Coinmach Laundry Corp.

National Labor Relations Board - Board Decisions

Sep 12, 2002

337 N.L.R.B. 1286 (N.L.R.B. 2002)

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1286
Coinmach Laundry Corp. and Local 729, Coalition of
Democratic Employees. Case 29–RC–9876
September 12, 2002
ORDER DENYING REVIEW
BY MEMBERS LIEBMAN, COWEN, AND BARTLETT
The National Labor Relations Board has carefully con-
sidered the Intervenor’s1 request for review of the Re-
gional Director’s Decision and Direction of Election
(pertinent portions of which are attached as an appen-
dix).2 The request for review is denied as it raises no
substantial issues warranting review. In denying review,
we find that the Intervenor has failed in its request for
review to set forth any facts which would warrant further
examination of the fronting issue.

MEMBER BARTLETT, concurring.
I disagree with Alto Plastics Mfg. Corp., 136 NLRB
850 (1962), to the extent it holds that the criminal re-
cords of, or judicial determinations of fraudulent conduct
by, union officers and representatives cannot be consid-
ered relevant either to whether an organization is a labor
organization within the meaning of the Act or to whether
such organization may be appropriately certified by the
Board. See Harrah’s Marina Hotel, 267 NLRB 1007
(1983). Here, however, I find that the Intervenor has
failed to make a sufficient threshold showing that this
was a relevant and necessary inquiry in this case. Rather,
it appears that the Intervenor was simply on a fishing
expedition. Thus, I find that the hearing officer and the
Regional Director properly refused to permit the Interve-
nor to inquire into the issue.

APPENDIX
REGIONAL DIRECTOR’S DECISION AND DIRECTION
OF ELECTION
The Employer, Coinmach Laundry Corp.,1 operates a coin-
operated laundry machine leasing, installment, and servicing
facility, located in Syosset, New York, where it employs about
120 to 125 employees in the unit sought by the Petitioner. The
Petitioner, Local 729, Coalition of Democratic Employees,
filed a petition with the National Labor Relations Board under
Section 9(c) of the National Labor Relations Act seeking to

1 Local 966, International Brotherhood of Teamsters, AFL–CIO
2 The issues presented for review are (1) whether the Board wishes
to reconsider its holding in Alto Plastics Mfg. Corp., 136 NLRB 850
(1962), and find that the hearing officer erred in ruling that certain
subpoenaed documents allegedly necessary to show that Petitioner’s
officers have criminal records are irrelevant, and (2) whether the Re-
gional Director correctly found that the Intervenor was not prejudiced
by the hearing officer’s refusal to permit the Intervenor to inquire about
possible fronting by the Petitioner, and by the hearing officer’s leading
of a witness.
1 The Employer’s name appears as amended at the hearing.
represent a unit of all employees, excluding all guards, supervi-
sors, office employees, foremen, salesmen, executives, dis-
patchers, laundry room attendants, security employees, coin
counters, and porters, employed at the Employer’s Syosset
facility. The Intervenor, Local 966, International Brotherhood
of Teamsters, AFL–CIO, intervened on the basis of its collec-
tive-bargaining agreement with the Employer encompassing the
petitioned-for unit. A hearing officer of the Board held a hear-
ing and the Intervenor filed a brief. Pursuant to Section 3(b) of
the Act, the Board has delegated its authority in this proceeding
to me.
As evidenced at the hearing and in the Intervenor’s brief, the
parties disagree on the issue of whether the Petitioner is a labor
organization within the meaning of Section 2(5) of the Act.
The Intervenor takes the position that the Petitioner is not a
labor organization. The Petitioner takes the contrary position,
and the Employer takes no position. However, the parties stipu-
lated that the Intervenor is a statutory labor organization, and
that the unit sought by Petitioner is appropriate. Petitioner’s
president, Francis Gauck, was the sole witness to testify at the
hearing.
I have considered the evidence and the arguments presented
by the parties on the issue of Petitioner’s labor organization
status. As discussed below, I have concluded that the Petitioner
is a labor organization. Accordingly, I have directed an elec-
tion in the unit sought by the Petitioner. The facts and reason-
ing that support my conclusion are presented in detail below.
I. LABOR ORGANIZATION STATUS OF PETITIONER
A. Case Law
Section 2(5) of the Act provides the following definition of
“labor organization”:

Any organization of any kind, or any agency or employee rep-
resentation committee or plan, in which employees participate
and which exists for the purpose, in whole or in part, of deal-
ing with employers concerning grievances, labor disputes,
wages, rates of pay, hours of employment, or conditions of
work.

Under this definition, an incipient union which is not yet actu-
ally representing employees may, nevertheless, be accorded
2(5) status if it admits employees to membership and was
formed for the purpose of representing them. See Butler Mfg.
Co., 167 NLRB 308 (1967); see also East Dayton Tool & Die
Co., 194 NLRB 266 (1971). Even if such a labor organization
becomes inactive without ever having represented employees, it
is deemed to have been a statutory labor organization if its or-
ganizational attempts “[c]learly . . . envisaged participation by
employees,” and if it existed “for the statutory purposes al-
though they never came to fruition.” Comet Rice Mills, 195
NLRB 671, 674 (1972). Moreover, “structural formalities are
not prerequisites to labor organization status.” Yale New Haven
Hospital, 309 NLRB 363 (1992) (no constitution, bylaws,
meetings or filings with the Department of Labor); see
Betances Health Unit, 283 NLRB 369, 375 (1987) (no formal
structure and no documents filed with the Department of La-
bor); Butler Mfg Co., 167 NLRB at 308 (no constitution, by-
laws, dues, or initiation fees); East Dayton, 194 NLRB at 266
337 NLRB No. 193
COINMACH LAUNDRY CORP. 1287
(no constitution or officers). A labor organization found to be
the beneficiary of unlawful employer domination, interference
or assistance under Section 8(a)(2) of the Act does not thereby
lose its Section 2(5) status; on the contrary, “[b]efore a finding
of unlawful domination can be made under Section 8(a)(2) a
finding of ‘labor organization’ status under Section 2(5) is re-
quired.” Electromation, Inc., 309 NLRB 990, 994 (1992).
B. Facts
The record reflects that Local 729 had its genesis at a June
2002, meeting attended by three individuals: Theodore
Sadowski, an employee of the Employer, Francis Gauck, past
president (until his discharge this June) of an electrical work-
ers’ local, and William Hoberg, whose employment status,
Gauck maintained, he did not know. At this June meeting, the
three men “discussed formulating this local” and agreed that
Gauck would be the president, Sadowski the vice president, and
Hoberg the secretary-treasurer. Subsequently, the three officers
drafted a set of bylaws, which they have not yet signed. No
official minutes have been taken at the Petitioner’s meetings.2
Gauck testified that the Petitioner was created to “organize,
negotiate contracts regarding wages, working conditions, hours
of employment . . . [and] grievance procedures.” He estimated
that the Petitioner is in the process of conducting organizational
campaigns at five or six companies, in addition to the Em-
ployer. When soliciting authorization cards, Gauck tells em-
ployees that if elected, Local 729 will “get them a better con-
tract, benefits that [are] above and beyond what they [are] re-
ceiving now.”
Currently, the Petitioner has about 50 to 55 members, who
are employees of the Employer and one of its competitors. Thus
far, however, the Petitioner has not been recognized by any
Employer or certified by the Board, nor has it negotiated any
contracts. It is not yet receiving dues from employees or ad-
ministering pension or welfare funds. Hence, it has no income,
assets or paid staff, and is operating out of Gauck’s residence.
C. Conclusion
The record establishes that the Petitioner meets the statutory
definition of “labor organization” set forth above. The purposes
articulated by Gauck are consistent with the Act and include
“dealing with employers” concerning matters itemized in Sec-
tion 2(5). In addition, that the Petitioner admits employees to
membership is sufficient to establish that it is an “organiza-
tion…in which employees participate.” See Butler Mfg. Co.,
supra; see also Comet Rice Mills; supra; East Dayton Tool &
Die Co., 194 NLRB 266 (1971). That one of the Petitioner’s
officers, Theodore Sadowski, is an employee of the Employer,
is further evidence of employee participation in Local 729.

2 Gauck testified that the Petitioner has held at least a dozen meet-
ings with the Employer’s employees. He claimed that at one of these
meetings, the employees made contract proposals, which the Peti-
tioner’s three officers wrote down. However, Petitioner did not pro-
duce this list of employee proposals in response to a subpoena request
for minutes from membership meetings. Rather, the Petitioner pro-
duced one small diary page of Sadowski’s notes, primarily concerning
meetings among the Petitioner’s three officers. The record does not
reveal what occurred at the other 11 membership meetings.
Based on the foregoing, I find that Local 729 exists, in whole
or in part, for the purpose of representing employees in dealings
with their employers regarding terms and conditions of em-
ployment, and that employees participate in the functioning
thereof. Accordingly, I conclude that Local 729 is a labor or-
ganization as defined in section 2(5) of the Act.
D. Brief of Intervenor
The Intervenor’s brief emphasizes alleged defects in Peti-
tioner’s bylaws and minutes, and the absence of collective-
bargaining agreements and dues records. However, this evi-
dence is irrelevant to the Petitioner’s 2(5) status. See Yale New
Haven Hospital, 309 NLRB 363 (1992); Betances Health Unit,
283 NLRB 369, 375 (1987); East Dayton, 194 NLRB at 266;
Butler Mfg. Co., 167 NLRB at 308.
The Intervenor also relies on the Hearing Officer’s alleged
“refusal to permit legitimate lines of inquiry regarding the Peti-
tioner.”3 More specifically, the Intervenor argues that its case
was unfairly prejudiced when the hearing officer ruled that
certain subpoenaed items were irrelevant, and when the Region
denied the Intervenor’s special appeal with regard to this rul-
ing.4 In addition, the Intervenor contends that the Hearing Of-
ficer wrongfully precluded it from pursuing certain lines of
questioning.
In its special appeal, the Intervenor contended that the sub-
poenaed documents were necessary (1) because “documents
showing any records of criminal convictions of the officers of
Local 729 . . . [are] relevant,”5 and (2) “to show that Local 729
is an organization which is fronting for a labor organization
which is not qualified to represent the employees of the Em-
ployer.”6 In its brief, the Intervenor makes essentially the same
3 Br. of Intervenor at 4.
4 Although the subpoena itself is not in evidence, the record indi-
cates that the Intervenor’s special appeal pertained to the following
subpoenaed items: (1) item 2: the names, departments and compensa-
tion of the petitioner’s officers; (2) item 5: all documents showing any
affiliation with any labor organization; (3) item 8: all LM-2 reports
filed with the United States Department of Labor for the last three
reporting years; (4) item 12: all documents showing the length of time
of the officers’ terms of office; (5) item 13: all documents showing the
current number of members of the Petitioner; (6) item 14: all financial
reports of the Petitioner since January 2, 2001; (7) item 15: all loan
documents and/or rental agreements entered into by the Petitioner, or
by its staff or officers; (8) item 16: all documents, leases, titles or deeds
that show ownership or lease of property by the Petitioner; (9) item 17:
all documents showing the conviction records of any officer or em-
ployee of the Petitioner; (10) item 18: all financial records of the Peti-
tioner, including checkbooks, canceled checks, receipts, accounts pay-
able and receivable ledgers, records of dues payments from January 1,
2001, to the present; and (11) item 19: copies of all correspondence
with and any notes of conversations with Vincent Sombrotto and/or
Edwin Gonzalez.
5 Special Appeal of Intervenor, par. 4 (citing Board’s Outline of Law
and Procedure in Representation Cases, Sec. 6-110 (citing Harrah’s
Marina Hotel, 267 NLRB 1007 (1983)); Mohawk Flush Doors, 281
NLRB 410 (1986)).
6 Special Appeal of Intervenor, par. 2 (citing Board’s Outline of Law
and Procedure in Representation Cases, Sec. 6-310 (citing Iowa Pack-
ing Co., 125 NLRB 1408 (1959)); National Electric Coil Division, 199
NLRB 1017 (1972)).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1288
arguments, with respect to both the subpoenaed documents and
the examination of Gauck. For the reasons set forth below, I
find these arguments to be lacking in merit.
(1) Records of criminal convictions
The instant case is similar to Alto Plastics Mfg. Corp., 136
NLRB 850 (1962), in which the Board was faced with rival
claims by petitioning and intervening unions. The intervenor
served the petitioner with a subpoena, in an effort to uncover
evidence that the petitioner was a “corrupt” union. The Board
ruled the subpoenaed items irrelevant, reasoning that if a labor
organization meets the statutory definition, “the fact that it is an
ineffectual representative, that its contracts do not secure the
same gains that other employees in the area enjoy, that certain
of its officers or representatives may have criminal records, that
there are betrayals of the trust and confidence of the member-
ship, or that its funds are stolen or misused, cannot affect the
[Board’s] conclusion . . . that the organization is a labor organi-
zation within the meaning of the Act.” Alto Plastics, 136 NLRB
at 851–852. Rather, the Board advised, allegations regarding
improper or corrupt practices in the administration of internal
union affairs are more properly addressed under the Labor-
Management Reporting and Disclosure Act. Alto Plastics, 136
NLRB at 853; see also Family Service Agency San Francisco,
163 F.3d 1369 (D.C. Cir. 1999); Westside Community Mental
Health Center, 327 NLRB 661, 663 (1999); Mohawk Flush
Doors, 281 NLRB 410 (1986) (union was a labor organization
despite evidence of “extensive influence by organized crime”).
This reasoning is equally applicable to the instant case.
Marina Associates, 267 NLRB 1007 (1983), cited by the In-
tervenor in its special appeal, is not on point. In Marina, the
petitioning union’s officers had been convicted of embezzling
union funds, and were found to have operated the union and its
funds “as their personal business and for their personal profit.”
Marina Associates, 267 NLRB at 1011. The fact that the peti-
tioner was seeking certification wholly “for purposes abhorrent
to the Act” compelled the conclusion that petitioner did not
“exist ‘in whole or in part’ for the purposes set forth in the stat-
ute,” as required by Section 2(5). Marina Associates, 267
NLRB at 1007 fn. 2, 1012. Thus, the officers’ criminal convic-
tions had a direct bearing on whether the petitioner was a statu-
tory labor organization. The instant case, involving a newly-
formed union, is not analogous to the facts in Marina Associ-
ates.
(2) “Fronting” allegation
In alleging that the Petitioner is “fronting,” the Intervenor re-
lies on an unpublished order issued by a United States District
Court, not offered into evidence, which allegedly bars another
labor organization and two individuals from representing mem-
bers of the Intervenor. The record does not disclose the legal
grounds underlying the District Court’s ruling. Moreover, the
Intervenor suggests no legal basis for finding that the authority
delegated to me under Section 3(b) of the Act encompasses the
power to determine whether there has been a violation of the
District Court’s order.
The two cases cited by the Intervenor in support of its “front-
ing” allegation are not on point. In Iowa Packing Co., 125
NLRB 1408 (1959), the petitioner was an “adjunct or satellite”
union, with only a “façade of a separate identity,” created by an
industrial union in an attempt to circumvent the then-applicable
requirement that a union seeking craft severance “must be the
one which traditionally represents that craft.” Iowa Packing,
125 NLRB at 1409, 1410 (citing American Potash & Chemical
Corp., 107 NLRB 1418 (1954), overruled by Mallinckrodt
Chemical Works, 162 NLRB 387 (1966)). In National Electric
Coil Division, 199 NLRB 1017 (1972), a recognized union filed
a certification petition as a subterfuge, for the purpose of allow-
ing a rival union to intervene at a time when it would have been
prohibited from filing its own petition under contract bar prin-
ciples. National Electric, 199 NLRB at 1018–1019. Thus, both
of these cases involved union attempts to circumvent rules gov-
erning representation cases filed under Section 9(c) of the Act.
They did not involve union attempts to circumvent District
Court orders such as that alluded to in the instant case. More-
over, both cases cited by the Intervenor were dismissed despite
the Board’s finding that the petitioners were Section 2(5) labor
organizations.
II. CONCLUSIONS AND FINDINGS
1. The Hearing Officer’s rulings made at the hearing are free
from prejudicial error and are affirmed.
. . . .
3. The Petitioner and Intervenor are labor organizations
within the meaning of Section 2(5) of the Act. The labor or-
ganizations involved herein claim to represent certain employ-
ees of the Employer.
. . . .
5. The following employees of the Employer constitute a
unit appropriate for the purpose of collective bargaining within
the meaning of Section 9(b) of the Act:

All employees, EXCLUDING office employees, foremen,
salesmen, executives, dispatchers, laundry room attendants,
security employees, coin counters and porters, and guards and
supervisors as defined in the Act.