Artcraft Iron Co.

National Labor Relations Board - Board Decisions

Jul 31, 1984

271 N.L.R.B. 829 (N.L.R.B. 1984)

ARTCRAFT IRON CO.
Artcraft Ornamental Iron Co., Inc., and Rich-
Morrow Insurance Agency, Inc. and Shopmen's
Local Union No. 626 of the International Asso-
ciation of Bridge, Structural and Ornamental
Ironworkers, AFL-CIO. Case 9-CA-19591
31 July 1984
DECISION AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
HUNTER AND DENNIS
On 10 February 1984 Administrative Law Judge
Stanley N. Ohlbaum issued the attached decision.
The Respondents filed exceptions and a supporting
brief, and the General Counsel and the Charging
Party Union each filed an answering brief to the
Respondents' exceptions.'
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
conclusions2 and to adopt the recommended
Order. 3
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge and orders that the Respondents, Artcraft
Ornamental Iron Co., Inc., and Rich-Morrow In-
surance Agency, Inc., Columbus, Ohio, their offi-
cers, agents, successors, and assigns, shall take the
I The Charging Party has moved that the Board reject the Respond-
ents' exceptions on the ground that they fail to set forth specifically the
questions of fact or law to which exceptions are taken. Contrary to the
Union, we conclude that the Respondents' exceptions and brief sufficient-
ly designate those portions of the judge's decision which they claim are
erroneous. Accordingly, we hereby deny the Union's motion to strike the
exceptions.
a We agree with the judge that Respondent Rich-Morrow Insurance
Agency is the alter ego of Respondent Artcraft Ornamental Iron. In
adopting this conclusion as well as the judge's remedy for the violations
found, we rely particularly on the evidence that the Respondents effectu-
ated a disguised continuance in order to avoid bargaining with the Union
and that they, in fact, also violated Sec. 8(aX3) of the Act by discharging
six union adherents.
We note that no exceptions were filed regarding the judge's findings
that Respondent Artcraft violated Sec. 8(aX3) by eliminating employees'
Thanksgiving and Christmas bonuses in retaliation for their union activi-
ties and violated Sec. 8(a)(5) by subcontracting certain unit work in Feb-
ruary 1983 without bargaining with the Union and by refusing to provide
the Union with information regarding the alleged sale of its assets to an-
other business concern.
Additionally, we find it unnecessary to rely on the judge's discussion in
fn. 35 of his decision concerning what effect, if any, the possible bank-
ruptcy of Respondent Artcraft would have on this proceeding.
s In adopting the judge's recommendation to issue a broad cease-and-
desist order requiring the Respondents to cease and desist from violating
the Act "in any other manner," we do not rely on his reference to NLRB
v. Entwistle Mfg. Co., 120 F.2d 532 (4th Cir. 1941). Rather, we find a
broad cease-and-desist order to be appropriate because the Respondents
have demonstrated a propensity to violate the Act. See Hickmott Foods,
242 NLRB 1357 (1979).
271 NLRB No. 133
action set forth in the Order, except that the at-
tached notice is substituted for that of the adminis-
trative law judge.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
Section 7 of the Act gives employees these rights.
To organize
To form, join, or assist any union
To bargain collectively through representa-
tives of their own choice
To act together for other mutual aid or pro-
tection
To choose not to engage in any of these
protected concerted activities.
WE WILL NOT violate any of these rights of
yours.
WE WILL NOT interrogate you, in violation of
the Act, concerning your union activities, member-
ship, or desires, or about how you voted in any
election conducted by the National Labor Rela-
tions Board.
WE WILL NOT threaten you that we will shutd
own our plant or go out of business in the event
you become unionized or decide you would like to
bargain with us collectively.
WE WILL NOT attempt to thwart your desire to
bargain with us collectively, nor to evade bargain-
ing with your Union, nor to get around NLRB cer-
tification of your Union as your bargaining repre-
sentative, by terminating your employment and
contracting or subcontracting out your work, or by
transferring our business, for that purpose, to some-
body who does so and aids and abets us in the pur-
pose to avoid and evade the effects of your exer-
cise of your lawful right to bargain collectively
under the National Labor Relations Act.
WE WILL NOT fail to recall any laid-off employ-
ee, and WE WILL NOT discharge or terminate any
employee or fail or refuse to reemploy or hire him
or her because he or she has exercised any right
under the National Labor Relations Act.
WE WILL NOT contract or subcontract your
work out without bargaining in good faith with
your Union.
WE WILL NOT set up any scheme to convert our
business to one where our former foremen are
829
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
named as contractors or subcontractors and our
employees are fired so that we can then use that as
an excuse for not bargaining with the Union which
you elected and which was certified by the Nation-
al Labor Relations Board as specified and required
by law.
WE WILL NOT in any other manner violate our
employees' rights under the National Labor Rela-
tions Act.
WE WILL promptly supply your Union with in-
formation it needs from us in order to bargain
properly for you.
WE WILL retroactively to 1982 reinstate your
Thanksgiving bonuses and your Christmas bonuses
which we discontinued without bargaining with
your Union; and WE WILL pay you those benefits,
with interest.
WE WILL bargain in good faith with your Union
and sign any agreement reached. The appropriate
collective-bargaining unit is:
All production and maintenance employees, in-
cluding structural, ornamental, installation and
miscellaneous department employees employed
by us (or either of us) at our Columbus, Ohio,
facility, but excluding all office clerical em-
ployees, engineering employees, and all profes-
sional employees, guards, and supervisors as
defined in the Act.
WE WILL offer the following persons immediate,
full, and unconditional reinstatement to their
former jobs (or, if they no longer exist, to substan-
tially equivalent jobs), with full seniority, privi-
leges, and benefits, and WE WILL make them whole
for any losses they may have suffered in wages lost
and otherwise, plus interest, since we discharged
them on or about 29 April 1983.
Steve R. Friley Robert William Deal
Ronald Lee
Monroe William M. Diedrich
Wilson Ford Jeffrey F. O'Hara
In the case of Wilson Ford and Jeffrey F. O'Hara,
Artcraft Ornamental Iron Co., Inc. will make them
whole additionally plus interest for wages and
other sums and benefits lost for the period from
February to 29 April 1983, or any part thereof
during which they or either of them were or was
discriminatorily not recalled from layoff, as well as
after 29 April 1983 as in the case of the foregoing
other employees.
ARTCRAFT ORNAMENTAL IRON Co.,
INC., AND RICH-MORROW INSURANCE
AGENCY, INC.
DECISION
STATEMENT OF THE CASE
STANLEY N. OHLBAUM, Administrative Law Judge.
This proceeding1 under the National Labor Relations
Act, 29 U.S.C. § 151 et seq. (the Act), was litigated
before me in Columbus, Ohio, on August 29 through
September 1, 1983, with all parties participating by coun-
sel or other representative and afforded full opportunity
to present evidence and contentions, to propose findings
and conclusions, and to file posttrial briefs which were
received by October 21, 1983, after an unopposed re-
quest for a time extension. Records and briefs have been
carefully considered.
The principal issues are whether Respondent Employ-
ers violated Section 8(a)(l), (3), and (5) of the Act
through interrogation of employees concerning their
union affairs and vote in an NLRB-conducted represen-
tation election; threat of plant closure in case of union-
ization; discontinuance of established Thanksgiving and
Christmas bonuses; unilateral subcontracting of collec-
tive-bargaining unit work; failure to recall to work laid-
off bargaining unit employees; termination of and failure
to recall bargaining unit employees; purported subcon-
tracting of bargaining unit work to supervisory person-
nel; refusal to furnish necessary bargaining information
to bargaining unit Board-certified bargaining representa-
tive; refusal to bargain with Board-certified bargaining
representative of unit employees; and colorable discon-
tinuance of business of Respondent Artcraft Ornamental
Iron Company and transfer to Respondent Rich-Morrow
Insurance Agency as alter ego and successor to avoid
and evade collective-bargaining obligations under the
Act with unit employees' Board-certified bargaining rep-
resentative.
On the entire record and my observations of the testi-
monial demeanor of the witnesses, I make the following
FINDINGS OF FACT
I. JURISDICTION
At all material times, Respondent Artcraft Ornamental
Iron Co., Inc. (Artcraft Iron), an Ohio corporation with
an office and place of business in Columbus, Ohio, has
been engaged in the business of fabricating and installing
structural steel. During the 12 months immediately pre-
ceding issuance of the complaint, a representative period,
in the course and conduct of its business, Artcraft Iron
purchased and received at its Columbus facility directly
in interstate commerce from places outside Ohio prod-
ucts, goods, and materials valued in excess of $50,000.
At all material times since about May 1, 1983, Re-
spondent Rich-Morrow Insurance Agency, Inc. (Rich-
Morrow; Rich-Morrow doing business as Artcraft Iron),
an Ohio corporation with an office and place of business
in Columbus, Ohio, has been engaged in the business of
supplying custom ornamental and structural iron prod-
i The complaint was issued June 14, 1983, as amended at the trial,
growing out of a charge filed by the Charging Party Union on April 26
as amended May 13 and June 3, 1983.
830
ARTCRAFT IRON CO.
ucts to retail and commercial customers. Based on a pro-
jection of its operations since their commencement about
May 1, 1983, Rich-Morrow doing business as Artcraft
Iron will, in the course and conduct thereof, annually
purchase and receive at its Columbus facility directly in
interstate commerce from places outside Ohio products,
goods, and materials valued in excess of $50,000; and,
during the same projected period, in its business oper-
ations, it will annually sell to commercial customers
goods and products valued in excess of $50,000.
I find that, as admitted by Artcraft Iron in its answer
and by Rich-Morrow at the trial, at all material times
Respondent Artcraft Iron has been and is an employer
engaged in commerce within the meaning of Section
2(2), (6), and (7) of the Act; and that at all material times
Respondent Rich-Morrow also has been and is an em-
ployer engaged in commerce within the meaning of Sec-
tion 2(2), (6), and (7) of the Act. I further find that at all
material times the Charging Party Union has been and is
a labor organization as defined in Section 2(5) of the
Act.
II. ALLEGED UNFAIR LABOR PRACTICES
A. Introduction
This case essentially involves the contention by the
General Counsel of the Board and by the Charging
Party Union, disputed by Respondents, that, after sundry
alleged violations of the Act, including impermissible in-
terrogations and threats surrounding a union organiza-
tional campaign to go out of business in the event of
unionization, upon the Board's subsequent certification of
the Union based upon overwhelming vote of the bargain-
ing unit employees in a statutory election under the Act,
Respondent Artcraft Iron (a well-established ironworks
fabricator) in order to frustrate and nullify the outcome
of the official election and the Board's certification, so as
to attempt to escape its bargaining obligation under the
Act, colorably shifted its assets and business to Respond-
ent Rich-Morrow ("doing business as Artcraft Iron"), an
insurance agency owned by the son-in-law of the princi-
pal of Artcraft; so that, under the circumstances, Rich-
Morrow, doing business as Artcraft Iron, as a knowing
participant therein, is the alter ego and successor of Art-
craft Iron, and as such is obligated to bargain with the
Board-certified Union, the Charging Party here.
Since the allegations of the complaint, covering 8
pages and 18 paragraphs, are somewhat awkwardly set
forth, other than chronologically, it will conduce to
clearer understanding of the facts to recast and deal with
them chronologically as they are alleged to have oc-
curred. The following chronological chart synthesizes
them (and related events) accordingly:
Date or Approx. Date
Sep. 23, '82
Oct. 29, '82
Mid-Nov. '82
Mid-Nov. '82 (3
occasions)
Late Nov. '82
Nov. 23, '82
Nov. 24, '82
Dec. 2, '82
Dec. 25, '82
Since Jan. 19, '83
Allegation or Event
Union files petition for
NLRB election
NLRB Reg. Dir. issues
Decisions and Direction
of Election (Case 9-RC-
14152)
Interrogation by Artcraft
through Supervisor
Graham
Threat of plant closure for
unionization by Artcraft
through Supervisor
Graham
Interrogation re NLRB
election vote by
Artcraft through
Supervisor Graham
Board-conducted election;
Union elected
overwhelmingly as
bargaining rep. of
Respondent's unit
employees
Discontinuance of
established
Thanksgiving bonus
practice
Union certified by NLRB
Discontinuance of
established Christmas
bonus practice
Refusal to provide Union
with required bargaining
information
Respondent(s) Involved2
A
A
A
A
A
A & R-M
Complaint par(s).
7(a), 15, & 183
7(b), 15, & 183
7(c), 15, & 18s
8(a), 16, & 183
9(b)
8(a), 16, & 183
1l(a), 11(c) 12, 17a; e , &
18s;6
I A: Artcraft Iron; R-M: Rich-Morrow doing business as Artcraft Iron.
3 Second paragraph 16 of complaint misnumbered 16 instead of 18.
4 Date (i.e., year) as amended at the trial.
6 Second paragraph 15 of complaint misnumbered 15 instead of 17.
8 Pars. 17 and 18 under the General Counsel's trial-end motion, grant-
ed without opposition, to conform pleadings to proof
Act Sec(s).
8(aX1)
8(aXI)
8(aXI)
8(aX)) & (3)
8(a)(1) & (3)
8(aXl) & (5)
831
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Date or Approx. Date
Feb. 2, '834
Mid-Feb. '83
Since Apr. 28, '83
Since Apr. 28, '83
Apr. 29, '83
May 1, '83
Since takeover of A by
R-M (on or about
April 29, 1983)
Allegation or Event
Bargaining unit work
subcontracted out
unilaterally
Failure to recall laid-off
unit employees O'Hara
& Ford
Refusal to provide Union
with info. re alleged
transfer of business from
A to R-M
Refusal to bargain with
NLRB-certified Union
R-M succeeds to business
of A, including
inventories and
contracts for work in
progress
A terminates 6 employees;
R-M refuses to
reemploy them, instead
ostensibly
"subcontracting" their
work to its own
supervisors
R-M is alter ego and
successor of A
Respondent(s) Involved2
A
A & R-M
A & R-M
A & R-M
A & R-M
A & R-M
A& R-M
Complaint par(s).
10(a), 10(c), 175 , & 183
8(b), 8(e), 16, & 183
Act Sec(s).
8(a)(1) & (5)
8(a)(1) & (3)
11(b), 11(c), 12, 175, & 183 8(a)(1) & (5)
13, 14, 175, & 183 8(a)(l) & (5)
4(a), 4(b) & 4(c)
8(c), 10(b), 10(c), 16, 174 , 8(a)(1) & (3)
& 183
4(a), 4(b), & 4(c) 8(a)(1), (3), & (5)
It is to be noted that Respondents rested their case, at
the close of General Counsel's case, without calling any
witnesses.
B. Facts as Found
1. Respondent Artcraft Iron: September 1982-April
29, 1983
Artcraft Iron, in business for almost 50 years (i.e.,
since 1936) in Columbus, Ohio, is a long-established
fabricator/seller/installer of structural ironwork, includ-
ing beams, columns, and framing members for buildings,
as well as decorative and also ordinary ladders, stair-
ways, and railings, some bearing its logo "Artcraft" (and
some of its other registered logo "Trashmaster"). Person-
nel of Respondents who figure in events to be described
are:
Arthur ("Art") L. Braun: president and principal (alleg-
edly 51 percent shareholders ) of Respondent Artcraft
Iron; brother of Walter Brown; uncle of Jeffrey Louis
Brown, general manager of Respondent Artcraft Iron
and also of Respondent Rich-Morrow doing business as
Artcraft Iron.
Walter ("Wally") Brown: vice president and principal
(allegedly 49 percent shareholder) of Respondent Art-
craft Iron; brother of Arthur L. Braun and father of Jef-
frey Louis Brown; now allegedly a salesman for Re-
spondent Rich-Morrow doing business as Artcraft Iron,
but performing same duties there as he had for some 30
years with Respondent Artcraft Iron.
Jeffrey ("Jeff') Louis Brown: general manager of Re-
spondent Artcraft Iron (at $450 per week) to April 29,
7 According to testimony of Jeffrey Louis Brown, general manager of
each of Respondents, all records of stock ownership in Artcraft Iron
were destroyed by water in the basement of Artcraft Iron's former attor-
ney.
1983; since April 29, 1983, general manager of Respond-
ent Rich-Morrow doing business as Artcraft Iron (at
$550 per week).
Helen Liles ("Lisles"): bookkeeper, secretary, and re-
ceptionist for Respondent Artcraft Iron and also for Re-
spondent Rich-Morrow doing business as Artcraft Iron.
Mildred A. Brown: wife of Walter Brown and mother
of Jeffrey Louis Brown; relief to Helen Liles under Re-
spondent Rich-Morrow doing business as Artcraft Iron
as well as under Respondent Artcraft Iron.
June L. Braun: wife of Arthur L. Braun.
Ward Argust: president and sole principal of Respond-
ent Rich-Morrow; son-in-law of Arthur L. Braun and
husband of latter's daughter Cheryl Braun Argust (who
is also an officer of Respondent Rich-Morrow).
According to Jeffrey Louis Brown, general manager
of each of Respondents and nephew of enterprise found-
er Arthur L. Braun, the building housing the business
operations here of Respondent Artcraft Iron (and, as will
be shown, subsequently without interruption and current-
ly of Respondent Rich-Morrow doing business as Art-
craft Iron) was and continues to be owned by Arthur L.
Braun and was occupied by Respondent Artcraft Iron
for some 30 years under oral lease from Arthur L.
Braun, the president and principal of Respondent Art-
craft Iron. Also according to Jeffrey Louis Brown, all
equipment of Respondent Artcraft Iron was owned by
Arthur L. Braun and not by Artcraft Iron. (As will be
shown infra, it is claimed that lease as well as equipment
were, following the Charging Party Union's certification
by the Board as bargaining representative following the
officially conducted election, turned over to Respondent
Rich-Morrow doing business as Artcraft Iron-thereby,
under circumstances to be shown, according to Respond-
ents, extinguishing or rendering nugatory any bargaining
obligation notwithstanding the official certification.)
832
ARTCRAFT IRON CO.
Union organizational activity commenced among Re-
spondent Artcraft Iron's employees in late August 1982.
On September 23, 1982, the Charging Party Union filed
its petition with the Board's Cincinnati, Ohio Regional
Director, upon the requisite showing of employee inter-
est, seeking certification as bargaining representative for
a conventional production and maintenance unit of Art-
craft Iron's employees (G.C. Exh. 3); and on October 29,
1982, the Regional Director issued his Decision and Di-
rection of Election under the Act (G.C. Exh. 4). That
election was held on November 23, 1982. Prior thereto,
however, as well as shortly thereafter, a number of viola-
tions of the Act by Respondent Artcraft Iron are alleged
to have occurred.
a. Interrogations
The complaint (pars. 7(a), 7(c), 15, and 188) alleges
that in mid-November 1982 Respondent Artcraft Iron,
through its department supervisor David Graham, con-
ducted employee interrogation in violation of Section
8(a)(1) of the Act concerning union activity and NLRB
election balloting. In support of these allegations, Art-
craft Iron former employee William Reverody Ford tes-
tified that on several occasions, 2 or 3 weeks before the
election, Supervisor Graham, after remarking to Ford
that he had been "awful quiet," asked him how he felt
about the Union. Ford replied that he favored it for job
security. Another former employee, Robert William
Deal, testified that in December 1982, shortly after the
election, Graham questioned him on whether he was in
favor of the Union; Deal replied, "I don't know yet."
Still another former employee, William M. Diedrich, tes-
tified that, shortly after the election, Graham also ques-
tioned him how he felt about the Union (which had just
been voted in overwhelmingly by the employees); as
fellow employee Ford, Diedrich also responded noncom-
mittally, "I really don't know." Yet another former em-
ployee, Steve Friley (who had been in Artcraft Iron's
employ for around 5 years), was similarly approached by
Graham about an hour after the Board-conducted elec-
tion and asked how he had voted; his response was, "It
[is] none of [your] business."
All of the above-named four former employees im-
pressed me, to my close observation, as sincere and I
credit their testimony, which was totally uncontroverted
by Graham or in any other way. (All four employees
were subsequently terminated.) I accordingly find the
complaint allegations concerning unlawful interrogation
established substantially as alleged.
b. Threats of plant closure in case of unionization
The complaint (pars. 7(b), 15, and 189) also alleges
that in mid-November 1982 Artcraft Iron Department
Supervisor Graham threatened employees with plant clo-
sure in the event of unionization. No less than five of
Artcraft's former employees-Monroe, Friley, Diedrich,
Deal, and Ford, all since terminated-testified credibly
to this effect, again without any contradiction of their
8 See fn. 3 supra.
9 See fn. 3 supra.
testimony. Thus, after hearing plant principal Arthur
Braun state, in September 1982, that "I'll shut the f-ing
doors before the union comes in," former employee
Ronald Lee Monroe also heard Department Supervisor
Graham state to him and several other employees, about
a week before the ensuing Board-conducted election,
"[General Manager] Jeff [Brown] would put a chain
around the building, and a padlock to match it, before
the union would come in." Monroe further testified that
also prior to this, after the inception of union organiza-
tional activity, his supervisor Graham had also stated
that "Artcraft never was union, never would be union,
and before they was, Jeff [Brown] would shut the doors
or sell out." Former employee Friley credibly testified,
in a similar vein, that on about a half-dozen occasions
during the month before the Board-conducted election
Graham repeatedly stated to him and another employee,
"[I]f the union [gets] in . . . within six months the place
would shut down, and [you would] be looking for
work." Employees Diedrich, Deal, and Ford testified
credibly to the same effect.
Monroe further testified credibly and without contra-
diction that on April 21, 1983, he was threatened by Art-
craft Iron Foreman John Graham that Manager "Jeff
Brown was going to subcontract out the individual
[work] bays to each one of the foremen and they would
keep who they wanted, and whoever they didn't want.
they'd let go."
The testimony of these witnesses is totally uncontro-
verted, Respondents having elected without explanation
to rest without producing any witnesses.
Crediting the uncontradicted testimony of the indicat-
ed five former employee witnesses on this subject, I find
the complaint allegations concerning unlawful threats of
plant closure in the event of unionization established.
c. Discontinuance of established Thanksgiving and
Christmas bonus practice
As indicated above, the official Board-conducted elec-
tion took place on November 23, 1982, resulting in an
overwhelming vote in favor of representation by the
Charging Party Union. One day later, on November 24,
Respondent Artcraft Iron summarily discontinued its es-
tablished Thanksgiving bonus practice ($15 gift certifi-
cate) and also, on Christmas, its established Christmas
bonus practice (S50-$125)--the latter, at least, clearly
unilaterally since the Union had meanwhile on Decem-
ber 2 been officially certified by the Board as bargaining
representative (G.C. Exh. 5).
The complaint (pars. 8(a), 16, and 1810) alleges that
Respondent Artcraft Iron took these actions, in violation
of Section 8(a)(1) and (3) of the Act, in reprisal against
its employees for exercising their right to bargain collec-
tively as guaranteed by the Act, and to discourage such
activity.
It being established through credited and, again,
wholly uncontroverted testimony of the General Coun-
sel's witnesses Ronald Lee Monroe and William L.
Purdy that Respondent Artcraft Iron indeed took the de-
'10 See fn. 3 supra.
833
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
scribed actions, and without bargaining (cf. Fibreboard
Corp. v. NLRB, 379 U.S. 203 (1964)); NLRB v. Katz, 369
U.S. 736 (1962), and this Respondent having wholly
failed to answer or to rebut or disestablish by preponder-
ating or indeed by any evidence whatsoever the General
Counsel's prima facie showing of a violation in this
regard, or in any way to demonstrate that its described
actions were for a reason or reasons other than in repris-
al, retaliation, and to discourage protected concerted ac-
tivities under the Act, I find the complaint allegations in
this regard established. See NLRB v. Transportation Man-
agement Corp., 462 U.S. 393 (1983).
d. Failure and refusal to furnish required bargaining
information
Subsequent to the Board's December 2, 1982 official
certification of the Charging Party Union as bargaining
representative of the unit employees, bargaining ostensi-
bly commenced in January 1983. It has gotten nowhere
at all, the eventual outcome being Respondent Artcraft
Iron's shiftover of its business at the end of April 1983 to
Respondent Rich-Morrow doing business as Artcraft
Iron, under circumstances to be described, since when
Respondent Artcraft Iron denies any bargaining obliga-
tion on the ground it is no longer in business and no
longer has any employees, and Respondent Rich-
Morrow doing business as Artcraft Iron denies any bar-
gaining obligation on the ground that the Board's certifi-
cation does not extend to it since it is neither an alter ego
of nor a successor to Artcraft Iron.
Since the inception of bargaining in January 1983,
however, as alleged in the complaint (pars. 11(a), 11(c),
12, 17,"1 and 1812), the Charging Party Union has, as es-
tablished by uncontradicted credited testimony of the
General Counsel's witnesses Deal, O'Hara, and Purdy,
sought and requested information necessary to the con-
duct of collective bargaining regarding hire dates and
rates of pay and cost factors on insurance, vacations, and
holidays. Although these are wholly usual and conven-
tional items of information, needed and invariably sought
by and required to be furnished to bargaining representa-
tives as essential to informed collective bargaining,s the
Union's requests for this information have, as established
by uncontradicted credited evidence, been unavailing. 1 4
' See fns. 5 and 6 supra.
12 See fn. 3 supra.
is See generally NLRB v. Truitt Mfg. Co., 351 U.S. 149 (1956); Curtiss-
Wright Corp. v. NLRB, 347 F.2d 61 (3d Cir. 1965); NLRB v. Whitin Ma-
chine Works, 217 F.2d 593, 594 (4th Cir. 1954), cert. denied 349 U.S. 905
(1955). Re: hire and wage data, see NLRB v. F. W Woolworth Co., 352
U.S. 938 (1956), summarily reversing, without argument or opinion, 235
F.2d 319 (9th Cir. 1956); Puerto Rico Telephone Co. v. NLRB, 359 F.2d
983 (Ist Cir. 1966); Curtiss-Wright, supra; Woodworkers v. NLRB, 263
F.2d 483, 484 (D.C. Cir. 1959); Whitin Machine Works, supra. Re: insur-
ance cost data, see NLRB v. Borden, Inc., 600 F.2d 313 (Ist Cir. 1979);
Sylvania Electric Products v. NLRB, 358 F.2d 591 (Ist Cir. 1966), cert.
denied 385 U.S. 852 (1966); NLRB v. John S. Swift Co., 277 F.2d 641 (7th
Cir. 1960). Re: vacations and holidays cost data, see Curtiss-Wright, supra;
Weber Veneer & Plywood Co., 161 NLRB 1054 (1966).
14 The only item supplied by Respondents has been a copy of a hospi-
tal plan brochure and the name and telephone number of an insurance
company. This clearly does not comply with the indicated requests.
It is accordingly found that Respondents have failed,
without justification, to supply the Charging Party
Union with the indicated necessary and properly re-
quired bargaining data as alleged in paragraphs 11(a) and
1l(c) of the complaint.
e. Unilateral subcontracting of unit work by
Respondent Artcraft Iron
The complaint (pars. 10(a), 10(c), 1715 and 181 i) also
alleges that in early February 1 9 83 t7 Respondent Art-
craft Iron, in further violation of Section 8(a)(1) and (5)
of the Act, unilaterally without bargaining with the
Charging Party Union subcontracted unit work to non-
unit personnel.
Concerning this, Respondent Artcraft Iron's former
production employee Ronald Lee Monroe testified credi-
bly and without contradiction that when he returned to
his regular job of spray painting in February 1983, after
a month's layoff subsequent to the Board's certification
of the Charging Party Union, he observed for the first
time since he had started there in 1979 his two cousins
Steve and Kevin Hern, operating under the style of
"H&H Fabrication," building front-load containers
("dumpsters") as "subcontractors"; and he himself (i.e.,
Monroe), by arrangement with Artcraft Iron General
Manager Jeffrey Brown, was paid for spray painting
them after his regular working hours by check of H&H
Fabrication, although he used Artcraft Iron's materials in
doing the job. Monroe explained here that, although the
iron fabrication work was performed by these subcon-
tractors, production employees of Respondent Artcraft
Iron were fully capable of doing it.
Respondent Artcraft Iron's only possible explanation
for subcontracting out the above-described unit work in
February 1983 unilaterally and without bargaining with
the Board-certified Union was suggested by its general
manager Jeffrey Brown, who, called by the General
Counsel as an adverse witness, while conceding that this
work had indeed been subcontracted out over the period
from February until July 1983 (and thus also encompass-
ing and involving Respondent Rich-Morrow doing business
as Artcraft Iron, which allegedly took over the entire
business about April 28-May 1, 1983, as will be shown
infra), stated that an earlier fabrication of such dump-
sters, some 10 years before, had not been done by Art-
craft Iron but by an outside contractor. This, however,
neither explains nor excuses the unilateral subcontracting
out of this work in February-July 1983, after the Union's
certification, since the unit employees had the capability
of doing it (indeed, employee O'Hara had actually
worked on dumpsters) and, furthermore, concededly (ac-
cording to General Manager Brown) it was done on Re-
spondents' premises with their own materials and equip-
ment. General Manager Brown further conceded that, in
addition to the February-July 1983 subcontracting of
dumpster fabrication to nonunit employees, no less than
perhaps seven other subcontracts were let out around
'6 See fn. 5 supra.
t" See fn. 3 supra.
' See fn. 4 supra.
834
ARTCRAFT IRON CO.
this time to outside, nonunit subcontractors involving
unit work, in some instances even performed on Re-
spondents' own premises but by nonunit personnel. The
excuses advanced at the hearing for these instances were
that the jobs were incidental or that the unit employees
might have been otherwise busy, if not on layoff. The
fact remains, however, that so far as these instances of
contracting out of unit work occurred subsequent to the
Charging Party Union's certification they were likewise
unilateral.
Under these circumstances, I find the allegations of the
indicated complaint paragraphs, concerning unilateral
subcontracting in February 1983, established. Cf. Fibre-
board Corp. v. NLRB, 379 U.S. 203 (1964); NLRB v.
Katz, 369 U.S. 736 (1964).
f. Failure to recall temporarily laid-off unit employees
O'Hara and Ford
The complaint alleges (pars. 8(b), 8(e), 16, and 1818)
that in mid-February 1983, following a temporary layoff
subsequent to the Union's certification, Respondent Art-
craft Iron failed to recall its unit production employees
O'Hara and Ford, although other employees were re-
called.
Jeffrey F. O'Hara had been in Respondent Artcraft
Iron's employ as an all-around layout man/fitter/welder
and field crane operator for 1-1/2 years as of his layoff
at the end of December 1982. No contention is raised
that his work was in any way unsatisfactory. However,
he also happened to have been the kingpin and key union
organizer in the shop, as well as the union observer at
the Board-conducted election. He had been openly
active on behalf of the Union and wore a union T-shirt
at work and attended all contract negotiating sessions in
this plant highly hostile to any union sentiment. His
father-in-law was also, to the knowledge of Respondent
Artcraft Iron department supervisor Shelby McFarland
Sr., as well as throughout the plant, a full-time union
representative. When it came time to recall the employ-
ees to work in February, O'Hara was, for no visible
reason or explanation here, not recalled-nor has he ever
been.
Similarly, Respondent Artcraft Iron's former experi-
enced welder Wilson Reverody Ford, who was also
openly advocative of the Union and wore a union T-shirt
at work even though twitted on the subject by General
Manager Brown ("Just because they gave you beer and
T-shirts it don't mean you have to vote for them"), was
also laid off in December 1982 shortly following the
Union's certification by the Board, even though a week
before the Board-conducted election General Manager
Brown had stated he saw no prospect of a layoff and
that a new job was coming up in April (1983). At the
time of his December (1982) layoff, Ford received a
letter indicating the reason was that work was "slow,"
rating his work as "commendable," and that he would be
recalled with a pickup of work. Among other things,
Ford, an experienced welder, is (as stipulated on the
record) capable of welding dumpsters (i.e., work unilat-
erally subcontracted out in February-July 1983). How-
' 8 See fn. 3 supra.
ever, as with O'Hara, supra, Ford has, without visible
reason or explanation here, never been recalled.
In both of these cases-O'Hara and Ford-considering
their work qualifications and capabilities, their prior sat-
isfactory work performance, the recall of others not
shown to have equivalent, much less superior, qualifica-
tions or seniority, and the fact that there was substantial
work on hand to be done in (as well as after) February
1983, within the frame of reference of their openly
known and avowed union organizational activity, the
General Counsel has succeeded in establishing, I find, a
prima facie case of failure to recall by reason of those
union activities; and, since Respondents have elected,
without explanation, not only to adduce no preponderat-
ing countervailing proof, but none at all, I find the com-
plaint allegations under discussion established. See
NLRB v. Transportation Management Corp., 462 U.S. 393
(1983).
g. Failure and refusal to bargain with Board-certified
Union since April 28, 1983, or to supply Union with
requested data
The complaint further alleges (pars. 11(b), 11(c), 12,
13, 14, 1718 and 1820) that since April 28 Respondents
have failed and refused to bargain with the Charging
Party as the Board-certified collective-bargaining repre-
sentative of the unit employees, including failure and re-
fusal to provide the Union with necessary information
concerning an alleged block transfer and shifting, on and
around that date, of the business of Respondent Artcraft
Iron to Respondent Rich-Morrow doing business as Art-
craft Iron.
Credited, uncontradicted testimony establishes that
since the time of the purported shiftover of the business
operations and assets of Respondent Artcraft Iron to Re-
spondent Rich-Morrow doing business as Artcraft Iron,
under circumstances detailed infra (sec. II,B,2), neither
Respondent has bargained with the Board-certified
Union-Respondent Artcraft Iron seemingly on the basis
that it has purportedly gone out of business and there is
no longer any bargaining unit of its employees; and Re-
spondent Rich-Morrow doing business as Artcraft Iron
seemingly on the basis that there is no longer any bar-
gaining unit, that the Union holds no certification appli-
cable to it, and that, unlike its predecessor, Respondent
Artcraft Iron, it is under no obligation to bargain with
the Union. The Union's certified letters requesting bar-
gaining and data concerning the transfer (G.C. Exhs. 19
and 20) have been unanswered and unavailing.
The circumstances of the purported business transfer,
and the related contentions of the parties, are considered
below. Meanwhile, however, it is found, without contest,
that, as alleged in the complaint, since April 28, 1983,
Respondents and each of them have continued to fail and
refuse to bargain with the Charging Party Union, includ-
ing failing and refusing to provide data concerning the
alleged transfer and shiftover of the business and assets
"9 See fn. 4 supra.
20 See fn. 3 supra.
835
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
of Respondent Artcraft Iron to Respondent Rich-
Morrow doing business as Artcraft Iron.
We proceed, then, with a description and consider-
ation of that transfer and shiftover.
2. Shiftover to Respondent Rich-Morrow doing
business as Artcraft Iron of business and assets of
Respondent Artcraft Iron: April 1983 to present
According to the complaint (pars. 4(a), 4(b), 4(c), 8(c),
10(b), 10(c), 16, 1721 and 1822), as fleshed out by the
proof, around April 28-May 1, 1983, and continuing
since then, as a feature of a unilateral purported transfer
nrd shiftover of the business and assets of Respondent
krtcraft Iron to Respondent Rich-Morrow doing busi-
ness as Artcraft Iron, all employees in the Board-certi-
fied bargaining unit have been unilaterally discharged
and the business unilaterally purportedly converted to an
operation under which the former supervisors purport as
"independent contractors" to employ the former bargain-
ing unit employees, in a colorable scheme to do away
with the certified bargaining unit and eradicate the offi-
cial Board certification and thereby eliminate the Charg-
ing Party Union as the duly elected statutory bargaining
representative of the employees, it being further alleged
that under the circumstances Respondent Rich-Morrow
doing business as Artcraft Iron is a disguised continu-
ation and alter ego of and successor to Respondent Art-
craft Iron.
Against the background of uncontested unfair labor
practices and violations of the Act already portrayed and
found (secs. IIA and IIB, supra), the further underlying
facts are as follows.
Credited testimony of Respondent's former shop fore-
man and department supervisor Shelby E. McFarland
Sr., testifying as the General Counsel's subpoenaed wit-
ness, establishes without contradiction that in early April
1983 he was informed by General Manager Jeffrey
Brown, after some "six months" of study by Respondent
(i.e., since shortly after the advent of the union organiz-
ing activity-bearing out Respondent's prediction,
supra), that "to improve on the whole business operation
. . .we foremen would have the first opportunity to go
into the subcontracting position . . . May Ist," but in-
volving no outlay or monetary expense on the part of
the subcontractors, who would continue to operate in
Respondent's premises as when they were foremen, with
Respondent's facilities and goods and supplies and even
Respondent's bookkeeping and other support-in other
words, essentially no change except in nomenclature.
Credited, uncontroverted testimony of McFarland fur-
ther establishes that about 2 weeks later-i.e., in mid-
April 1983-he as well as the other foremen were assem-
bled by General Manager Brown and also Respondent
Artcraft Iron's president and principal, Arthur Braun's
son-in-law Ward Argust, both of whom in essence de-
scribed the same plan. There is no indication that any-
thing was said about any sale or transfer of the business
of Respondent Artcraft Iron to Respondent Rich-
21 See fn. 4 supra.
22 See fn. 3 supra.
Morrow Insurance Agency, Inc. (of which Braun's son-
in-law Ward Argust was president).
Credited and uncontroverted testimony of Respond-
ent's former employee Steve Friley-who had been in its
employ for about 5 years, as a painter, welder, forklift
driver, and field erector, until his termination on April
29, 1983-further establishes that toward the end of
April 1983, General Manager Jeffrey Brown informed all
of the shop employees, in the presence of General Man-
ager Jeffrey Brown's father, Wally Brown (vice presi-
dent and a principal of Respondent Artcraft Iron),
"Well, boys, the sh-t's done hit the fan," and that "a
company in Mansfield" (without disclosing the identity
to be Respondent Rich-Morrow Insurance Agency, Inc.
of Mansfield, Ohio, about 75 miles distant, owned by
Arthur Braun's son-in-law Ward Argust, who lives in
Mansfield) was taking over. When asked if this was "an
easy way to get out of the union," Brown denied it.
Brown also told the employees that if they wanted work
(i.e., at the very same plant, at the very same operation,
at their very same work) to "talk to the foremen." (As
will be shown, Friley was never permitted to work there
again, although there was ample work on hand.)
Credited, uncontroverted testimony of former employ-
ee Ronald Lee Monroe-a spray painter, layout man,
welder, and miscellaneous equipment operator in Re-
spondent Artcraft Iron's employ for some 4 years until
he also (with the other unit employees) was terminated
on April 29-establishes that on April 21 foreman and
department supervisor David Graham told him General
Manager Jeffrey Brown was going to contract out the
individual work bays at Respondent Artcraft Iron's
premises to its foremen and subcontract the Company's
work to them; and that when the production employees
met with General Manager Brown on Wednesday, April
27 (2 days before their termination), and asked him to ex-
plain what was going on, Brown's response was merely
that he had sold the Company to "a company in Mans-
field," the name of which he declined to disclose, but he
assured the men that the same usual staff would still con-
tinue to do the bidding on jobs. In response to a ques-
tion, he denied the purpose was "to get out of the
union." As in the case of unit employee Friley, supra,
Monroe, who likewise was openly and avowedly a union
backer and who was on the union bargaining committee,
also was at all times after his termination refused work,
although it was being done by others as well as by
former supervisors.
Former employee Robert William Deal-layout man,
fitter, welder, and outside erector-also testified credibly
and without contradiction that at a previously scheduled
bargaining session on April 28 General Manager Brown
refused to bargain any more on the ground the "compa-
ny had been sold." Ward Argust, who was standing by,
said nothing, merely nodding "yes" or shaking his head
"no" when questions were directed to Brown, who
stated he did not know to whom the company had been
sold. As in the cases of Friley and Monroe, Deal also,
who was likewise on the bargaining committee, has been
refused employment at all times since his termination on
April 29, although he observed work to be on hand with
836
ARTCRAFT IRON CO.
others including new employees working there. Deal's
account of what occurred at the scheduled April 28 bar-
gaining session is corroborated by former employee Jef-
frey F. O'Hara (layout man, fitter, welder, and field
crane operator), another ardent unionist who likewise
has never been given any work after his layoff on De-
cember 31, 1982. Finally, credited and uncontradicted
testimony of the Charging Party Union's district repre-
sentative, administrator, and chief bargaining spokesman
William L. Purdy further establishes that not until the
negotiating session scheduled for April 28, 1983-1 day
before the Friday, April 29, termination of Respondent's
unit employees-was he told, at that brief session, by
General Manager Brown that there would be no meeting
or further negotiations because "the company had been
sold"; and that, in response to questioning, Brown
claimed he had been unaware of the pending sale and did
not know the identity of the purchaser.2 8 At no time had
Respondent Artcraft Iron indicated to the Union that it
contemplated any change in the nature of its operations,
including subcontracting, 2 4 nor did it bargain with
regard to it.
Respondents' answers admit that about April 29, 1983,
Respondent Rich-Morrow purchased Respondent Art-
craft Iron's inventory and contracts for work in progress.
On April 29, 1983, the Union wrote a letter by certi-
fied mail to General Manager Brown and Respondent
Artcraft Iron, received by Brown a few days later, re-
questing further dates for bargaining (G.C. Exh. 19). The
letter was neither answered nor acknowledged. Again on
May 16, 1983, the Union wrote another certified letter to
Brown and Respondent Artcraft Iron (receipted for May
17) requesting the identity of the new owner, for the pur-
pose of continuation of bargaining (G.C. Exh. 20). That
letter was likewise neither answered nor acknowledged.
Nor has any communication between the parties oc-
curred since then other than in this proceeding.
Meanwhile, about April 29, 1983, all six unit employ-
ees of Respondent Artcraft Iron 25 were, concededly, ter-
minated, without notice to or bargaining with the Union
in any way, including as to the intended terminations or
as to the effect thereof. None has ever been rehired. Re-
spondent's foreman Graham's uncontroverted threat to
Monroe that Manager "Jeff Brown was going to subcon-
tract out the individual [work] bays to each one of the
foremen and they would keep who they wanted, and
whoever they didn't want, they'd let go," will be re-
called.
It is undisputed that all unit employees were terminat-
ed on April 29, 1983 (Friday), and it is stipulated that
"[c]ommencing on or about May 1, 1983 [Sunday], Re-
spondent Rich-Morrow contracted work previously done
by employees of Respondent Artcraft to among others
Shelby McFarland, David Graham, John Graham and
23 The uncontroverted proof establishes that by no stretch of the
imagination may the parties be regarded as having arrived at impasse,
and I so find.
24 Other than the subcontracting of dumpster work (supra sec. 11I,B,I),
which had been done unilaterally and without bargaining with or agree-
ment of the Union.
a" I.e., Robert William Deal, William M. Diedrich, Wilson Ford, Steve
R. Friley, Ronald Lee Monroe, and Jeffrey F. O'Hara.
Chuck McConnell" (G.C. Exh. 6, par. 3), of whom, other
than John Graham, all are stipulated to have been super-
visors and agents, within the meaning of the Act, of Re-
spondent Artcraft through April 29, 1983 (id. par. 1).
Respondents' (i.e., both Respondents') general manager
Jeffrey Brown and Respondent Rich-Morrow president
and principal Ward Argust were called only by the Gen-
eral Counsel as adverse witnesses and testified as such.
(As indicated before, both Respondents rested at the con-
clusion of the General Counsel's case without calling any
witnesses.) Both Brown and Argust described the nature
of the purported transfer/shiftover transaction between
Respondents about April 29, as well as the nature of the
business before and after that date. These subjects will
now be delineated.
Respondents' general manager Brown (son of Re-
spondent Artcraft Iron's vice president and principal
Wally Brown and nephew of its president and principal
Arthur L. Braun, father-in-law of Respondent Rich-Mor-
row's president and principal Ward Argust) testified that
he was general manager of Respondent Artcraft Iron, at
$450 per week, until April 29, 1983, when he executed a
"bill of sale" and an "agreement for purchase of assets"
to Respondent Rich-Morrow and, without hiatus in busi-
ness operations or execution of his duties, became gener-
al manager of Respondent Rich-Morrow at $550 per
week. For practical purposes, he ran Respondent Art-
craft Iron and now runs Respondent Rich-Morrow,
which also does business-the same business, at the same
location, with the same machinery and equipment, and
essentially, with the exception of the terminated unit
Union employees, the same personnel-as Artcraft Iron.
According to Brown, the only real alleged change was
that the foremen ("department supervisors"-see stipula-
tion, G.C. Exh. 6) were designated as subcontractors and
they allegedly had the rank-and-file (unit) employees
working for them (i.e., the foremen) instead of for Re-
spondent. But the mechanics of this alleged arrangement
are interesting. The foremen continued to do so substan-
tially what they had previously done, and so did the
rank-and-file (unit) employees, on the same premises (i.e.,
Respondent's/Respondents' premises), using all of the
same facilities, machinery, and equipment (i.e.,
Respondent's/Respondents') without change or charge,
including even Respondent's/Respondents' same book-
keeper/secretary/receptionist (Helen Liles), who took
charge of and who ran all of the foremen's books and
records. No foreman made any monetary investment
whatever. In some instances, former foremen were
teamed up, as of May 1, 1983, with certain favored
former rank-and-file (unit) employees2 6 to form alleged
'" E.g., former supervisor David Graham was teamed up with his
brother, rank-and-file (unit) employee Ben Graham, as "Creative Metals";
former supervisor Chuck McConnell was teamed up with rank-and-file
(unit) employees Bill Combs and Miles McDowell as "B&C Iron Erec-
tion"; and former supervisor Shelby E. McFarland, Sr. was teamed up
with rank-and-file (unit) employees Shelby McFarland, Jr. and Otis
Lewis as "Hudson Steel Fabricators [Fabricating]." On the other hand-
presumably to make up for unit employees and union loyalists who were
terminated (supra), former supervisor John Graham was established as
"J&G [J.G.] Ornamental Iron [Co.]," with new "employees" (his broth-
ers).
837
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
partnerships or other loose associations with their trade
names listed on removable signs on the outside of the
building. Respondents' general manager Brown testified
that after paper transfer/shiftover from Respondent Art-
craft Iron to Respondent Rich-Morrow doing business as
Artcraft Iron, accomplished over a weekend (April 29-
May 1, 1983), the same customers and geographical area
continued to be served-although, according to him,
there was increased concentration on fabrication rather
than on outside erection.2" According to Brown, each of
the former foremen/supervisors who are now dubbed
subcontractors operates in his usual designated area or
bay, with common areas including storage areas, as pre-
viously, using Respondents' equipment including even
trucks, and Respondent continues to furnish and pay for
utilities (cost of which is said to be reflected in the
amounts allowed to the subcontractors by Respondent
on the jobs assigned to them by Respondent). Brown
funnels all incoming work to the foremen, as previously,
now designated subcontractors, and Respondent contin-
ues to be responsible to customers for shortcomings in
the work done. The so-called lease or occupancy ar-
rangements with each such subcontractor have never
been reduced to writing-as testified by Brown, "It's all
verbal." It is Brown who continues, since the transfer, as
before, to bid on work and set the prices-not the sub-
contractors. Brown's father, Walter (Wally) Brown
(Arthur Braun's brother and Ward Argust's uncle), a
principal of Respondent Artcraft Iron, continues to do
the same thing for Respondent Rich-Morrow doing busi-
ness as Artcraft Iron as he had for some 30 years for Re-
spondent Artcraft Iron, but now he is called a salesman.
Respondent Artcraft Iron's estimator ("takeoffman"), or-
namental sales, and detailer Roger Chaney continues in
the same capacity under Rich-Morrow doing business as
Artcraft Iron. Helen Liles, Respondent Artcraft Iron's
bookkeeper/receptionist/secretary, also continues in the
same capacity with Respondent Rich-Morrow doing
business as Artcraft Iron, the only difference being that
she now does all the bookkeeping for the subcontractors,
those books and records continuing to be maintained in
Respondents' office. Liles is still relieved, as before, by
Wally Brown's wife (General Manager Brown's mother),
Mildred A. Brown. Even Arthur L. Braun's son, Arthur
Braun II (Junior) continues, as before, to act as janitor
and general "gopher," including doing some production
work. Respondent Artcraft Iron's vehicles continue to be
registered in its name, although used by Respondent
Rich-Morrow doing business as Artcraft Iron, as well as
by the foremen/subcontractors and employees. Materials
used to fulfill job orders continue to be purchased by Re-
spondent Rich-Morrow doing business as Artcraft Iron
under purchase orders signed (as before) by General
Manager Brown and not by the subcontractors; materials
are removed from storage areas and used by the subcon-
tractors at will, without signing for the materials. Re-
spondent makes "advances" to these subcontractors prior
s7 Brown's testimony on this was somewhat vague. Apparently even
prior to the transfer, some outside erection work had been done by out-
side companies. However, even assuming there was less outside erection
done by Respondent after the transfer, this would not be controlling
here. See discussion, sec. II,C infra.
to completion of the work assigned to them. Respondent
Artcraft Iron's two trademarks or logos, "Artcraft" and
"Trashmaster," continue to be used and affixed to mer-
chandise fabricated by the subcontractors. According to
Brown, no consideration was paid by Respondent Rich-
Morrow for the goodwill, long-established, of Respond-
ent Artcraft Iron or for its seemingly valuable trade-
marks or the continued use of its name (Artcraft Iron),
but only, allegedly, for inventory, and directly to Arthur
L. Braun and his wife, June L. Braun, for the equipment
of the business (which it is claimed was owned by them
and not by the business). Brown conceded that, other
than the described (and further to be described infra)
conversion of foremen to subcontractors, the general op-
eration of the business prior to and after the alleged
transfer/shiftover from Respondent Artcraft Iron to Re-
spondent Rich-Morrow doing business as Artcraft Iron
has remained unchanged.
Cross-examination by Respondent of its General Man-
ager Brown yielded a form of "Subcontract Agreement"
(sic; R.-A Exh. 1) on the letterhead of Respondent Art-
craft Iron, dated, it is to be observed, February 2, 1983,
with H&H Fabrication (referred to elsewhere as H&H
Fabricators), covering the dumpsters which it will be re-
called were unilaterally contracted out by that Respond-
ent in February (sec. II,B,I supra). It is also to be ob-
served that, notwithstanding the imprinted name on that
letterhead ("Artcraft Ornamental Iron Co."), the docu-
ment itself as well as its signature refers to the Company
as "Artcraft Iron Co."-the same appendage used by Re-
spondent Rich-Morrow since the transfer/shiftover of
May 1, 1983. Some if not most of the purported subcon-
tract agreements are not even signed by the subcontrac-
tor (R.-RM Exhs. 1, 4, 9, and 11).
Ward Argust, also called as an adverse witness by the
General Counsel, testified that he is the president and
sale shareholder and director of Respondent Rich-
Morrow Insurance Agency, Inc., 2a located in Mansfield,
Ohio (where he lives), some 75 miles distant from the
premises of Respondent Artcraft Iron; and that he is the
son-in-law of Respondent Artcraft Iron's principal and
president Arthur L. Braun. According to Argust, his
corporation (which thereafter, according to the testimo-
ny of Respondents' General Manager Jeffrey Brown, at
least in its operation of Artcraft Iron, began calling itself
Rich-Morrow doing business as Artcraft Iron), an insur-
ance agency, entered the ironcraft business about May 1,
1983, with the execution to him by his father-in-law and
mother-in-law, Arthur L. and June L. Braun, of a 15-
year lease, plus 5-year renewal option, covering the
premises in which Respondent Artcraft Iron conducted
its business.2 9 Although not entirely clear, the lease
28 Notwithstanding Argust's sworn testimony before me to this effect,
it is noted that his wife, Cheryl D. Argust (the daughter of Arthur L.
Braun), is identified in the corporate minutes as the secretary as well as a
director of Rich-Morrow Insurance Agency, Inc. (G.C. Exhs. 13-18).
n9 I.e., the entire building, there being no other tenant. According to
General Manager Brown, up to this time these premises had been occu-
pied by Respondent for some 30 years under an oral arrangement with
Arthur Braun.
838
ARTCRAFT IRON CO.
(G.C. Exh. 9) appears to reserve to the lessors (i.e., the
Brauns) as well as the lessee the right to the use of the
premises "jointly by Landlord and Tenant, and their re-
spective customers and employees erected thereon" (sic;
id. at sec. 1.01); it contains a security provision that the
lessor "shall have the right to purchase up to fifty-one
percent (51%) of the outstanding shares of Tenant" (id.
at sec. 12.08). It is further to be noted that although the
lease purports to be to "Rich-Morrow Insurance Agency," it
is executed by "Artcraft Iron Company" as tenant (id. at
pp. I and 19-20).
Also on April 29, 1983, Arthur L. Braun and June L.
Braun are said to have executed to Respondent Rich-
Morrow Insurance Agency, Inc. a "Sales Agreement" to
sell attached scheduled equipment, tools, furniture, and
vehicles-i.e., those in use in the business of Respondent
Artcraft Iron-to Respondent Rich-Morrow Insurance
Agency, Inc. for $146,000, of which payment of $87,000
(in undescribed form, not here established to have been
made) was acknowledged, with a $60,000 I-year promis-
sory note for the balance (G.C. Exhs. IIA and IIB), to
be secured by the property purportedly transferred but
with no security document executed either simultaneous-
ly or thereafter.3 0 The payees of this promissory note
agreed (G.C. Exh. I IB, par. 4) to subordinate the note to
future bank mortgages and liens of the buyer.
As of May 12, 1983, Respondents here are said to have
executed an "Agreement for Purchase of Assets," this
time by "Artcraft Ornamental Iron Co., Inc." with
"Rich-Morrow Insurance Agency, Inc.," calling for the
sale of scheduled inventories for $36,164, of which
$10,000 was payable in cash upon execution of the agree-
ment and the balance by August 31, 1983 (G.C. Exh.
10A; no schedule attached). Notwithstanding the forego-
ing, it was allegedly on May 26, 1983, that Respondent
Artcraft Iron executed a bill of sale to Respondent Rich-
Morrow Insurance Agency, Inc. covering these items
and on that date that the latter, by Ward C. Argust, exe-
cuted its promissory note to the former for $26,164 (G.C.
Exhs. 10B and 10C). No documentary evidence has been
presented of the payment of the initial $10,000 in cash or
otherwise.
Ward Argust swore here that he (or his corporation)
acquired the entire goodwill of Respondent Artcraft
Iron, a 50-year old enterprise, for $1. Argust further tes-
tified that the way he (or his corporation) came to ac-
quire Artcraft Iron was that in the early part of 1983 his
father-in-law, Arthur L. Braun, told him that a union had
"just been voted in" and that he was disturbed about the
business. After much mincing of words and testimonial
equivocation, Argust conceded that Braun had expressed
concern about the advent of the Union as at least poten-
tially creating "additional problems for the company."
Certainly it is fair to say that this betokens knowledge on
Argust's part of the unionization of Respondent Artcraft
Iron, since the president/principal of that Company, his
father-in-law Arthur L. Braun, discussed it and his con-
50 According to testimony of Argust (seemingly contrary to that of
General Manager Brown), this equipment was owned by Respondent
Artcraft Iron, but "surrendered" by the latter to the Brauns in mid spring
1983 under an alleged security interest of the Brauns incepting in 1982.
cern over it with him prior to the takeover of that Com-
pany by Argust's company doing business under the
same name. According to Argust, he acquired that busi-
ness as a "good economic possibility,"'3 but it was not
feasible-for some undisclosed and factually unestab-
lished reason-to continue to operate it under its own
longstanding name. Further according to Argust, of
what he regards as the $187,000 indebtedness of his com-
pany to his father-in-law, Braun, only $13,000 has been
paid off-and even that not factually established here,
leaving at least $174,000 still due. Again curiously, since
Argust appears to be an established, experienced, and
knowledgeable businessman, he explained that when and
if paid all of that sum except the $26,000 for the invento-
ry is due to Braun; however, it is to be observed that the
Brauns' sales agreement "acknowledges receipt" of
$87,000 "at the time of the signing of this agreement"
(G.C. Exh. 11, par. 2), leaving a balance of only $60,000
to the Brauns, as shown by the accompanying promisso-
ry note (G.C. Exh. I IA).32
Argust also conceded (as does General Manager
Brown) that there was no hiatus between the operations
of Respondent Artcraft Iron and those of Respondent
Rich-Morrow doing business as Artcraft Iron in connec-
tion with the "takeover." Nor did Argust receive any ap-
proval or acquiescence from any of the insurance carri-
ers for which Respondent Rich-Morrow Insurance
Agency, Inc. is agent (and presumably holds premiums)
for its entry into the iron fabrication or jobbing business,
an endeavor in which Argust disclaims experience, his
concentration being largely in real estate development
and mobile home sales. Asked at the trial if his company,
Respondent Rich-Morrow doing business as Artcraft
Iron, which took over the business and operations of Re-
spondent Artcraft Iron, is willing to bargain with the
Board-certified Union here, Argust responded in the neg-
ative on the ground that the Union does not represent
any employees of Respondent Rich-Morrow doing busi-
ness as Artcraft Iron.33
The testimony of Respondent Artcraft Iron's foreman
and department supervisor Shelby E. McFarland, Sr.,
later redubbed a subcontractor and subpoenaed here by
the General Counsel, affords a direct view of the precise
3' In seeming contrast to the present contentions of its allegedly dire
economic circumstances necessitating its "going out of business" and sale
to the other Respondent herein.
S2 In fairness, however, but also somewhat confusingly, Argust also
mentioned in his testimony another promissory note-not produced
here-for $84,000, unsecured and due in 5 years allegedly from "Rich-
Morrow Realty Company, Inc.... another company that I own" to the
Brauns. No such note or transaction is reflected in any of the documents
here produced. The net upshot, however, is that, according to Argust,
"only S3,000 in cash" was allegedly "paid at all in connection with the
acquisition of the equipment."
ss On cross-examination, Argust indicated that the nature of the oper-
ations here involved, following the takeover, changed from an estimated
70 percent or so for "structural and resale" items and around 25 percent
for "ornamental" items, to an estimated 20 percent for structural and
resale items to around 70-73 percent for ornamental items. Although this
was in no way factually established, assuming arguendo that it were true,
it would not be determinative here. Such a change, had it occurred under
Respondent Artcraft Iron, would not of itself have relieved it of its obli-
gation to bargain with the Board-certified Union. See discussion infra sec.
II,C.
839
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
nature of what actually occurred in the shiftover from
one Respondent to the other here. Although McFarland
was at times an evasive, reluctant, self-contradictory, and
hostile witness, and one who even attempted to change
some of his testimony after an overnight recess, as the
record will disclose (see, e.g., Tr. 463), nevertheless his
testimony provides much necessary factual clarification
as to details of what actually happened. Thus, McFar-
land testified that, contrary to Respondent Artcraft
Iron's unionized bargaining unit employees who were
terminated about April 29, 1983, he, then a foreman, con-
tinued on in his usual work but as a subcontractor, al-
though he never bid on even a single job and never set
even a single price; all of his jobs were obtained for him
by Respondent's general manager Brown, who also fixed
the rates to be charged. His only participation in job
terms was to sign a printed form captioned "Sub-Con-
tract Agreement" ("Tops Form No. 3461-Revised") pre-
sented to him by General Manager Brown or Respond-
ents' office secretary Helen Liles (G.C. Exh. 12; see also
R-RM Exhs. 1, 2, 4, 9). It is to be observed that that
form (id.) is made out and signed between "Hudson Steel
Fabricating Co." (the "trade name" secured for McFar-
land by Respondent) by McFarland as subcontractor and
"Artcraft Iron Co." by Jeffrey L. Brown as contractor;
that the "work" to be done is referred to as "attached
work orders per Artcraft [numbered job order] worklist
sheet"; that no customer is identified by name or other-
wise; that all contract terms, drawings, specifications,
and changes are "prepared and identified by contractor"
(i.e., Artcraft Iron Co.-Rich-Morrow not even being re-
ferred to or seemingly a party to the subcontracts, even
though they were subsequent to May 1, 1983 and Art-
craft Iron Co. had allegedly gone out of business by that
time); that all work, materials, painting, loading, and de-
livery are to be "per [Artcraft Iron Co. numbered work-
list sheet" (as previously); and that the "payment"
amount is in all cases but one omitted (in the one case
preset) but to be determined by Artcraft Iron Co. All sup-
posed or supporting paperwork-including even blank
invoice forms-were handled for McFarland by Re-
spondents' bookkeeper Helen Liles in and filed in Re-
spondents' office, including receipts for gasoline and
tolls. There has also been produced an Invoice from
"Rich-Morrow Insurance Agency, Inc. dba Artcraft Iron
Co." to "Hudson Steel Fabricating" for "Lease for
month of May, 1983" (R.-RM Exh. 5); the one for half
of June 1983 is a blank invoice without identification of
invoicer (R.-RM Exh. 6). McFarland testified that all of
these invoices-reflecting no change in the actual nature
of the work he had previously performed for Respond-
ent Artcraft Iron-were prepared by General Manager
Brown who, together with Ward Argust, had instructed
him that after May I McFarland "had to have a name,"
which was the only reason he utilized the trade name
"Hudson Steel Fabricating Co."; and McFarland there-
upon had two of his subordinates (his son Shelby McFar-
land, Jr. and Otis Lewis) continue to work as before and
obtained two new employees (Kim Tucker and Scott
Travis) to replace two (unionized) unit employees termi-
nated by Respondent. It is to be observed that although
these printed subcontract agreement forms explicitly re-
quire the purported subcontractor to "furnish all materi-
al" (art. 1), McFarland unequivocally swore he is certain
that he furnished no materials and also that he never fur-
nished any delivery except by vehicle of Respondents
available to all of the other foremen subcontractors. He
swore that he always carried out the assignments he re-
ceived as subcontractor without negotiation of terms and
without question; and he always paid amounts fixed as
rent-he could not recall what these amounts were-by
General Manager Brown without discussion of any kind.
He swore that all of his books and records as subcontrac-
tor were taken care of by Respondents' bookkeep-
er/secretary Helen Liles in Respondents' office, at no
charge. Prior to May 1983, with the sole exception of
H&H working on dumpsters (supra), he had never seen
any subcontracting done on Respondent's premises. After
May 1, he as well as other foremen, thenceforth called
subcontractors, continued to do all work assigned by Re-
spondent to each of them, as previously, and, also as pre-
viously, continued to utilize and interchange all equip-
ment of Respondent. Even though purportedly a subcon-
tractor, at no time did he have any contact with any cus-
tomer-as previously, Respondents' general manager
Brown negotiated and fixed all prices to be charged to
customers. At no time did McFarland solicit any business
of his own, he had no phone listing, and he did no ad-
vertising. It was only at the insistence of Respondents
that he was called a subcontractor. It was in early
April-while Respondent Artcraft Iron was still in business
and professedly carrying on negotiations with the Union-
that McFarland, as he swore, was informed by Respond-
ent Artcraft Iron's general manager Brown that he and
the other foremen would have "the first opportunity to
go into the subcontracting position . . .May Ist."
McFarland also swore that when and after he became a
subcontractor he invested no money and made no outlay
of any kind; that he had no equipment of any kind; that
he was at all times a subcontractor only from week to
week and never had a subcontract or contract for longer
than I week; that he at all times used Respondent's mate-
rials, equipment, and trucks; that Respondent ordered
and paid for his and other foremen's wooden trade name
signs placed on the outside of the building; that the
source of his money to meet "his" payrolls (as well as his
own salary) as subcontractor was Respondent at all times;
that he at no time as subcontractor even billed or in-
voiced any customer (other than Respondent, if the latter
may be so considered, and in that case all such invoices
were prepared by Respondent's own bookkeeper/-
secretary Liles); that since leaving that venture, at his
own election because he did not wish to continue it that
way, he has made no use of the trade name; and that
since he left Respondent his subcontracting books and
records have remained with Respondent in its office
where they still presumably continue to be. At the time
he left, his fellow former supervisors at Respondent Art-
craft Iron-David Graham, John Graham, and Chuck
McConnell-were still there, purportedly as subcontrac-
840
ARTCRAFT IRON CO.
tors.3 4 Finally, McFarland also swore that his income as a
week-to-week subcontractor was the same as it had been
when he was called and paid weekly as a foreman-a truly
remarkable and arresting "coincidence." I find, upon the
basis of McFarland's own testimony concerning the sub-
contractors here, that they were not in fact or in law
subcontractors or independent contractors under the
guiding principles established by the Supreme Court in
United States v. Silk, 331 U.S. 704 (1947).
C. Discussion and Resolution
There is presented here a situation of a firmly estab-
lished family business in existence for some 50 years.
When its employees commenced exercising rights guar-
anteed to them by Congress under the Act, to organize
themselves for collective bargaining, they were repeated-
ly warned and threatened by responsible officials of the
Company that it would not tolerate the exercise of those
rights. Indeed, the Company's president himself bluntly
threatened that "I'll shut the f-ing doors before the
union comes in" (followed up by a departmental supervi-
sor's threat that "[General Manager] Jeff [Brown] would
put a chain around the building, and a padlock to match
it, before the union would come in." Undaunted, howev-
er, the unit employees, pursuing the rights statutorily
guaranteed to them by Congress in the Act, selected and
designated the Charging Party Union as their bargaining
representative in a Board-supervised statutory election
resulting in the Union's official Federal certification.
This set into inexorable motion not only unilateral action
detrimental to the unit employees without bargaining
with their officially certified representative (dumpster
subcontracting) but also, while purportedly engaging in
bargaining with the Union, a scheme to thwart and
defeat its unit employees' statutory rights and to negate
the Board's official certification of their Union through
discharging the bargaining unit members, dubbing its
foremen/supervisors subcontractors to hire whomever
they wished (but coincidentally debarring the terminated
union activists from access to their former or any jobs),
and purportedly shifting over its entire business to a
close family member, its principal's son-in-law, who con-
tinued to operate it through the same general manager
and executive, office, and supervisory personnel, in the
same location as before, without time hiatus, serving the
same customers, under the same trade name as before,
and utilizing the same trademarks as before. The trans-
parent purpose of this scheme was not to effect a legiti-
mate, arm's-length, and bona-fide sale of this long-estab-
lished business, but, put plainly, to oust the Union, to rid
itself of the unwanted union supporters, to flout the
Board as an agency of the United States Government,
and to thumb its nose at the law and its underlying con-
gressionally declared public policy.
That these actions, taken by Respondent Artcraft
Iron-which presents no factual defense here-constitut-
a4 It will be recalled that Respondents have stipulated that
"[clommencing on or about May 1, 1983, Respondent Rich-Morrow con-
tracted work previously done by employees of Respondent Artcraft to
among others Shelby McFarland, David Graham, John Graham and
Chuck McConnell" (G.C. Exh. 6, par. 3). There is no contention that this
was at any time discussed with the Union by either of Respondents.
ed violations of Section 8(a)(l), (3), and (5) of the Act as
alleged is not open to serious doubt. The question re-
mains whether that is in any way erased or changed, or
the normal consequences of such illegal activities abort-
ed, through the device of the shiftover of the business of
Respondent Artcraft Iron to another corporation, Re-
spondent Rich-Morrow doing business as Artcraft Iron,
owned by the son-in-law of the president and principal
of Artcraft Iron. I think not, regardless of whether the
situation be regarded as "alter ego," "disguised continu-
ance," or "succession"-terms which are defined as de-
sired by a particular definer-since in any event the legal
consequences, result, and outcome are the same.
It is settled through myriad cases that an employer, as
here, in the throes of collective bargaining with a Board-
certified union which he has vowed he would never
accept, may not, in order to defeat his statutory bargain-
ing obligation, discharge the entire bargaining unit,
refuse to bargain with the union on the ground he no
longer has any employees, and shift his business oper-
ations colorably to a knowledgeably participating substi-
tute employer to operate "union-free" and thereby delib-
erately thwart the intent of Congress as expressed in the
Act.
As stated recently by the Board in Allcon, Inc., 267
NLRB 700, 705 (1983):
The Board and courts have described the requi-
sites of an alter ego or of a successorship relation-
ship sufficient to justify a carryover of the obliga-
tions under a collective labor agreement with a
predecessor. Significant elements have been said to
be whether the "new" business is substantially the
same, in whole or in part; whether the "new" busi-
ness has its own contract with another union;
whether the product or services are the same;
whether the location is the same; whether the same
equipment is used; whether the customers are the
same; whether the business name is the same or
similar; whether there is a continuity of the work
force; whether the jobs are substantially the same;
whether supervision is the same; and whether there
was an hiatus in operations." That a diminution in
operations, as here, is consistent with a successor-
ship, see NLRB v. Fabsteel Co. of Louisiana, 587
F.2d 689, 695 (5th Cir. 1979), cert. denied 442 U.S.
943:
The Board has long held, with court approval,
that under proper circumstances, the obligation
to bargain with an incumbent union may be
found although the work force is considerably di-
minished by the transfer.
As also stated in J. M. Tanaka Construction v.
NLRB, 675 F.2d 1029, 1034 (9th Cir. 1982), also a
case involving attempted evasion of paying fringe
benefits required under a collective agreement:
An alter ego relationship may exist when only a
portion of an enterprise is purportedly transferred
to a new owner. ....
841
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Nor is the balance shifted by testimony that [Re-
spondent] uses primarily asphalt, rather than con-
crete, and does a smaller percentage of its work
on government contracts.
A "continuity of operation across the change in
ownership"-even assuming, arguendo, that there
has occurred a real change of ownership here-re-
quires at least recognition of and bargaining with
the incumbent union (Wiley v. Livingston, 376 U.S.
543 (1964)), whether or not the substantive obliga-
tions of the labor agreement continue to bind the
successor (NLRB v. Burns Security Services, 406 U.S.
272 (1972)); but where the "subsequent" employer is
but a disguised continuation (albeit at a scaled-down
level, cf. Fabsteel, supra) or alter ego of the "prede-
cessor" employer, even the substantive contractual
obligations carry over (Crawford Door Sales Co., 226
NLRB 1144 (1976)) and the "subsequent" employer
may even be held accountable for the "predeces-
sor's" unfair labor practices, particularly if an alter
ego thereof (Atlantic Paper Co., 121 NLRB 125
(1958)).
"' See, e.g., Johnston Ready Mix Co., 142 NLRB 437 (1963).
The situation herein truly smacks of what the Supreme
Court has characterized as a "technical change in the
structure or identity of the employing identity . . . to
avoid the effect of the labor laws, without any substan-
tial change in its ownership or management," with the
result that the "successor," "alter ego," or "substitute"
continues to be "subject to all the legal and contractual
obligations of the predecessor" (Howard Johnson Co. v.
Hotel & Restaurant Employees, 417 U.S. 249, 259 (1974)),
as "a disguised continuance of the old employer" (South-
port Petroleum Co. v. NLRB, 315 U.S. 100, 106 (1942)).
See also Howard Johnson Co. v. Hotel & Restaurant Em-
ployees, supra at fn. 5; NLRB v. Campbell-Harris Electric,
719 F.2d 292 (8th Cir. 1983); NLRB v. Al Bryant, Inc.,
711 F.2d 543 (3d Cir. 1983); Nelson Electric v. NLRB,
638 F.2d 965 (6th Cir. 1981); NLRB v. Ozark Hardwood
Co., 282 F.2d 1 (8th Cir. 1960); NLRB v. O'Keefe & Mer-
ritt Mfg. Co., 178 F.2d 445 (9th Cir. 1949); Allcon, Inc.,
supra; Fugazy Continental Corp., 265 NLRB 1301 (1982);
American Pacific Pipe Co., 262 NLRB 1223 (1982); St.
John's Construction Corp., 258 NLRB 471 (1981); Farm-
ingdale Iron Works, 249 NLRB 98 (1980); McDonald's
Readi-Mix Concrete, 246 NLRB 152 (1979); Blake Con-
struction Co., 245 NLRB 630 (1979); Shield-Pacific, Ltd.,
245 NLRB 409 (1979); Century Printing Co., 242 NLRB
659 (1979), enfd. 661 F.2d 914 (3d Cir. 1981); Big Bear
Supermarkets #3, 239 NLRB 179 (1978), enfd. 640 F.2d
924 (9th Cir. 1980); Sturdevant Sheet Metal Co., 238
NLRB 186, 188 (1978), enfd. 636 F.2d 271 (10th Cir.
1980); Dee Cee Floor Covering, 232 NLRB 421 (1977);
Co-Ed Garment Co., 231 NLRB 848 (1977); Crawford
Door Sales Co., supra; P. A. Hayes, Inc., 226 NLRB 230
(1976); Flite Chief Inc., 220 NLRB 1112 (1975), enfd.
106 LRRM 2968 (9th Cir. 1977); Helrose Bindery, 204
NLRB 499 (1973); Rushton & Mercier Woodworking Co.,
203 NLRB 123 (1973), enfd. mem. 502 F.2d 1160 (Ist
Cir. 1974). Also violative of the Act are employer
threats of reorganization of its method of doing business
to thwart unionization (Chester Valley, Inc., 251 NLRB
1455 (1980), enfd. in relevant part 652 F.2d 263 (2d Cir.
1981)), and threats to set up another company to avoid
the bargaining obligation (Owen Lee Floor Service, 250
NLRB 651 (1980)). Even a bona fide successor having
knowledge of a predecessor's unfair labor practices-
much more so one who knowledgeably participates
therein-may be ordered to remedy them. Cf., e.g.,
Golden State Bottling Co. v. NLRB, 414 U.S. 168 (1973);
NLRB v. Winco Petroleum Co., 668 F.2d 973 (8th Cir.
1982).
That not even lack of identical corporate ownership
will bar a finding of alter ego status, see, e.g., J. M
Tanaka Construction v. NLRB, supra; Crawford Door
Sales Co., supra.
As shown and found, what is presented here, against
the indicated background of intense employer hostility to
and nonacceptance of its statutory bargaining obligation,
is a mere shiftover of a long-established business to the
corporation of a close relative of its principal, without
hiatus in time or operations, i.e., uninterrupted continu-
ation of the same business under the same trade name,
logos, and trademarks, at the same location, utilizing the
same equipment and serving the same customers in the
same fabrication operation, with essentially the same per-
sonnel, except for the summarily discharged unionists,
who have been refused reemployment while others have
been hired. There is presented here no conventional
arm's-length sale of a business, but rather a colorable
deal or scheme, with features enabling ready recapture
control by the alleged predecessor/transferor, accompa-
nied by a cosmetic change in the method of operations to
subcontractorships by the foremen (a change which
could not only as well have been effected by the trans-
feror corporation but was actually, indeed, announced by
it prior to the transfer to the transferee corporation), but
without real significance to the foremen or rank-and-file
employees, without real effect on the customers, and
with Respondents continuing to maintain total control
over the operation of the very same business-a paper
shiftover from one corporation to a close relative's cor-
poration to flout the statutory bargaining obligation es-
tablished by Federal law.
The statutorily enacted and Board-administered repre-
sentation election mechanism of the Act was not provid-
ed by Congress to be flouted and aborted through the
device of colorably passing assets from one corporate
employer to another owned by the first corporation's
principal's son-in-law engaged in a totally unrelated type
of business elsewhere (while continuing the transferred
business in place) in a transparent ploy to avoid the ne-
cessity for compliance with the Act and to defeat the
rights of employees to do what Congress expressly guar-
anteed them the right to do.
Here there are present literally all of the elements re-
quired by the Board and courts in the aforecited deci-
sions to support the conclusion of alter ego, disguised
continuance, or successorship: continuation of company
842
ARTCRAFT IRON CO.
trade name, trademarks, and logos; no hiatus in oper-
ations; same location; same equipment; same customers;
same executive, supervisory, and supporting staff; and es-
sentially same or same type of work force, except for un-
lawfully discharged unionized unit employees covered
by the Board's official certification. As conceded at the
hearing, the only difference attending the shiftover was
the dubbing of foremen as subcontractors, although Re-
spondent continued, as before, to deal with all customers,
estimate and bill all jobs, and even to take care of and
maintain the records and files of the subcontractors, who
continued to make the same amount of money as they
did while foremen. It is entirely clear that, if the bargain-
ing unit employees had not been discharged and if the
predecessor had instituted such a subcontracting system
unilaterally, as here, it would have been in violation of
the Act. It is also entirely clear that if the successor had
not instituted such a system, the operation would in all
particulars have been precisely identical to that of the
predecessor. The colorable conversion to a subcontractor
system through its own former foremen is in no way de-
terminative here, since, if such a redubbing through
change in nomenclature were controlling, an employer
could through that device defeat Board certification and
the policies of the Act, thereby evading its bargaining
obligation through its own stratagem. See, e. g., Fabsteel,
Tanaka, Allcon, Hayes, and St. John's Construction, supra.
Respondents' basic contention appears to be that Re-
spondent Artcraft Iron had the right to go out of busi-
ness. Of course it did, for whatever reason. See Textile
Workers v. Darlington Mfg. Co., 380 U.S. 263 (1965). But
this contention misperceives or skews the issue. The
complaint does not allege that Respondent Artcraft Iron
committed an unfair labor practice by going out of busi-
ness. The issue here is not that at all, but instead-aside
from sundry independent unfair labor practices commit-
ted by that Respondent, as here found without contest-
whether Respondent Rich-Morrow doing business as
Artcraft Iron, in knowingly participating in a colorable
shiftover to itself of the business of Respondent Artcraft
Iron, under the circumstances shown, is an alter ego, dis-
guised continuance, or successor of Respondent Artcraft
Iron so as to have acquired the Artcraft Iron business
freighted with its obligation to continue to bargain with
its federally certified bargaining representative; and
whether Rich-Morrow doing business as Artcraft Iron is
chargeable with repair of the consequences of its knowl-
edgeable participation in the colorable death warrant
dealt by its predecessor to the entire bargaining unit by
discharging its members during the pendency of bargain-
ing, through the simplistic expedient of dubbing its fore-
men subcontractors in order to lend surface plausibility
to the contention that the business no longer had unit,
that is to say unionized, employees, but only workers
employed by contractors operating independently of Re-
spondents. In consideration and determination of these
issues, it is entirely clear and I find that the predecessor
corporate Respondent here contrived and sought to
obtain and purportedly did obtain substantial economic
benefit through the transfer to the successor corporate
Respondent by ostensibly shucking off and ridding itself
of its statutory bargaining obligation and discharging its
employees who had sought to exercise their rights under
the Act.
Respondents further contend that they had the right to
change their method of operations from employing em-
ployees to utilizing subcontractors as a more economical
or profitable alternative. While this is undoubtedly true,
such a defense has not been made out here, since (1) Re-
spondents, electing to rest at the conclusion of the Gen-
eral Counsel's case without calling any witness, present-
ed no factual proof in support of this contention; (2) the
colorable nature of the redubbing of the foremen as sub-
contractors has already been described in detail supra;
(3) even if, unlike here, such a contention were factually
established, it would still constitute a violation of the Act
to discharge the members of the certified statutory bar-
gaining unit by implementing such a decision unilaterally
without bargaining with the officially certified bargain-
ing representative. See, e.g., NLRB v. Katz, 369 U.S. 736
(1962). Furthermore, by electing to rest without presen-
tation of proof, Respondents have totally failed in fact to
rebut the General Counsel's prima facie showing that the
unit employees were terminated en masse here in order
to purge the business of unionists and to restrain and
coerce employees in exercise of their rights under the
Act. Respondents having elected not to adduce any
proof, to say nothing of preponderating proof, as re-
quired, to the contrary, the General Counsel's showing
in this regard stands solidly established. See NLRB v.
Transportation Management Corp., 462 U.S. 393 (1983).
Under the circumstances, in view of the facts as found
and the applicable law, cited supra, deemed to be con-
trolling here, it is accordingly determined that, essential-
ly as alleged in the complaint, Respondent Rich-Morrow
doing business as Artcraft Iron is the alter ego or dis-
guised continuance of, or successor to, Respondent Art-
craft Iron; and that the jointly shared purpose of Re-
spondents, known to and participated in by Respondent
Rich-Morrow, to terminate all of the bargaining unit em-
ployees and to fail and refuse to bargain further with
their Board-certified bargaining representative was to at-
tempt to escape from and overcome the statutory certifi-
cation of the Charging Party Union and the bargaining
obligation under the Act, and to interfere with, coerce,
and restrain employees in the exercise of their rights
under the Act, through utilizing the purported conver-
sion of foremen to subcontractors as a device and screen
to lend surface plausibility to Respondents' scheme to
evade the Act. Cf. St. John's Construction Corp., 258
NLRB 471 (1981).35
On the foregoing findings and the entire record, I state
the following
as There was some intimation at the trial, as on brief, that Respondent
Artcraft Iron is now involved in a bankruptcy proceeding. Although nei-
ther this nor any adjudication was factually established, even if true it
would not erase its violations of the Act and thus not be a defense to the
allegations here, although a discharge might affect the efficacy of remedi-
ation as to that Respondent. Cf., e.g., Sec. 15 of the Act; Nathanson v.
NLRB, 344 U.S. 25, 30 (1952); Allcon, Inc., 267 NLRB 700 (1983); In re
Wilson Foods Corp., 115 LRRM 2140 (Bankr. W.D. Okla. 1983).
843
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
CONCLUSIONS OF LAW
A. Jurisdiction is properly asserted in this proceeding
and over all parties thereto.
B. At all material times as set forth and described in
section II, supra, and continuously since April 29, 1983,
Respondent Rich-Morrow Insurance Agency, Inc., has
been and is the alter ego, disguised continuation, or suc-
cessor of Respondent Artcraft Ornamental Iron Co. and
a single employer with it within the meaning of the Act.
C. By engaging and continuing to engage in the acts
set forth and found in section II, supra,3 6 Respondents
and each of them have:
1. Interfered with, restrained, and coerced employees
in the exercise of their rights under Section 7 and contin-
ue to do so in violation of Section 8(a)(1) of the Act:
2. Discriminated and continue to discriminate in regard
to the hire, tenure, and terms and conditions of employ-
ment of employees, thereby discouraging or encouraging
membership in a labor organization in violation of Sec-
tion 8(a)(3) of the Act:
3. Failed and refused to bargain in good faith, and
continue to do so, with the duly elected and Board-certi-
fied exclusive collective-bargaining representative of the
employees in the following appropriate bargaining unit in
violation of Section 8(a)(5) of the Act:
All production and maintenance employees, includ-
ing structural, ornamental, installation and miscella-
neous department employees employed at Respond-
ents' Columbus, Ohio facility, but excluding all
office clerical employees, engineering employees,
and all professional employees, guards and supervi-
sors as defined in the Act.37
D. Said unfair labor practices and each of them have
affected, are affecting, and unless permanently restrained
and enjoined will continue to affect commerce within the
meaning of Section 2(6) and (7) of the Act.
REMEDY
Respondent Artcraft Iron should be required to cease
and desist from interrogating and threatening employees
as herein found; from unilaterally discontinuing any of
their established work-related fringe benefits; from discri-
minatorily failing or refusing to recall them to employ-
ment from layoff; from unilaterally subcontracting out
unit work; from failing or refusing to provide its unit em-
ployees' bargaining representative with information and
data reasonably required for collective bargaining; and
from failing and refusing to bargain collectively in good
faith with the Charging Party Union as the duly elected
and certified bargaining representative of the employees
a5 Particularized in relation to complaint allegations and otherwise in
attached Appendix A. [Appendix A omitted from publication.]
37 Although Respondents' answers deny the appropriateness of this
unit, alleged in the complaint (par. 9(a)), as well as its certification (id. at
par. 9(b)), the fact is (see G.C. Exhs. 4 and 5) that this is the unit found
appropriate and certified by the Board's Regional Director in Case 9-
RC-14152, and I take official notice thereof. "[I]t is unnecessary to
embark on a unit determination analysis once there is adequate evidence
to support the finding [of] . . . alter ego." NLRB v. Al Bryant, Inc., 711
F.2d 543, 554 (3d Cir. 1983); NLRB v. Scott Printing Corp., 612 F.2d 783
(3d Cir. 1979).
in the appropriate bargaining unit. Inasmuch as Respond-
ent Rich-Morrow doing business as Artcraft Iron knowl-
edgeably and deliberately participated with Respondent
Artcraft Iron in a common plan, stratagem, and device
to overcome the Board's official certification of the
Charging Party Union as the duly elected statutory bar-
gaining representative of the unit employees here by at-
tempting to disestablish the certified bargaining unit
through terminating the employment of the members
thereof, allegedly subcontracting out all of the unit work,
and purposefully and deliberately failing and refusing to
employ or reemploy such terminated employees (namely,
Robert William Deal, William M. Diedrich, Wilson
Ford, Steve R. Friley, Ronald Lee Monroe, and Jeffrey
F. O'Hara) since April 29, 1983, as well as discriminator-
ily failing to recall between February and April 29, 1983,
two previously laid-off employees (namely, Wilson Ford
and Jeffrey F. O'Hara), both Respondents should be re-
quired to offer immediate and full reinstatement to all of
those employees into their employment and former jobs
(or, if such jobs no longer exist, to substantially equiva-
lent jobs), terminating, if necessary, any and all other
employees serving in their place and stead; and to make
them whole, with interest, for any wages, overtime pay,
accruals, bonuses (including unilaterally discontinued
Thanksgiving and Christmas bonuses), and benefits of
whatsoever nature (including vacations and vacation pay
and hospitalization and other medical benefits, with reim-
bursement for any expenses or obligations incurred by
reason of any cancellation, withdrawal, lapse, or nonpay-
ment of premiums thereon by Respondents or either of
them) lost or unpaid by reason of said nonrecalls and ter-
minations, and with full restoration of seniority as
though the nonrecalls and terminations had not occurred,
all as determinable in a supplemental backpay proceeding
if necessary. Sums and interest due should be computed
as explicated in F. W. Woolworth Co., 90 NLRB 289
(1950), Isis Plumbing Co., 138 NLRB 716 (1962), and
Florida Steel Corp., 231 NLRB 651 (1977). Respondents
should also be required to disestablish their so-called sub-
contracting or contracting-out system instituted after the
Board's official certification of the bargaining unit herein,
and to reinstitute the former direct employment
system, 3a making no change therein unilaterally without
good-faith bargaining with the Charging Party Union
concerning any such decision and the effects thereof
upon the certified bargaining unit and the members
thereof; and to bargain collectively with the Charging
Party Union, at its request, as the duly elected and offi-
cially certified bargaining representative of the unit em-
ployees. Respondents should also be required seasonably
to provide to the Charging Party Union, at its request,
information and data reasonably necessary for collective
bargaining, including all subcontracting and contracting-
out documents, data, and entries, and also including all
documents, data, and entries concerning any alleged sale
or transfer of assets of any nature whatsoever from Re-
spondent Artcraft Iron to Respondent Rich-Morrow (in-
cluding Rich-Morrow doing business as Artcraft Iron).
a8 Cf. St. John's Construction Corp., supra.
844
ARTCRAFT IRON CO.
Respondents should further be required to preserve and
make available to the Board's agents their books and
records for backpay computation and compliance deter-
mination purposes, and to post the usual informational
notice to employees. Finally, in view of Respondents'
calculated, deliberate, and serious flouting of the Board's
certification in their device and stratagem to evade the
Act's requirements and to thwart and retaliate against
their employees for exercising rights guaranteed to them
by Federal law, seeking to undermine the very basic
policy and purpose of the Act, Respondents should also
be required to cease and desist from further violation of
the Act. 3 9
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
ed40
ORDER
It is hereby ordered that
A. Respondent Artcraft Ornamental Iron Co., Inc., its
officers, directors, officials, agents, successors, and as-
signs, shall cease and desist from
1. Interrogating employees, in violation of the National
Labor Relations Act, concerning their or other employ-
ees' union membership, activities, affiliations, or sympa-
thies, or regarding how they voted in any National
Labor Relations Board-conducted election for bargaining
representative.
2. Threatening employees, in violation of the Act, with
plant closure or business discontinuance in the event of
the designation, selection, or election by employees of a
labor organization for collective bargaining.
B. Respondents Artcraft Ornamental Iron Co., Inc.
and Rich-Morrow Insurance Agency, Inc., their respec-
tive officers, directors, officials, agents, successors, and
assigns, shall cease and desist from
1. Unilaterally and without bargaining in good faith
with the labor organization bargaining representative of
the employees of Respondents, or either of them, discon-
tinuing any established policy, system, or practice of
paying bonuses, including Thanksgiving bonuses and
Christmas bonuses, to such employees.
2. Discriminatorily, in violation of the Act, failing to
recall to employment laid-off employees of the Respond-
ents, or either of them, because of their leadership, activ-
ism, or participation in lawful activities under the Act.
3. Unilaterally and without bargaining in good faith
with the labor organization bargaining representative of
the employees contracting out or subcontracting the
work of the employees so as to deprive the employees of
such work.
4. Failing and refusing to provide and supply to the
employees' labor bargaining representative information
and data requested and reasonably necessary and re-
quired by the bargaining representative for bargaining
sg Cf., e.g., A. J Krajewski Mfg. Co., 180 NLRB 1071 (1970); NLRB vP
Entwistle Mfg. Co., 120 F.2d 532, 536 (4th Cir. 1941).
40 If no exceptions are filed as provided by Sec. 102.46 of the Board's
Rules and Regulations, the findings, conclusions, and recommended
Order shall, as provided in Sec. 102.48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses.
purposes with Respondents, or either of them, on behalf
of the employees, including, but not limited to, informa-
tion and data concerning rates of pay and hire of all em-
ployees and cost factors on insurance and vacations and
holidays, and information and data concerning any sale
or transfer, or purported or proposed sale or transfer, of
the business or business assets of Respondent Artcraft
Ornamental Co., Inc. to Respondent Rich-Morrow Insur-
ance Agency, Inc., such as to impact on the jobs or
wages, terms, and conditions of employment of the em-
ployees.
5. Failing or refusing to bargain collectively in good
faith with Shopmen's Local Union No. 626 of the Inter-
national Association of Bridge, Structural and Ornamen-
tal Iron Workers, AFL-CIO as the duly elected and
Board-certified exclusive bargaining representative of
employees in the following appropriate bargaining unit:
All production and maintenance employees, includ-
ing structural, ornamental, installation and miscella-
neous department employees employed by Re-
spondents (or either of them) at their Columbus,
Ohio facility, but excluding all office clerical em-
ployees, engineering employees, and all professional
employees, guards and supervisors as defined in the
Act.
6. Terminating or participating in the termination of
employees, in violation of the Act, for exercising rights
guaranteeed them under the Act, such as (but not limited
to) by purportedly reorganizing the business employing
such employees from a conventional employer-employee
relationship to a purported contracting or subcontracting
relationship, with such employees' foremen redesignated
as contractors or subcontractors so as ostensibly to elimi-
nate all employees and terminate their employment with
Respondents or either of them, and thereafter discrimina-
torily, in violation of the Act, failing and refining to
rehire or employ the terminated employees.
7. Unilaterally changing or purporting to change the
mode of operations and business structure of Respond-
ents, or either of them, from employment to purported
contracting or subcontracting out, without bargaining in
good faith with the labor organization .bargaining repre-
sentative of the employees with respect thereto and the
effects thereof on the employees.
8. Through utilization of a juridical entity, or through
shifting unit work to such other entity, or otherwise, in
violation of the Act, unilaterally evading or attempting
to evade or escape from the obligation to deal with the
employees' representative certified by the Board in con-
sequence of an election under the Act.
9. In any other manner violating the Act so as to deny
or deprive employees of their freedom to exercise their
rights thereunder, or so as by deliberate design, unlaw-
fully and in violation of the Act, to flout, defeat, and
overcome the official statutory certification by the Board
under the Act of the employees' bargaining representa-
tive.
C. Respondents Artcraft Ornamental Iron Co., Inc.
and Rich-Morrow Insurance Agency, Inc., their respec-
tive officers, directors, officials, agents, successors, and
845
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
assigns, shall take the following affirmative actions neces-
sary to effectuate the policies of the Act.
1. Notify the above-named Union in writing, within 10
days from the date of this Order, that the recognition of
the Union as officially certified exclusive statutory bar-
gaining representative of the aforementioned collective-
bargaining unit is acknowledged, confirmed, and contin-
ued for all purposes.
2. Disestablish the purported contracting or subcon-
tracting system unilaterally announced by Respondent
Artcraft Ornamental Iron Co., Inc. with the knowledge
and participation of Respondent Rich-Morrow Insurance
Agency, Inc. prior to the transfer of the business of the
former to the latter about April 29, 1983, and purported-
ly effectuated in connection with that transfer, and
resume operations on an employer-employee basis as it
existed at the time of the Board's official certification of
the bargaining representative following the Board-con-
ducted statutory election, and make no change therein
affecting the wages, terms, and conditions of employ-
ment of employees without bargaining in good faith with
the bargaining representative.
3. Retroactively reinstate the Thanksgiving and Christ-
mas bonus policy and practice which were discontinued
unilaterally in November and December 1982 without
bargaining with the bargaining representative, and make
whole all employees deprived thereof, together with in-
terest.
4. Promptly furnish to the Union all information and
data reasonably necessary for bargaining purposes, in-
cluding, but not limited to, a list of rates of pay and hire
dates of all employees (including all employees of Re-
spondent Artcraft Ornamental Iron Co., Inc. and all em-
ployees of Rich-Morrow Insurance Agency, Inc., includ-
ing all alleged employees of alleged contractors or sub-
contractors thereof conducting business on the premises
of Respondents or either of them); cost factors on insur-
ance, vacations, and holidays; and information and data
regarding the sale and transfer or purported sale and
transfer of the business and assets of one Respondent to
the other Respondent about and since April 29, 1983.
5. Offer Robert William Deal, William M. Diedrich,
Wilson Ford, Steve R. Friley, Ronald Lee Monroe, and
Jeffrey F. O'Hara immediate, full, and unconditional re-
instatement to their former positions held in the employ
of Respondent Artcraft Ornamental Iron Co., Inc. (or, if
not available, to substantially equivalent positions), with-
out prejudice to their seniority and other rights, privi-
leges, benefits, and emoluments, including but not limited
to any and all wage and pay scale increases and progres-
sions as if not terminated about April 29, 1983; and make
them whole for any loss of income (including overtime
pay, holiday and vacation pay, and reimbursement for all
hospitalization, surgical, medical, and other payments or
obligations incurred by reason of any cancellation, with-
drawal, or nonpayment of premiums on any applicable
insurance coverages in consequence of their termination
and nonemployment on and since that date), together
with interest, in the manner set forth in the remedy por-
tion of the decision of which this Order forms a part. In
the case of Wilson Ford and Jeffrey F. O'Hara, addition-
ally make them whole, with interest and otherwise as
above specified, for all wages and benefits and emolu-
ments lost by reason of the discriminatory failure to
recall them to employment from February 1983 until
their aforesaid termination about April 29, 1983; but this
additional obligation for the period from February to
April 29, 1983, shall be applicable only to Respondent
Artcraft Ornamental Iron Co., Inc.
6. On request, bargain in good faith with the Union as
such exclusive collective-bargaining representative retro-
actively as of April 28, 1983, the date of Respondent's
unilateral discontinuance of bargaining and announce-
ment of refusal to participate in further bargaining; and
embody in a signed agreement any understanding
reached.
7. Preserve and on request make available to the
Board or its agents for examination and copying, all pay-
roll records, wage rate and income records, work sched-
ules, overtime records, contracting and subcontracting
records, personnel records and reports, and all other
records necessary to determine the amounts of backpay
and other sums due under and the extent of compliance
with the terms of this Order.
8. Post at their premises in Columbus, Ohio, copies of
the attached notice marked "Appendix B."4 1 Copies of
the notice, on forms provided by the Regional Director
for Region 9, after being signed by Respondents' author-
ized representatives, shall be posted by Respondents im-
mediately upon receipt and maintained for 60 consecu-
tive days in conspicuous places including all places
where notices to employees are customarily posted. Rea-
sonable steps shall be taken by Respondents to ensure
that the notices are not altered, defaced, or covered by
any other material.
9. Notify the Regional Director in writing within 20
days from the date of this Order what steps Respondents
have taken to comply.
" 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 Na-
tional Labor Relations Board" shall read "Posted Pursuant to a Judgment
of the United States Court of Appeals Enforcing an Order of the Nation-
al Labor Relations Board."
846