985, and shows the individual employees
who performed the jobs. The January figures list seven former A-1 em-
ployees (Ed Vaculik, Roy Williams, Bruce Day, Roger Duncan, Charles
Schmidlin, Douglas Lynch, and Jeff Rogge) and one new part-time heat-
ing mechanic (Richard Bartkiewicz) performing the jobs. The four em-
ployees who worked the most hours in January (and throughout January
through September 1985) are former A-1 employees Bruce Day, Roy
Williams, Ed Vaculik, and Roger Duncan.
13 See NLRB v. Burns Security Services, 406 U.S. 272, 294-295 (1972).
14 We reject the judge's suggestion that the Union waived its bargain-
ing rights. On 3 January 1985 the Union received a letter dated 31 De-
cember 1984 from A-1's corporate secretary informing it "that with the
close of business on December 31, 1984, A-I Schmidlin Plumbing and
Heating Company is terminating busmess," and a copy of a notice to em-
ployees that 31 December would be the final day of business for A-1 and
they could pick up their checks on 2 January 1985. The union business
agent immediately called A-1 and asked for an explanation and for some
information about its members, thereby indicating a continued interest in
representing the employees and determining the employment situation
after the corporate changes. The Union later sent a letter to A-1, "RE:
Schmidlin, Inc.," dated 15 January 1985. The letter stated a desire to
meet with the Company to determine whether there had been a contract
or statutory violation that would warrant a grievance or unfair labor
practice charge and requested information about the operations, owner-
ship, and management of A-1 and of Schmidlin.
15 A-1 had made fringe benefit payments to the Union for certain em-
ployees. Charles Schmidlin testified that Schmidlin had not sent any re-
ports to the Union or any deductions for health and welfare and pension
benefits. He also stated that Schmidlin had changed Ed Vaculik's pay
Commercial Refrigeration Units-5 H.P. (com-
bination not to exceed 10 H.P.)
"4. Since at least 1 July 1982 Plumbers Local 50
and the Union have been the exclusive representa-
tive of the employees in the appropriate unit for
the purposes of collective bargaining with respect
to rates of pay, wages, hours, and other terms and
conditions of employment.
"5. Schmidlin is a successor employer to A-1.
"6. By telling employees that they could not be
hired if they remained with the Union, Schmidlin
violated Section 8(a)(1) of the Act.
"7. By discriminatorily denying employment to
James Neary, Schmidlin violated Section 8(a)(3)
and (1) of the Act.
"8. By refusing to recognize and bargain with
the representative of its employees and by unilater-
ally changing terms and conditions of employment,
Schmidlin violated Section 8(a)(5) and (1) of the
Act."
REMEDY
Having found that Sclunidlin has engaged in cer-
tain unfair labor practices, we shall order it to
cease and desist and to take certain affirmative
action necessary to effectuate the policies of the
Act.
Because Schmidlin discriminatorily denied em-
ployment to James Neary, we shall order it to offer
him employment to the job he would have re-
ceived if he had not been discriminated against, or,
if that job no longer exists, to a substantially equiv-
alent position without prejudice to his seniority or
any other rights or privileges he might have en-
joyed, and make him whole for any resulting loss
of earnings and other benefits, computed on a quar-
terly basis from 2 January 1985 to the date it offers
him proper employment, less any net interim earn-
ings, as prescribed in F. W. Woolworth Co., 90
NLRB 289 (1950), with interest to be computed in
the manner prescribed in New Horizons for the Re-
tarded."
Because Schmidlin unlawfully refused to recog-
nize and bargain with the representative of its em-
ployees and unilaterally changed terms and condi-
tions of employment, we shall order it to bargain
on request and to restore the conditions it unilater-
ally changed and continue them in effect until it
fulfills its bargaining obligation, and to make whole
employees for any loss of wages due to Schmidlin's
16 In accordance with our decision in New Horizons for the Retarded,
283 NLRB 1173 (1987), interest will be computed at the "short-term Fed-
eral rate" for the underpayment of taxes as set out in the 1986 amend-
ment to 26 U.S § 6621. Interest on amounts accrued prior to 1 Jamiary
1987 shall be computed in accordance with Florida Steel Corp., 231
NLRB 651 (1977).
A-1 SCHMIDLIN PLUMBING CO. 1509
unilateral action, with interest, in accordance with
Ogle Protection Service, 183 NLRB 682 (1970), and
for any benefits it unilaterally discontinued.17
ORDER
The National Labor Relations Board orders that
the Respondent, Schmidlin, Inc., Toledo, Ohio, its
officers, agents, successors, and assigns, shall
1. Cease and desist from
(a)Interfering with, restraining, or coercing em-
ployees by telling them they cannot be hired if
they continue to support a labor organization.
(b) Denying employment to, or otherwise dis-
criminating against, any employee for supporting a
labor organization.
(c) Refusing to recognize and bargain with
Plumbers and Steamfitters Local Union No. 50 of
the United Association of Journeymen and Ap-
prentices of the Plumbing and Pipe Fitting Indus-
try of the United States and Canada and Local
Union No. 1076, International Brotherhood of
Electrical Workers as the exclusive representative
of its employees in the appropriate unit described
below:
All employees engaged in the installation and
service of automatic heating and air condition-
ing equipment and controls, including all types
of oil burners, gas burners, stokers, electric
furnaces, air conditioning and automatic con-
trol systems, solar heat systems, and the instal-
lation and service of refrigeration systems.
Such defined work shall be limited as follows:
Heating Systems-1,000,000 B.T.U.
Air Conditioning Systems-30 Tons
Commercial Refrigeration Units-5 H.P. (com-
bination not to exceed 10 H.P.)
(d)Unilaterally changing terms and conditions of
employment.
(e) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
17 Because the provisions of employee benefit fund agreements are
variable and complex, the Board does not provide at the adjudicatory
stage of a proceeding for the addition of interest at a fixed rate on unlaw-
fully withheld fund payments. We leave to the compliance stage the
question of whether SclunicUin must pay any additional amounts into the
benefit funds in order to satisfy our make-whole remedy. These addition-
al amounts may be determined, depending on the circumstances of each
case, by reference to provisions in the documents governing the funds at
issue and, when there are no governmg provisions, to evidence of any
loss directly attributable to the unlawful withholding action, which might
include the loss of return on investment of the portion of funds withheld,
additional administrative costs, etc., but not collateral losses. See
Menyweather Optical Co., 240 NLRB 1213, 1216 fn. 7 (1979).
The General Counsel has requested us to include a visitatorial clause in
the Order that would authorize the Board to obtain discovery from the
Respondent under the Federal Rules of Civil Procedure in order to moni-
tor the Respondent's compliance with this Order. We find it unnecessary
to include such a clause in the Order in this case. Accordingly, we deny
the General Counsel's request.
ercise of the rights guaranteed them by Section 7
of the Act.
2. Take the following affirmative action neces-
sary to effectuate the policies of the Act.
(a) Recognize and, on request, bargain with
Plumbers and Steamfitters Local Union No. 50 of
the United Association of Journeymen and Ap-
prentices of the Plumbing and Pipe Fitting Indus-
try of the United States and Canada and Local
Union No. 1076, International Brotherhood of
Electrical Workers as the exclusive representative
of the employees in the appropriate unit set out
above concerning terms and conditions of employ-
ment and, if an understanding is reached, embody
the understanding in a signed agreement.
(b)Restore the terms and conditions of employ-
ment that it unilaterally changed and continue
them in effect until it fulfills its bargaining obliga-
tion.
(c)Make whole employees for any loss of wages
due to its unilateral action and for any benefits it
unilaterally discontinued.
(d)Offer James Neary immediate employment to
the job he would have received if he had not been
discriminated against, or, if that job no longer
exists, to a substantially equivalent position without
prejudice to his seniority or any other rights or
privileges he might have enjoyed, and make him
whole for any loss of earnings and other benefits
suffered as a result of the discrimination against
him, in the manner set forth in the remedy section
of the decision.
(e) Preserve and, on request, make available to
the Board or its agents for examination and copy-
ing, 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.
(t) Post at its facility in Toledo, Ohio, copies of
the attached notice marked "Appendix." 18 Copies
of the notice, on forms provided by the Regional
Director for Region 8, after being signed by the
Respondent's authorized representative, shall be
posted by the Respondent immediately upon re-
ceipt and maintained for 60 consecutive days in
conspicuous places including all places where no-
tices to employees are customarily posted. Reason-
able steps shall be taken by the Respondent to
ensure that the notices are not altered, defaced, or
covered by any other material.
18 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading "Posted by Order of the Nation-
al 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."
1510 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
(g) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondent has taken to comply.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
WE WILL NOT tell employees they cannot be
hired if they continue to support a labor organiza-
tion.
WE WILL NOT deny employment to James Neary
or otherwise discriminate against any employee for
supporting a labor organization.
WE WILL NOT refuse to recognize and bargain
with Plumbers and Steamfitters Local Union No.
50 of the United Association of Journeymen and
Apprentices of the Plumbing and Pipe Fitting In-
dustry of the United States and Canada and Local
Union No. 1076, International Brotherhood of
Electrical Workers as the exclusive representative
of our employees in the appropriate unit described
below:
All employees engaged in the installation and
service of automatic heating and air condition-
ing equipment and controls, including all types
of oil burners, gas burners, stokers, electric
furnaces, air conditioning and automatic con-
trol systems, solar heat systems, and the instal-
lation and service of refrigeration systems.
Such defined work shall be limited as follows:
Heating Systems-1,000,000 B.T.U.
Air Conditioning Systems-30 Tons
Commercial Refrigeration Units-5 H.P. (com-
bination not to exceed 10 H.P.)
WE WILL NOT unilaterally change terms and
conditions of employment.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce you in the exer-
cise of the rights guaranteed you by Section 7 of
the Act.
WE WILL recognize and, on request, bargain
with Plumbers and Steamfitters Local Union No.
50 of the United Association of Journeymen and
Apprentices of the Plumbing and Pipe Fitting In-
dustry of the United States and Canada and Local
Union No. 1076, International Brotherhood of
Electrical Workers as the exclusive representative
of our employees in the appropriate unit described
above concerning terms and conditions of employ-
ment and, if an understanding is reached, embody
the understanding in a signed agreement.
WE WILL restore the terms and conditions of
employment that we unilaterally changed and con-
tinue them in effect until we fulfill our bargaining
obligation.
WE WILL make whole employees for any loss of
wages due to our unilateral action and for any ben-
efits we unilaterally discontinued.
WE WILL offer James Neary immediate employ-
ment to the job he would have received if he had
not been discriminated against, or, if that job no
longer exists, to a substantially equivalent position
without prejudice to his seniority or any other
rights or privileges he might have enjoyed, and wE
WILL make him whole for any loss of earnings and
other benefits he suffered as a result of denial of
employment.
SCHMIDLIN, INC.
Rufus L. Warr, Esq., for the General Counsel.
Terrance L. Ryan, Esq., of Toledo, Ohio, for the Re-
spondent.
Jefferson Julius, Esq., of Toledo, Ohio, for the Charging
Party.
DECISION
STATEMENT OF THE CASE
RICHARD H. BEDDOW JR., Administrative Law Judge.
This matter was heard in Toledo, Ohio, on 29 and 30
October 1985.
Subsequent to the close of the hearing the brief due
date was extended in anticipation of the possible settle-
ment. The issues were not resolved and briefs were filed
by all parties.
The proceeding is based on a charge filed 21 May
1985 by Local Union No. 1076, International Brother-
hood of Electrical Workers. The Regional Director's
complaint dated 5 July 1985 alleges that Schmidlin, Inc.
is the alter ego/disguised continuance or the successor of
A-1 Schmidlin Plumbing & Heating Company of Toledo,
Ohio, and that it violated Section 8(aX1), (3), and (5) of
the National Labor Relations Act by refusing to recog-
nize and bargain with the Union, by making unilateral
changes in terms and conditions of employment, and by
refusing employment to James Neary. At the close of the
hearing the General Counsel sought to amend the com-
plaint to include Plumbers and Steam Fitters, Local 50,
as an additional party and to allege that Respondent vio-
lated Section 8(a)(I) of the Act by advising employees
that they would not be hired or continued in employ-
ment if they remained members of the Union. In view of
the conclusions otherwised reached herein and the gener-
al untimeliness of the request, I find that the General
Counsel has failed to show just cause for granting the
relief sought and her motion is denied. See Seaward
International, 270 NLRB 1034 (1984).
A-1 SCHMIDLIN PLUMBING CO. 1511
At the close of the hearing, provisions also were made
for the late filing of an exhibit reflecting work orders of
the two companies and an abstract of information reflect-
ing job assignment The material was submitted in a
single document identified as General Counsel Exhibit 6
and it is received into evidence.
On a review of the entire record in this case and from
my observation of the witnesses and their demeanor, I
make the following
FINDINGS OF FACT
I. JURISDICTION
Both Respondents are Ohio corporations engaged in
sale, installation, and servicing of heating and air-condi-
tioning equipment. Based on respective past and project-
ed business operations gross revenues exceed $500,000
and purchased and received goods valued at a minimum
of $20,000 annually are received from points outside
Ohio. Although Sclimidlin, Inc. denies that the two
Companies are affiliated business enterprises, it otherwise
admits at all times material to being an employer in oper-
ations affecting commerce within the meaning of Section
2(2), (6), and (7) of the Act. Respondent also admits that
the Union is a labor organization within the meaning of
Section 2(5) of the Act.
IL ALLEGED UNFAIR LABOR PRACTICE
A-1 Schmidlin was formed in 1960 and conducted
business at 6810 Door Street in Toledo. It was a member
of Toledo Heating & Air Conditioning Contractors As-
sociation and signatory to the collective-bargaining
agreement with Local Union No. 1076, International
Brotherhood of Electrical Workers and Local Union No.
50 of the United Association of Journeymen and Ap-
prentices of the Plumbing and Pipe Fitting Industry of
the United States and Canada.
An agreement due to expire in June 1985 was renego-
tiated during the summer of 1984 by these groups and on
8 August 1984, Service Manager Charles Schmidlin
signed the assent to the agreement on behalf of A-1
Schmidlin. Subsequently, Charles and his brother Walter
made plans to go into business together and purchase A-
1 Schmidlin. They formed a corporation, Schmidlin,
Inc., and on 27 December 1984 reached an agreement to
purchase the name, vehicles, supplies, equipment, inven-
tory, customer list, accounts receivable, and real estate of
A-1 Schmidlin and to take over the payroll effective 1
January 1985.
During the last week of December all employees were
given a notice by Charles that stated:
December 31, 1984 will be the final day for the
corporation of A-1 Schmidlin Plbg & Htg. Co.
Your checks can be picked up as usual on
Wednesday January 2, 1985 for the termination of
your employment with A-1 Schmidlin. Thanks to
all of you.
On 31 December 1984 a letter also was sent to the
Union's business manager informing the Union that A-1
Schmidlin was that day terminating business.
Charles also gave all A-1 Sclunidlin employees appli-
cations for employment and told them that he and
Walter had formed Sclunidlin, Inc. and would hire any
employee who wanted to work for the new Company.
Charles also testified that he told the three service em-
ployees that were union members that the new Company
would be nonunion. Service employee and union
member James Neary recalled that Charles told him that
he would have to fill out a job application and get a
withdrawal card from the Union. At the time he gave an
affidavit to a Board agent, Charles also stated that: "I
told them if they wanted to stay with the Union, we
wouldn't be hiring them." A further inquiring was made
by the court as follows:
Q. Did you give any other verbal reasons to the
people that you were talking to at that time?
[CHARtEs]: I told them that I couldn't hire them
if they were union people, due to the fact I didn't
have an agreement with the union and I thought
that you had to have an agreement with the union
in order to hire union people and I still did—until I
got in here, I swear that was the way it went.
Q. Did you make that additional statement to
the—
[CHARLES]: That's what I told them in that office
that day, that they could or that they had—that if
they were going to stay with the union, that I
couldn't hire them because I didn't have a contract
with the union.
Neary, who also served as job steward, testified that
after being offered an application he told Charles that he
wanted to talk to the union business manager.
Neary did not fill out an application then or after he
spoke with Business Manager Thomas Curley. At the
advice of the business agent, he showed up at work at
the usual time on 2 January 1985. All other employees of
A-1 Schmidlin had filled out job applications for
Schmidlin, Inc. and also reported for work on 2 January.
The other service employees were given assignments;
however, Neary testified he just sat for a few hours and
then went home. He engaged in some small talk with
Charles, but did not bring up the subject of the new
Company, the Union, or his employment status. Neary
did the same thing on the next 2 days and then apparent-
ly made no further contact with the Company.
Business Manager Curley testified that he received a
letter from A-1 Schmidlin regarding its closing and
called Corporation Secretary Kathleen Vaculik on 3 Jan-
uary to inquire what was going on. She told him A-1
Schmidlin was out of business and that Walter and
Charles had purchased the Company. He inquired about
the status of his three union members and was told that
Roy Williams now was warehouse manager and Ed Va-
culik was field supervisor and that she did not know
about Neary because he had some things to work out
On 15 January Curley sent a letter addressed to the
chief executive office of A-1 Schmidlin addressed to the
subject of "Schmidlin, Inc." in which he referred to the
possibility of contract violation because of A-1's oper-
ations of another company in the performance of unit
1512 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
work. The letter noted that the Union was "investigat-
ing" the filing of a contractual grievance or a Labor
Board charge. It said the Union wished to have a meet-
ing to attempt to determine whether in fact there was a
violation and it requested an answer in 10 days to an at-
tached list of 45 questions pertaining to the detail of
ownership management and operation of the two Com-
panies. No answer was received and, apparently near the
end of January, Curley called the Company and again
spoke with Vaculik who informed him that he would
have to talk with Charles.
No grievance was filed and the Union made no further
communication with Respondents until the filling of the
charge on 21 June. Three days after the filing of the
charge Business Manager Curley visited the Company's
plant site 1 in an apparent attempt to observe and photo-
graph physical indications of ownership. He also contact-
ed the Company's two union members and advised them
that he would not give them the honorary withdrawal
cards that they had requested.
SUCCESSOR/ALTER EGO STATUS
The alleged unfair labor practices are the outgrowth
of the closing of one business and the opening of another
similar enterprise. Under such circumstances, "alter ego"
and related legal obligations generally will be examined
to consider whether the two enterprises have substantial-
ly identical ownership, management, business purpose,
operation, equipment, customers, and supervision. See
Crawford Door Sales Co., 226 NLRB 114 (1976), and
Custom Mfg. Co. 259 NLRB 614 (1981). The addition,
traditional standard for evaluation of "successor" status
and any resulting duty of a successor employer to bar-
gain with a union that represents the predecessor's em-
ployees, includes an inquiry into whether there has been
substantial continuity in business operations, plant, work
force, jobs and working conditions, supervisors, machin-
ery, equipment, and methods of production, and product
or service and derives from the decision of the Supreme
Court in NLRB v. Bums Security Services, 406 U.S. 272
(1972).
Here, the record shows that A-1 Schmidlin was
formed in 1960 by Oscar Schmidlin, the father of Charles
and Walter Schmidlin. Oscar exercised day-to-day con-
trol of the business; however, Mary Lucille Schmidlin,
stepmother of Charles and Walter, was majority stock-
holder and president of the Company. Both Charles and
Walter Schmidlin were given minor shareholds. Walter
liquidated his four shares and left the Company in the
late 1970's. At the time A-1 Schmidlin ceased business,
31 December 1984, Mary Lucille Sclunidlin owned 66
shares, Charles Schmidlin owned 4 shares, and Corpora-
tion Secretary Kathleen Vaculik, daughter of Owner
Mary Lucille, owned 4 shares. Charles worked at vari-
ous jobs for A-1 Sclunidlin, most significantly as service
manager; however, he played no significant role in the
overall management of the Company. He did hold a titu-
lar position as vice president and, on occasion, would ac-
company his father or, at his father's directions, substi-
1 Errors in the transcript have been noted and corrected.
tute for his father in taking some action on behalf of the
Company.
Specifically, Charles accompanied his father to some
labor-management meetings, including one in September
1981, and he was named with his father by the contrac-
tor's association as a representative of A-1 Schmidlin on
a list given the Union in 1979. His father died in 1983
and in August 1984, Charles signed the assent to the bar-
gaining agreement for A-1 Sclunidlin at the direction of
his stepmother. Charles supervised, hired, and fired serv-
ice and installation employees who performed unit work;
however, all retail sales and other business activities
were controlled by his stepmother and stepsister.
Walter testified that he left A-1 Schmidlin in the mid-
1970's because he was not allowed to obtain a managerial
role or further equity in the business. He then engaged in
other similar business ventures on his own. After the
death of his father, Charles became concerned over his
lack of control of company affairs, and in the fall of 1984
joined with Walter in exploring the possibility of a pur-
chase, as suggested by his stepmother.
In November 1984, Schmidlin, Inc. was incorporated
with offices at 5414 Talmadge Road, the location of
Walter's business. The stock of the new Company is
shared evenly by Walter and Charles. Charles resigned
from A-1 Schmidlin on 1 December, and agreement was
reached regarding the sale of the Company, and A-1
Schmidlin ceased doing business on 31 December 1984.
Formal transfer of the assets was delayed by various
legal complications until finalized in April 1985.
Schmidlin, Inc. began operations at the facility owned
by Lucille Schmidlin but made monthly lease payment
until the sale of all assets were finalized in April. Begin-
ning in January, Schmidlin, Inc. began operation in its
own name and with independent legal counsel, bank ac-
count, business permits, pay records, etc. Some name
changes, however, were not make until after April, when
titles were transferred and items such as trucks were re-
painted and signs changed. Kathleen resigned her office
with A-1 Schmidlin effective 31 January and apparently
remained at the business location as office manager for
Schmidlin, Inc. She did not become an officer of
Schmidlin, Inc. and referred outside business inquiries to
Charles. With the start of the new Company, Walter
transferred accounts from his former business. These
transferred accounts make up approximately 25 percent
of Schmidlin, Inc.'s customers.
Under the circumstances presented I conclude that the
record is insufficient to support a finding that there exists
any substantially identical management, supervision, and
ownership between A-1 Schmidlin and Schmidlin, Inc.
Here, I find that Charles (and Walter) held as insignifi-
cant ownership position and were effectively precluded
from the exercise of any meaningful control over the old
Company. The family relationship present in this case
demonstrates a strained accomodation between nonblood
relatives and fails to support an inference of common in-
fluence and control. Despite the noncontrolling fact that
the business remains substantially the same, the new
owners made no attempt at subterfuge and, although
some explainable delays occurred, title changes and other
A-1 SCHMIDLIN PLUMBING CO. 1513
aspects of the transfers were carried out in a reasonably
timely fashion. Also, it otherwise appears that the pur-
chase of A-1 Schmidlin was an arm's-length transaction
for which full and fair consideration was paid. The assets
of the Company were purchased rather than the stock or
the business itself. The actual purchase price for the
assets, including equipment and the customer list, was
$42,000 and an additional $160,000 was paid for the real
property occupied by A-1 Sclunidlin at the Door Street
address and it is shown to be a fair approximation of the
actual value of the business. Finally, it is noted that the
former controlling officials, Lucille and Kathleen, have
no interest or controlling position with the new entity.
Turning to a review of the composition of the work
force in the new Company, it appears that the abstract of
information in General Counsel's Exhibit 6 is based on
underlying service forms that indicate the hours worked
by employees performing unit work for the first 9
months of 1985. The invoices show that old A-1 Schmid-
lin Inc. forms were used until 2 February when newly
printed Schmidlin forms became available. The abstract
shows that eight employees of Schmidlin, Inc. performed
bargaining unit work installing and servicing heating and
air-conditioning equipment. Former A-1 Schmidlin em-
ployees Roy Williams and Ed Va.culik performed a sig-
nificant amount of the work; however, at no time during
the period were less than six employees involved in bar-
gaining unit work during each month and over that
period Roy and Ed accounted collectively only for 43
percent of the hours worked. There was some employee
turnover; however, at least four persons performed sig-
nificant bargaining unit work throughout the period.
Specifically, of a total of 3612 job hours, 1110.57 were
attributable to Roy and Ed, although Roger had 608
hours, Bruce 806.75, Chuck 132.5, Doug 240.5, Jeff
222.5, Chris 150.5, and Jim 220. Accordingly, the ab-
stract shows that the equivalent of at least four employ-
ees consistently perform significant bargaining unit work
for Schmidlin, Inc. that only two of these employees
were members of the original A-1 Schmidlin bargaining
unit, and that a majority of Schmidlin, Inc. unit employ-
ees were not former employees of A-1 Schmidlin.
In addition, the record here also shows that one co-
owner of the new company had his own business engag-
ing in a similar type service and in fact brought alone ac-
counts that comprise 25 percent of the new Company's
business. Under these circumstances, it is clear that
Schmidlin, Inc. is a corporate entity distinct from A-1
Sclunidlin whose creation and entry into business was
not designed to be a "disguised continuance" of a former
business designed to avoid the responsibilities of a collec-
tive-bargaining agreement.
Although a finding of intent to evade union obligation
or antiunion animus is not prerequisite to a finding of
alter ego status, consideration of that factor can be rele-
vaut. Here, it appears that the motivation behind the cre-
ation of the new business was completely independent of
labor-management considerations. And, contrary to the
suggestion of the Charging Party, the record does not in-
dicate any history of union activities or that troublesome
union-management relations or past animus on the part
of any involved managerial personnel played any part in
the creation of a new Company. Moreover, there is no
showing that A-1 Schmidlin engaged in any earlier
unfair labor practices that might set the stage for the not
uncommon situation where a successor corporation is es-
tablished in order to attempt to avoid liability for a pred-
ecessor's actions.
Under these circumstances, I find that a balancing of
all the relevant factors leads to the conclusion that
Schmidlin, Inc. is not an alter ego of A-1 Schmidlin, as
alleged.
In a similar vein, I find that although two of the bar-
gaining unit employees accepted employment with
Schmidlin, Inc., it is shown that a majority of the bar-
gaining unit work subsequently was performed by other
employees and that at all times there were a total of at
least six employees engaged in that type of work.. As in-
dicated below I do not fmd that Schmidlin, Inc. refused
to hire any of its predecessor's employees solely because
of their union affiliation. Compare Shoreline South, Inc.,
276 NLRB 913 (1985), and accordingly, I conclude that
the majority of Schmidlin, Inc. bargaining unit employ-
ees constitute a new work force and I further conclude
that the General Counsel had failed to show that
Schmidlin, Inc. is a legally obligated successor of A-1
Schmidlin, as alleged. See Burns Security Services, supra.
IV. ALLEGED REFUSAL TO BARGAIN OR TO HIRE
JAMES NEARY
All employees of A-1 Schmidlin were offered the op-
portunity to fill out an application for employment with
Schmidlin, Inc. All who did so were hired, Neary how-
ever declined to do so. As Neary testified, Charles
Schmidlin told him that he should get a withdrawal card
from the Union and that Neary responded by stating that
he first wanted to talk to the Union's business agent.
Further testimony by Charles indicates that his statement
to the employees was accompanied by an explanation to
the effect that he could not hire union people because he
did not have a contract with the Union.
The Union responded to Neary's information by advi-
sig him to report to the job the same as usual. Neary did
so and made no attempt to fill out the requested applica-
tion. He also made no further effort to question Charles
about his status or to report to Charles what the position
of the Union was on the matter. The Union, although ad-
vised of the Company changes by Neary and by a letter
from A-I Schmidlin, made no immediate attempt to con-
tact the new Company to fmd out the status of its bar-
gaining unit members or to advise the new Company of
its position regarding the propriety of its members work-
ing for a Company with which it did not have a bargain-
ing agreement.
Nothing of record provides a foundation for drawing
any inference that Charles, Walter, the old Company, or
the new Company had any adverse labor experiences or
animus. There is no showing of any attendant unfair
labor practices by either Company and there is no basis
for finding any antiunion animus or motivation in con-
nection with the hiring of employees of Schmidlin, Inc.
The context in which Charles indicated his belief that
Neary would need a withdrawal card from the Union
1514 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
was conversational and informational in manner and does
not rise to the level of a threat or of a refusal to grant
employment because of union affiliation.
No attempt was made by Neary or the Union to dis-
cuss the question of whether Neary actually needed a
withdrawal card for his own purposes or whether union
members properly could work for the new Company in
the absense of a contract. Even though two other union
members filled out applications and were hired (and sub-
sequently requested withdrawal cards), Neary failed to
take the necessary first step to secure employment. Oth-
erwise, there is no showing that this first step of filling
out an application would have been a futile endeavor.
My review of all the noted circumstances leads to the
conclusion that Neary failed to secure employment with
Schmidlin, Inc. only because he failed to make an appli-
cation for employment. I concluded that the General
Counsel has failed to show that Neary's nonemployment
was attributable to any failure on part of the Respondent,
let alone being attributable to any discriminatory motiva-
tion. Compare Vantage Petroleum Corp., 247 NLRB 1492
(1980). Accordingly, I find that Respondent is not shown
to have violated Section 8(a)(3) and (1) of the Act, as al-
leged.
In a similar vein, the issue is whether Schmidlin, Inc.'s
refusal to bargain also must be resolved on the basis of
the union action or in this case, nonaction in making a
request to bargain. As noted, I have concluded that
Schmidlin, Inc. is not shown to be a successor of A-1
Schmidlin such that it would be obligated to bargain on
the basis of the collective-bargaining agreement with the
latter Company. However, even if some bargaining obli-
gation could be found to exist the record here failed to
show that Neary or anyone else on behalf of the Union
made any request to bargain with Schmidlin, Inc.
Although the record shows that the union business
manager was informed by letter of the termination of
business by A-1 Schmidlin and verbally by Neary of the
commencement of operation by Schmidlin, Inc., the
Union failed to respond with any unequivocal declara-
tion that it planned to represent the former bargaining
unit members or that it desired to negotiate an agreement
or terms and conditions of employment. It did address an
ambiguous letter to the old Company, however, that
letter contained only equivocal references to "possible-
contract violations" and "investigating" the filing of a
contractual grievance or a Labor Board charge and a re-
quest to meet to determine if they had been violated. Al-
though the Union subsequently made one call to the
former Corporate Secretary Kathleen Va.culik, it made
no apparent attempt to follow through on her referral of
the matter to Charles.
It is well established that any duty to bargain that
exists must be activated by a request, and where no re-
quest is made, an effective waiver results. See Clarkwood
Corp., 233 NLRB 1172 (1977), and cases cited therein.
Here, I find that the Union tendered no communication
to either A-1 Schmidlin or Schmidlin, Inc. that can be
considered to be a request to bargain and, accordingly, I
conclude that the General Counsel has failed to show
any violation of the Act as alleged.
Otherwise, I fmd that it is not shown that Schmidlin,
Inc. was not free to set initial terms and conditions for its
employees. See Burns Security Services, supra, and there-
fore I also conclude that it is not shown to have violated
the Act in this respect, as alleged.
CONCLUSIONS OF LAW
1. Respondents A-1 Schmidlin Plumbing and Heating
Company and Schmidlin, Inc. are employers within the
meaning of Section 2(6) and (7) of the Act.
2. Local Union No. 1076, International Brotherhood of
Electrical Workers is a labor organization within the
meaning of Section 2(5) of the Act.
3. Schmidlin, Inc. is neither an alter ego of nor a suc-
cessor to A-1 Schmidlin Plumbing and Heating Compa-
ny for purposes of applying the obligations of Section
8(aX5) of the Act.
4. Respondents did not refuse to bargain with the
Union and have not engaged in conduct violations of
Section 8(a)(5) and (1) of the Act, as alleged in the com-
plaint.
5. Respondents have not engaged in unfair labor prac-
tices within the meaning of Section 8(aX1) and (3) of the
Act, as alleged in the complaint.
[Recommended Order for dismissal omitted from pub-
lication.]