CASCADES CONTAINERBOARD PACKAGING – NIAGARA, A DIVISION OF CASCADES HOLDING US INC.

National Labor Relations Board - Administrative Judge Opinions

Mar 17, 2020

03-CA-242367 (N.L.R.B. Mar. 17, 2020)

JD–11–20
Niagara Falls, NY
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
CASCADES CONTAINERBOARD PACKAGING –
NIAGARA, A DIVISION OF CASCADES HOLDING
US INC.
and Cases 03-CA-242367
03-CA-243854
03-CA-248951INTERNATIONAL ASSOCIATION OF
MACHINISTS AND AEROSPACE WORKERS,
DISTRICT LODGE 65, AFL-CIO
Jesse Feuerstein, Esq.,
for the General Counsel.
Don T. Carmody, Esq., and
Carmen M. Dirienzo, Esq.,
(Carmody and Carmody)
Katonah, New York,
for the Charging Party.
DECISION
STATEMENT OF THE CASE
PAUL BOGAS, Administrative Law Judge. This case was tried in Buffalo, New
York, on December 3, 4, and 5, 2019. The International Association of Machinists and
Aerospace Workers, District Lodge 65, AFL-CIO (the Union or IAMAW or Charging
Party) filed the initial charge on May 30, 2019, the second charge on June 25, 2019,
and the third charge on September 27, 2019, and amended the third charge on October
3, 2019. The Regional Director for Region Three of the National Labor Relations Board
(NLRB or the Board) issued the initial complaint on August 6, 2019, the consolidated
complaint on October 1, 2019, and the second consolidated complaint (the Complaint)
on October 30, 2019. The Complaint alleges that Cascades Containerboard Packing –
Niagara, a Division of Cascades Holding US Inc. (the Respondent), in the immediate
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aftermath of employees voting to be represented by the Union: coerced employees in
violation Section 8(a)(1) of the National Labor Relations Act (the Act) by telling them
that the profit-sharing plan checks were being adjusted because employees voted to
unionize; violated Section 8(a)(5) and (1) of the Act by failing to bargain before laying off
employees, changing the terms of its profit-sharing plan, and subcontracting bargaining 5
unit work, and by refusing to provide the Union with information regarding the profit-
sharing plan; and violated Section 8(a)(3) and (1) of the Act by discriminatorily changing
the profit-sharing plan payments and ceasing to display profit-sharing information
because employees formed the union and engaged in concerted activities. The
Respondent filed a timely answer in which it denied committing any of the violations 10
alleged.
On the entire record, including my observation of the demeanor of the witnesses,
and after considering the briefs filed by the General Counsel and the Respondent, I
make the following Findings of Fact and Conclusions of Law. 15
FINDINGS OF FACT AND ANALYSIS
I. JURISDICTION
20
The Respondent, a corporation, operates an office and place of business in
Niagara Falls, New York, (the Niagara facility) where it manufactures material for use in
cardboard boxes, containerboard, and folding cartons. In conducting these business
operations, the Respondent receives at the Niagara facility goods and services valued
in excess of $50,000 directly from points outside the State of New York. The 25
Respondent admits, and I find, that it is an employer engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act, and that the Union is a labor
organization within the meaning of Section 2(5) of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES30
A. BACKGROUND FACTS
The Respondent operates a facility in Niagara Falls, New York, that consists of a
paper mill and administrative offices. The Respondent’s Niagara facility produces paper 35
used in the construction of cardboard boxes. It is one of six paper mills that, along with
30 box-making plants, comprise the Cascade Containerboard Packaging (CCP)
operation. In the overall corporate structure, CCP is “underneath a New York holding
division.” Transcript at Page (Tr.) 423. Above the holding division, and other Cascade
entities, in the corporate structure is Cascade, Inc., which is headquartered in Quebec, 40
Canada. Ibid.
Prior to April 2019, none of the employees at the Respondent’s Niagara Facility
were represented by a union. The Respondent employs approximately 145 workers at
the Niagara facility, of whom between 108 and 115 are production and maintenance 45
employees. Employees initiated a union organizing campaign at the facility in August
2018 and on April 26, 2019, the production and maintenance employees voted to be
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3
represented by the IAMAW/Union. On May 6, 2019, the Board certified the Union as
the exclusive collective-bargaining representative of those employees.1 At the time of
trial – seven months following certification of the Union – the parties had not reached an
initial collective bargaining agreement.
5
There is no allegation in the Complaint that the Respondent violated the Act
during the union campaign. Rather the Complaint focuses on the Respondent’s actions
immediately after the union campaign succeeded. On the evening of May 14, 2019 – 8
days after the Union was certified – the Respondent, by email, informed the Union that it
would begin laying off unit employees less than a week later. The Respondent 10
proceeded with the layoffs, on two consecutive weeks, starting on May 20. In June, the
Respondent began meeting with employees about the profit-sharing payments that it
makes to employees twice each year. During those meetings, the Respondent told
employees that the profit-sharing plan payments they would receive had been changed
due to the current situation at the facility. When asked, the Respondent told employees 15
that the situation that led to the change was the advent of the Union. In addition,
immediately after the union election, the Respondent abruptly ceased its longstanding
practice of displaying, and otherwise sharing with employees, the monthly profit figures
for the facility. Employees used those profit figures to estimate the amounts of the
profit-sharing plan payments that they could expect to receive. The Union made an 20
information request for information relating to the profit-sharing plan payments, but the
Respondent refused to provide the Union with any of the requested information.
As discussed more fully below, in the weeks following the certification of the
Union, the Respondent began using an outside contractor to perform janitorial work that 25
had previously been performed by an employee-janitor who was in the bargaining unit.2
The Respondent had employed a janitor for at least 23 years3 prior to the Union’s
certification. The Respondent moved this work out of the bargaining unit without giving
the Union notice and an opportunity to bargain about the action.
30
B. RESPONDENT LAYS OFF NEWLY UNIONIZED EMPLOYEES
Prior to the Union’s May 6, 2019, certification, the Respondent had not resorted
to an employee layoff at the Niagara facility in over 10 years, and had done so just twice
in approximately 20 years. On May 14, 2019, at 6:02 in the evening, the Respondent35
informed the Union, via email and attached memorandum, that management would lay
1 The Unit is defined as:
All full-time and regular part-time Production and Maintenance employees employed by
Respondent at its facility located at 4001 Packard Road, Niagara Falls, NY 14303, excluding all
fire watch employees, office clerical employees, guards, professional employees and
supervisors as defined in the Act, and all other employees.
2 In the record, this work is sometimes referred to as janitorial work, and sometimes as
custodial work. The record makes clear that both terms refer to the same work, and I use the
term janitorial throughout this decision in the interests of clarity.
3 Tr. 456-457 (Joseph Zilbauer, human resources manager, testifies that, prior to the
union election, direct employees had performed the custodial work as long as he has been at
the Niagara facility) and Tr. 395-396 (Zilbauer has been at the facility for 23 years)
JD–11–20
4
off employees for 2 weeks beginning on May 20, 2019. This was the first time the
Respondent notified the Union that it would be laying off the unit employees. The
memorandum was from Normand LaPorte, the Respondent’s general manager, to
Richard Dahn, a union business representative, and stated:
5
Due to current market conditions, Cascades Containerboard Packaging-Niagara,
a division of Cascades Holding US Inc. will begin a 2 week market down that will
cause some bargaining unit employees to be temporarily laid off in accordance
with a long established past practice at the facility. This is to begin May 20,
2019. As a result, a total of approximately 19 employees will be laid off during 10
the first week of the shutdown, and a total of approximately 18 employees will be
laid off for the second week of the shutdown.
The Respondent’s human resources manager, Joseph Zilbauer, testified that the
Respondent had already made the decision to impose the layoffs at the time it sent the 15
email notifying the Union. Tr. 452-453. LaPorte testified that the reason for the layoff
was that, beginning in mid-March 2019, the Respondent’s business had been slower
than expected and the Respondent had reached its capacity for warehousing the
accumulating unsold product. There was no evidence that the Respondent had lost any
customers or had any orders cancelled during this time period and, in fact, Zilbauer 20
testified that he had no knowledge that either of those things had occurred. T. 450-451.
Both LaPorte and Zilbauer testified that the market conditions the Respondent relies on
to explain the layoff were not so extreme that the Respondent considered going out of
business at the Niagara location. Tr. 359 and 449-450.
25
At the time Dahn received LaPorte’s email about the layoffs, Dahn was not in
Niagara Falls, but rather attending a meeting in Chicago, Illinois. Ronald Warner,
directing business representative, who was Dahn’s superior in the Union, was also at
the meeting in Chicago. On May 15, while at the meeting, Dahn showed Warner the
email. At that time, the Respondent had not provided the Union with any information 30
about which employees would be affected by the layoff, or how they would be selected.
Warner, upon his return to Niagara Falls on May 17, met with long-time Niagara
facility employee Shawn Reed and asked him about the Respondent’s past practice
regarding layoffs. Reed told Warner that there was no past practice regarding layoffs35
and that, in fact, there had not been a layoff at the facility for many years. The record
shows that the last layoff had been over 10 years earlier, and the next-to-last layoff had
been about 10 years before that.4 The record shows that the method by which the 2019
layoff was carried out was different than the way those two prior layoffs had been
handled. To implement the prior layoffs, the Respondent had started by offering the 40
most senior employees the opportunity to volunteer for the layoff. The Respondent
would proceed by making the same offer to progressively less senior employees. The
Respondent would impose the layoff on unwilling employees only to the extent that too
few employees volunteered. On May 20, 2019, however, the Respondent laid off the 19
4 There had apparently also been non-layoff shutdowns of all or part of the facility,
including one to permit a deep cleaning of the plant.
JD–11–20
5
least senior unit employees, without attempting to lessen the burden on employees by
seeking volunteers. The two prior layoffs and the May 2019 layoff were similar in that
they were all premised on market conditions.
Warner, in a May 17 letter to Zilbauer, responded to the Respondent’s May 14 5
email announcing the layoff.5 In the letter, Warner stated that the Respondent had
made a unilateral decision regarding a mandatory subject of bargaining, and further
stated that the Union was calling upon the Respondent to “cease and desist” until
decisional and effects bargaining took place. Warner said that the Union was available
to bargain “over the proposed change . . . on May 28 or 29.”6 This letter, although sent 10
several days before the Respondent began the layoff, was not delivered until the third
day of the 2-week layoff. Upon receiving the letter, the Respondent did not “cease and
desist” from laying off the unit employees until bargaining occurred, but rather
proceeded with both weeks of the layoff. Nineteen unit employees were laid off for the
first week, and 18 employees were laid off for the second week. Neither the Union nor 15
the Respondent contacted the other by phone about the layoff during the days between
the Respondent’s email and the start of the layoff.
LaPorte testified that the dates Warner offered for bargaining – May 28 and May
29 – were “too late,” but Laporte did not offer any alternative dates to the Union. Tr. 20
365. On May 28 or 29, Dahn met with LaPorte, Zilbauer, and a human resources
staffer, regarding an unrelated disciplinary matter. At this meeting, the Respondent
raised the subject of the layoff, but Dahn stated that Warner, his supervisor, was
handling that issue. On June 4, after the layoff ended, Warner had a phone
conversation with LaPorte and Zilbauer. During that call, LaPorte stated that the reason 25
for the layoff was that the Respondent had “a lot of warehouses with a lot of product.”
During a meeting about the layoff on June 10, Laporte told Warner that the “market
conditions” that he cited in his memorandum to explain the layoff involved a surplus of
5 The Respondent attempts to give the impression that its officials did not know who
Warner was when it received this May 17 letter from him. However, Zilbauer was clear that he
knew since at least April 26 that Warner was an official of the Union and knew since May 6 that
Warner was a business representative for the Union. Tr. 403, 444-445. I note, moreover, that
while LaPorte testified that he did not even know what union represented employees at the time
he saw the IAMAW’s May 17 letter, he later backtracked from that claim – conceding that at that
time he knew Dahn was an IAMAW official and represented the bargaining unit. Tr. 361.
6 The body of Warner’s May 17, 2019, letter read:
This letter is written in response to the Company’s letter dated May 14, 2019,
signed by Normand LaPorte. The Company has made a unilateral decision to implement
a layoff of the bargaining unit employees, who we represent. This is a change in the
working conditions of the bargaining unit employees at Cascades. The Union hereby
request[s] decisional and effects bargaining. The Union calls for a cease and desist of
this practice until bargaining can take place.
Please advise the Union as to when the Company will be able to bargain over the
proposed change, we have availability on May 28 or 29, 2019. As you know, this is a
mandatory subject of bargaining[ and] failure to bargain on this subject would be
considered a unilateral change, under the National Labor Relations Act. Please respond
within two (2) business days of receipt of this certified letter, with how you would like to
proceed.
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warehouse inventory. On June 13 – almost 2 weeks after the layoff ended – the
Respondent first informed the Union which employees had been affected by it.
C. PROFIT-SHARING PAYMENTS
5
1. HISTORY OF PROFIT-SHARING PAYMENTS
For over 20 years, the Respondent has made semi-annual profit-sharing plan
payments to employees of the Niagara facility – once in June or July and once in
December of each year. Employees receive these payments at the Niagara facility if 10
they have been permanent employees for at least a year. The amounts of the semi-
annual profit-sharing payments vary over time and between employees because the
amounts are calculated based on variable factors including the profits of the Niagara
facility and the other compensation the Respondent paid to the employee during the
relevant period. The Respondent informed employees that the payments were 15
calculated by setting aside a percentage of the facility’s profits for distribution to
employees, and then determining each employee’s share of the set-aside amount
based on that employee’s regular earnings during the relevant time period. Tr. 166-168,
193-194, 210-214. Zilbauer stated that he had to check the employees’ eligible
earnings to make sure that the profit-sharing payments were based on the correct 20
information. Tr. 425. On two occasions prior to the Union’s certification, the
Respondent informed employees that it was reducing the portion of the Niagara facility
profits that would be set aside for distribution to employees. One of these occasions
was in 2010 and the other in 2014.
25
The profit-sharing plan payments constitute a very substantial portion of the
compensation that employees at the Niagara Facility receive. In 2018, for example,
hourly employees received average total profit-sharing plan payments of $15,6627 – an
amount equal to approximately 21 to 22 percent of the average of employees’ other
annual wages at the time of trial.8 Zilbauer testified that the Respondent considers the 30
profit sharing payments to be a “gift” to employees, not a term and condition of
employment. He stated that the payments are a program of the head office of Cascade,
Inc., in Canada, although he did concede that the Respondent was responsible for
making sure that the wage information used to determine the payments was accurate
and that all eligible employees were included. The Respondent has promulgated a35
“production working conditions manual” and a “maintenance employee handbook” that
each reference the profit-sharing payments. Those documents, which pre-date the
arrival of, and were not negotiated with, the Union, each state that “profit-sharing is a
non-negotiable and a discretionary corporate program which can be modified or
reviewed at any time by the Company.” The portions of these documents that the 40
Respondent presented at trial do not state what is meant by “Company,” and,
7 Joint Exhibit Number (Jt Exh.) 2 shows that hourly employees’ average profit-sharing
payments were $6422 in June 2018 and $9240 in December 2018 for a total of $15,662 that
year.
8 According to LaPorte, general manager of the Niagara facility, the average yearly
wages for hourly employees at the facility was $68,000 to $70,000. Tr. 483.
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specifically, do not state whether this refers to the Respondent (Cascades
Containerboard Packaging – Niagara), to Cascades Holding US or to the overall
corporate entity headquartered in Canada. Respondent’s Exhibit Number (R Exh.) 8. I
do note that headings on both documents make specific reference to the Respondent’s
Niagara Falls operation. One heading is “Cascades Containerboard Packaging, 5
Niagara Falls Division, Production Working Conditions Mutual Agreement 2018 & 2019.”
The other heading is “Cascades New York, Inc. Niagara Falls Divisions Maintenance
Employees Handbook.”
2. JUNE/JULY 2019 PROFIT-SHARING PLAN PAYMENTS10
Prior to when the Respondent makes the semi-annual profit-sharing plan
payments to hourly employees, a supervisor meets with each employee to discuss the
amount that the employee will receive. The Respondent then makes the profit-sharing
payment to each employee either by disbursing a check to the employee or by direct 15
deposit. At the time when supervisors met with individual Niagara facility employees
about the upcoming June/July 2019 payment – the first such payment since employees
elected the Union as their bargaining representative – supervisors and other officials
stated that the profit-sharing plan payments had been changed because of the current
situation or “culture” at the Niagara facility. The supervisors read a script about the 20
change from a hand-written note that management provided to them. The Respondent
did not provide a copy of this handwritten note to the employees, and declined to so
when employees asked for it. This procedure diverged from the Respondent’s prior
practice, which was that the supervisor would discuss a typed document regarding the
profit-sharing plan payment and then provide a copy of that typed document to the 25
employee, without the use of a handwritten script.
Zilbauer (human resources manager) – a witness for the Respondent and a
supervisor and agent – testified that Cascade’s regional human resources manager
(Dave Guillemette) informed him that the July 2019 profit-sharing payments to 30
employees at the Niagara facility were being changed because of the Union situation at
the facility. Tr. 426, 466-467. Another supervisor, Robert Pozzobon, communicated
that information to employees. When Pozzobon met with unit employee Gerald
Cracknell to discuss the June/July 2019 profit-sharing plan payment, he told Cracknell
that the “profit sharing had been adjusted due to the current conditions and situation in 35
Niagara Falls.” Tr.140-142. When Cracknell asked what “situation” Pozzobon was
referring to, Pozzobon stated that the “situation” was “the Union.” Ibid. Similarly, when
Pozzobon met with unit employee Randy Butski in June about the profit-sharing plan
payment, Pozzobon told him that “due to the current culture of the Niagara Falls mill, we
were forced to reduce your profit-sharing check.” Tr. 179. When Butski asked 40
Pozzobon what he meant by the current culture, Pozzobon responded, “if you’re asking
me, it’s because of the Union.” Tr. 197-198.9
9 Butski’s testimony that Pozzobon had made this statement about the Union being the
reason for the reduction of his profit-sharing payment was clear and certain. Pozzobon did not
deny making this statement, although he did state that he could not remember whether he had
met with Butski at all. Tr.289-290. Since Pozzobon denied neither that the meeting with Butski
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Pozzobon also met with unit employee Reed about the June 2019 payment, and
told Reed that there had been an adjustment to the payment because of the “current
situation” at the facility. Reed asked whether the Respondent’s other facilities were
affected by the adjustment, and Pozzobon responded “no, only ours.” Tr. 219-221. 5
Reed testified that he did not ask Pozzobon what “current situation” led to the
adjustment since he considered it obvious that Pozzobon was referring to the recent
certification of the Union because that was the only situation that had changed. Tr. 221.
Given that this was the first profit-sharing payment after the Union was certified, that the
Respondent diverged from its usual procedure by providing supervisors with a 10
handwritten script that was not shared with employees, that Pozzobon stated that
payments at other facilities were not being adjusted, and that no other “current situation”
was identified by Pozzobon, I find that it was reasonable for Reed to understand that the
recent union activity was the “situation” to which Pozzobon was attributing the change in
profit-sharing plan payments. 15
3. RESPONDENT CEASES SHARING THE MONTHLY PROFIT INFORMATION THAT
EMPLOYEES RELIED ON TO ESTIMATE THE PROFIT-SHARING PAYMENTS
For approximately 10 to 15 years, the Respondent shared monthly profit figures20
for the Niagara facility with employees. Employees used this information to estimate the
amount of their next semi-annual profit-sharing payment. The Respondent displayed the
monthly profit figures in the office of Chris Marlowe (assistant controller) where they
could be viewed by employees. Sometimes supervisors also conveyed this information
to employees orally.25
The record shows that immediately after the union election, the Respondent
stopped displaying and otherwise sharing the monthly profit information with employees.
Butski asked Marlowe for the information, but Marlowe told Butski that she was no
longer permitted to display the information. Cracknell asked LaPorte (general manager) 30
why the monthly profit figures were no longer being shared with employees and LaPorte
took place, nor that he had made the statement about the Union to Butski, I find that Butski’s
otherwise credible testimony on this score is uncontradicted and I credit that testimony. In
addition, Pozzobon was evasive on the subject of his statements to Cracknell about changes to
the profit-sharing payments. For example, Pozzobon denied, under oath, that during his
meeting with Cracknell he used “words to the effect” that the payments had been “adjusted” due
to current circumstances. Tr. 287. However, Pozzobon then conceded that he had told
Cracknell that the payments had been “affected” due to current circumstances. Ibid.
Pozzobon also denied that he told Cracknell that the payments had been adjusted because of
the Union, Ibid., but as shown by the above, Pozzobon was drawing a distinction between using
“words to the effect” that the payments had been “adjusted” and using words to the effect that
the payments had been “affected.” Pozzobon never denied that he told Cracknell that the
payments had been affected (or changed or reduced or modified) because of the Union.
Therefore, I consider Cracknell’s clear, certain, and credible testimony that Pozzobon identified
the Union as the reason for a change in the profit-sharing plan payment to be unrebutted. To the
extent that Pozzobon’s testimony can be seen as a denial on this point, I credit Cracknell over
Pozzobon given Pozzobon’s evasiveness.
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answered “because there’s a third party involved.” Another employee, Reed, also
asked LaPorte why the facility’s profit information was no longer being shared with
employees. LaPorte responded, that “the Union had proven that they can’t be trusted
with important information.” Reed told LaPorte that he was asking for the information on
his own behalf, not on behalf of the Union. LaPorte still refused to provide the 5
information to Reed.
At trial, LaPorte admitted that the Respondent stopped providing the profit
information because of a flyer that he received from a supervisor on the day before the
union election. LaPorte himself was the subject of the flyer. The flyer expressed 10
skepticism about LaPorte’s academic history and also set forth information about the
value of two of LaPorte’s residences.10 The flyer gave the addresses of each of these
residences, and identified LaPorte’s spouse by name as a co-purchaser of one of them.
LaPorte testified that this flyer was a “big disappointment” and that he was particularly
troubled by it due to his bad experience approximately 18 years earlier with a different 15
union at a different company in Canada.
The flyer discussing LaPorte was entered as an exhibit at trial. Although LaPorte
testified that the flyer made him feel that the Union had “disrespected” him, the
Respondent does not assert that the Union claimed responsibility for the flyer, nor did20
the Respondent present testimony from anyone who claimed to have witnessed union-
affiliated individuals distributing it. No witness claimed to have knowledge regarding the
creation of the flyer.11 The flyer itself makes no reference to the Union or the union
campaign. The flyer is undated, and the most recent year referenced within it is 2017,
well before the union campaign began in August 2018. At trial, LaPorte testified that he 25
assumed that the Union was responsible for the flyer, but he stated that he did not
attempt to determine whether this was true or not. Tr.375-376. When Reed asked
LaPorte about the Respondent’s decision to withhold the profit information from
employees, Reed stated that he was not involved with the flyer. During a bargaining
session, the Respondent complained about the flyer, and the Union representatives 30
who were present neither claimed credit for the flyer nor denied involvement with it. I
find that the Respondent did not have a reasonable basis for concluding that the Union,
or anyone acting on its behalf, was responsible for the flyer. LaPorte testified that after
receiving the flyer he complained about it to Luc Pelletier (LaPorte’s superior in the
Cascade organization), Karen Jaben (a vice-president) and Guillemette (regional 35
human resources manager).
LaPorte testified that the flyer was indirectly referenced in an April 29, 2019,
memorandum from the “CCP Niagara Management Team” (the members of which the
10 LaPorte testified, without contradiction, that he rented, rather than owned, one of
these residences. This is not inconsistent with the information in the flyer, which does not claim
that LaPorte owned that property.
11 Counsel for the Respondent claims in the Respondent’s brief that unit employee
“Reed knew that the Union had distributed a flyer with personal information about LaPorte.”
Brief of Respondent at Page 18, citing Tr. 235. This misrepresents the record. In the cited
testimony, Reed does not state that he knew who created or distributed the flyer or anything
about it. In fact, he testified that he had never even seen the flyer.
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memorandum does not identify) to employees of the Niagara facility. The April 29
memorandum begins by stating that management was “disappointed at th[e] news” that
a “slight majority” of employees had voted for union representation. The memorandum
states that the Respondent would, nevertheless, “respect the outcome.” Then the
memorandum goes on to state:5
Based on the past days experience, it is concerning to us how this union
has taken sensitive information and used it to put together an adversarial
campaign including personal attacks. In Niagara Falls, we have shared,
until now, a good deal of sensitive and private information with our 10
employees, such as profits, that we may not be comfortable to share the
same way anymore. If you have any questions, please do not hesitate to
ask us.
LaPorte testified that this memorandum represented the notice he received directing 15
him to cease sharing monthly profit figures with employees. Tr. 381-382. I find,
however, that the memorandum does not direct LaPorte to cease sharing the profit
information. Rather it states that management “may not be comfortable to share” the
information in “the same way anymore.” (Emphasis Added). Moreover, it is not clear
who specifically the memorandum came from, or even whether it came from anyone 20
above LaPorte in the Cascade organization. In addition, I find that there was no
showing at trial that the flyer regarding LaPorte included any information that was not
publicly available or that would only have been available to the creator of the flyer
because the Respondent shared the information with employees or the Union. To the
contrary, the flyer specifically identifies public sources (Zillow.com, Realtor.com, Social 25
Media) for the information. The profit figures that the Respondent has ceased sharing
with employees were not referenced in the flyer in any way.
Regarding the evidence surrounding the Respondent’s decision to stop sharing
the monthly profit information, I found LaPorte to be a biased and highly unreliable 30
witness based on his testimony and demeanor. He strained unconvincingly to distance
himself from the decision to stop sharing the monthly profit information with employees.
He repeatedly asserted that he took the action only at the direction of higher ups in the
organization, see, e.g., Tr. 352-353, 378, but, as discussed above, the memorandum
that he says directed him to cease sharing the profit information, does not, in fact, direct 35
him to do that. It was not even demonstrated that LaPorte, the highest on-site official at
the Niagara facility, was not a member of (or even the only member of) the “CCP
Niagara Team” who issued it. Indeed, when LaPorte was asked at trial to explain the
memorandum he said “we decided to publish a communication to all the employees,
and it happened after the election” Tr. 344 (emphasis supplied) – thus indicating that it 40
was a directive from LaPorte, not to him from upper management. The Respondent did
not introduce documentation in which any official from outside the Respondent directed
Laporte to stop sharing the information. At any rate, if Cascades officials beyond the
Niagara facility had decided that because of the flyer the profit information should no
longer be shared with the employees, the evidence shows that they would have been 45
doing so in response to LaPorte’s complaints blaming the Union for the flyer. Tr. 351-
352, 378.
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LaPorte’s effort to avoid responsibility for the decision to withhold profit
information from his workforce became even more far-fetched when he claimed that not
only had he been directed to stop sharing the profit information, but that he would not
have been capable of sharing the information even if he wished to do so, because he5
himself no longer had access to it. Tr. 381-382. Given that LaPorte was the general
manager of the facility and was responsible, in own words, to “manage sales,
accounting, production, quality,” in order “make a successful” operation at the Niagara
facility, Tr. 313, it is implausible that he would not have access to profit information for
the facility. LaPorte claimed not only that he was now managing the facility without the 10
profit information that had until recently been shared with the entire workforce, but he
testified that he had never even asked for that information. Tr. 381 at lines 11 to 19; Tr.
382 at lines 8 to 12.12 LaPorte’s willingness to make such an implausible claim under
oath reflects poorly on his honesty and reliability as a witness. Indeed, the
Respondent’s counsel apparently recognized this and, during a subsequent re-direct 15
examination, helped LaPorte change his answer. Tr.383-384. Specifically, under
questioning by the Respondent’s counsel, LaPorte acknowledged that, contrary to his
earlier claim, he did continue to have access to the profit information for the Niagara
facility, even after he stopped sharing that information with employees following the
union election. Ibid.20
Based on the record evidence discussed above, I find that the LaPorte and the
Respondent were responsible for ceasing the longstanding practice of sharing the
Niagara facility’s monthly profit information with employees.
25
4. UNION INFORMATION REQUEST REGARDING PROFIT-SHARING
As mentioned above, in June and/or July of 2019, during meetings regarding the
first post-certification profit-sharing plan payments, the Respondent told employees that
their profit-sharing plan checks had been changed due to the current situation at the 30
Niagara facility. Pozzobon and Guillemette stated that the Union was the reason for
these changes. Unit employees alerted the Union that the Respondent was stating that
the Union was the reason that profit-sharing plan payments had been changed. The
Union had no information from the Respondent regarding the formula used to calculate
the profit-sharing plan payments or of the change to those payments. In a letter from 35
Warner to Zilbauer, dated August 16, 2019 (and received on August 18), the Union
requested information relating to the profit-sharing plan payments and the changes that
the Respondent was telling employees had been made. The letter also asked the
Respondent to resume its longstanding practice of sharing monthly profit information for
the Niagara facility with employees. The letter reads in relevant part: 40
I. Please provide the detailed formula for how the Profit Share that the
Cascades bargaining unit employees receive, is figured. This profit share
12 LaPorte definitively testified at one point that he never asked for the profit information
for the Niagara facility, but he subsequently stated that “maybe” he had asked for a
“guesstimation” of the profit information. Tr. 382.
JD–11–20
12
is referenced in both employee handbooks that you provided. We need
this formula for each of the past three years; 2017, 2018 and 2019,
including any changes in the formula that may been implemented in these
years.
II. Please provide the actual amount of profit share checks that each 5
bargaining unit employee received for the past three-year period 2017,
2018 and 2019. Also seeking the average amount paid out each period.
We understand that this is distributed two times a year, so we are seeking
the past 6 check amounts.
III. Understanding that the Profit Share is distributed two times a year. 10
Please provide the time period that is used in the determination of the
amount of the profit share as well as when the checks are paid out to the
employees. (example; January – June time period and paid out 2nd week
of July?)
IV. Please provide the monthly profit statements which Cascades stopped 15
posting for the bargaining unit employees in April 2019. We are seeking
the profit statement for April, May, June, and July, as well as August
statement when that month becomes available. The Union additionally
requests Cascades to continue to post these profit statements on a going
forward basis, as this has been the historical practice prior to the 20
organizing campaign.
Warner’s letter stated that the information was “essential to bargain intelligently on the
issues of wages and working conditions in the forthcoming negotiations.”
25
As of August 26, 2019, Warner had received no response at all to the information
request sent 10 days earlier. Warner sent a second letter to Zilbauer regarding the
matter. This one was dated August 26, referenced the August 16 request, and repeated
the same information requests. On September 3, Zilbauer sent an email message to
Warner regarding the Union’s request. Zilbauer stated that the Respondent would not 30
provide the Union with any of the requested information. Instead, Zilbauer asserted with
respect to each and every information request in the Union’s letter that “the relevance of
the information being sought . . . is not evident.” With respect to information request
paragraphs I and III, Zilbauer also made a conclusory statement that the requested
information was “confidential and proprietary.” Warner responded by letter dated 35
September 6. Regarding the Respondent’s contention that the relevance of the
information sought was “not evident,” Warner stated:
Although we have already done so, to further clarify, the profit share has
historically been part of the benefits that employees that we now represent 40
have received as part of their compensation. As such it is part of the
terms and conditions of their employment. Therefore, we are entitled to
this information under National Labor Relations Act.
The Respondent did not respond to Warner’s September 3 letter, and did not provide 45
any information at all in response to that letter and the information requests.
JD–11–20
13
5. CHANGE TO THE PROFIT-SHARING PLAN PAYMENTS,
WHO MADE THE CHANGES, AND ADVERSE INFERENCE
Pozzobon, an admitted supervisor and agent of the Respondent,13 told
employees that the June/July 2019 profit-sharing plan payments had been reduced and 5
changed. Zilbauer, another admitted supervisor and agent,14 testified that the June/July
profit-sharing plan payments had been changed. In addition, unit employees Cracknell
and Reed both testified that the June/July payment was about $1000 lower than what
they should have received. Although, in its pleadings, the Respondent denied that it
had altered the profit-sharing plan payments, it presented no testimony or other 10
evidence to contradict the statements of Pozzobon, Zilbauer, Cracknell, and Reed, that
the payments had, in fact, been changed. I find that there was a change to the profit-
sharing plan payments that the Respondent disbursed to unit employees in June/July
2019.15
15
I also find that the Respondent did not provide the Union with notice or an
opportunity to bargain before reducing the June/July profit-sharing plan payments to
bargaining unit employees. Warner credibly testified that the Respondent did not notify
the Union. Tr. 42. Zilbauer, the human resources manager and a witness for the
Respondent, testified that he knew about the change, but did not notify the Union. Tr. 20
467. The Respondent presented no evidence showing that it provided the Union with
notice or an opportunity to bargain before making the change. Indeed, it maintains that
it had no obligation to do so.
The record evidence does not establish exactly how much the profit-sharing25
plan’s operation was changed. This is not surprising given that the Respondent failed to
produce information properly sought in the General Counsel’s subpoena duces tecum
regarding, inter alia, the formulas/calculations that the Respondent used to arrive at the
profit-sharing amounts and the Respondent’s internal communications regarding the
profit-sharing plan payments. This failure continued even after I denied the 30
Respondent’s petition to revoke the General Counsel’s subpoena and directed the
Respondent to produce the information.16 There was, however, the credible testimony
of Cracknell and Reed that the June/July payment had been reduced by about $1000.
The Respondent did not provide any information to show that the change to the profit-
sharing plan payments was less consequential than that.35
At trial, the General Counsel made a motion for the imposition of a range of
evidentiary sanctions to address the Respondent’s failure to comply with the General
13 See GC Exh. 1(x-1) at Paragraph 5 (Respondent’s Amended Answer to Complaint)
14 Ibid.
15 For this reason, I deny the Respondent’s motion to dismiss the claims relating to the
profit-sharing plan. In that motion, the Respondent argued that no change had been shown.
16 The Respondent never produced information regarding the profit-sharing plan
formulas and calculations. The only production it made regarding the plan was on the last day
of the hearing when it provided recently prepared summary documents listing amounts that
employees received over a 3-year period. It did not provide the underlying documents or any
other material that would reveal how the amounts were calculated or changed.
JD–11–20
14
Counsel’s subpoena for information relating to the profit-sharing plan even after I
directed the Respondent to do so. I reserved ruling on that motion at trial, and now
grant the motion to the extent that I find that the Respondent’s contumacious refusal to
produce plainly relevant records properly subpoenaed by the General Counsel warrants
drawing an adverse inference against the Respondent on the questions of: (1) whether 5
the profit-sharing payment to unit employees were calculated based, in whole or in part,
on the Niagara facility’s profits and the other earnings of the particular recipient during
the relevant time period; (2) whether the change made to the operation of the profit-
sharing plan in June/July 2019 was substantial, and (3) whether the Respondent was
responsible for the change. See Shamrock Foods Co., 366 NLRB No. 117, slip op. at 1 10
n. 1, and 15 n. 29 (2018), enfd. 779 Fed. Appx. 752 (D.C. Cir. 2019); Sparks
Restaurant, 366 NLRB No. 97, slip op. at 10-11 (2018); Metro-West Ambulance
Service, 360 NLRB 1029, 1030 and n. 13 (2014); McAllister Towing & Transportation,
341 NLRB 394, 396–397 (2004), enfd. 156 Fed. Appx. 386, 388 (2d Cir. 2005).
15
Generally, a party must produce subpoenaed information as long as it is, or could
lead to evidence, potentially relevant to the complaint allegations. See NLRB Rules and
Regulations, Sec. 102.31(b); McDonald’s USA, LLC, 363 NLRB No. 144, slip op. at 15
(2016). At trial, the Respondent’s counsel forwarded a variety of meritless arguments17
in an effort to justify its refusal to produce the subpoenaed profit-sharing information that 20
was highly relevant to the allegations that the Respondent discriminatorily and
17 For example, attorney Carmody, the Respondent’s counsel, argued that he did not
have to provide subpoenaed information regarding the profit-sharing plan because changes to
the plan could not be an unfair labor practice inasmuch as the plan was a “gift” rather than a
term or condition of employment. Tr. 300. Although Carmody is certainly entitled to argue to the
Board that the profit-sharing plan is not a term or condition of employment, it is improper
conduct for him to make that determination for the Board and, on that basis, decline to comply
with a valid subpoena for information relevant to adjudication of the issue, especially after I
directed him to do so. Worse yet, Carmody did not initially disclose that he was withholding
information on his own authority in this manner. He only admitted to doing so after a document
responsive to the subpoena came to light, and he was questioned as to why he had not
produced it. The work of attorneys who appear before the Board would be much easier if rather
than presenting arguments to the Board they could, as Carmody seems to think he can, simply
make the rulings themselves and in favor of their own clients.
Also without merit is Carmody’s argument that the Respondent should not be required to
comply with the General Counsel’s subpoena because it seeks some of the same information at
issue in the Complaint allegation relating to the Union’s information request. I agree that if the
information request claim was the only alleged violation in this case, the General Counsel would
not have a legitimate need for the information in advance of the Board order being sought and
could reasonably be seen as improperly attempting to use the subpoena as substitute for such
an order. See Electrical Energy Services, 288 NLRB 925, 931 (1988). In this case, however,
the General Counsel’s subpoena clearly has a legitimate purpose, and is not improper, since it
seeks information that is relevant to the Complaint allegations that the Respondent
discriminatorily and unilaterally reduced employees’ profit-sharing payments. The General
Counsel is seeking a Board order, unrelated to information production, to remedy harm
employees allegedly suffered as a result of such violations. The production of information
necessary to litigate those separate issues in no way undercuts, and in fact undergirds, the
statutory requirement for a hearing on the ultimate issue.
JD–11–20
15
unilaterally changed that benefit. After I spent a significant amount of time addressing
the Respondent’s arguments to justify withholding the information, and after I rejected
those arguments and directed production, the Respondent’s counsel, stunningly and
abruptly, changed course and asserted that the Respondent simply did not have the
subpoenaed information and therefore could not produce it regardless of whether the 5
Respondent had a valid basis for withholding it. If that were true, the Respondent’s
counsel no doubt would have said so at the outset rather than making lengthy written
and oral attempts to justify the Respondent’s decision to withhold information that it
subsequently claimed it never had in the first place.18
10
18 Carmody also asserted that the provincial law of Quebec, Canada – one of the ten
provinces in Canada’s federal system – includes a “blocking” provision that justifies the
Respondent withholding the subpoenaed material, even though the instant proceeding is taking
place before a United States federal agency, under United States federal law, and addresses
the allegedly unlawful treatment of employees working in the United States. Carmody made this
argument without even bothering to provide the text of the foreign provision that supposedly
justified withholding relevant evidence. Instead Carmody provided only his own paraphrasing of
the foreign law with some selective quotes to its language. Carmody did not provide the
testimony or opinion of any counsel admitted to practice in Quebec, or with expertise regarding
Canadian law, to support his assertions regarding the operation of the Quebec provincial
provision he paraphrases. Nor did he present any evidence showing that the Respondent had
requested the information from its corporate parent but that the corporate parent refused to
provide the information based on Quebec provincial law. The U.S. Supreme Court addressed
the type of argument made by Carmody here in Societe Nationale Industrielle Aerospatiale v.
United State District Court, and there stated that “[i]t is well settled that [foreign blocking]
statutes do not deprive an American court of the power to order a party subject to its jurisdiction
to produce evidence even though the act of production may violate that statute.” 482 U.S. 522,
544 n. 29 (1987) The Respondent cites no cases in which federal courts have held that,
contrary to Aerospatiale, the federal law of the United States must, in a federal proceeding
regarding the treatment of employees in the United States, yield to the Quebec blocking statute.
Carmody relies on two federal district court cases in which the Quebec blocking statute was
discussed in the context of privately brought asbestos litigation where the information at-issue
was sought from a nonresident company that manufactured asbestos in Canada. Notably,
even in those federal asbestos cases cited by the Respondent, both district courts did compel
production of subpoenaed information despite the Quebec provision. See Central Wesleyan
College, 143 F.R.D. 628, 644-646 (D. S.C.1992), judgment affirmed by 6 F.3d 177 (4th Cir.
1993) and Petruska v. Johns-Manville, 83 F.R.D. 32 (E.D.Pa.1979). Moreover, production was
compelled in those cases even though the rationale for doing was not nearly as strong as it is in
the instant case since here the information is being sought in a case brought by a United States
federal agency seeking production from a United States employer regarding its allegedly
unlawful treatment of United States workers at a United States facility. Board precedent in
analogous cases involving state law limitations on disclosure establishes that in Board
proceedings federal law overrides contrary local law restrictions. See, e.g., R. Sabee Co., 351
NLRB 1350 n. 3 (2007), and cases cited there. It is clear under Societe Nationale Industrielle
Aerospatiale v. United State District Court, supra, and the other precedent set forth above, that
the Quebec local provision relied on by Respondent cannot do what even the state and local
law of the United States could not do – that is, override the Board’s authority under federal
statute to obtain information highly relevant to allegations that the Respondent violated the
federal rights of United States employees.
JD–11–20
16
In reaching the conclusion that an adverse inference is an appropriate sanction, I
considered the Respondent’s assertion that the subpoenaed information was not in the
possession of the Respondent, but rather in the possession of the Respondent’s parent
corporation in Canada, which is not named in the Complaint. I consider the claim of
Respondent’s counsel that the management of the Niagara facility did not possess any 5
of the requested information to be specious. The Respondent did not show that it had
made a reasonable search of its records, but had failed to find the subpoenaed
information. Moreover, as noted above, counsel only resorted to claiming that the
Respondent did not possess the information after losing his bid to justify withholding
that information. I note, moreover, that when the Respondent answered the Union’s 10
information requests for information about the profit-sharing plan, the Respondent did
not claim that it lacked such information, but rather refused to provide the information
based on assertions that the information was not relevant and/or was confidential and
proprietary. General Counsel Exhibit Number (GC) Exh. 6.
Moreover, the Respondent’s production obligation extends not only to information 15
in its immediate possession, but also to information that it could obtain from other
persons or companies. See Clear Channel Outdoor, Inc., 346 NLRB 696, 702 fn. 10
(2006) (“[i]n responding to a subpoena, an individual is required to produce documents
not only in his or her possession, but any documents that he or she had a legal right
to obtain”); see also Winthrop Management, 2018 WL 834316 at n.2 (Board Order 20
Regarding Petition to Revoke Subpoena). The subpoena apprised the Respondent of
the obligation to provide information that was not in its immediate possession or control,
but which was in the possession of an entity “connected with you.” See Respondent
Exhibit Number (R Exh.) 1, Attachment 1 (Subpoena), Definitions and Instructions
Paragraphs 2 and 10.25
The Respondent’s counsel did not call a custodian of records to substantiate that
the Respondent either searched its own records for, or sought unsuccessfully to obtain
from within the Cascade organization, the relevant profit-sharing information that I
directed it to produce.19 Even more disturbing is the fact that the Respondent’s counsel
failed to present the testimony of the custodian of records after assuring me that he 30
would do so. Tr. 255. In the end, there was no record evidence that the Respondent
made any search at all for the highly relevant information that was properly subpoenaed
by the General Counsel and which I directed the Respondent to provide.
The Respondent’s conduct regarding the subpoena issues demonstrates
contempt for the Board’s processes and authority under federal law. Allowing the 35
Respondent to escape scrutiny of its alleged violations by withholding relevant
19 LaPorte and Zilbauer testified, but the Respondent did not suggest that either was the
custodian of records. At any rate, neither LaPorte nor Zilbauer testified that they conducted or
oversaw a reasonable search for the subpoenaed information, nor did they claim that they
asked for the records from the Respondent’s parent corporation, the holding company, or some
other part of the Cascades organization.
JD–11–20
17
information properly subpoenaed by the General Counsel would frustrate the purposes
of the Act. Therefore, it is appropriate to draw the adverse inferences articulated earlier.
I find that: the profit-sharing payments were calculated based, at least in part, on
a percentage of the Niagara facility’s profits and the particular recipients’ earnings; that
the payments made to unit employees in June/July 2019 were substantially reduced; 5
and that the Respondent was responsible for this reduction. My decision to grant the
General Counsel’s motion to the extent of drawing adverse inferences should not be
construed as a conclusion that such an adverse inference is necessary to these
findings. I would have found a substantial change was made to payments and that the
payments were based on employment-related factors such as the employee’s other 10
wages based, inter alia, on the unrebutted testimony of Zilbauer that a change was
made and that he had to check the employees’ other wages to make sure the profit-
sharing payments were correct, and the testimony of employees that the profit-sharing
payments were calculated based on the facility’s profits and the employee’s earnings
and that the June/July payment was reduced by approximately $1000.2015
In addition, even apart from the adverse inference that the Respondent bore
responsibility for the reduction to the profit-sharing payments, I believe that the record
indicated that the Respondent did bear such responsibility. The record shows that the
Respondent was the employer of the unit employees to whom the profit-sharing
payments were made, was responsible for disbursing the profit-sharing payments, and 20
was responsible for making sure that the profit-sharing payments correctly reflected the
employee’s earnings and eligibility. The Respondent was the one who communicated
with employees regarding the payments and told them that the payments had been
changed because of the Union. The Respondent introduced no documentation to
substantiate the self-serving testimony that the Respondent itself had no role in, or 25
control over, how much profit-sharing compensation it distributed to its own employees.
Similarly, the Respondent did not present testimony from officials elsewhere in the
Cascades organization to support the suggestion that such officials, rather than the
Respondent’s own managers, were responsible for reducing the payments to
Respondent’s employees, and that this decision was made without the participation of 30
the Respondent. Not only did the Respondent fail to identify such officials, but by
refusing to produce the subpoenaed information about the profit-sharing plan
calculations and internal communications, the Respondent inhibited the Board’s ability
to identify and meaningfully question responsible officials. The Respondent’s assertion
that it bore no responsibility for changes to the payments the Respondent made to its 35
20 I reference the $1000 figure as an approximation. Calculation of the exact amounts
lost due to any violations would be a matter for a compliance proceeding. See, e.g., Pepsi-Cola
Bottling Co. of Fayetteville, Inc., 330 NLRB 1043, 1049 (2000) (where employer refused to
provide documentation showing how much employees lost in profit-sharing payments, the
calculation of those amounts would await a separate compliance proceeding), remanded on
other grounds, 258 F.3d 305 (4th Cir. 2001); Champ Corp., 291 NLRB 803, 805 (1988) (Board
leaves to the compliance stage the calculation of lost profit-sharing and other monetary relief),
enfd. 933 F.2d 688 (9th Cir. 1990), cert. denied 502 U.S. 957 (1991).
JD–11–20
18
own employees is especially unworthy of credence since the changes were, according
to the Respondent’s statement at the time it disbursed the payments, made only at the
Respondent’s facility and in response to the employees’ decision to unionize at the
Niagara facility. It is implausible that the Respondent’s corporate parent in Quebec
would retaliate in this way against employees at one of its dozens of facilities without 5
significant input and involvement from management at the facility being singled out. In
reaching this finding, I considered the fact that LaPorte denied that the Respondent had
any responsibility for reducing the payments. However, for the reasons previously
discussed I found LaPorte to be unusually lacking in credibility. See, supra, Section
II.C.3., and Footnote 5. LaPorte gave wholly implausible and contradictory testimony in 10
an effort to avoid acknowledging responsibility for the treatment of his employees.
Based on this, and the record as a whole, I do not credit LaPorte’s testimony denying
that the Respondent was responsible for changes to the profit-sharing payments.
D. JANITOR WORK
15
1. HISTORY OF THE RESPONDENT’S USE OF AN EMPLOYEE
TO PERFORM JANITORIAL WORK ON A FULL-TIME BASIS
For at least 23 years, the Respondent employed an individual to perform
janitorial services for the “mill” portion of the Niagara facility. The janitor’s duties 20
extended to the entire facility, with the exception of the administrative offices. The
janitor’s shift was from 5:30 am to 2:00 pm, during which time the employee generally
was engaged full-time in cleaning the general production areas, the conference rooms,
the lunchroom, the bathroom, the locker room, and the showers. Janitorial services for
the administrative offices have historically been performed primarily by an outside25
contractor. The mill area of the facility cleaned by the employee-janitor was
characterized by a witness as “massive” compared to the administrative offices cleaned
by the contractor. Tr. 455.
The Respondent’s janitor and the outside contractor occasionally substituted for 30
one another. When the contractor was on vacation, the janitor would clean the
administrative offices. Tr. 185. Similarly, when the janitor was on vacation – 5 to 6
weeks annually – the Respondent usually had the contractor clean the mill areas,
although the Respondent also sometimes assigned the janitor’s work to one of its own
employees. On occasion the Respondent’s janitor would perform safety audits at the 35
facility, and this would take the janitor away from his or her janitorial duties for a matter
of days or as much as a week. During such times the Respondent had the outside
contractor clean the mill area.
40
2. JACKSON LEAVES JANITOR POSITION AND THE RESPONDENT PERMANENTLY
ASSIGNS HIS JANITORIAL WORK TO THE OUTSIDE CONTRACTOR
For 10 years, Steve Jackson was the Respondent’s employee-janitor. Jackson
was an undisputed member of the bargaining unit. In May 2019, shortly after the 45
JD–11–20
19
election, Jackson voluntarily ended his employment with the Respondent.21 Within two
weeks of when Jackson left the Respondent, management assigned Jackson’s janitorial
work in the mill to the outside contractor. Since then, the Respondent has relied solely
on the contractor to perform that work.
5
The Respondent did not give the Union notice or an opportunity to bargain before
permanently assigning the bargaining unit janitorial work to the outside contractor.
When the Union learned that the bargaining unit janitorial work had been subcontracted,
Warner, in a June 4, 2019, letter to Zilbauer, stated that “hir[ing] a subcontractor to fulfill
the job duties of the Custodian/Janitor position” constituted a unilateral change. 10
Warner’s letter asked the Respondent to cease and desist, to “hire a full time employee
into this bargaining unit position,” and to engage in decisional and effects bargaining
with the Union. On June 21, Warner wrote to Zilbauer a second time regarding the
janitorial position. Warner reported a discussion during which Zilbauer told him that the
Respondent was “not sure” it would fill the janitorial position. Warner reiterated his 15
demand that Zilbauer fill the position. In a June 27 email to Zilbauer, Warner described
a conversation in which Zilbauer acknowledged that a contractor had taken over the
work of a bargaining unit position. He also referenced the Respondent’s interest in
“swapping” a new unit position for the janitor position. Warner indicated that while the
Union might be open to discussing that during future negotiations, it was first necessary 20
for the Respondent to restore the status quo by filling the bargaining unit position.
Zilbauer responded to Warner by email on July 2, 2019. Zilbauer told Warner
that the Respondent was planning on posting the janitor position that day so that unit
employees could apply. From July 2 to July 9, the Respondent did, in fact, post an 25
invitation for its employees to apply. Ten unit employees signed the Respondent’s
posting to express their interest in filling the janitorial position. However, July and
August passed without the Respondent offering the position to any employee. In a
September 5 email, Warner told Zilbauer that he was aware that the position had not
been filled. He stated, in addition, that employees were reporting that Zilbauer had told 30
them the Union would not allow the Respondent to fill the position. Warner asked
Zilbauer to stop placing blame on the Union for the Respondent’s failure to offer the
position to the employees. Warner also asked Zilbauer to let the Union know the
Respondent’s “intentions on filling the Janitor position.” Zilbauer responded by email on
September 9. Rather than offering to bring the work back within the bargaining unit, or 35
explaining why the Respondent had failed to fill the position during the 2 months since
posting the opening for bids, Zilbauer told Warner that during contract negotiations the
Union could propose that the company agree to “change our past practice, and consent
to an absolute obligation to fill any and all vacancies.” In addition, the Respondent was
interested in the possibility of contract negotiations on the subject of eliminating the 40
janitor job as a bargaining unit position in exchange for the creation of a different
bargaining unit position. In a September 23 email to Zilbauer, Warner recounted that,
during contract negotiations, Zilbauer stated that the Respondent was not going to fill
21 Although Jackson’s departure came shortly after the election of the Union, it does not
appear that his decision was motivated by the election results. The record shows that Jackson
was on the organizing committee. Tr. 52.
JD–11–20
20
the janitor position. Warner opined that this was a violation of the National Labor
Relations Act and that the Union would be “seeking a decision from the NLRB.” At the
time of trial, the Respondent was still relying solely on the contractor to perform the
janitorial work for the mill.
5
DISCUSSION
I. SECTION 8(A)(1): RESPONDENT’S STATEMENTS THAT PROFIT-SHARING PLAN
PAYMENTS WERE BEING REDUCED AND CHANGED DUE TO THE UNION
10
In June and/or July 2019, shortly after the Union was certified, Pozzobon, a
supervisor and agent of the Respondent, told unit employee Butski that his profit-
sharing plan check had been reduced and that the reason for this was the union
situation at the facility. Similarly, Pozzobon told unit employee Cracknell that the profit-
sharing plan payment had been changed as a result of the Union. The General 15
Counsel alleges that these statements violated Section 8(a)(1) of the Act. Section
8(a)(1) makes it unlawful for an employer to make statements that “interfere with,
restrain, or coerce employees in the exercise of the rights guaranteed” by the Act. A
violation of this provision occurs when the employer makes a remark that has “a
reasonable tendency, under all the circumstances, to interfere with, restrain, or coerce 20
employees in the exercise of their . . . rights” under the Act. Roemer Industries, 367
NLRB No. 133, slip op. at 1 n. 2 (2019). I find that a reasonable employee would tend
to be coerced in the exercise of their rights under the Act by the Respondent’s
statements, shortly after employees voted for union representation, that employees’
compensation was being changed and reduced because of the union situation. The 25
Board has reached this conclusion in analogous cases. In Holland American Wafer
Co., the Board held that an employer unlawfully coerced employees’ exercise of their
statutory rights in violation of Section 8(a)(1) by telling them it was withholding wage
increases because the employees had voted to be represented by a union. 260 NLRB
267, 271-272 (1982). In Gorman Machine Corp., the Board held that an employer made 30
coercive statements in violation of the Act when it told employees that their overtime
work was being eliminated because they had voted to be represented by a union. 257
NLRB 51, 58-59 (1981), enfd. in relevant part by 682 F.2d 11 (1st Cir. 1982).
I find that the Respondent violated Section 8(a)(1) of the Act in June and/or July35
2019 when it told employees that their profit-sharing plan payments had been reduced
and changed because of the union situation at the facility.
II. SECTION 8(A)(5) AND (1): RESPONDENT LAYS OFF BARGAINING
UNIT EMPLOYEES FOR 2 WEEKS BEGINNING ON MAY 2040
An employer violates Section 8(a)(5) of the Act when it makes unilateral changes
to a mandatory subject of bargaining without providing the employees’ union with notice
and an opportunity to bargain. NLRB v. Katz, 369 U.S. 736 (1962). The Board has
consistently held that an employer’s decision to lay off bargaining unit employees for
economic reasons is a change to terms and conditions of employment, and is a45
mandatory subject of bargaining that triggers the duty to provide notice and an
JD–11–20
21
opportunity to bargain. Pan American Grain Co., 351 NLRB 1412, 1413-1414 (2007),
enfd. 558 F.3d 22 (1st Cir. 2009); McClain E-Z Pack, Inc., 342 NLRB 337, 342-343
(2004); Toma Metals, Inc., 342 NLRB 787 (2004); Tri-Tech Services, 340 NLRB 894,
894-895 (2003). “Layoffs are not a management prerogative. They are a mandatory
subject of collective of collective bargaining. Until the modalities of layoff are 5
established in the agreement, a company that wants to lay off employees must bargain
over the matter with the Union.” NLRB v. Advertisers Mfg. Co., 823 F.2d 1086, 1090
(7th Cir. 1987) enfg. in relevant part Advertisers Mfg. Co., 280 NLRB 1185 (1986).
As alleged in the Complaint, the Respondent in this case violated Section 8(a)(5) 10
by failing to notify, and bargain with, the Union before deciding to lay off bargaining unit
employees for 2 weeks starting on May 20, 2019.22 The record is clear that the
Respondent did not give the Union notice prior to making the decision to lay off these
employees. The May 14 email and the attached memorandum were sent only after the
final decision was made and to inform the Union of a fait accompli over which the 15
Respondent did not express a willingness to bargain. The memorandum states that
“begin[ning] May 20 . . . . nineteen employees will be laid off.” (Emphasis Added). The
Respondent does not temper this announcement with a statement that this is a
proposed action or with any language suggesting the slightest willingness to bargain.
Zilbauer, an agent of, and witness for, the Respondent, confirmed that the May 14 email 20
presented the Union with a fait accompli. He testified that management had already
made the decision to carry out the layoff at the time it sent the May 14 email. Indeed,
no witness for the Respondent claimed that management had been willing to bargain
with the Union before proceeding with the layoff on May 20. An employer does not meet
its Section 8(a)(5) duty to bargain when it simply announces a final decision to the union 25
and the circumstances make clear that bargaining would be fruitless. Brannan Sand &
Gravel Co., 314 NLRB 282, 282 (1994).
Even assuming that, contrary to the evidence, I had concluded that the
Respondent was not simply announcing a fait accompli in its May 14 email, I find that 30
the notice did not meet the Respondent’s obligations under Section 8(a)(5) both
because the notice was not timely and because it did not provide the specifics of the
layoff. As the Board has stated, “[t]he key here is that the proposal should be presented
to the union in a timely manner.” Harley-Davidson Motor Company, 366 NLRB No. 121,
slip op. at 3 n.8 (2018). “To be timely, the notice must be given sufficiently in advance 35
of actual implementation of the change to allow a reasonable opportunity to bargain.”
Ciba-Geigy Pharmaceutical Division, 264 NLRB 1013, 1017 (1982), enfd. 722 F.2d
1120 (3d Cir. 1983). At a minimum this means that the employer must “inform the
union of its proposed actions under circumstances which afford a reasonable
opportunity for counter arguments or proposals.” Pontiac Osteopathic Hospital, 336 40
NLRB 1021, 1023 (2001), quoting NLRB v. Citizens Hotel Co., 326 F.2d 501, 505 (5th
Cir. 1964). Here the Respondent gave the Union no warning that a layoff was in the
works until after the normal close of business just 6 days before implementation. The
22 Although the Respondent announced this layoff, the first in 10 years, just 8 days after
the Union was certified, there is no allegation in this case that the layoff was retaliatory in
violation of Section 8(a)(3) of the Act.
JD–11–20
22
Board has found that comparable, or even somewhat greater, advance notice is not
timely. See Comau, Inc., 364 NLRB No. 48, slip op. at 6, 24 (2016) (violation where
notice was given 6 days before implementation); Pontiac Osteopathic Hospital, 336
NLRB at 1022-1024 (violation where notice was given 20 days before implementation);
Defiance Hospital, 330 NLRB 492, 493 (2000) (violation where employer’s letter gave 5
union 7 days to respond to the notice of a change). On its face this timing did not
provide a “reasonable opportunity for counterarguments or proposals,” but under the
particular circumstances here the timing was even more deficient. Specifically, the
Respondent knew it was dealing with a Union that had just been certified and did not
have the type of experience with the facility’s past practices and seasonal workload that 10
would permit it to instantly propose alternatives to the layoff that the Respondent had
decided to implement.23
Also consistent with my finding that the Respondent failed to meet its bargaining
obligation is the fact that its pre-layoff notice did not advise the Union which employees 15
would be laid off or how those employees had been selected. Given the Respondent’s
failure to provide the Union with such details, the Respondent’s communication cannot
be fairly construed as giving the Union a “reasonable opportunity for counterarguments
or proposals.” Lacking such details, the Union did not have a meaningful opportunity to
propose, for example, that the employer first allow employees to volunteer for the layoff 20
(as had been done in the past) instead of choosing which employees to layoff without
regard to their willingness, or ability, to absorb it. Cf. The Washington Post Company,
237 NLRB 1493, 1498 (1978) (notice inadequate where insufficient detail is provided).
Such matters are ones regarding which the Union could have negotiated even if market
conditions made a layoff inevitable. 25
Three days after the Respondent’s email on the evening of March 14, the Union
sent the Respondent a letter demanding that the Respondent cease and desist from
laying off employees until it engaged in good faith bargaining. The Respondent
received that letter on the 3rd day of the 14-day layoff. After receiving the letter, the 30
23 For the same reasons, I reject the Respondent’s argument that by not responding
more quickly to LaPorte’s May 14 letter the Union did not act with due diligence to bargain and,
therefore, unequivocally waived its statutory right to bargain. Even in the case relied upon by the
Respondent on this point, McCraw-Hill Broadcasting Co., Inc., the Board specifically stated that
an employer cannot succeed in showing that a union failed to act with due diligence and waived
bargaining where “the employer’s notice provides too little time for negotiation before
implementation.” 355 NLRB 1283, 1284 (2010). Moreover, any shortcomings in a union’s
response to a unilateral change do not constitute a waiver of bargaining where, as here, the
employer presented the change as a fait accompli. North Memorial Health Care, 364 NLRB No.
61, slip op. at 24, enfd. in relevant part, 860 F.3d 639 (8th Cir. 2017); Eby-Brown Co., 328 NLRB
496, 570-572 (1999); Dorsey Trailers, Inc., 327 NLRB 835, 858 (1999), enfd. in part 233 F.3d
831 (4th Cir. 2000); Jaydon, Inc., 273 NLRB 1594, 1601 (1985); Ciba-Geigy Pharmaceuticals
Division, 264 NLRB 1013, 1017-1018 (1982), enfd. 722 F.2d 1120 (3d Cir. 1983); see also
Naperville Jeep/Dodge, 357 NLRB 2252, 2272 (2012) (Waiver will not be found where the
employer simply announces and implements changes as if it had no obligation to bargain over
the effects of the changes.), enfd. 796 F.3d 31 (D.C. Cir. 2015), cert. denied 136 S.Ct. 1457
(2016).
JD–11–20
23
Respondent continued with the layoff as planned. It did not suspend the layoff until it
complied with the obligation to bargain, as the Union demanded. Indeed, none of the
Respondent’s witnesses claimed that they would have been willing to bargain over the
layoff if they had received the Union’s cease and desist letter prior to the start of the
layoff. The testimony of the Respondent’s witness Zilbauer was to the contrary – the 5
Respondent had already decided to proceed with the layoff at the time it notified the
Union.24
I find that the Respondent violated Section 8(a)(5) and (1) by failing to give the
Union reasonable notice and an opportunity to bargain regarding the 2-week layoff that 10
began on May 20, 2019.
III. SECTION 8(A)(5) AND (1): RESPONDENT
SUBCONTRACTS JANITOR’S WORK
15
The Complaint alleges that the Respondent has been violating Section 8(a)(5)
and (1) since May 2019 by unilaterally subcontracting bargaining unit janitorial work.
The Supreme Court held, in Fibreboard Corp. v. NLRB, 379 U.S. 203, 215 (1964), that
an employer’s “replacement of employees in the existing bargaining unit with those of
an independent contractor to do the same work under similar conditions of employment 20
– is a statutory subject of bargaining.” See also, O.G.S. Technologies, Inc., 356 NLRB
642, 644 (2011) (same) and Torrington Enterprises, 307 NLRB 809, 810-811 (1992)
(subcontracting of unit work to an outside contractor is a mandatory subject of
bargaining about which an employer is required to bargain in good faith unless the
subcontracting “involve[s] a significant change in scope and direction of the enterprise”); 25
see also Bob’s Tire Co., 368 NLRB No. 33, slip op. at 1 (2019) (Employer violated the
Act by failing to notify and bargain with the Union before subcontracting bargaining unit
work.). The record in this case demonstrates that, for well over 2 decades, the janitorial
work in the mill portion of the Niagara facility had been performed on a full-time basis by
employees of the Respondent who fall within the bargaining unit. After the employees 30
selected the Union as their bargaining representative, the Respondent subcontracted
this bargaining unit janitorial work to an outside contractor and did so without providing
the Union with notice or an opportunity to bargain. I find that the Respondent clearly
failed to meet its bargaining obligation with respect to this mandatory subject of
bargaining, and by doing so violated Section 8(a)(5) and (1) of the Act. 35
The Respondent attempts to escape a finding of violation by raising a number of
defenses, none of which have merit. First, the Respondent argues that its actions were
consistent with past practice because it has not always filled vacant positions in the
past. This argument wholly misses the point, since the Complaint allegation is not that 40
the Respondent failed to fill a position, but rather that it transferred work from the
bargaining unit to an outside contractor. The Respondent’s argument might have some
bearing on this case if the allegation was that, upon Jackson’s departure, management
24 The Respondent makes no argument, and the evidence does not suggest, that
exigent economic circumstances justified implementing the layoff without, or with only
expedited, notice and bargaining. Cf. RBE Electronics of S.D., Inc., 320 NLRB 80, 81 (1995).
JD–11–20
24
continued to use bargaining unit employees to perform the janitorial work, but failed to
fill the position of full-time janitor. However, that is neither what happened, nor what the
Complaint alleges. The Respondent forwards a second “past practice” defense, arguing
that it did not have to bargain because in the past when the bargaining unit janitor was
on vacation, or otherwise unavailable to perform his janitorial duties in the mill, the 5
Respondent would in most instances have a contractor, rather than its own employees,
fill in for the employee-janitor. The Respondent cites no precedent for its assertion that
the occasional use of a contractor to fill-in for a bargaining unit employee means that it
does not have to bargain over the wholesale subcontracting of a type of work formerly
done by the bargaining unit. The lack of such citation by the Respondent is not 10
surprising since the applicable precedent is to the contrary. The Board distinguishes
between piecemeal and wholesale subcontracting, see San Luis Trucking, 352 NLRB
211, 231 (2008),25 and holds that an employer must bargain when it substantially
increases or expands the use of contractors to perform bargaining unit work even if it
had subcontracted to some degree in the past. O.G.S Technologies, 356 NLRB at 645-15
646; Equitable Gas Co., 245 NLRB 260, 264-265 (1979), enf. denied 637 F.2d 980
(1981). The Respondent’s subcontracting of all the bargaining unit janitorial work was a
substantial expansion of its use of contractors, not as the Respondent’s counsel would
have me believe, “wholly consistent with,” Brief of Respondent at Page 67, its past
practice of using outside contractors to perform a small portion of that work. 20
The Respondent also asserts that it had no obligation to bargain because,
although Fibreboard Paper requires employers to bargain over the subcontracting of
bargaining unit work, that duty does not extend to changes that “alter the Company’s
basic operation.” Brief of Respondent at Pages 66-67. This argument is frivolous. 25
After subcontracting the work at-issue, the Respondent’s continued in precisely the
same business – i.e., paper manufacturing – at the same location. There was no
significant commitment, or reallocation of capital. The only change was in the identity of
some of the individuals who were performing work relevant to that operation – with
contractors substituting for the bargaining unit janitor. The Respondent’s claims that it 30
was going “out of the business of janitorial services” is without merit. Janitorial services
never were the Niagara facility’s business. It did not offer the bargaining unit’s janitorial
services to customers or otherwise maintain it as a business. The janitorial work was
simply part of operating a paper production facility – which is what it continued to do
after subcontracting the janitorial work. As the Board made clear in Torrington 35
Industries, the subcontracting of bargaining unit work is a mandatory subject of
bargaining where, as here, the subcontracting did not change the “scope and direction
of the enterprise,” but merely changed “the identify of the employees doing the work.”
307 NLRB at 811.
40
Finally, the Respondent contends that it was the Union that failed to bargain in
good faith since its officers were insisting that the Respondent restore the status quo
ante by filling the janitorial position with a bargaining unit employee before the Union
25 This decision was reaffirmed by the Board at 356 NLRB 168 (2010), enfd. 479 Fed.
Appx. 743 (9th Cir. 2012), after the Supreme Court issued its decision in New Process Steel,
560 U.S. 674 (2010).
JD–11–20
25
would negotiate over the Respondent decision to subcontract that work. I reject this
defense, for which the Respondent cites no legal support. The Respondent was
required to restore the status quo with respect to the bargaining unit’s janitorial work in
order provide the Union with a true opportunity to bargain over the subcontracting. Cf.
O.G.S. Technologies, Inc., 356 NLRB at 647 (“When bargaining unit work has 5
unilaterally and unlawfully been removed . . . by subcontracting,” “the judge properly
ordered the restoration of the status quo ante, in order to provide the Union with a true
opportunity to bargain over the subcontracting.”), and Brooks Inc., 251 NLRB 757, 764
(1980) (“no good-faith impasse could exist since the breakdown in the negotiations was
at least in part attributable to Respondent’s unlawful conduct in failing to restore the 10
status quo ante”), enfd. 682 F.2d 874 (10th Cir. 1982). Negotiations must proceed from
the status quo ante, not from circumstances that the Respondent unlawfully changed
and which increase its bargaining power by permitting it, during bargaining, to enjoy the
very change that it is statutorily required to bargain over before making. Not to require
the Respondent to restore the status quo ante would effectively reward it for violating 15
the Act by vastly improving its bargaining position regarding the change.
The Respondent has violated Section 8(a)(5) and (1) since May 2019 by
subcontracting bargaining unit janitorial work without bargaining in good faith with the
Union. 20
IV. SECTION 8(A)(5) AND 8(A)(3): CHANGES TO
JUNE/JULY 2019 PROFIT-SHARING PLAN PAYMENTS
The Respondent’s employees have received profit-sharing plan payments twice 25
a year for over 20 years. In June/July 2019 the payment that employees at the Niagara
facility received were substantially reduced and the Respondent told employees that the
union activity at the facility was the reason for the change to their payments. The
General Counsel alleges that the Respondent’s action was unlawful both because the
Respondent did not bargain over the change as required by Section 8(a)(5) and 30
because the change was discriminatory in violation of Section 8(a)(3). For the reasons
discussed below I find that the General Counsel has established both violations.
As previously set forth, an employer violates Section 8(a)(5) of the Act when it
makes unilateral changes to a mandatory subject of bargaining without providing the 35
employees’ union with notice and an opportunity to bargain. NLRB v. Katz, supra. In
this case the Respondent substantially reduced the June/July 2019 profit-sharing plan
payments it made to the unit employees and did so without giving the Union any notice
or any opportunity to bargain. In fact, the Respondent expressly asserts that it had no
duty to do so. The Respondent makes two arguments to support its claim that it had no 40
obligation to bargain over the change. First it argues that it did not have to bargain over
changes to the profit-sharing plan payments because the payments were not a term or
condition of employment, but rather a mere “gift.” Second, it argues that it did not have
to bargain because the payments were made by its corporate parent in Canada, with no
involvement by the Respondent itself.45
JD–11–20
26
The Respondent’s contention that the payment was a gift, rather than a term of
employment, is untenable under established Board law. The Board has repeatedly
affirmed that profit-sharing, as a matter of law, is a mandatory subject of bargaining.
J.P. Stevens & Co., Inc., 239 NLRB 738, n.3 (1978); Western Foundries, Inc., 233
NLRB 1033, 1037-1038 (1977); Sunshine Food Markets, 174 NLRB 497, 504 (1969). 5
These cases are dispositive of the issue in my view, but even if profit-sharing could in
rare circumstances be seen as failing to rise to the level of a term and condition of
employment, these are not those circumstances. Employees at the Niagara facility had,
without interruption, received these payments twice a year for over 20 years. The
payments were not mere “pats on the back” of limited economic value – such as a 10
holiday ham or gift card – but rather constituted a significant portion of employees’
overall compensation. In 2018, the total of the two profit-sharing payments that each of
the Respondent’s hourly employees received was, on average, about 21 percent as
much as their total other wages for the entire year. Moreover, the amount of the
payments was determined by work-related factors that included the facility’s profits and 15
the particular employee’s other earnings for the relevant time period. The other
earnings figure itself incorporated additional work-related factors such as the
employee’s wage rate, seniority, and hours worked. Even if the Board had not already
decided that recurring profit-sharing payments are a mandatory subject of bargaining, it
is inconceivable that the payments at-issue here – which are very substantial and 20
dependent on work-related factors – could be viewed as something less than terms and
conditions of employment. See Gas Machinery Co., 221 NLRB 862, 862-863 (1975)
(Christmas bonuses were terms and conditions of employment not gifts where the
bonuses were “tied to the remuneration which employees received for their work.”).26
25
26 The Respondent reliance on Bob’s Tire Co. supra, is misplaced. In that case, the
Board found that the record evidence was insufficient to show that holiday bonuses (not profit-
sharing payments) that the employer distributed to employees rose to the level of terms and
conditions of employment. 368 NLRB No. 33, slip op. at 1. An examination of the Board’s
discussion regarding the holiday bonus paid in Bob’s Tire reveals that that decision not only
does not support the Respondent’s argument, but, to the contrary, provides further support for
finding that the profit-sharing payments in the instant case are a term or condition of
employment. In Bob’s Tire, the Board stated that the General Counsel’s evidence was
inadequate because it did not show “the amount paid in any particular year and it is silent as to
whether the bonus was tied in any way to employment-related factors.” Ibid. The situation in
the instant case is exactly the opposite. The record shows the amounts of the profit-sharing
payments paid to bargaining unit employees in 2016, 2017, and 2018. Not only that, but the
record evidence shows that the profit-sharing payments that the unit employees received were
very substantial. Some employees’ total profit share payments for 2018 exceeded $20,000.
Joint Exhibit 1 (see, e.g., employees Patrick Bonacorso, John Newell, and Jeffrey Velzy).
Second, unlike in Bob’s Tire, the record here shows that the payments were tied to
“employment-related factors” – specifically to the other remuneration that the Respondent paid
the employee during the relevant time period, a factor that itself incorporated additional
employment-related factors such as seniority and hours worked. Indeed, in Bob’s Tire, the
Board stated that in a case where, as here, employment-related factors determined the payment
amount, the payment “was clearly a term and condition of employment.” 368 NLRB No. 33, slip
op. at 2.
JD–11–20
27
The Respondent’s second defense – that it did not have to bargain with the
Union over changes to the profit-sharing plan payments because it was not responsible
for making those changes – is not persuasive. For reasons discussed in the statement
of facts, I find that the Respondent was responsible for the changes to employees’
profit-sharing plan payments.5
The Respondent violated Section 8(a)(5) and (1) by changing the manner in
which it calculated profit-sharing plan payments and reducing the amount of the
June/July 2019 payments to bargaining unit employees without first providing the Union
with notice and an opportunity to bargain.10
The Complaint also alleges that the Respondent violated Section 8(3) and (1) of
the Act because it discriminated based on the employees’ protected union activity when
it reduced the June/July 2019 profit-sharing plan payments. Where unlawful motivation
is in dispute, as here, the General Counsel bears the initial burden under the Wright 15
Line analysis of showing that the Respondent's decision to take adverse action against
employees was motivated, at least in part, by activities protected by the Act. 251 NLRB
1083, 1083 (1980), enfd. 662 F.2d 899 (1st Cir. 1981), cert. denied, 455 U.S. (1982),
approved in NLRB v. Transportation Corp., 462 U.S. 393 (1983). The General Counsel
may meet its initial Wright Line burden by showing that: (1) the employees engaged in 20
union or other protected activity, (2) the employer knew of such activities, and (3) the
employer harbored animosity towards the union or other protected activity. Camaco
Lorain Mfg. Plant, 356 NLRB 1182, 1184-1185 (2011); ADB Utility Contractors, 353
NLRB 166, 166-167 (2008), enf. denied on other grounds, 383 Fed. Appx. 594 (8th Cir.
2010); Intermet Stevensville, 350 NLRB 1270, 1274-1275 (2007); Senior Citizens 25
Coordinating Council, 330 NLRB 1100, 1105 (2000); Regal Recycling, Inc., 329 NLRB
355, 356 (1999). Animus may be inferred from the record as a whole, including timing.
See Camaco Lorain supra. If the General Counsel establishes discriminatory motive,
the burden shifts to the employer to demonstrate that it would have taken the same
action absent the protected conduct. Camaco Lorain, supra; ADB Utility, supra; Intermet 30
Stevensville, supra; Senior Citizens, supra.
In this case, the General Counsel easily meets its initial Wright Line burden.
There is no dispute either that the Respondent’s employees engaged in protected
activity by voting to be represented by the Union in April 2019 or that the Respondent 35
was aware of that activity. The evidence also establishes that the Respondent bore
animosity towards the union activity and that this animosity was connected to the
decision to reduce employees’ June/July 2019 profit-sharing plan payments. The
Respondent’s own witness, human resources manager Zilbauer, identified union activity
as the reason for the change to employees’ profit-sharing plan payments. In addition,40
Pozzobon, a supervisor and agent who the Respondent entrusted to tell employees how
much they would receive, informed employees that their payments had been reduced
and changed because of the Union. The timing of the change to employees’ profit-
sharing payments provides additional evidence of unlawful motivation. See Gates &
Sons, 361 NLRB 563, 566 (2014), LB&B Associates, Inc., 346 NLRB 1025, 1026 (2006) 45
enfd. 232 Fed. Appx. 270 (4th Cir. 2007); Desert Toyota, 346 NLRB 118, 120 (2005),
pet. for review denied 265 Fed. Appx. 547 (9th Cir. 2008); Detroit Paneling Systems,
JD–11–20
28
330 NLRB 1170 (2000), enfd. sub nom. Carolina Holdings, Inc. v. NLRB, 5 Fed. Appx.
236 (4th Cir. 2001); Bethlehem Temple Learning Center, 330 NLRB 1177, 1178
(2000); American Wire Products, 313 NLRB 989, 994 (1994). The record shows that
management announced it was reducing the first profit-sharing payments made after,
and only shortly after, the employees voted for union representation. This would 5
suggest a discriminatory motive even if the Respondent’s agents had not openly
admitted that union activity was the reason for the change.
Since the General Counsel has met its initial burden, the burden shifts to the
Respondent to show that it would have reduced the employees’ June/July 2019 profit-10
sharing payments even absent the anti-union motivation. Camaco Lorain, supra; ADB
Utility, supra; Intermet Stevensville, supra; Senior Citizens, supra. In this case, the
Respondent has failed to articulate, much less provide evidence of, a non-discriminatory
explanation for the decision to reduce employees’ profit-sharing payments in the wake
of employees’ selection of the Union as their bargaining representative. The 15
Respondent has not met its responsive Wright Line burden.
I find that the Respondent discriminated in violation of Section 8(a)(3) and (1) of
the Act by reducing employees’ June/July 2019 profit-sharing plan payments because
employees engaged in protected union activity.20
V. SECTION 8(A)(3): RESPONDENT CEASES SHARING
MONTHLY PROFIT INFORMATION WITH EMPLOYEES
The record shows that within days of the union election the Respondent ceased 25
its longstanding practice of displaying, and otherwise sharing with employees, the
monthly profit figures for the Niagara facility. In the past, employees had used this
information to estimate what they should receive in their next profit-sharing plan
payment. The General Counsel easily meets its initial Wright Line burden with respect
to this allegation. As discussed above, the Respondent was aware that employees had 30
engaged in protected union activity by initiating a union campaign and voting to be
represented by the Union. The General Counsel has also established that the
Respondent bore animus towards the employees’ protected activity. Such animus is
demonstrated not only by the Respondent’s statements to employees explaining that
the union situation was the reason why management reduced the profit-sharing35
payments, but also by the Respondent’s April 29 memorandum to employees. The
memorandum informed employees both that management was “disappointed” that
employees had decided to be represented by the Union, and that, given the adversarial
nature of the union campaign, management might “not be comfortable to share”
information “such as profits” with employees anymore. Similarly, LaPorte told Cracknell 40
that the Respondent had stopped sharing the information because there was now a
“third party involved.”
Since the General Counsel has made the initial showing required by Wright Line,
the burden shifts to the Respondent to show that it would have taken the same action 45
absent the employees’ protected conduct. The Respondent attempts to meet that
burden by arguing that the “directive to cease posting profits was legitimate in light of
JD–11–20
29
the flyer disseminated by the Union.” Brief of the Respondent at Page 60. This
argument fails for multiple reasons. First, if the Respondent is right, and the flyer, was
part of the union campaign,27 then distributing the flyer was itself protected activity and
retaliating against employees for such distribution was unlawful.28 Therefore, the
testimony that the Respondent was motivated by the flyer does not, as Respondent 5
seems to believe, tend to show a lawful motive, but rather constitutes additional proof
that the Respondent was unlawfully motivated by employees’ protected union activity.
In any event, I find that the Respondent has failed to show that, absent the union
campaign and the employees’ decision to be represented by the Union, management 10
would have reacted to the flyer at-issue here by ceasing its longstanding practice of
sharing profit information with employees. For starters, management’s April 29
memorandum admits that it was concerned about the flyer because it believed the flyer
was part of the union campaign. In addition, as stated earlier, there is no evidence, or
even a claim, that any of the information used in the flyer had been shared with 15
employees on a confidential basis or was not publicly available. To the contrary, the
flyer cites public sources for the information. The profit figures that the Respondent
unilaterally stopped displaying were not revealed or even mentioned in the flyer. Thus,
the flyer provides no basis for concluding that employees could not be trusted to respect
limits on the disclosure of information the Respondent provided to them on a 20
confidential basis. Moreover, LaPorte admitted that he blamed the Union campaign for
the flyer without making any attempt to determine whether the Union played any part in
its creation or distribution. The fact that the employer failed to investigate the Union’s
suspected involvement with the flyer before taking punitive action supports the inference
of discriminatory motive and further undermines the Respondent’s attempt to defend its 25
27 As stated earlier, the evidence does not, in fact, establish that the flyer was created, or
distributed, by the Union or as part of the union campaign. LaPorte stated that a supervisor
provided it to him shortly before the union election, but there was no testimony about when the
flyer came into the possession of the supervisor, and the flyer itself is undated and makes no
reference to the Union or the union campaign. The only date referenced in the memorandum is
2017, well before the union campaign started in approximately August 2018. There was no
testimony that union officials or supporters were seen distributing the flyer.
28 I recognize that disparaging statements otherwise protected by the Act may forfeit that
protection if they are sufficiently reckless or maliciously untrue, See Valley Hospital, 351 NLRB
1250, 1252 (2007), enfd. 358 Fed. Appx. 783 (9th Cir. 2009). However, the Board has
guaranteed that employees’ Section 7 protection is meaningful by setting a high threshold for
forfeiture of that protection. Employees engaged in protected activity may use “intemperate,
abusive, or insulting language without fear of restraint or penalty.” Mount Desert Island
Hospital, 259 NLRB 589, 589 fn.1 and 593 (1981) (emphasis in Board decision), affd. in relevant
part and remanded 695 F.2d 634 (1st Cir. 1982). Even if “statements are false, misleading or
inaccurate” that “is insufficient to demonstrate that they are maliciously untrue” so as to forfeit
protection. Valley Hospital, 351 NLRB at 1252. The statements in the flyer do not begin to
approach the level that would cause them to lose protection. The creator and/or distributor of
the flyer – whoever that might have been – was not shown to have made any disparaging
statements that were false, much less any that were recklessly or maliciously false. The
statements about LaPorte are quite mild – expressing skepticism about his academic
achievements without claiming that LaPorte lied about them, and attempting to highlight
LaPorte’s personal spending/lifestyle by referencing the value of two of his residences.
JD–11–20
30
action based on the flyer. Cf. Stahl Specialty Company, 364 NLRB No. 56 (2016)
(evidence that the employer failed to investigate alleged misconduct supports an
inference of discriminatory motive), Relco Locomotives, Inc., 358 NLRB 298, 313
(2012) (same) and Amptech, Inc., 342 NLRB 1131, 1146 (2004), enfd. 165 Fed. Appx.
435 (6th Cir. 2006).295
I find that the Respondent discriminated in violation of Section 8(a)(3) and (1) of
the Act when it stopped sharing monthly profit information with employees because of
their protected union activity.
10
VI. SECTION 8(A)(5): RESPONDENT FAILS TO PROVIDE INFORMATION
REQUESTED BY THE UNION REGARDING PROFIT-SHARING PLAN
The General Counsel alleges that the Respondent violated its bargaining
obligations under Section 8(a)(5) and (1) by failing to provide information that the Union 15
requested in writing regarding the profit-sharing plan. The Union, after receiving reports
from employees that the Respondent was telling them the Union was the reason their
profit-sharing plan payments had been reduced and changed, made written requests –
on August 16, August 26, and September 3, 2019 – for information regarding the profit-
sharing plan calculations, payments, and changes to its operation. The Respondent 20
does not deny that it received these requests, the substance of which is set out earlier
in this decision, or that it refused to provide the Union with any of the requested
information. The Board has held that union requests for information regarding
bargaining unit employees’ terms and conditions of employment are “presumptively
29 Respondent’s counsel argues that the complaint paragraph alleging that “the
Respondent stopped displaying company profit-sharing information” failed to put the
Respondent on notice that the parties would be litigating a possible violation based on the fact
that it stopped displaying profit information that employees used to estimate their profit sharing
payments. The Respondent’s claim that it did, or could, read the complaint allegation in such a
narrow and technical manner is both disingenuous and inconsistent with the federal notice
pleading standards applied by the Board. First, it is clear that the Respondent knew perfectly
well that the parties were litigating an allegation that the Respondent unlawfully stopped sharing
profit information for the Niagara facility with employees. The Respondent’s counsel addressed
the issue in his opening statement, Tr. 271, and the Respondent made extensive efforts at the
hearing to defend the conduct. This defense included examining LaPorte regarding the decision
to stop displaying the monthly profit information for the Niagara facility, the purported
justification for that decision, and LaPorte’s explanation for his reaction to the flyer. The
Respondent entered the flyer as an exhibit. The Respondent also elicited testimony from
LaPorte aimed at avoiding responsibility for the refusal to display or otherwise share the profit
information with employees. The Board, consistent with federal notice pleading standards, only
requires that the complaint provide “due notice” of the charges such that the employer is
provided with a “full opportunity” to “put upon [its] defense.” Artesia Ready Mix Concrete, Inc.,
339 NLRB 1224, 1226 & fn. 3 (2003) (citing cases). Notice pleading does not require the
particularity of pleading of an indictment or information, nor the elements of a cause like a
declaration at law or a bill in equity. Ibid.; see also NLRB v. MacKay Radio & Telegraph
Co., 304 U.S. 333, 349-350 (1938). In this case the Respondent was fully aware that the
violation I find was being litigated pursuant to the Complaint and counsel had a full opportunity
to present its defense.
JD–11–20
31
relevant” and must be provided upon request. Richfield Hospitality, Inc., 368 NLRB No.
44, slip op. at 2 n.4 and 26 (2019); Disneyland Park, 350 NLRB 1256, 1257 (2007). As
found above, the profit-sharing plan was a term and condition of employment for the unit
employees and, therefore, the Union’s request for information about the plan was
presumptively relevant and the Respondent was required to provide the information. 5
See A-1 Door & Building Solutions, 356 NLRB 499, 499-500 (2011) (information related
to employer profit-sharing plans must be provided upon request) and Fremont
Manufacturing Division, 259 NLRB 355, 357 (1981) (same). “Like a flat refusal to
bargain, ‘[t]he refusal of an employer to provide a bargaining agent with information
relevant to the Union's task of representing its constituency is a per se violation of 10
[Section 8(a)(5) of] the Act’ without regard to the employer's subjective good or bad
faith.” Piggly Wiggly Midwest, LLC, 357 NLRB 2344, 2355 (2012), quoting Brooklyn
Union Gas Co., 220 NLRB 189, 191 (1975).
The Respondent violated Section 8(a)(5) and (1) of the Act by refusing to provide 15
the information that the Union has requested since August 16, 2019, regarding the
profit-sharing plan.
CONCLUSIONS OF LAW
20
1. The Respondent is an employer engaged in commerce within the meaning of
Section 2(2), (6) and (7) of the Act.
2. The Union is a labor organization within the meaning of Section 2(5) of the
Act.25
3. The Respondent violated Section 8(a)(1) of the Act in June and/or July 2019
when it told employees that the Respondent’s profit-sharing payments to them had been
reduced and changed because of the union situation at the facility.
30
4. The Respondent violated Section 8(a)(5) and (1) of the Act by failing to give
the Union reasonable notice and an opportunity to bargain regarding: the 2-week layoff
it implemented on May 20, 2019; the subcontracting of bargaining unit janitorial work
since May 2019; and changes to the manner in which it calculated, and the amounts of,
the June/July 2019 profit-sharing plan payments to unit employees.35
5. The Respondent violated Section 8(a)(5) and (1) of the Act by refusing to
provide the Union with the information, requested since August 16, 2019, about the
profit-sharing plan.
40
6. The Respondent discriminated on the basis of employees’ protected union
activity in violation of Section 8(a)(3) and (1) of the Act when it: reduced employees’
June/July 2019 profit-sharing plan payments; and ceased to display, or otherwise share
with employees, monthly profit information for the Niagara facility.
45
6. The above unfair labor practices affect commerce within the meaning of
Section 2(6) and (7) of the Act.
JD–11–20
32
REMEDY
Having found that the Respondent engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and to take certain affirmative action 5
designed to effectuate the policies of the Act. In particular, the Respondent must be
ordered to cease and desist from changing the terms and conditions of employees in
the bargaining unit without first providing the Union with notice and an opportunity to
bargain. Upon the Union’s request, the Respondent should be required to retroactively
rescind the unilateral changes, including the employee layoffs, the subcontracting of the 10
bargaining unit janitorial work, and the reductions to profit-sharing plan payments, and
make whole its employees for any losses of earnings and other benefits suffered as a
result of the unlawful changes. Backpay shall be computed in accordance with F. W.
Woolworth Co., 90 NLRB 289 (1950), with interest at the rate prescribed in New
Horizons for the Retarded, 283 NLRB 1173 (1987), compounded daily as prescribed in 15
Kentucky River Medical Center, 356 NLRB 6 (2010). The Respondent shall file a report
with the Social Security Administration allocating backpay to the appropriate calendar
quarters and shall also compensate the employees for the adverse tax consequences, if
any, of receiving one or more lump-sum backpay awards covering periods longer than 1
year, Latino Express, Inc., 359 NLRB No. 44 (2012). 20
On these findings of fact and conclusions of law and on the entire record, I issue
the following recommended Order.30
ORDER25
The Respondent, Cascades Containerboard Packaging—Niagara, a Division of
Cascades Holding US Inc., its officers, agents, successors, and assigns, shall
1. Cease and desist from30
(a) Coercing employees in the exercise of their rights under the Act by telling
them that their profit-sharing plan payments have been reduced or changed because
employees engaged in protected union activity.
35
(b) Refusing to display, and otherwise share with employees, monthly profit
information for the Niagara facility.
(c) Changing the manner in which it calculates profit-sharing plan payments or
reducing the amount of those payments to bargaining unit employees because40
30 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 purposes.
JD–11–20
33
employees engaged in protected union activity.
(d) Changing the manner in which it calculates profit-sharing plan payments or
reducing the amount of those payments to bargaining unit employees without
bargaining in good faith with the Union. 5
(e) Laying off employees without bargaining in good faith with the Union over the
layoff and the effects of the layoff.
(f) Subcontracting bargaining unit work without bargaining in good faith with the 10
Union.
(g) Refusing to provide the Union with information it requests that is necessary
for and relevant to performance of its duties as exclusive collective-bargaining
representative.15
(h) In any like or related manner interfering with, restraining, or coercing
employees in the exercise of the rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to effectuate the policies of the 20
Act.
(a) Make the bargaining unit employees whole, with interest, for the loss of
earnings and other benefits, resulting from the 2 weeks of layoffs that began on May 20,
2019. 25
(b) Make the bargaining unit employees whole, with interest, for the loss of
earnings and other benefits suffered as a result of the decision to, after April 26, 2019,
subcontract bargaining unit janitorial work.
30
(c) Make the bargaining unit employees whole, with interest, for the loss of
earnings and other benefits suffered as a result of the unlawful changes to employee
profit-sharing plan calculations and payments.
(d) Display and share monthly profit information for the Niagara Falls facility in 35
the manner this information was displayed and shared prior to the April 2019 union
election.
(e) Rescind the unlawful changes made to the manner in which it calculates
profit-sharing plan payments to unit employees.40
(f) Provide the Union with the information sought in the Union’s requests of
August 16, August 26, and September 3, 2019.
(g) Preserve and, within 14 days of a request, or such additional time as the 45
Regional Director may allow for good cause shown, provide at a reasonable place
designated by the Board or its agents, all payroll records, social security payment
JD–11–20
34
records, timecards, personnel records and reports, and all other records, including an
electronic copy of such records if stored in electronic form, necessary to analyze the
amount of backpay due under the terms of this Order.
(h) Within 14 days after service by the Region, post at its facility in Niagara Falls, 5
New York, copies of the attached notice marked “Appendix.”31 Copies of the notice, on
forms provided by the Regional Director for Region Three, after being signed by the
Respondent’s authorized representative, shall be posted by the Respondent and
maintained for 60 consecutive days in conspicuous places including all places where
notices to employees are customarily posted. In addition to physical posting of paper 10
notices, the notices shall be distributed electronically, such as by email, posting on an
intranet or an internet site, and/or other electronic means, if the Respondent customarily
communicates with its employees by such means. Reasonable steps shall be taken by
the Respondent to ensure that the notices are not altered, defaced, or covered by any
other material. In the event that, during the pendency of these proceedings, the 15
Respondent has gone out of business or closed the facility involved in these
proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the
notice to all current employees and former employees employed by the Respondent at
any time since April 26, 2019.
20
(i) Within 21 days after service by the Region, file with the Regional Director a
sworn certification of a responsible official on a form provided by the Region attesting to
the steps that the Respondent has taken to comply.
25
Dated, Washington, D.C. March 17, 2020
30
PAUL BOGAS
U.S. Administrative Law Judge35
31 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 National Labor Relations Board” shall read “Posted
Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”
~~9--~,~`_
JD–11–20
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 Federal labor law and has
ordered us to post and obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities.
WE WILL NOT coerce you by stating that your profit-sharing plan payments are being
reduced or changed because you voted to unionize or otherwise engaged in union activity.
WE WILL NOT refuse to display, and otherwise share with you, monthly profit
information for the Niagara Falls facility.
WE WILL NOT change the manner in which we calculate profit-sharing plan payments or
reduce the amount of those payments to you because you vote to unionize or otherwise engage
in protected union activity.
WE WILL NOT change the manner in which we calculate profit-sharing plan payments
and/or reduce the amount of those payments to you without first bargaining in good faith with
the International Association of Machinists and Aerospace Workers, District Lodge 65, AFL-CIO
(the Union).
WE WILL NOT lay you off without first bargaining in good faith with the Union over the
layoff decision and the effects of that decision.
WE WILL NOT subcontract bargaining unit work without first bargaining in good faith
with the Union.
WE WILL NOT refuse to provide the Union with information it requests that is necessary
for and relevant to performance of its duties as your exclusive collective-bargaining
representative.
WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the
exercise of the rights guaranteed you by Section 7 of the Act.
WE WILL display, and otherwise share with you, monthly profit information for the
Niagara Falls facility in the same manner as we did prior to the April 2019 union election.
JD–11–20
WE WILL rescind the unlawful changes to the manner in which we calculate profit-
sharing plan payments to you.
WE WILL provide the Union with the information regarding the profit-sharing plan that
the Union sought in its requests of August 16, August 26, and September 3, 2019.
WE WILL make you whole, with interest, for the loss of earnings and other benefits,
resulting from the 2 weeks of layoffs that we implemented beginning on May 20, 2019.
WE WILL make you whole, with interest, for the loss of earnings and other benefits
suffered as a result of our decision to subcontract bargaining unit janitorial work.
WE WILL make you whole, with interest, for the loss of earnings and other benefits
suffered as a result of our decision to unlawfully change your profit-sharing plan payments.
WE WILL file a report with the Social Security Administration allocating backpay to the
appropriate calendar quarters.
WE WILL compensate you for the adverse tax consequences, if any, of receiving one or
more lump-sum backpay awards covering periods longer than 1 year.
CASCADES CONTAINERBOARD
PACKAGING – NIAGARA, A DIVISION OF
CASCADES HOLDING US INC.
(Employer)
Dated By
(Representative) (Title)
The National Labor Relations Board is an independent Federal agency created in 1935
to enforce the National Labor Relations Act. It conducts secret-ballot elections to
determine whether employees want union representation and it investigates and
remedies unfair labor practices by employers and unions. To find out more about your
rights under the Act and how to file a charge or election petition, you may speak
confidentially to any agent with the Board’s Regional Office set forth below. You may
also obtain information from the Board’s website: www.nlrb.gov
Niagara Center Building, 130 S. Elmwood Avenue, Suite 630, Buffalo, NY 14202-2465
(716) 551-4931, Hours: 8:30 a.m. to 5 p.m.
The Administrative Law Judge’s decision can be found at www.nlrb.gov/case/03-CA-242367 or by using the
QR code below. Alternatively, you can obtain a copy of the decision from the Executive Secretary, National
Labor Relations Board, 1015 Half Street, S.E., Washington, D.C. 20570, or by calling (202) 273-1940.
JD–11–20
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE
DATE OF POSTING AND MUST NOT BE ALTERED, DEFACED, OR COVERED BY
ANY OTHER MATERIAL. ANY QUESTIONS CONCERNING THIS NOTICE OR
COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE
REGIONAL OFFICE’S COMPLIANCE OFFICER (518) 419-6669.