Certco Food Distribution Centers

National Labor Relations Board - Administrative Judge Opinions

May 5, 2005

30-CA-016895 (N.L.R.B. May. 5, 2005)

JD(ATL)–17–05
Madison, WI

UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
ATLANTA BRANCH OFFICE

CERTCO FOOD DISTRIBUTION CENTERS

and

TEAMSTERS LOCAL UNION NO. 695, affiliated
with the INTERNATIONAL BROTHERHOOD OF
TEAMSTERS, AFL-CIO
Case 30–CA–16895-1

Andrew S. Gollin, Esq., for the General Counsel.
Steven C. Zack, Esq., for the Respondent.
Scott D. Soldon and YingTao Ho, Esqs., for the
Charging Party.

DECISION

Statement of the Case

George Carson II, Administrative Law Judge. This case was tried in Madison, Wisconsin,
on March 14 and 15, 2005, pursuant to a consolidated complaint that issued on September 30,
2004.1 The complaint alleges various violations of Section 8(a)(1), (3), and (5) of the National
Labor Relations Act following the Respondent’s opening of a new nonunion facility in Madison,
Wisconsin. The Respondent’s answer denies all violations of the Act. I find that the Respondent
did violate Section 8(a)(1) of the Act substantially as alleged in the complaint and Section
8(a)(5) of the Act by dealing directly with employees and failing to provide the Union with certain
requested information. The evidence does not establish any Section 8(a)(3) violation. I find that
the Respondent’s failure to apply the collective-bargaining agreement to the new facility did not
violate the Act.

On the entire record, including my observation of the demeanor of the witnesses, and
after considering the briefs filed by the General Counsel, the Charging Party, and the
Respondent, I make the following

Findings of Fact
I. Jurisdiction
The Respondent, Certco Food Distribution Centers, the Company, is a corporation,
engaged in the storage and distribution of grocery and related items from its warehouses
located in Madison, Wisconsin, at which it annually receives goods and materials valued in
excess of $50,000 directly from suppliers located outside the State of Wisconsin. The Company
admits, and I find and conclude, that it is an employer engaged in commerce within the meaning
of Section 2(2), (6), and (7) of the Act.
1 All dates are in 2004 unless otherwise indicated. The charge was filed on June 4 and was
amended on July 14 and August 31.

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The Respondent admits, and I find and conclude, that Teamsters Local Union No. 695,
affiliated with the International Brotherhood of Teamsters, AFL-CIO, is a labor organization
within the meaning of Section 2(5) of the Act.

II. Alleged Unfair Labor Practices
A. Background

The Company has recognized the Union as the collective bargaining representative of its
warehousemen and drivers since 1962. The current collective-bargaining agreement is effective
by its terms from July 1, 2002, through June 30, 2005. The preamble states that the contract
applies to “all employees of … [Certco] engaged in work covered by this Agreement, all of
Madison, Wisconsin.” That wording has been repeated without change since the initial
collective-bargaining agreement of 1962. Article 14 provides that Certco will not subcontract to
an outside company “for the purpose of circumventing … this Agreement.” Immediately
following that prohibition is the following provision: “However, it is understood that nothing
contained in this Agreement shall prohibit the Employer from opening new facilities [or] …
transferring operation[s] from one facility to another ….” Article 14, Subcontracting, was
changed in the contract entered into on October 16, 1970, and has been repeated without
change thereafter.

The central issue in this case is whether the Company could establish a new warehouse
in Madison, Wisconsin, hire new employees to work there, and fail and refuse to apply the
collective-bargaining agreement to the employees at the new facility.

The Company has operated and continues to operate a warehouse at 5321 Verona
Road in Madison, hereinafter referred to as the Verona Road warehouse or Verona Road. The
warehouse has, over the past 40 years, expanded and currently has approximately 400,000
square feet of space. From the warehouse, the Company supplies grocery and related items to
grocery stores in Wisconsin, northern Illinois, southeastern Minnesota, and northeastern Iowa.
The Company’s largest customer is Woodman’s, a chain of full service supermarkets.

Company President Donald Watzke explained that, in late 2003, Certco was approached
by Woodman's regarding supplying approximately 18,000 items that had been being provided to
the Woodman’s stores by a different company. The items, described by Watzke as general
merchandise items, included health and beauty aids. Certco was handling many of these same
items from its Verona Road warehouse, but not at the volume that would be anticipated if it
became the supplier of these items to Woodman’s. Consequently, another location was sought.
After evaluating facilities in Beloit, Janesville, and Waunakee, Wisconsin, the Company settled
upon a 120,000 square foot facility located on Helgesen Drive in Madison, hereinafter referred
to as Helgesen or the Helgesen Drive warehouse.

On February 16, the Company received a letter from the Central States Pension Fund,
to which the Company contributes pursuant to the collective-bargaining agreement. The letter
advises of the Fund’s “deteriorating funding status” caused by market losses following the
terrorist attacks of September 11, 2001, and the bankruptcy of Consolidated Freightways, a
major contributing employer to the Fund. The Company made several communications to
employees regarding its concerns about the financial stability of the Fund. Company officials
also expressed their confidence in the Certco 401(k) Plan, which is offered to nonunit clerical
and supervisory employees as well as the employees that were hired at Helgesen.

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In mid-February, shortly after receipt of the foregoing letter, the Company announced the
opening of the Helgesen Drive warehouse as follows:

Certco, Inc[.,] is opening a new facility on the east side of Madison as a result of a new
business opportunity. The facility will be a different and separate operation from the
facility and operation on Verona Road. Certco, Inc. will be hiring new employees for the
facility. Since it is a new facility with new employees, it does not have a bargaining unit.

B. Facts

Employees had heard rumors of a new warehouse in January. Chief Shop Steward
Howard Hosely advised Teamsters Business Representative Larry Weden of the “rumor about
them opening this facility,” and Weden told him that “we had to sit back and wait to see what
happened.” The written announcement, set out above, was sent to employees in their
paychecks. Executive Vice President and Chief Operating Officer Randy Simon presented a
copy of the written announcement to Business Representative Weden. On February 23, Vice
President Simon held a meeting with the first shift employees and later with the second shift
employees. He began both meetings by announcing that the Company had received the
February 16 letter noted above from the Pension Fund, stated that the letter would be posted,
and requested that the employees read the letter. He then read the announcement of the
opening of the new warehouse and then answered any questions. A summary of each meeting
was prepared by Simon’s secretary Adel Haldiman who was present at each meeting. Simon
denied that he was asked about transferring at the first meeting. The summary of the second
meeting reflects that an employee asked if he would be transferred and that Simon answered
“anyone can fill out an application, your Union contract states that you are in this facility.”
Although Simon had with him a typed explanation relating to wages at the new facility, he
denied that he was asked about wages and testified that he did not read the explanation. The
explanation states:

The wages at the new facility are higher because their fringe benefit package is not as
costly as the Verona Road package. The new employees have a 401(k) pension plan
that provides them with comparable pension benefits at less cost. Because of this,
Certco was able to provide the employees with a higher wage rate.

Chief Steward Hosely recalled that, at the first shift meeting, Simon stated that the new
warehouse was going be handling health and beauty aids and housewares and that it “was not
going to be part of the bargaining unit.” He recalled that Simon was asked whether Verona
Road employees would be able to work there and that Simon replied that “there would be no
postings … [but] somebody could apply for that job if they wanted to.” Contrary to Simon’s
denial that he mentioned anything about wages, Hosely recalled that Simon stated that “the
starting wage there would be a dollar an hour more than the starting wage at the Verona Road
facility … because Certco would not have to deal with the expensive Central States Pension at
the Helgesen site … [that the employees] would have health insurance … [and] a company
sponsored 401(k) Fund there.”

Employee Gary Anderson confirmed that Simon began the meeting by referring to the
letter from the Pension Fund, stating that he was concerned about the contents of the letter and
that he would post it. Simon then announced the opening of the Helgesen Road warehouse,
stating that it would be nonunion and that if employees wished to apply they should do so
through Mark Squires, Human Resources Coordinator. Although not recalling any mention of
wages, Anderson recalled that Simon did state that, “since there would be no pension Fund
there [at the Helgesen warehouse] there would be a 401(k).”

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Employee Steve Anderson recalled that, when announcing the opening of the new
facility, Simon stated that it would be nonunion, that current employees “could fill out an
application but … it would be nonunion ….”

Employee David Henning recalled that, after announcing the opening of the Helgesen
Drive warehouse, Simon stated that “he was going to be able to pay them more money to start
because he wouldn't have to pay the expensive Teamster pension.”

Human Resources Coordinator Squires did not deny that, when Simon told employees
that they could fill out applications, he also stated that they could give them to Squires.

Simon’s recollection of the questions he was asked and his responses was hazy at best.
He acknowledged at one point that he was relying upon Haldiman’s notes of the meeting rather
than his recollection. Gary Anderson and Steve Anderson both recall that Simon stated that the
facility was going to be nonunion. I find that the Andersons testified to what Simon
communicated rather than what he actually said. The written announcement states that the new
facility “does not have a bargaining unit.” Hosely recalled that Simon stated that the facility “was
not going to be part of the bargaining unit.” Immediately following his announcement of the
opening of a new facility that had no “bargaining unit,” Simon was asked if “they,” referring to the
unit employees, could work there. Hosely, whom I credit, testified that Simon answered that
“there would be no postings … [but] somebody could apply for that job if they wanted to.” The
absence of postings pursuant to the contract confirmed that the Company intended to operate
the new facility as a nonunion facility. Any doubt that the facility was to be nonunion was erased
when, as Hosely credibly testified, Simon informed the employees that “the starting wage there
would be a dollar an hour more than the starting wage at the Verona Road facility … because
Certco would not have to deal with the expensive Central States Pension at the Helgesen site
… [that the employees] would have health insurance … [and] a company sponsored 401(k)
Fund there.”

There is no probative evidence that any Verona Road employee was informed that he or
she could not apply for a job at Helgesen. I find that employee Ernest Seay was mistaken in
recalling that, when an employee asked about applying, Simon responded that employee would
not be able to apply “at this time” but would be able to apply at “a later time.” Employee Steve
Anderson admitted that he was not actually told that he could not apply. He concluded that he
could not apply because of the Company’s designation of Helgesen as a nonunion facility.

On February 27, the Union filed a grievance protesting the “opening of a new facility
without covering that facility by the Union Contract and offering the bargaining unit persons the
available work opportunities.” The Company denied the grievance stating that the grievance
was not arbitrable, that the new facility was not part of the bargaining unit, and that the “Verona
Road labor agreement does not extend to employees at the new facility, nor does it give any
right to Verona Road employees with respect to the new facility.” On March 17, the Union filed
for arbitration. On March 22, Counsel for the Company wrote the Union stating that “Certco
does not believe that this matter is arbitrable as set forth in its response to the grievance.”

Following Vice President Simon’s announcement, employee Gary Anderson approached
Squires regarding the 401(k) Plan on the afternoon of February 23. Squires took him to Simon’s
office. Employee Tom Hanko was also present, but did not testify regarding the conversation.
Anderson questioned Simon regarding the benefits of the 401(k) Plan. They also spoke about
the Pension Fund. Simon expressed his opinion that the Pension Fund was “a bad deal,” and
Anderson agreed with him. They discussed the Helgesen facility, and Simon stated that the

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starting wages would be a dollar an hour higher “because of the fact that there was no pension
there.” Anderson asked what it would mean if “we get a 401(k) implemented at Certco [Verona
Road], and Simon said that “wages would go up.” Anderson requested a specific figure and
Simon said “a dollar.” Anderson stated that he would talk with his fellow employees. Simon did
not either encourage or discourage him from doing so. He did so.

Chief Steward Hosely received various questions following Simon’s announcement.
Around 3 p.m. on the afternoon of February 23, Hosely went to Simon’s office and stated to him
that several people had asked him “to come up and talk to you about the 401(k)." Supervisor
Dan Pechan, who became Manager of the Helgesen Drive warehouse, was in the office, and he
remained. Simon responded to Hosely saying, "I figured you'd be up here sooner with concerns,
you know". Hosely noted that “the pension always takes care of itself.” Simon repeated that one
reason that the Company was able “to pay a dollar an hour more to start” at Helgesen was
because it did “not have to worry about the pension fund at the Helgesen site.” Hosely asked
Simon to explain the manner in which the 401(k) Plan worked, and Simon explained “you
contribute 6 percent and [the Company contributes] 3 percent.” Hosely asked how the Fund was
doing, and Simon replied “pretty good” but gave no specifics. Hosely asked if he could be more
specific, and Simon replied that he needed to “ask the company lawyer if I could give you
specifics." He then commented that he was surprised that “the Union is not mad at you up here
talking to me about it." Hosely noted that Business Representative Weden was “a very open
minded person and everything would have to be discussed with him anyways." Supervisor
Pechan stated that if Hosely had the 401(k) plan from when he began with Certco, instead of
receiving a $2,500 a month Pension Fund benefit, "you'd be looking at now 10 to $15,000.00 a
month." As Hosely was leaving, Simon said to “talk amongst yourselves.” He then smiled and
said, "See, we can do wonderful things here." Simon did not deny the foregoing comment.

In early March, the complaint alleges the date of March 3, Ron French, who was steward
for the drivers at that time, observed that two new drivers from the Helgesen Drive warehouse
were transporting products from the Verona Road warehouse to Helgesen. He and Chief
Steward Hosely approached Vice President Simon with regard to this. French argued “that it
should be Local 695 members hauling the product from this location at Verona Road to the
Helgesen location.” Simon acknowledged the Union’s concern and stated that he would consult
with President Watzke and get back to the Union. The conversation then “transitioned into the
item of our pension and the concerns from Randy Simon about our pension.” French recalled
that Simon referred to the Company 401(k) Plan and stated that “he could do better for the
employees at the Verona Road location … [r]ather than the pension plan that we had at this
time.” French responded that he was not “authorized to bargain in any way, shape or form on
our pension plan, that I stood behind it and that I couldn't speak for the members.” The
foregoing disclaimer establishes that French communicated that he had no authority to
negotiate in that regard. See McDaniel Ford, Inc., 322 NLRB 956, 962 (1997).

Simon denied making any promises in the foregoing three conversations. I do not credit
that testimony. Shortly before the conversation with Gary Anderson on February 23, Simon had
announced that employees at the new warehouse would be receiving a higher starting wage
because the Company would not have to deal with the “expensive Central States Pension.” It
strains credulity to believe that, when Anderson asked what it would mean if “we get a 401(k)
implemented” at Verona Road, Simon would not assure him that the Company would treat the
Union represented employees in the same manner as its nonunion employees. Anderson stated
that Simon did so, answering that “wages would go up.” Similarly, I credit employee Ron French
and find that Simon, after expressing concerns about the Union pension, mentioned the
Company 401(k) Plan and stated that “he could do better for the employees at the Verona Road
location … [r]ather than the pension plan that we had at this time.”

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Simon consulted with President Watzke who agreed that a bargaining unit driver should
transport products from Verona Road to Helgesen. Simon informed both Hosely and French of
this. Since that time, unit drivers have performed this work.

On March 12, pursuant to the Company’s request, union officials including Secretary-
Treasurer Mike Spencer, Business Representative Weden, and various stewards including
Hosely and French met with Counsel to the Company Steven Zach, President Watzke, Vice
President Simon and others regarding the Pension Fund. Weden recalls stating to President
Watzke that the Union did not have “any crystal ball to enlighten him or the Company as to
where the fund was going to be going.” The Company representatives expressed concern that
the February 16 letter reflected that the pension was underfunded but that they were unable to
find out the amount of the Company’s unfunded liability. President Watzke said that he was
“putting money into a black hole, that these folks weren't going to see anything out of the
pension fund.” Weden disputed that and referred to former employees who were drawing a
pension. Watzke mentioned 401(k) plans, and the tone of the meeting changed. It concluded
when Secretary-Treasurer Spencer stated that the Union was not there to negotiate and to
“[s]ee us at contract time."

In late March, Steward Ron French observed that full pallets ready for delivery to stores
were being brought to Verona Road by Helgesen drivers and cross-docked. The term “cross-
docked” is used for orders that have not been stored in the Verona Road warehouse but have
been packed for delivery to specific stores, brought to the Verona Road loading dock, and then
placed upon the truck that is going to the specific store for which the packed pallet is destined.
Prior to the opening of the Helgesen warehouse, these prepacked pallets were chiefly meat
products packed at large packinghouses. French spoke with Vice President Simon regarding
the delivery of these full Certco pallets from Helgesen by the two Helgesen drivers, stating his
contention that the delivery of Certco packed products was unit work. Simon responded that “he
would designate that work over there as he sees fit.” Simon again broached the matter of
pensions, stating again that “he though that Certco could do better for their employees at that
location [Verona Road] without the pension plan.” French repeated Secretary-Treasurer
Spencer’s statement that the pension issue was “for contract time … at a later date.” On March
24, French filed a grievance to which the Company did not respond. The Union did not file for
arbitration of this grievance, and there is no complaint allegation relating to it.

Also in late March, employee Gary Anderson spoke again with Vice President Simon
requesting information about how a 401(k) plan worked. Simon informed him that
representatives from U.S. Bank were coming to talk to Certco’s nonunion employees regarding
their 401(k) Plan. Anderson stated that he would like to attend the meeting. Simon answered
that could be a possibility, he “couldn't give me an answer” at that point. Anderson, apparently
referring to conversations that he had with employees following his conversation with Simon on
February 23, noted that there were “a lot of people that for some reason or another don't trust
Certco to keep that profit sharing in place.” Simon responded that he was not “Darth Vader …
[and] didn't want to destroy us. He wasn't up there to -- for our demise.”

At some point shortly after the foregoing conversation, Simon informed Anderson that
the Company would have a meeting with representatives of U.S. Bank for any unit employees
who were interested. Anderson spread the word. Contrary to Anderson’s initial understanding,
the meeting did not include nonunit employees. On March 30, Anderson and many other unit
employees attended a meeting that the Company had set up with U.S. Bank representatives.
President Watzke, Vice President Simon, and Human Resources Coordinator Squires were also
present. Prior to the meeting, Squires asked Chief Steward Hosely “if it was okay with the Union

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to have that meeting.” Hosely stated that it was. Anderson asked Hosely if he “could invite some
friends,” and Hosely expressed no objection. No representative of the Company contacted
Business Representative Larry Weden regarding this meeting. The U.S. Bank representatives
presented the same data regarding the 401(k) Plan that had been presented to the nonunit
employees. Following the presentation, employee Dave Hennings asked whether the
employees would recoup in wages money saved on the 401(k) Plan. He recalled that President
Watzke answered that “there was only so much money and … [that] would have to be
bargained.“ Employee Anderson testified that, before Watzke answered Hennings, Vice
President Simon said “there would be a raise” and that Hennings asked him to be more specific
at which time President Watzke interrupted stating that the employees were there “for
information about 401(k) and that anything along those lines would have to be negotiated with
the Union.” Simon did not deny making the foregoing statement in the March 30 meeting.

The Company, on April 15, received a letter from the Pension Fund advising that its
underfunded liability if it were to withdraw from the fund at that time would be approximately four
million dollars. In May, the Company sent General Counsel’s Exhibit 8, a one-page undated
memorandum signed by President Watzke and Vice President Simon, to unit employees. The
memorandum states that it is being sent “to keep you informed on the status of your pension
fund.” It refers to the financial condition of the Pension Fund and continues as follows:

We have now received word that the current Fund deficit is 9.7 billion dollars. Certco’s
liability for this deficit is almost 4 million dollars.

We are deeply concerned about this.

We are concerned about how this may affect the long-term financial status of the
Company and your pension benefits.

We are analyzing our options at this point and will address them with your union at such
point as is appropriate.

Testimony establishes that there would be no liability if the Company continued to
participate in the Fund as it was doing pursuant to the existing contract. There is no evidence
regarding the current withdrawal liability, if any. The memorandum does not explain that the
Company was liable for the four million dollars only if it were to withdraw from the fund.

In late May or early June, the Company sent unit employees another undated
memorandum signed by Watzke and Simon. The memorandum is a one-page cover sheet to
which testimony given before a House of Representatives subcommittee on March 18 by the
Vice President of United Parcel Service and April 29 by the President of the Motor Freight
Carriers Association is attached. The memorandum states, “This testimony is frightening.”

On June 23 and again on October 13, Counsel for the Company wrote the Union asking
whether the Union would be interested in commencing contract negotiations “earlier than we
normally begin.” Business Manger Weden testified that, historically, the parties begin bargaining
about 60 days before expiration of the collective-bargaining agreement. The Union did not
respond the foregoing correspondence.

On May 15, a retirement party was held for an employee at a bar in Madison. Employee
Steve Anderson testified that he was concerned because of the communications he had
received regarding the Pension Fund and seeing product going to the Helgesen facility. In the
course of the evening, he spoke with Vice President Simon. He asked if Simon would like to see

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the Union dissolved. Simon replied that he would, that there were “things that the Company
could do for the employees at Certco without the Union such as a 401(k) Fund incentives,
company insurance. Things that they cannot do with the Union in the place at this time.”
Anderson responded that he had been there a long time and that the Pension Fund meant a lot
to him. Simon replied that he understood, but “they had to figure out a way to keep the younger
employers … still working at Certco, [a]nd the way of doing that would be offering a 401(k).”
Simon did not deny the foregoing statements. He testified that he was inebriated and did not
recall making them. Anderson agrees that Simon was inebriated. Anderson acknowledges that
he drank alcohol at the party but testified that he remained sober because he had to drive to his
home across town after the party. I credit Anderson.

On May 10, the Union sent the Company a questionnaire with 43 questions relating to
the Helgesen Road facility. The Company did not respond. The letter, in the first paragraph,
refers to the Company’s “attempts to remove work from Local 695 jurisdiction” and, in the final
sentence of the second paragraph states, “We need information related to your transfer of work
to prepare for effects bargaining.”

Watzke testified that, upon learning of Woodson’s desire to have Certco supply items
that had previously been supplied by a different company, we “realized there was no way that
we could handle that in our existing facility,” that the Company was used to handling cases and
big boxes, and that smaller items “like toenail clippers and lipstick … [would require] a different
type of picking system.” After investigating the manner in which other suppliers of these items
worked, Watzke decided that the Company should adopt “a model used by Walgreens with
racks four levels high and … totes … rather than cases on pallets.” He acknowledged that totes
were used at Verona Road, testifying, “We had used a few totes in our packroom” but noted that
“our packroom is a very small part of our facility at Verona Road.” The foregoing admission
confirms that the work being done at Helgesen was virtually the same work that had been
performed at Verona Road albeit at a higher volume. Any argument to the contrary is refuted by
the notes of the February 23 meeting which reflect that second shift employee Terry Hartlich
asked whether “the whole packroom [would] move to the new warehouse.” Simon responded
that “some packroom product will go but not all.” In addition to health and beauty aids, other
items including nuts and seasonal candy, i.e. Halloween, Valentine’s Day, and Easter, were
moved to the Helgesen Drive warehouse.

President Watzke explained that, although a new addition to the Verona Road
warehouse had given the Company additional space, he anticipated that the Company “would
use up all the space … [to increase] our product line in our existing lines.” He estimated that
approximately 5,000 square feet of the Verona Road warehouse was devoted to general
merchandise items that were to be warehoused at Helgesen. The testimony does not establish
whether that estimate included the seasonal candy and nuts, which certainly are not health and
beauty aids and would appear to be grocery items. Regardless of the volume of product
involved, the record establishes that many identical items and other items similar to those
previously warehoused and shipped from the Verona Road warehouse are now being
warehoused and shipped from, or prepared for shipment at, the Helgesen Drive warehouse.

Product shipped to either warehouse is first entered into a computerized inventory and
then placed in numbered bins at the warehouses by receiving employees who use forklifts,
pallet jacks, and similar equipment. Customer orders are given to order pickers who go down
the aisles and, using the same equipment, obtain the product from the appropriate bin. The
product is loaded onto pallets destined for the specific customer as identified by labels
generated by the computer. A typical loaded pallet is six feet high. The pallets are taken to the
specified locations on the dock for loading onto the truck that will take the product to the

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customer. The loader, driving a forklift, will load the pallets onto the appropriate trailer. Verona
Road drivers work on two shifts, the first shift reporting as early as 4 a.m. and the second shift
in the afternoon. Drivers deliver the product to the customers on their respective routes.

There are two drivers at the Helgesen warehouse. Normally they make two deliveries a
day of fully loaded pallets destined for specific stores on the routes of the Verona Road drivers
to the Verona Road loading dock. These pallets are cross-docked. The Helgesen drivers also
deliver directly to the two Woodman’s stores in Madison. Consistent with the Union’s protest in
early March, product that is received at Verona Road but warehoused at Helgesen is delivered
to Helgesen by Verona Road drivers.

The Company selected Dan Pechan, a supervisor at Verona Road, as Warehouse
Manager at Helgesen. He is assisted by Supervisor Tracy Daubenspeck, who was also a
supervisor at Verona Road. The Company’s operations are computerized and inventory control,
payroll, and records are all centrally maintained at Verona Road. Insofar as personnel records
are maintained at Verona Road, Pechan would, before disciplining an employee, need to
contact that facility to obtain the employee’s personnel file.

There is no evidence that any employee at Verona Road sought to apply at Helgesen.
On February 23, the Company stated that the positions at Helgesen would not be posted. The
seniority of all of the employee witnesses who testified would have resulted in significant pay
cuts had they applied and been hired as new employees. The Company staffed the Helgesen
warehouse by hiring employees through a temporary agency. Human Resources Coordinator
Squires also sent applications made at Verona Road to Pechan when the facility opened and
referred one of the two Helgesen drivers to that facility. Pechan testified that he made the hiring
decisions. Although maintaining that Pechan makes all final discharge decisions, Squires
admitted that Pechan would consult with him to confirm whether a proposed action was
consistent with Company policy.

There has been no interchange between the warehousemen. Although Verona drivers
see the Helgesen drivers at the fuel pump at Verona Road and at the stores to which they both
deliver, that is, with one exception, the extent of their contact. The exception is that, in March
2005, a year after the opening of the Helgesen warehouse, all drivers attended a training
session regarding use of a new computer system on their trucks. The foregoing contact does
not establish the interchange of any work. Bowie Hall Trucking, 290 NLRB 41, 43 (1988).

No unit positions were lost at Verona Road. As of March 1, 2004, there were 126
bargaining unit employees at Verona Road. On March 1, 2005, there were 157. There are
approximately 25 employees at Helgesen--23 warehousemen and 2 drivers.

C. Analysis and Concluding Findings

1. The Section 8(a)(1) Allegations

The Complaint, in subparagraph 6(a), alleges that the Respondent, by Simon, Watzke,
and Pechan, on February 23 and in early March, informed employees that Union membership
“was incompatible with hire … at Helgesen …by telling them they could not transfer or apply for
a position at the Helgesen … facility because the Helgesen … facility was non-union or that no
Union employees would be working there.” There is no evidence of any such communications
by either Watzke or Pechan. The Respondent’s announcement that the new facility would not
have a bargaining unit coupled with the statement that the jobs would not be posted and
announcement of a higher starting wage and a 401(k) Plan rather than “the expensive Central

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States Pension” effectively announced that the Respondent was going to operate the new
facility as a nonunion facility. Although Simon did not state that unit employees could not apply,
employee Steve Anderson concluded that he would not be considered for a position at the new
facility. The conclusion that Anderson made from Simon’s statements, that union membership
was incompatible with employment at the new nonunion facility, was logical. “When an employer
tells applicants that the company will be nonunion before it hires its employees, the employer
indicates to the applicants that it intends to discriminate against … [them] to ensure its nonunion
status.” Kessel Food Markets, 287 NLRB 426, 429 (1987). See also Ryder Truck Rental, 318
NLRB 1092, 1094-1095 (1995). In announcing to its Union affiliated unit employees prior to
hiring the workforce at the Helgesen warehouse that the facility would be nonunion, the
Respondent informed them that union affiliation was incompatible with employment at that
location in violation of Section 8(a)(1) of the Act.

Subparagraph 6(b) of the complaint alleges that the Respondent “threatened employees
with adverse consequences unless the employees persuaded the Union to drop the Teamsters
Union Pension Fund for the Respondent’s 401(k) plan.” The General Counsel argues that the
foregoing threat is implicit in Simon’s presentation on February 23 in which he first
communicated the Respondent’s concerns regarding the Pension Fund and immediately
followed those remarks by announcing the opening of the nonunion facility. As hereinafter
discussed, the collective-bargaining agreement permits the Respondent to open new facilities.
There was no threat either explicit or implicit in the announcement made to employees on
February 23. I shall recommend that this allegation be dismissed.

Subparagraph 6(c) of the complaint alleges that the Respondent, on February 23 and on
or about March 3 and 26, promised employees a pay increase and a better pension plan in
order to persuade employees to give up their contractual Teamster Union Pension Fund for
Respondent’s 401(k) Fund.” On February 23, Vice President Simon informed employee Gary
Anderson that employees would receive a dollar an hour wage increase if they abandoned the
Central States Pension Fund and adopted the Certco 401(k) Plan. On that same day he implied
improved benefits when, in his discussion with Chief Steward Hosely, he stated that Certco was
able “to pay a dollar an hour more to start” at Helgesen because it did “not have to worry about
the pension fund,” and, as Hosely was leaving, stated, "See, we can do wonderful things here."
On March 3, although not specifying an amount, Simon informed employee Ron French that “he
could do better for the employees at the Verona Road location … [r]ather than the pension plan
that we had at this time.” He repeated this to French in late March. On March 30, in the
discussion following the presentation by the representatives of U.S. Bank, Simon stated that,
with the 401(k) Plan the employees would receive a raise. Watzke’s comment that this “would
have to be negotiated with the Union” did not disavow Simon’s representation establishing what
would be on the bargaining table if the Union adopted the Certco 401(k) Plan. Each of the
foregoing statements extended a promise of benefit if the Central States Pension Fund were to
be replaced with the Certco 401(k) plan. An employer may not seek to exert pressure on a
union in order to further its bargaining objectives by making promises of a wage increase to unit
employees. Ad-Art, Inc., 290 NLRB 590, 606 (1988). The foregoing promises of benefit
independently violated Section 8(a)(1) of the Act.

Subparagraph 6(d) alleges that the Respondent, by Randall Simon, on May 15 at a
tavern, impliedly promised better working conditions to encourage employees to persuade the
Union to agree to the Company 401(k) Fund. Simon, in his conversation with employee Steve
Anderson, explicitly promised improved benefits “such as a 401(k) Fund incentives, company
insurance. Things that they cannot do with the Union in the place at this time.” That statement
promised improved benefits upon abandonment of the contractual pension benefit which
Anderson stated “meant a lot to him,” and it violated Section 8(a)(1) of the Act.

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2. The Direct Dealing Allegations

The complaint, in paragraph 8, sets out various instances, several of which are
coextensive with the foregoing Section 8(a)(1) allegations, in which it is alleged that the
Respondent bypassed the Union and dealt directly with employees. As held by the Second
Circuit Court of Appeals in NLRB v. General Electric Co., 418 F.2d 736, 759 (2nd Cir. 1969),
direct dealing occurs when the employer chooses "to deal with the Union through the
employees, rather than with the employees through the Union." On February 23, Vice President
Simon announced the establishment of the Helgesen facility and referred to the wages and
benefits, linking the higher starting wage to the presence of the Respondent’s 401(k) Plan as
opposed to the Union’s “expensive” Pension Fund. The gratuitous injection of the relative costs
of the 401(k) Plan and the Pension Fund into the announcement suggests an ulterior motive.
The suggestion of an ulterior motive is confirmed by Simon’s conversations thereafter in which
he promised a wage increase if unit employees were under the Certco 401(k) Plan. The
Respondent began sending documents to employees in which it expressed concern regarding
the Pension Fund. Although none of those communications are alleged to violate the Act, the
sending of them suggests a pattern which, “when examined in its totality, reveal direct dealing.”
NLRB v. Pratt & Whitney Air Craft Division, 789 F.2d 121, 135 (2d Cir. 1986). There is no
testimony contradicting Business Representative Weden’s testimony that, historically, the
parties have commenced negotiations approximately 60 days prior to the expiration of a
contract. The Respondent’s requests in June and October to begin negations “earlier” suggests
a desire to capitalize upon its touting the Certco 401(k) Plan to unit employees while denigrating
the Union’s Pension Fund. It is in this context that I address the allegations contained in
paragraph 8 of the complaint.

The complaint, in subparagraph 8(a), alleges that the Respondent, by Vice President
Simon, “bypassed the Union and bargained directly with employees concerning their wages and
pension” on February 23, on various dates in March, and on May 15. I find that Simon’s
informing employee Gary Anderson on February 23 that employees would receive a dollar an
hour wage increase if they abandoned the Central States Pension Fund and adopted the Certco
401(k) Plan and stating to Steward Ron French in early March and late March that “he could do
better for the employees at the Verona Road location … [r]ather than the pension plan that we
had at this time” constituted direct dealing. I also find that the Respondent engaged in direct
dealing when Simon stated, in the discussion following the presentation by the representatives
of U.S. Bank on March 30, that with the 401(k) Plan the employees would receive a raise.

On May 15, Simon, speaking to employee Steve Anderson, promised improved benefits
that the Respondent could not implement “with the Union in the place at this time.”2 The
Respondent argues that this did not constitute direct dealing and cites the decision of the Court
of Appeals in Americare Pine Lodge Nursing V. NLRB, 164 F.3d 867, 878 (4th Cir. 1999). In that
decision the Court of Appeals refused to enforce the portion of the Board Order in Americare
Pine Lodge Nursing, 325 NLRB 98, 101, 104 (1997), that found direct dealing when, on a
smoke break, a supervisor who was a friend of the employee, asked the employee what she
thought of the employer’s wage offer. The Court of Appeals reasoned that “friend-to-friend
conversations outside of the workplace” did not constitute “evidence of direct dealing.” In so
2 The General Counsel’s brief, at footnote 31, states that the May 15 conversation was not
alleged as direct dealing. The transcript, at pages 268-269, reflects that the General Counsel
moved to amend subparagraph 8(a) of the complaint in that regard, there was no objection, and
I allowed the amendment.

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finding, the Court of Appeals noted that “there was no evidence of an attempt to enter into any
quid pro quo negotiation with employees outside of the proposal on the table before the Union
… [nor did the supervisor] communicate, either expressly or impliedly, that through dealing with
… [the employer], the employees could achieve the same or better results than they could
achieve through the Union.” In the instant case there was a quid pro quo. Simon promised
improved benefits “such as a 401(k) Fund incentives, company insurance” that the Respondent
could not implement “with the Union in the place at this time.” The foregoing direct dealing
violated Section 8(a)(5) of the Act.

The complaint, in subparagraph 8(b) alleges that Supervisor Dan Pechan bargained
directly with employees on February 23. Hosely's testimony establishes that Pechan stated
what he believed Hosely's monthly benefit would be if he had the 401(k) Plan rather than the
Pension Fund. The foregoing statement of opinion did not constitute direct dealing. I shall
recommend that this allegation be dismissed.

The General Counsel, in his brief, withdrew subparagraph 8(c) of the complaint.

Subparagraph 8(d) alleges that the Respondent bypassed the Union and bargained
directly with employees by sponsoring a meeting with U.S. Bank officials to explain
Respondent’s 401(k) Plan. The Respondent, citing Fabric Warehouse, 294 NLRB 189 (1989),
argues that the holding of the meeting did not violate the Act. I agree. In Fabric Warehouse the
Board specifically held that describing the wages and benefits of nonunit employees does not
violate the Act in the absence of “any implied promises that the wages and benefits of the
employees at the meeting will be adjusted if the union is voted out.” In that case, as in this case,
comments made in the meeting were found to violate the Act. Nevertheless, the holding of the
meeting was found not to violate the Act. I shall recommend that the allegation that the
sponsoring of the meeting violated the Act be dismissed.

3. Allegations Concerning the New Facility

Paragraph 7 of the complaint alleges that the Respond refused to consider and hire unit
employees for employment at the Helgesen Drive facility. As already discussed, several
employees who testified confirmed that they were initially interested in working at Helgesen but
did not apply because they were informed that the Respondent intended to operate the facility
as a nonunion facility and, therefore, all applicants would be new hires and begin at the starting
wage. The unit employees who testified all had sufficient seniority so that they were earning
more than the Helgesen starting wage, and none applied. Despite the Respondent’s implicit
discouragement of unit applicants, there is no evidence that the Respondent refused to consider
any unit employee for hire. No unit employees applied. In GSX Corp., of Missouri, 295 NLRB
529 (1989), cited by the General Counsel, the Board held that the layoff of unit employees and
failure to rehire them for work claimed by the union violated the Act. In finding an unlawful failure
to rehire despite the absence of any applications by the employees, the Board relied upon the
union’s claim for the work involved coupled with the filing of 20 grievances over the failure of the
respondent to permit employees to bid for the jobs in question. The Board held that the
foregoing established “a claim to and application for the transfer-station work.” Id at 531, fn. 10.
In this case there was no failure to rehire because there was no layoff. As hereinafter
discussed, there was no obligation to post the positions because the contract is inapplicable to
the new facility. No unit employee applied for work at Helgesen.

Paragraph 12 alleges that the Respondent failed to employ union affiliated employees as
alleged in paragraph 7 in order to avoid its obligation to recognize and bargain with the Union.
Insofar as I have found that there was no discrimination against any union affiliated employees,

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none of whom applied for work at Helgesen, I shall recommend that paragraphs 7 and 12 of the
complaint be dismissed.

There is no complaint allegation relating to the Respondent’s entrepreneurial decision to
establish a separate facility for the increased volume of products that it anticipated handling
following Woodman’s decision to have Certco supply it with health and beauty aids and other
general merchandise items. The General Counsel correctly points out that, at the time the
120,000 square foot Helgesen warehouse was obtained, the Verona Road warehouse had over
150,000 of unused space. He does not address President Watzke’s testimony that he
anticipated that the Company “would use up all the space … [to increase] our product line in our
existing lines.” Nor does he acknowledge that the number of unit employees increased from 126
to 157 between March of 2004 and March of 2005. It is obvious that this proceeding would
involve different issues if new employees had been hired at Verona Road and the Respondent
had failed to apply the collective-bargaining agreement to them at that location or if unit
employees had been laid off. Neither of those issues is presented. There is no complaint
allegation relating to failure to bargain over the decision to begin operations at the new facility.

Paragraph 9 of the complaint alleges that the Respondent, in violation of Section 8(a)(1)
and (5) of the Act, has failed and refused to recognize the Union as the collective bargaining
representative of the Helgesen employees, has failed and refused to apply the collective-
bargaining agreement to those employees, and has refused to arbitrate a grievance over the
opening of that that facility as nonunion. The answer admits the foregoing allegations, denies
that the Respondent was obligated to recognize the Union or apply the contract, and
affirmatively pleads that the grievance was not arbitrable.

The brief of the General Counsel argues that the opening of the Helgesen warehouse
and transfer of unit work violated Section 8(a)(1), (3), and (5) of the Act. The only 8(a)(3)
violations alleged in the complaint are contained in paragraphs 7 and 12 and, as discussed
above, the allegations of paragraph 12 are predicated upon the paragraph 7 allegations. There
is no Section 8(a)(3) allegation relating to the opening of the warehouse or transfer of work.

The allegations regarding the Respondent’s failure to recognize the Union and apply the
collective-bargaining agreement raise issues that have come before the Board for decades.
They involve the competing interest of the collective bargaining representative to preserve unit
work and the Section 7 right of employees to choose or to choose not to be represented by a
collective bargaining representative.

The contract herein is of little assistance. Although, as argued by the General Counsel
and Charging Party, the preamble states that it applies to “all employees of … [Certco] engaged
in work covered by this Agreement, all of Madison, Wisconsin,” the wording of the preamble has
been repeated without change since the initial collective-bargaining agreement of 1962, and
until 2004, there was only one facility in Madison. Only drivers and warehousemen are in the
unit although the Respondent also employs mechanics in its truck shop. The agreement does
not specify the “work” it covers. The Respondent points out that, in the 1970s, Certco operated
a produce facility in Rockford, Illinois. Article 14, Subcontracting, was changed in the contract
entered into on October 16, 1970. Article 14 provided, as it provides in the current contract, that
Certco will not subcontract or transfer work to an outside company “for the purpose of
circumventing … this Agreement.” Immediately following that prohibition is the following
statement: “However, it is understood that nothing contained in this Agreement shall prohibit the
Employer from opening new facilities [or] … transferring operation[s] from one facility to another
….” There is no language relating to any protocol, such as the posting of jobs or recognition
upon the presentation of evidence of majority status, to be followed concerning the opening of a

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new facility.

The Union, in filing its grievance on February 27, contended that the new facility should
be covered by the collective-bargaining agreement and that unit employees should have been
offered the positions. The Respondent denied the grievance and asserted that it was not
arbitrable. The position of the Respondent is consistent with Board precedent as stated in Super
Valu Stores, 283 NLRB 134, 135 (1987), in which the Board quoted with approval the following
language in Marion Power Shovel Co., 230 NLRB 576, 577-578 (1977):

The determination of questions of representation, accretion, and appropriate unit do not
depend upon contract interpretation but involve the application of statutory policy,
standards, and criteria. These are matters for decision of the Board rather than an
arbitrator [footnote omitted].

In short, Board precedent supports the Respondent’s position that the grievance was not
arbitrable and, even if it were, an employer’s “refusal to arbitrate one type of grievance is not
necessarily an unfair labor practice. Where an employer refuses to arbitrate a very narrow,
specifically defined grievance subject matter, the Board has not found a violation of the Act.”
GAF Corp. 265 NLRB 1361, 1364-1365 (1982).

I find, as argued by the Respondent, that this case is governed Gitano Distribution
Center, 308 NLRB 1172 (1992). Neither the General Counsel nor the Charging Party cites
Gitano in their briefs which suggests that they consider it inapplicable. Although the factual
situation in Gitano involved layoffs and failure to transfer employees, the principle announced is
clear. In Gitano, the Board stated that it had decided “to abandon the ‘partial relocation’ and
‘spinoff” analyses” used in prior cases and that it would begin its analysis of factual situations
involving new facilities with its “long-held rebuttable presumption that the unit at the new facility
is a separate appropriate unit,” and rather than “focusing on the continuity between the ‘old’ and
‘new’ units … [will] employ “the correct focus, balancing the rights of the new employees against
those of transferees to the new location.” Id at 1176. The Board noted that Gitano did not raise
the issue of applicability of a current contract, stating:

Because the new facility is presumptively a separate unit, we would view as irrelevant to
the analysis the question of whether or to what extent the employees at the new facility
are performing work that previously was performed by the unit employees at the old
facility.

The issue of whether an existing contract would be applicable to the new facility is not
before us in the present case. However, if the new facility is a separate unit, it would
appear that the contract would not apply, without an agreement that it would apply. See
Kroger Co., 219 NLRB 388 (1975). Id. at fn. 21

It is axiomatic that, in the absence of transferees or a finding of accretion, the Union
must demonstrate majority support in order for there to be a bargaining obligation. See Mine
Workers (Arch of West Virginia), 338 NLRB 406, fn. 3 (2002). Critical to the Board decision in
Kroger Co., supra, cited in footnote 21 of the Gitano decision, was evidence that “both Unions
offered to submit proof that they had card majorities among the employees at the stores in
issue.” The contract herein permits the Respondent to open new facilities and does not
establish a protocol for recognition or require that the positions at the new facility be posted.
Although the absence of any applications from unit employees may arguably be explained by
the Respondent’s unlawful statements that the new facility would be nonunion, making such a
finding with regard to any employee other than Steve Anderson, who concluded that he could

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not apply, requires an inference that the statements were the basis for the absence of
applications. In order to find that a bargaining obligation existed, I would have to further infer
that a sufficient number of employees would have applied and, absent discrimination, been
employed so as to establish a bargaining obligation. The Board has long held that “[i]nferences
must be founded on substantial evidence upon the record as a whole” and, since an inference is
not substantial evidence, “an inference based on an inference” is impermissible. Steel-Tex
Manufacturing Corp., 206 NLRB 461, 463 (1973); Diagnostic Center Hospital Corp., 228 NLRB
1215, 1216 (1977).

The General Counsel and Charging Party argue that the record evidence establishes
that the Helgesen warehouse is an accretion to the unit at the Verona Road warehouse citing
the functional integration between the two facilities and the asserted lack of authority of
Warehouse Manger Pechan.

The Board has followed a restrictive policy in finding accretions to existing units because
it seeks to insure that the employees' right to determine their own bargaining
representative is not foreclosed. We thus will find a valid accretion "only when the
additional employees have little or no separate group identity … and when the additional
employees share an overwhelming community of interest with the preexisting unit to
which they are accreted [footnotes omitted]. Safeway Stores, 256 NLRB 918 (1981).

It is undisputed that the employees at the two facilities have the same skills. The
Helgesen facility is approximately 10 miles distant from the Verona Road facility. The operations
of the warehouses are integrated. At both warehouses the centralized computer system dictates
what items are to be warehoused in which bins and which items are to be picked and packed for
delivery. Helgesen drivers deliver prepacked pallets to be cross-docked at Verona Road for
delivery to distant customers and, pursuant to the Respondent’s agreement with the Union,
items from Verona Road that are to be warehoused at Helgesen are delivered there by Verona
Road drivers. The only interaction between the drivers is when they chance upon each other at
the Verona Road fuel pump or at the two Woodman’s stores in Madison to which the Helgesen
drivers directly deliver products. There is no interaction between the warehouse employees. The
drivers and warehousemen at Helgesen are separately supervised, and they have a different
pay scale and benefit package.

In this case, the similarity of skills of the employees and the integration of the operations
mitigate towards finding a community of interest. The absence of a bargaining history is not a
factor insofar as there is no history of inclusion or exclusion. The distance between the two
facilities, 10 miles, is also neutral. See Super Valu Stores, supra at 136.

Board precedent suggests that the two most significant factors in evaluating the
propriety of accretion are the degree of employee interchange and day-to-day supervision. In
Super Valu Stores, the Board, pointed out that it had specifically addressed those two critical
factors in Towne Ford Sales, 270 NLRB 311, 312 (1984):

One of these elements is the degree of interchange of employees between the affiliated
companies. Mac Towing, 262 NLRB 1331 (1982). No weight is assigned to the fact that
interchange is feasible when in fact there has been no actual interchange of employees.
Combustion Engineering, 195 NLRB 909, 912 (1972). Another important element is
whether the day-to-day supervision of employees is the same in the group sought to be
accreted. Save-It Discount Foods, 263 NLRB 689 (1982); Weatherite Co., 261 NLRB
667 (1982). This element is particularly significant, since the day-to-day problems and
concerns among the employees at one location may not necessarily be shared by

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employees who are separately supervised at another location. Renzetti's Market, 238
NLRB 174, 175 (1978). Super Valu Stores, supra at 136.

Warehouse Manage Pechan’s testimony that he runs the day-to-day operations of the
warehouse, including hiring and firing, is uncontradicted. The General Counsel and Charging
Party note that Pechan has received no formal human relations management training and, by
his own admission, relies on “instinct.” Pechan is a warehouse manager, not a human
resources or personnel manager. Both the General Counsel and the Charging Party argue that
Pechan was not credible, pointing out that Human Resources Coordinator Squires testified that
Pechan would consult with him regarding proposed disciplinary actions whereas Pechan
admitted to such consultation only “very rarely.” In view of the uncontradicted testimony of
Squires and Vice President Simon regarding Pechan’s authority, the foregoing conflict
establishes a difference in perception, not authority. As pointed out by the administrative law
judge in Judge & Dolph, Ltd., 333 NLRB 175, 187 (2001), “no supervisor or manager, save an
owner, exercises unbridled authority. … Every one of them possesses authority which to some
degree is circumscribed.” The General Counsel points that Human Resources Coordinator
Squires sent applications that he had on file to Pechan and specifically referred one of the
drivers hired there. There is no evidence regarding the action that Pechan took regarding the
applications. The Charging Party argues that the Respondent produced no documents
corroborating Pechan’s testimony that he actually interviewed and hired employees and argues
that the foregoing establish doubts regarding the actual authority exercised by Pechan. Doubts
do not constitute probative evidence. Insofar as the General Counsel and Charging Party seek
to assert that Pechan exercises no meaningful supervisory authority, it was incumbent upon
them to produce that evidence. The complaint alleges and the answer admits that Pechan is a
supervisor. Human Resources and Vice President Simon confirm that he possess and exercises
that authority. There is no evidence that Warehouse Manager Pechan does not have and
exercise the authority to which he testified, specifically that he is “in charge,” that he hires and
fires, and that he runs the day-to-day operations of the warehouse with the assistance of his
subordinate supervisor Tracy Daubenspeck.

The Board, in Gitano Distribution Center, requires that analysis of factual situations
involving new facilities begin with the “long-held rebuttable presumption that the unit at the new
facility is a separate appropriate unit.” The burden is upon the party challenging that
presumption to establish that the unit is not appropriate. The employees herein share the same
skills and the operations are integrated. As in Bowie Hall Trucking, supra, 290 NLRB 41, payroll,
benefits, and records are centrally maintained. Despite the foregoing, Board precedent
establishes that in determining the appropriateness of a single location unit, the two most critical
factors are separate supervision and absence of interchange. I find that the presumption that
the separate Helgesen facility is an appropriate unit has not been rebutted.

The contract permits the Respondent to establish new facilities. It contains no protocol
relating to job posting or recognition. There is no complaint allegation that the Respondent
violated the Act by failing to bargain with regard to the opening of the new facility. The evidence
does not rebut the presumption that the separate Helgesen warehouse constitutes an
appropriate unit. This is not to say that a unit encompassing both warehouses would not also be
appropriate, but that is not relevant. “[T]he doctrine of accretion will not be applied where the
employee group sought to be added to an established bargaining unit is so composed that it
may separately constitute an appropriate bargaining unit.” Hershey Foods Corp., 208 NLRB
452, 458 (1974). “To hold that the new warehouse is an accretion to the unit represented by the
Union would be to contravene the policies expressed in … [Board precedent], and would
effectively deprive the employees of the right to determine the issue of representation.” Essex
Wire Corp., 130 NLRB 450, 453 (1961). In view of the foregoing, I shall recommend that the

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allegations contained in paragraph 9 of the complaint be dismissed.3

4. The Information Request

The Respondent argues that it “had no duty to supply information concerning the
nonunion Helgesen facility” and that the Union did not meet its burden of showing that the
requested information was relevant. In view of the absence of a bargaining obligation with
regard to the Helgesen facility, I agree with the Respondent that information sought relating to
the establishment of that facility, the management of that facility, and information regarding
employees at the facility is not relevant.

Contrary to the Respondent’s argument, I find that the portions of the Union’s request for
information regarding unit work, product that was previously warehoused at Verona Road and
that was being moved to Helgesen, was relevant and that the Union established its need for that
information. The Union pointed out that the information sought regarding “your transfer of work”
was “to prepare for effects bargaining.” Information relating to the performance of unit work by
nonunit employees is relevant. Phoenix Coca-Cola Bottling Co., 337 NLRB 1239 (2002). I find
that the requests in paragraphs 3 and 4 for a description of “the type of groceries and other
product warehoused “ in the “Old Location “ and the “New Location” respectively directly relate
to unit work in view of the testimony regarding movement of product from the packroom and the
movement of nuts and seasonal candy. The request in paragraph 35 regarding whether any
work has been transferred is answered by the testimony herein; work has been transferred. The
record does not identify who made the decision to transfer what work. The identity of the
decision maker is potentially relevant to effects bargaining. Similarly, the information sought in
paragraph 38 relating to any “plan to transfer any other work” is clearly relevant. Paragraph 41
requests identification of the work that the Respondent initially planned to transfer. On February
23, Vice President Simon informed employees that not all of the work in the packroom would be
transferred. The requested information, with the information sought in paragraphs 3 and 4, is
relevant in that it would reveal whether that plan had changed. I find that the Union’s request
established the relevance of, and its need for, the foregoing information in order to prepare for
effects bargaining and that the Respondent, having not responded to the request in any way,
violated Section 8(a)(5) of the Act by failing and refusing to provide the foregoing information.

Conclusions of Law
1. By informing its Union affiliated unit employees prior to hiring the workforce at the
Helgesen warehouse that union affiliation was incompatible with employment at that location
because the facility would be nonunion, the Respondent has engaged in unfair labor practices
affecting commerce within the meaning of Section 8(a)(1) and Section 2(6) and (7) of the Act.

2. By promising employees an increase in their wages and improved benefits if they
participated in the Certco 401(k) Plan rather than the Teamsters Central States Pension Fund,
the Respondent has engaged in unfair labor practices affecting commerce within the meaning of
Section 8(a)(1) and Section 2(6) and (7) of the Act.
3 The foregoing finding establishes that the appropriate unit is:

All warehousemen and drivers employed by the employer at its Verona Road warehouse,
Madison, Wisconsin; but excluding all other employees, guards, and supervisors as defined
in the Act.

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3. By bypassing the Union and dealing directly with employees by promising them an
increase in their wages and improved benefits if they participated in the Certco 401(k) Plan
rather than the Teamsters Central States Pension Fund, the Respondent has engaged in unfair
labor practices affecting commerce within the meaning of Section 8(a)(1) and (5) and Section
2(6) and (7) of the Act.

4. By failing and refusing to provide the Union with the information it requested regarding
product that was previously warehoused at Verona Road and that was being moved to
Helgesen Drive, said information being relevant and necessary to the Union as the collective-
bargaining representative of the unit employees it represents, the Respondent has engaged in
unfair labor practices affecting commerce within the meaning of Section 8(a)(1) and (5) and
Section 2(6) and (7) of the Act.

Remedy
Having found that the Respondent has engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and post an appropriate notice.

The Respondent having failed and refused to provide the Union with information it
requested on May 10, 2004, as specified above, it must provide that information.

On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended4

ORDER
The Respondent, Certco Food Distribution Centers, Madison, Wisconsin, its officers,
agents, successors, and assigns, shall

1. Cease and desist from

(a) Announcing to its Union affiliated unit employees prior to hiring the workforce that
any facility that it is opening is nonunion.

(b) Promising employees an increase in their wages and improved benefits if they
participate in the Certco 401(k) Plan rather than the Teamsters Central States Pension Fund.

(c) Bypassing the Union and dealing directly with employees by promising them an
increase in their wages and improved benefits if they participate in the Certco 401(k) Plan rather
than the Teamsters Central States Pension Fund.

(d) Refusing to bargain collectively with Teamsters Local Union No. 695, affiliated with
the International Brotherhood of Teamsters, AFL-CIO, by failing and refusing to provide
requested information regarding product that was previously warehoused at Verona Road and
that was being moved to Helgesen, said information being relevant and necessary to it as the
4 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.

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collective-bargaining representative of warehousemen and drivers employed at Verona Road.

(e) 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 Act.

(a) Promptly furnish the Union with the information found to have been unlawfully
withheld as set forth in the remedy section of this decision.

(b) Within 14 days after service by the Region, post at its Verona Road warehouse in
Madison, Wisconsin, copies of the attached notice marked “Appendix.”5 Copies of the notice,
on forms provided by the Regional Director for Region 30, after being signed by the
Respondent's authorized representative, shall be posted by the Respondent immediately upon
receipt and maintained for 60 consecutive days in conspicuous places including all places
where notices to employees are customarily posted. 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 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 February 23, 2004.

(c) 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.

IT IS FURTHER ORDERED that the complaint is dismissed insofar as it alleges
violations of the Act not specifically found.

Dated, Washington, D.C. May 5, 2005

_____________________
George Carson II
Administrative Law Judge

5 If this Order is enforced by a Judgment of the 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.”
JD(ATL)–17–05

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 had 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 announce prior to hiring at any facility that we are opening that the facility is
nonunion.

WE WILL NOT promise you an increase in your wages and improved benefits if you participate
in the Company 401(k) Plan rather than the Teamsters Central States Pension Fund.

WE WILL NOT bypass Teamsters Local Union No. 695, affiliated with the International
Brotherhood of Teamsters, AFL-CIO, and deal directly with you by promising an increase in
your wages and improved benefits if you participate in the Company 401(k) Plan rather than the
Teamsters Central States Pension Fund.

WE WILL NOT refuse to bargain collectively with the Union by failing and refusing to provide
requested information regarding product that was previously warehoused at Verona Road and
moved to Helgesen Drive, said information being relevant and necessary to the Union as the
collective-bargaining representative of our warehousemen and drivers at Verona Road, and WE
WILL promptly furnish the Union with the information found to have been unlawfully withheld as
set forth in the remedy section of the decision.

WE WILL NOT in any like or related manner interfere with, restrain, or coerce any of you in the
exercise of your rights guaranteed by Section 7 of the Act.

CERTCO FOOD DISTRIBUTION CENTERS
(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.

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2
310 West Wisconsin Avenue, Federal Plaza, Suite 700, Milwaukee WI 53203-2211
(414) 297-3861, Hours: 8 a.m. to 4:30 p.m.
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, (414) 297-3819