Daka, Inc.

National Labor Relations Board - Board Decisions

Sep 30, 1987

286 N.L.R.B. 548 (N.L.R.B. 1987)

548 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
DAKA, Inc., and its subsidiary DAKA Food Service
Management, Inc. and Local 217, Hotel and
Restaurant Employees and Bartenders Union,
a/w Hotel Employees and Restaurant Employ-
ees International Union, AFL-CIO. Cases 1-
CA-22337 and 1-CA-22591-1
30 September 1987
DECISION AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
JOHANSEN AND BABSON
On 6 August 1986 Administrative Law Judge
Richard L. Denison issued the attached decision.
The General Counsel filed exceptions and a sup-
porting brief, and the Respondent filed an answer-
ing brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge's rulings, findings, I and
conclusions2 and to adopt the recommended
Order.
ORDER
The recommended Order of the administrative
law judge is adopted and the complaint is dis-
missed.
' The General Counsel has excepted to some of the judge's credibility
findings . The Board's established policy is not to overrule an administra-
tive law judge 's credibility resolutions unless the clear preponderance of
all the relevant evidence convinces us that they are incorrect Standard
Dry Wall Products, 91 NLRB 544 (1950), enfd 188 F 2d 362 (3d Cir
1951) We have carefully examined the record and find no basis for re-
versing the findings
In adopting the judge's conclusion that the Respondent did not violate
the Act, as alleged , we find it unnecessary to rely on his statement that
the Respondent's failure to hire one of the ATS bartenders can be readily
explained by the fact that the Respondent was informed that an unidenti-
fied ATS bartender was suspected of watering drinks.
In sec IV,E, par 16, the ninth sentence of his decision, the judge inad-
vertently referred to the DAKA lease as the "ATS" lease . In sec IV,E,
par 17, the penultimate sentence , the judge inadvertently referred to
ATS employees as "DAKA" employees
2 Chairman Dotson agrees that the Respondent cannot be a successor
because it lawfully did not hire the employees of the predecessor He
therefore finds it unnecessary to pass on the remainder of the judge's dis-
cussion of the criteria for determining whether an employer is a succes-
sor
Burton E. Rosenthal, Esq., and Susan Cole, Esq., for the
General Counsel.
John E. Coyne, Esq. (Coyne & Gottlieb), of Boston, Mas-
sachusetts, for the Respondent.
Morty F Miller, Area Director, Local 217, for the
Charging Party.
DECISION
STATEMENT OF THE CASE
RICHARD L. DENISON, Administrative Law Judge.
This case was heard at Providence, Rhode Island, on 25,
27, and 28 February; 1, 5, 6, 7, and 8 March; and 15, 16,
and 17 April 1985. The complaint, issued 19 November
1984, formally amended on 5 February 1985, and further
amended at the hearing, alleges violations of Section
8(a)(5), (3), and (1) of the Act.t
The Respondent's answer denies the allegations of
unfair labor practices alleged in the complaint. On the
entire record in the case, 2 including my consideration of
the briefs filed 25 June 1985, I make the following3
FINDINGS OF FACT
1. JURISDICTION AND SINGLE EMPLOYER STATUS
Based on the allegations of paragraphs 2(a) and (b),
3(a) and (b), 4(a) and (b), and 5, admitted by the Re-
spondent's answer, as amended, I find, respectively, that
DAKA, Inc., and DAKA Food Service Management,
Inc., constitute a single integrated business enterprise
and, as such, are a single employer engaged in commerce
within the meaning of Section 2(2), (6), and (7) of the
Act.
II. LABOR ORGANIZATION
Based on the allegation in paragraph 6 of the com-
plaint, admitted by the oral amendment to paragraph 6
of the Respondent 's answer, I find that Local 217, Hotel
and Restaurant Employees and Bartenders Union, a/w
Hotel Employees and Restaurant Employees Internation-
al Union , AFL-CIO, the Charging Party and the Union
in this proceeding, is a labor organization within the
meaning of Section 2(5) of the Act.
III. SUPERVISORY STATUS
Based on the allegation contained in paragraph 7 of
the complaint, as amended, admitted in paragraph 7 of
the Respondent's answer, I find that the following-named
persons have occupied the positions set forth opposite
their respective names, and are now, and have been at all
times material herein, supervisors of Respondent within
the meaning of Section 2(11) of the Act, and agents of
' The 8(a)(l) violation is entirely derivative, since, at the outset of the
hearing, the General Counsel's motion to delete par 8 of the complaint
(and thus associated par 18 ) was granted
2 Comprising over 1700 pages of transcript and approximately 60 ex-
hibits composed of over 1100 pages
3 I have received on the dates specified the following motions, which
are granted
(a) General Counsel's motion to correct transcript, dated 25 June 1985,
received 28 June 1985
(b) The following motions, which had the practical effect of extending
the time for filing briefs in this matter until 24 October 1985
(i) General Counsel's motion to supplement brief with additional case
citation, dated 26 July 1985, received 1 August 1985
(ii) Charging Party's motion to take judicial notice of court of appeals
decision and analysis , dated 19 September 1985
(iii) Counsel for General Counsel's request for judicial notice, dated 2
October 1985, received 8 October 1985, and Respondent's response there-
to, dated 10 October 1985, received 24 October 1985
286 NLRB No. 49
DAKA, INC. 549
Respondent within the meaning of Section 2(13) of the
Act:
Terry Vince President
Allen Maxwell Vice President
Terry Tehrany District Manager
Brian Magaw Manager of Airport Facility
IV. THE UNFAIR LABOR PRACTICES
A. Background
The T. F. Green State Airport at Warwick, Rhode
Island , is owned and operated by the State of Rhode
Island under the auspices of the State 's Department of
Transportation (DOT). The T . F. Green complex is the
chief airport serving the Greater Providence, Rhode
Island area . This case stems from a change in the conces-
sionaire authorized to operate the eating facility , cocktail
lounge , and gift shop in the terminal building . The rele-
vant history of this concession is described in the cred-
ited testimony of Isidore W. D'Orsi , assistant director of
DOT for real estate and chairman of the airport proper-
ties committee , and in credited portions of the testimony
of Edward T. Krzyzek , former manager of the conces-
sion for the predecessor , ATS.4 Other stale officials who
played a prominent role in the events under consider-
ation are D'Orsi 's superior , Director of Transportation
Ed Wood ; Henry Almonte , director of DOT's division
of airports; and Almonte 's assistant , Anthony Rosatti,
who also serves as vice chairman of the airport proper-
ties committee.
On 19 August 1964, DOT signed an agreement with
Air Terminal Services , Incorporated (ATS), a Virginia
corporation , in which the State granted ATS a license to
use state-supplied space, furnishings , fixtures, and equip-
ment to operate restaurants , alcoholic beverage service,
and other incidental operations in the airport terminal.
ATS, a subsidiary of Delaware North Companies, is an
international concession service that basically runs air-
port concessions , including restaurants , lounges, coffee
shops , gift shops , and parking lots throughout the United
States and at various other locations worldwide. The
parent corporation is also involved in the sports industry
where it operates sports centers and owns professional
teams . The term of the agreement was for 5 years. The
licensee had the option to renew the agreement for an
additional 5-year term. The agreement also granted ATS
the right to prepare and sell food and beverages for the
purpose of in-flight service by airlines that operate at the
airport, and for a number of years ATS also performed
this service . ATS exercised its option to renew the li-
cense , but at the end of the second term no successor
agreement was negotiated, because the State was in the
midst of developing a master plan for airport expansion.
This plan took several years to develop , and ultimately
resulted in more widespread and sweeping renovation
and expansion of the terminal far beyond what was origi-
4 D'Orsi impressed me as a dedicated state official determined to be
candid at all times in the face of an unpleasant situation into which he
clearly felt the State should have no part For reasons described later in
this decision , Krzyzek 's testimony is crediled only where specifically in-
dicated
nally considered. Construction began in the late 1970's. It
was completed in the early 1980's. In the meantime, ATS
operated its concession at the airport on a month-to-
month basis under the terms of the expired contract, and
continued to do so until it vacated the premises in 1984.
Over the intervening years, however, the State came
under increasing pressure, in the form of publicity and
otherwise, to put the concessions up for bidding.
At this point it should be noted that ATS had not been
the holder of the gift shop concession, which was operat-
ed by Tele-Trip Corporation, a subsidiary of Mutual of
Omaha. In early 1983 the State issued bidding specifica-
tions seeking bidders for the airport concessions . The re-
quest for proposals sought bidders for both eating facili-
ties and the lounges, and separately for the gift shop, on
the basis of a 10-year minimum rent and a percentage of
the gross profit. The 1983 bid solicitation was unsuccess-
ful. There was only one bidder. In the meantime, on 1
January 1983, ATS and Local 217, Hotel and Restaurant
Employees and Bartenders Union, AFL-CIO (the Union
and the Charging Party), entered into a collective-bar-
gaining agreement recognizing the Union as the exclu-
sive collective-bargaining representative for ATS's T. F.
Green employees.5
Tele-Trip and ATS declined to bid. ATS announced
its intention in a letter dated 13 July 1983, addressed to
the State Division of Purchases from its vice president,
Lawrence J. Amico. However, since this bid solicitation
was a failure, in the months of late 1983 and early 1984
the concessions continued to be operated by Tele-Trip
and ATS, respectively. During the last week of January
and the first week of February 1984, the State again
placed newspaper ads in the Providence Journal, Wall
Street Journal, and Boston Globe soliciting bids for the
airport concessions. Simultaneously, bid specifications
were issued. A prebid conference, held on 1 March, was
attended by D'Orsi, Krzyzek for ATS, and others not in-
volved in this proceeding. The Respondent did not
attend. At some unspecified time thereafter, ATS once
again notified the State by letter that it did not intend to
bid. Nevertheless, it continued to operate its concession
until the Respondent took over the premises on 1 Sep-
tember 1984. Tele-Trip, however, abandoned its gift
shop concession on approximately 1 May 1984. ATS
took over the operation of the gift shop at that time, and
thereafter for the duration of ATS's tenure the previous-
ly unorganized gift shop employees were represented by
Local 217.6 Krzyzek did, however, attend the 2 April
6 The collective-bargaining unit is
All persons employed in the categories and classifications set
forth in the wage schedule attached hereto at T. F Green State Air-
port , excluding office and clerical employees , guards, professional
employees , trainees for management or supervisory positions, mana-
gerial employees, managers, assistant managers, and all supervisors as
defined in the National Labor Relations Act, 1947 , as amended, and
all other employees not specifically included as employees
The attached wage schedule listed bartenders , waiters/waitresses, cash-
iers, cooks, short order cooks, cooks ' helpers, and utility employees.
6 The collective-bargaining history is based on the credited testimony
of Morty Miller, the area director for the Union responsible for servicing
Local 217, including the handling of grievances and the negotiation of its
labor contract Miller testified clearly and concisely Generally , his calm,
Continued
550 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
bid opening meeting, which was held in the state's offi-
cial reception room upstairs in the airport terminal. It
was at this point in time that the Respondent formally
entered the picture for the first time.
B. Nature and Extent of DAKA'S Operations
DAKA is the registered trade name and logo for
Dining and Kitchen Administration, Inc., the parent cor-
poration of a series of highly efficient and sophisticated
companies operating in the catering industry. DAKA is a
Massachusetts corporation with home offices in Wake-
field , Massachusetts . Since its corporate organization in
early 1973, the Company has grown to the point where
it currently employs in excess of 4500 employees at over
250 locations. Although DAKA operates in over eight
states, it specializes in serving locations primarily in the
northeast . Among its impressive list of clients are the
General Foods world headquarters, a large papermill in
Maine, the Boston Globe and Herald, the Boston
Museum of Fine Arts, Harvard Law School, the Univer-
sity of Pittsburgh, Illinois State University at Normal,
and numerous hotels, banks , prep schools, and colleges.
DAKA also serves the Maine State Office Building, and
the Empire State Plaza complex in Albany, New York.
Although DAKA has virtually no airport experience, it
operates a wide range of services , including gift shops,
fast food facilities , cafeterias , and gourmet restaurants.
The six members of the Company's board of directors
are Vincent P. Wilbur, chairman; Terry Vince, president
and chief executive officer; Kenneth J. Fahey, vice presi-
dent and treasurer; Leo H. Skellchock, R.D. vice presi-
dent; Allen R . Maxwell , vice president of administration;
and Mollie E. Rudall, vice president. Other DAKA man-
agement personnel who played a role in the events relat-
ing to DAKA's acquisition of the T. F. Green conces-
sion are Ron Cohen, vice president of operations; Susan
Shea, director of merchandising; Gloria Chabot, a mer-
chandising technician ; Brian Magaw , manager of the
new airport facility; and Paula Clarke, DAKA's manager
at the Citizens Bank cafeteria in Providence. The district
manager for DAKA over the entire State of Rhode
Island is Terry Tehrany.
DAKA's corporate concerns and management func-
tions are summarized in the following extract from mate-
rials, in evidence, provided to the State as a part of the
Company's bid proposal:
Our Objective: Food Service at Its Very Best
IT IS OUR CORPORATE OBJECTIVE:
To provide our clients and customers with the
best possible food service within the framework of
the conditions imposed and consistent with our own
established standards of quality of food, service,
personnel and sanitation.
To provide superior supervision in all phases of
our food operations.
straightforward , and businesslike manner convinced me that he was a
skilled professional attempting to relate the facts truthfully as he saw
them. Therefore , his testimony has been credited, except where specifi-
cally noted.
To provide technical assistance adequate to guide
the branch managers in the training of employees,
food production, merchandising, menu preparation,
and to supervise the maintenance of high standards
of quality.
To conduct our affairs in such a manner as to
ensure that our corporate activity will be mutually
beneficial to employees, clients, purveyors, the com-
munities in which we operate, stockholders, and all
levels of government.
To conduct throughout the sphere of our busi-
ness activity food service operations in such a
manner as to encourage reasonable and continuous
corporate earnings.
To conduct our food operations in such a manner
as to provide and maintain the highest possible level
of client satisfaction.
To conduct our corporate affairs in such a
manner as to be recognized as a responsible corpo-
rate citizen.
Management Functions
Management daka provides management services
under many contractual arrangements. A custom-
designed agreement can be tailored to meet your
needs, whether it is a fixed fee or a fee based on a
percentage of sales, or guaranteed results by daka;
and there are also incentives for cost reductions, in-
cluding profit and loss arrangements. Consulting on
a continuous basis is often desired by clients, includ-
ing resident management consultations and kitchen,
serving, and dining area design.
Purchasing daka provides specifications and en-
sures control of quality for meats, poultry, fruits,
vegetables, staples and groceries.
daka's Purchasing Director is responsible for ob-
taining the best prices possible consistent with our
specifications. daka approved suppliers are both
local and national, but when prices are competitive,
priority is given to all local vendors.
The purchasing budget is the largest single ex-
pense and warrants a full staff to direct, coordinate,
and control its functions.
Financial and Accounting The company maintains
a fully computerized accounting department which
provides monthly and year-to-date operating state-
ments of revenue and expense for every operation,
with a comparison to budget with last year.
The company acccounting periods are comprised
of four thirteen-week quarters with two four-week
and one five-week period in each quarter.
Personnel daka, an Equal Opportunity Employer,
maintains a modern, professional personnel and
labor relations department responsible for recruit-
ing, fringe benefits, employee newsletters, wage and
salary administration.
All eligible employees have major medical, life
insurance, pension plan, paid vacations and holi-
days, meals, bonus awards. Food service and hospi-
tality is a personalized business, and our personnel
DAKA, INC. 551
programs help provide enthusiastic, productive em-
ployees.
Training Food service and hospitality workers
are thought to be unskilled and underproductive.
daka has challenged this by establishing training
programs and compensation that has earned daka
the reputation of developing employees with above
average loyalty. At all levels, people require train-
ing and retraining. To this end daka is proud of
these programs.
Sanitation and Safety The highest priority on
maintaining standards of sanitation and safety in all
phases of food preparation and service is a must
with daka.
Under the direction of a Sanitation and Safety
Director, it is this department's responsibility to es-
tablish, maintain , and enforce the standards that
daka insists upon. The Sanitation inspects regularly
all daka operations and completes a report that ana-
lyzes all aspects of cleanliness, housekeeping, and
safety. Follow-up to the inspection report is accom-
plished with the operations staff to rectify any areas
needing alteration.
Research and Development A research test kitch-
en is located in the home office to constantly test
food products and develop recipes. Under the man-
agement of the Research and Development Direc-
tor, a professional program of sampling, testing, and
analysis provides operations with the latest tech-
niques and quality control. This program ensures
that all operations maintain the highest quality of
menu and food preparation.
Space Planning and Design Through trained and
experienced eyes, dreary facilities are soon convert-
ed into bright, cheerful, and efficient work and
service areas. daka's expert can work miracles in
layout and design whether for a mode of service, a
total change of concept, or for subtle traffic flow ef-
ficiencies.
C. Events that Led to DAKA's Bid and its Selection
by State
Terry Tehrany described in detail his efforts, which
ultimately resulted in DAKA's being awarded the airport
concession lease. One of his major responsibilities is the
location and development of new accounts. This function
occupies approximately 15 percent of his time each
week. On 14 March 1984, he received a telephone call
from one of his unit managers, Brian Magaw, who in-
formed him that the State was soliciting bids for the con-
cessions at T. F. Green Airport. Tehrany obtained a
copy of the bid specifications at the offices of the State
of Rhode Island purchasing department on Promenade
Street in Providence. Later that day he visited the air-
port, to view the ATS facility and attempt to confirm
the sales figures contained in the State's bid specification.
On arriving, Tehrany visited the coffee shop, which he
described as looking as though it had been built in the
early 1950's and never touched since then. It was dark
and dirty. It took about 15 minutes before he obtained
service, and another 15 minutes before he received his
sandwich . Tehrany sat at the table eating and making
notes on the poor condition of the facility, and his obser-
vation of the sales receipts displayed on the cash register.
This activity occupied the remainder of his day. He re-
sumed this activity at 7:30 a.m. on the 15th, when he
spent the entire day at the airport making notes and ana-
lyzing sales.7
Tehrany also spent a portion of his time observing the
gift shop operations. Tehrany continued his survey on
Friday the 16th, and spent between 6 and 7 hours
making observations and formulating his ideas. That
afternoon he examined ATS's operations in the upstairs
lounge. Tehrany spent the weekend formulating his ideas
for presentation on Monday morning to Company Presi-
dent Terry Vince in his office in Wakefield. Tehrany had
concluded that the sales figures in the State's bid specifi-
cation were low. This placed DAKA in a favorable bid-
ding position. He had decided that because of the age
and dirty condition of the concession facilities, that the
whole operation would have to be "gutted out" and that
"the whole system of food service had to change." He
noted that the ATS operation was losing business "be-
cause of the condition of the place, and because of the
way-the nonchalant feeling that the waitresses present-
ed-the carelessness of the waitresses" due to what he
described as "an attitude problem among them." All this
led Tehrany to decide that the type of food service oper-
ation needed at the airport was basically a fast food type
service, which did not require waiter/waitresses or dish-
washers in order to operate.
He next prepared a tentative manning chart, based on
a McDonald's or Burger King type facility, which he es-
timated as basically requiring a five-person shift in the
morning and four employees in the afternoon. His analy-
sis was reflected in a report, called a pro forma, which,
along with the State's bid specifications, constituted the
basis for his presentation to the company president. After
hearing Tehrany's presentation, Vince made one impor-
tant change. He concluded that if DAKA were to be the
successful bidder, the State's percentage should be 15
percent rather than the 10 percent recommended in Teh-
rany's pro forma. He then gave his approval to the plan
and instructed Tehrany to begin work preparing
DAKA's proposal for presentation to the State of Rhode
Island by 2 April, the due date.
On the following day, 20 March, Tehrany returned to
the airport facility accompanied by representatives from
Paramount Restaurant Equipment Corporation, a Provi-
dence, Rhode Island company in business as suppliers,
consultants, and designers to the food industry. Para-
mount has affiliated construction and financial lending
companies . DAKA frequently uses Paramount's services
in opening new facilities and renovating old ones. With
the cooperation of Henry Almonte, Tehrany secured
7 Tehrany was on the stand 3 successive days in the hearing, giving a
detailed account of his role in all the events relating to the issues in this
matter Generally, his testimony was concise , clear, and logical He dis-
played an excellent memory of details and presented his evidence without
hesitation or evasion In a number of areas where his testimony conflicted
with employee witnesses , Tehrany's superior memory, generally, has per-
suaded me that his account was factual and, for the most part, correct
He was corroborated by Brian Magaw. Therefore , I credit Tehrany's tes-
timony, except where specifically noted
552 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
access to the ATS premises for the purpose of determin-
ing needed renovation, construction, alterations, new
equipment, and the taking of measurements. The Para-
mount representatives were particularly impressed by the
age of the facility and its equipment and the degree of
dirt, insects, and deterioration. As the Paramount repre-
sentatives took their measurements, Tehrany ran further
checks on his sales estimates by renewed observations of
the gift shop and the upstairs lounge. During this time he
did not have any conversations with any of the ATS em-
ployees. At the end of the day Tehrany recomputed his
sales figures. Having determined that DAKA could
afford to give the State the 15 percent, that Vince had
concluded would be necessary for a successful bid, he
began assembling the materials that comprised DAKA's
bid proposal, which he filed with the Promenade Street
office on the morning of 2 April.8
While waiting for the 2 April bid opening meeting to
start, Tehrany noticed that Ed Krzyzek was present.
After a few minutes , the sealed bids were opened by a
Mr. Moan, assisted by a secretary, in the presence of
DOT officials, Isidore D'Orsi and his assistant, Paul Car-
cieri. Then Moan announced that those present would be
afforded an opportunity to examine the various bids.
Tehrany noticed Krzyzek examining the DAKA bid,
after which he turned to Tehrany and said, "Not in a
million years can you do these numbers." Tehrany asked
why, and Krzyzek responded that 45 to 50 percent of
ATS's sales at the airport were going against labor costs
because it was "a union shop."9 Tehrany testified that it
was not until this moment that he learned that the ATS
operation at the airport was a "union house." In his
words, "It was devastating to find out that . .. I didn't
know it was union wages involved there . . . . I lost my
heart because, you know, that was something I should
have known. . . . After I picked up my heart from under
my feet, I walked out of the Transportation Depart-
ment." Obviously, what had Tehrany worried was the
fact that, with President Vince's blessing , he had pledged
15 percent of the gross profit to the State without learn-
ing that 45 or 50 percent of ATS' gross went toward
labor costs. As Tehrany summarized, ". . . the numbers
I put together did not include union wages, and here I'm
putting the best proposal together to present to the state.
... Of course, the numbers would be tremendously dif-
ferent." As Tehrany was leaving the department, he met
D'Orsi and Carcieri outside the door. Each of the men
introduced himself and exchanged business cards. At this
point Tehrany confessed, "The numbers I proposed do
not include any union wages." Despite this revelation,
D'Orsi and Carcieri smiled, and in a manner that Teh-
rany interpreted as a lack of concern over this revela-
tion , asked where Tehrany could be contacted. He re-
8 Tehrany emphasized that prior to filing DAKA 's bid proposal he had
not had any contact with anyone from DOT, nor had he talked with Ed
Krzyzek , the ATS facility manager at T F Green
9 Krzyzek admitted having a "brief exchange of words" with Tehrany
at the bid opening meeting, he did remember examining DAKA's bid,
however, and noticed that it was "awful high " He admitted that he
might have commented to Tehrany about this, but could not remember
what he said
ferred them to his telephone number printed on his busi-
ness card . The men shook hands and Tehrany left.
Thereafter , beginning the following week , there were
weekly telephonic contacts between Tehrany and Car-
cieri concerning the status of the bid competition. On 25
April, at Tehrany's invitation , D'Orsi and Carcieri, to-
gether with Airport Director Rosatti and his assistant,
Walter McCall, visited DAKA's home offices in Wake-
field, where they spent the entire day touring DAKA fa-
cilities in Boston, including the operation at the Museum
of Fine Arts . About 1 May the airport properties com-
mittee agreed to recommend to the state properties com-
mittee that DAKA be selected . Tehrany testified that it
was shortly after May that he received the impression
during one of his telephone conversations with Carcieri
that the State considered DAKA's bid to be the most fa-
vorable.
On 4 May, based on the Airport Committee 's recom-
mendation, Carcieri prepared the bid award recommen-
dation memorandum from DOT Director Wood to
Dennis Lynch , chairman of the state properties commit-
tee, recommending that the bid award be made to
DAKA. The memorandum describes DAKA's proposal
as "by far the most generous to the state in terms of
annual guaranteed payment." It also continues,
. . . Our recommendation , however, is not based
solely upon monetary considerations . . . . The De-
partment was impressed by both the quality of serv-
ice and management staff which this company pos-
sessed.. . . Furthermore, DAKA has also proposed
a capital investment of $120 ,000 for the refurbish-
ment of the present restaurant/gift shop facilities at
the airport . . . sufficient to upgrade the comfort
and attractiveness of these facilities to levels far
above those in existence today.
About this same time Tehrany was receiving telephon-
ic assurances from Carcieri and D'Orsi concerning
DAKA's selection . On 8 May 1984 , Elizabeth Clancy,
executive secretary of the state properties committee,
sent a memorandum to Wood confirming that the Com-
mittee had that day decided to award the bid to DAKA.
Official notification of the award was given in a letter
from State Purchasing Agent Dennis Lynch to Tehrany,
dated 8 June 1984.
DAKA and DOT signed the concession lease agree-
ment on 30 July.
D. Events Leading to DAKA's 1 September Opening
at the Airport, and the Union 's Efforts to Secure
Recognition and Preserve Employees' Jobs
A day or two after Carcieri and D 'Orsi told Tehrany
that they had made a favorable recommendation to the
airport authority, Tehrany met with Brian Magaw at
Northeastern University , where Magaw was stationed at
the time . Magaw was Tehrany 's selection to manage
DAKA 's T. F. Green operations . The meeting lasted ap-
proximately an hour , during which Tehrany briefed
Magaw concerning his observations , conclusions, and
plans for DAKA's future airport operations. He de-
scribed in detail the bad condition of the ATS airport fa-
DAKA, INC. 553
cility and explained the changes he intended to make in
order to improve its image. He sand that they were going
to completely "gut out" the upstairs lounge, and con-
struct a completely new bar. He specified that the eating
facility would become a fast food type operation, and
consequently they would not need waiters or waitresses.
He stated that he wanted Magaw to line up the gift shop
supplies as soon as possible , listing the items that he in-
tended to add to the present gift shop inventory. He also
mentioned that he had discovered at the bid opening
meeting that the ATS operation was organized. Tehrany
told Magaw that he was to report for work as the new
manager of the DAKA facility at the Roger Williams
Park Zoo on Monday, 4 June, from which location he
would prepare for the startup of DAKA's business at the
airport, but that his immediate duties on reporting there
would be to prepare for the big celebration at the
park. 10
On 11 June, Tehrany took DAKA's designer and ar-
chitect, Irving Brody, and Vice President Leo Skell-
chock to the airport to discuss the design for the future
DAKA facilities and to take additional measurements for
a new blueprint. Shortly before that Tehrany met with
Brian Magaw, who had assumed his new position at the
Roger Williams Zoo. They discussed and Tehrany ap-
proved Magaw's recommendation to hire Scott Sever-
ance and Jim Doura as the assistant managers whom he
intended to take with him to the airport when the transi-
tion was made. Both these men had experience with fast
food operations. It was Tehrany who conducted the final
interview.1'
About 4 July, Tehrany and Magaw met again. On that
occasion he and Magaw reviewed their earlier discussion
at Northeastern University in which Tehrany had de-
scribed the bad condition of the ATS airport facility, the
carelessness he observed there on the part of the wait-
resses, and his decision that the future operation at T. F.
Green would not utilize waitresses or dishwashers. At
the conclusion of their discussion, Tehrany gave Magaw
his instructions for staffing the new operation . It was de-
cided, with Tehrany's approval, that they were not
going to hire the entire ATS work force as a unit, but
would look for qualifications over everything else in
considering individual applicants. The instructions given
Magaw at this meeting were the beginning of the imple-
mentation of Tehrany's plans for the airport concession
presented to Vince on 16 March.
Meanwhile, Morty Miller of Local 217 had first
learned that DAKA was the successful bidder for the
airport concessions when he received by mail a copy of
a newspaper article announcing the award, while he was
on special assignment for the International Union at Las
Vegas, Nevada. He apparently did nothing until approxi-
mately the last week of July, when Dominic Bozzotto,
the head of the Boston local, gave Allen Maxwell's name
as to Miller being the person in charge of DAKA's labor
10 Magaw had been working summers at the zoo and winters at North-
eastern
11 Although Tehrany insisted that he was not involved in hiring any of
the personnel for the airport , it is clear from his testimony that his use of
the term "involvement" did not include either the interviews with Sever-
ance and Doura or the subsequent discussion between him and Magaw
relations. Miller testified that Bozzotto told him that his
local represented the DAKA employees at the Boston
Globe facility, and because the Boston Globe was totally
unionized he had a very decent relationship with Max-
well. Miller telephoned Maxwell on 3 August. After in-
troducing himself, he said he understood DAKA was
going to be taking over the airport operation, and that
the Union was interested in having a smooth transition.
He asked Maxwell what the Company's plans were for
the T. F. Green facility. Maxwell's response was to refer
Miller to the Company's attorney, John Coyne. Miller
succeeded in reaching Coyne on the following Tuesday.
In answer to Miller's question concerning DAKA's
plans, Coyne stated that he did not think any commit-
ments had been made to any air terminal service employ-
ees, and that the Company's first responsibility would be
to those DAKA employees at a seasonal operation in the
area (the zoo facility). Miller asked how the ATS em-
ployees could apply for work with DAKA at the airport
if they so desired, and Coyne promised to find out and
inform Miller by the end of the week.
On 10 August Miller wrote to Maxwell, stating that
the Union was the collective-bargaining agent for the
restaurant, bar, and gift shop employees at T. F. Green,
and that these employees are ready, willing, and able to
work for DAKA at that operation. He also asked Max-
well to notify him concerning how the present employ-
ees could apply for jobs with DAKA, and whether or
not they intended to employ the current work force.
That same day Miller also telephoned the DAKA facility
at the Roger Williams Park Zoo and pretended to be
seeking a job at the airport. He asked the receptionist
how he could apply. She answered that he should come
to the zoo and obtain an application that, when complet-
ed, would be reviewed by Brian Magaw, the future
DAKA airport concessions manager. Later that day
Miller prepared an undated petition that he circulated for
signature among the ATS employees working at the air-
port. The petition, addressed to Director of State Air-
ports Anthony Rosatti, stated as follows:
As concessions employees at Green State Airport,
we are upset at the intent of DAKA Food Service
to:
(1) refuse to hire us when they assume operation
of the restaurant, bar, and gift shop-jobs we have
performed for years;
(2) refuse to honor the rates of pay, benefits, and
other conditions in our Union Contract;
(3) refuse to recognize Local 217 as our collec-
tive bargaining agent.
This is unfair treatment of a loyal group of employ-
ees who have given many years of service at the
Airport.
We ask you to ensure that our jobs are protected.
Miller personally began the circulation of the petition
among the employees on 10 August, but left before all
the signatures had been obtained. Miller tried unsuccess-
fully to reach Maxwell by telephone on 13 and 14
554 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
August . The petition was returned to him on Wednes-
day, 15 August , by the employees charged with the re-
sponsibility of obtaining further signatures. That same
day Miller and a delegation of ATS employees, Jane
Olsen , Jane Orsini , Jenny Lawrence , Sherrill Bouthilher,
Claire Matteson , and Bernadette Morrell , presented the
petition to Rosatti 's assistant , Mr. McCall.
Next , Miller received a letter dated 15 August from
John E . Coyne. After reciting that Miller's 10 August
letter to Maxwell had been forwarded to him for re-
sponse, Coyne stated:
Presently , daka 's intent is to offer employment at
the airport facility to its employees who would oth-
erwise face layoff or termination due to the close
down of certain seasonal facilities . If any other ad-
ditional employees are necessary , they will be hired
by the company in its usual manner.
Any further inquiries or correspondence in con-
nection with this matter should be referred directly
to this office.
According to Miller , between 15 and 19 August, he met
with D'Orsi and Carcieri in D'Orsi's office at DOT.
George Nee , an official of the state AFL-CIO was also
present . The meeting lasted about half an hour . Miller
briefed D 'Orsi on his views concerning the situation that
was developing at the airport, i.e., that Local 217, the
collective-bargaining agent for the T . F. Green ATS
employees , was having no success with DAKA in their
efforts to persuade DAKA to employ the current work
force , and that it appeared they did not intend to do so.
Miller asked for D'Orsi 's assistance . According to Miller,
D'Orsi said that he was sympathetic to the position of
the current employees and that he would do what he
could. 12
On 19 and 20 August an advertisement appeared in the
help-wanted section of the Providence Journal Bulletin
seeking full- and part-time bartenders , cooks, cashiers,
general utility , waiters and waitresses for work "in the
Warwick area ." Although the ad did not specify the
name of the company , employees were instructed to
apply in person between 10 a.m. and 3 p . m., 21 August
at the concession building at the Roger Williams Park
Zoo, DAKA 's facility . Pursuant to Miller's advice, ATS
employees Claire Matteson , Jenny Lawrence, Jane
Orsini , Phyllis Kelley, Ollie Fitzpatrick , Eleanor Galla-
gher , Sherrill Bouthillier , and Tracy Smith went to the
DAKA establishment at the zoo on 21 August . Galla-
gher was accompanied by her daughter Tracey, a high
school student . Each of these persons filled out an appli-
cation , which they turned in either to Brian Magaw or
Jim Doura . None of these ATS employees was ever of-
fered a job with the Respondent . However , Tracy Galla-
12 D'Orst testified that in late 1982 or 1983, when the State was pre-
paring to put the airport concessions out for bids for the first time, Miller
requested that he place in the request for proposals a requirement that the
successful bidder would be required to honor the existing contract with
the Union This was not done According to D'Orsi, Miller made the
same request at this meeting in August, in addition he sought assistance
for the ATS work force
gher was hired by Brian Magaw and ultimately began
work at the airport on 2 September.
On 25 August, Morty Miller wrote a letter to Alan
Maxwell enclosing 11 letters addressed to Maxwell by
individual ATS employees seeking employment.13
In the meantime , Terry Tehrany, Brian Magaw, and
his two assistants , had been busy with arrangements for
the scheduled 1 September commencement of DAKA's
airport operations . Magaw , Doura, and Severance spent
most of their time checking references, screening , inter-
viewing , and hiring employees . This aspect will be dis-
cussed later in a separate section of this decision. Teh-
rany handled other matters related to the forthcoming
opening and coordinated their efforts . In mid-July, Teh-
rany arranged with Ken Fahey, DAKA 's treasurer, to
secure all the proper licenses in time for the T . F. Green
opening . On 19 July , he met with ATS Manager Edward
Krzyzek concerning the transition.14 On 23 July, Teh-
rany left for his vacation . He returned on 7 August, at
which time he took a Boston auctioneer to the airport in
an unsuccessful effort to sell some of the furnishings and
equipment in the restaurant and the lounge. He again re-
turned to the airport about a week later where he met
with Brian Magaw concerning filling the vending ma-
chines , which constituted DAKA's initial presence at the
airport.
On 21 August , while Magaw was busily engaged in
accepting applications at the park , Terry Tehrany and
Alan Maxwell drove from a district managers ' meeting
to Providence for a meeting with Isidore D'Orsi and
Paul Carcieri in D'Orsi 's office . D'Orsi had requested the
meeting . The meeting opened with D'Orsi saying he had
met with Morty Miller , and expressing concern about the
pressure the Union was putting on the State to assist it in
obtaining recognition from DAKA and jobs for the ATS
employees . D'Orsi asked Maxwell to advise him con-
cerning what DAKA 's position would be in the event
the State were to pressure DAKA to recognize the
Union. D'Orsi showed them clippings from local news-
papers , and said he was also worried about the possibility
that the publicity over this matter might adversely affect
the State's efforts to upgrade the airport and improve its
image . In D'Orsi's words , "It cast a negative shadow on
our airport." Maxwell responded that should the State
require DAKA to recognize the Union, DAKA would
look to the State for economic relief with respect to the
agreed-on rent , based on the outcome of any negotiations
with the Union . He promised to write D'Orsi a letter
presenting DAKA 's views on how union wage rates
13 The enclosed letters were from Mary Banes, Joseph Brachen, Alyce
Burke , Pasquale Caniglia , John Coletti Jr., Thelma Dufresne, David
Ghighotty , Bernadette Morrell , Dawn Monteiro , Kimberly Tolly, and
Julie Wagoner On Sunday, 26 August , ATS employees picketed the
DAKA operation at the Roger Williams Zoo and distributed a leaflet
stating that DAKA has refused to agree to hire the current employees at
the T F Green concessions and planned to "throw the 35 restaurant em-
ployees at Green State Airport out of work "
Miller sent a similar letter to Maxwell on 30 August, enclosing an "ap-
plication" from Jane LaFazia , and on 19 September on behalf of Michael
Leighton and Diana Tomassi
14 The details concerning other aspects of this meeting and of other
important conversations Tehrany had with Krzyzek are discussed in a
later portion of this decision
DAKA, INC.
would affect the economics of the Company' s agreement
with DOT.
During the days immediately following the 21 August
meeting with state officials, Maxwell asked Tehrany to
obtain data concerning the wage rates that DAKA
planned to pay at T. F. Green and, if possible, the rates
that were in the ATS union contract. 15 Utilizing this in-
formation, Maxwell drafted the following letter, dated 31
August 1984, which he sent after it had been casually re-
viewed by Tehrany. Because of the importance of this
exhibit, it is fully set forth as follows:
Mr. Isidore V. D'Orsi
Assistant Director for Real Estate
Department of Transportation
Property Management Office:
323 State Office Building
Providence, Rhode Island 02903
Dear Mr. O'Orsi:
As discussed, daka's bid to operate the food serv-
ice at the T. F. Green Airport was based on eco-
nomic conditions which determined the amount of
rent we committed to the State of Rhode Island.
Concerning economic conditions, specifically
wages and fringes, daka's bid was based on rates
and benefits we know to be competitive in non-
union operations in the Providence/Warwick area.
We were aware of and concerned about the exist-
ence of a collective bargaining agreement between
the incumbent operator and the local hotel/-
restaurant union as we prepared our bid. To that
end, we asked the state to advise whether we
should include consideration of the union in our
proposal and were advised not to reflect such a
factor.
The cost ramifications to daka, should we be re-
quired to recognize and negotiate a contract, would
be substantial.
Following is a comparison of the wage rates that
daka used in its bid and, to the best of our knowl-
edge, the wage rates in the current union contract:
Wages
Rates
Used
Daka's
Bid
Union
Rates
Bartender $3.50 $4.85
Hostess 5.00 5.00
Waitress 2.01 2.98
Cook 4.00 5.05
Counter 4.00 4.37
General Utility 350 4.17
P.T Cook 3.50 5.05
Cashier 3.50 4.37
Sundry Shop Supervisor 7.50 7.50
15 Meanwhile , on August 29 Tehrany and Magaw attended a hearing
that resulted in DAKA's obtaining its liquor license at the airport Miller
and 15 ATS employees appeared and opposed the granting of that li-
cense
555
daka's tax and fringe benefit ratio was projected
at 21% of total raw wages. To the best of our
knowledge, the union's tax and fringe benefit costs
approximate 30%.
Assuming that the number of hours of labor per
week remains as daka proposed in its bid, when ap-
plying the union's wage rates and tax/fringe costs,
an additional $87,000 in annual payroll costs would
occur.
We anticipate, Izzy, should recognition of the
union be required, and assumption of economic con-
ditions be required similar to what currently exists
with the union contract, that selling price increases
above the level of our projections would have to be
implemented. These price increases would absorb
about one-half the increased labor expenses, result-
ing in a short fall of between $45,000 to $50,000.
If I may be of further assistance, don't hesitate to
contact me.
Sincerely,
Allen R. Maxwell
Executive Vice President
Allen Maxwell explained that his 31 August letter con-
tained two serious inaccuracies . The first was the state-
ment that during the time DAKA was preparing its bid,
they were aware of and concerned about the existence of
a collective-bargaining agreement between ATS and the
Union. The second was the statement that during that
same period of time DAKA asked the State to advise
them whether they should include consideration of the
Union in their proposal, and that the State had advised
that the proposal need not reflect such a factor. Maxwell
explained that these untrue statements were the result of
his exuberance in desiring to take the strongest possible
position in order to disabuse the State officials of any
idea that their problem could be solved simply by raising
DAKA's rent.
Likewise on 31 August, Morty Miller and George Nee
had a second meeting with state officials about the air-
port problem. This meeting was attended by DOT Di-
rector Ed Wood, D'Orsi, Anthony Rosatti, and Paul
Carcieri in Wood's office. Miller spoke about his per-
ceived unfairness over DAKA's alleged failure to inter-
view and consider employing the ATS employees. He
asked for the intervention of DOT in assisting the ATS
workers' efforts to obtain an opportunity to work for
DAKA. According to Miller, Wood said that he was
sympathetic to Miller's position and that he would be
talking to the Company. The meeting adjourned.
Also 31 August was the day on which DAKA as-
sumed occupancy of the gift shop, restaurant, and lounge
areas. Under the supervision of Tehrany, Magaw, and
Doura, people were brought in to clean the gift shop,
and approximately 8 to 10 people worked that night
shutting down the coffee shop and setting up the cafete-
ria line, which was slated to temporarily supply DAKA's
food service during the renovation, alteration, and con-
struction phase of the changeover. Krzyzek assisted in
556 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
the transition work.' 6 Other DAKA managerial person-
nel who were present to assist in setting up the tempo-
rary buffeteria line were Gloria Chabot, Pat Annese,
DAKA's executive chef, and Paula Clarke, the manager
of DAKA's Citizens Bank facility.
Tehrany hand delivered Maxwell's letter on 3 or 4
September.17 Like most dedicated public officials,
D'Orsi deeply resented such outside pressure, and it is
not surprising that he reacted adversely. He angrily
handed the letter back to Tehrany and, referring to the
statement that the State had advised DAKA that it was
not necessary to consider the Union in their proposal,
said, "There's not a god damned worth [sic] of truth in
it." This time Tehrany read the letter carefully, and re-
plied, "Your [sic] right." After noting his embarrassment,
he promised to talk to Maxwell about the matter, and
quickly left D'Orsi's office. When Tehrany reported to
Maxwell, Maxwell expressed his irritation. He said,
"What the hell did you let me send that thing with the
incorrect reference in there for. Boy, don't we look
stupid?" Tehrany replied that he should have looked at
the letter more closely, and thus he failed to catch the
inaccuracies.
In this temporary mode, DAKA opened for business
on 1 September.1 S Also on this date, the Union began
picketing the airport and distributing a leaflet accusing
DAKA of unfair treatment in failing to hire the former
concession employees and hiring new workers at lower
wages. The leaflet, bearing the full name of Local 217,
requested the public not to patronize the airport restau-
rant, bar, and gift shop.
On 7 September, Isidore D'Orsi sent a handwritten
memorandum to Director Wood with Maxwell's 31
August letter attached. The memorandum denied that
state officials gave any advice to DAKA prior to the
submission of their proposal concerning the Union, and
averred that neither D'Orsi nor Carcieri ever spoke to or
heard from anyone from DAKA until Tehrany intro-
duced himself after the bid opening meeting. The memo-
randum ends with a suggestion that "the above and the
inflated projection attached must be tempered by the
high degree of service DAKA will give us." Thereafter,
Wood contacted DAKA President Terry Vince and
asked for a meeting . The meeting took place on 20 Sep-
tember between Wood and D'Orsi and Vince and Max-
well in Wakefield. It lasted about 30 minutes, after which
the four men, joined by Terry Tehrany, toured DAKA's
offices. Wood stated that he had promised the Union that
he would speak to DAKA about the possibility of recog-
nition. The record does not reflect that Maxwell made
any departure from his previously expressed position that
if the State were to pressure DAKA to recognize the
Union, then DAKA would be required to negotiate a
contract with the Union. However, Wood did not ask
Maxwell to do anything specifically with respect to the
ATS employees or the airport facility. Meanwhile, Max-
16 A list of bargaining unit employees employed at ATS on 31 August
at the airport is attached as Appendix A.
1 r Based on Tehrany 's testimony , since the date on the "received"
stamp of the DOT real estate office is illegible
18 A list of DAKA employees employed at the airport from 1 Septem-
ber to the present is attached as Appendix B
well and D'Orsi talked about Maxwell's 31 August letter.
D'Orsi asked if Maxwell was aware that he was incor-
rect in what he said in that letter. Maxwell responded
that he was aware that the letter was inaccurate, and de-
scribed the letter as a terrible mistake. Apparently this
meeting resolved the temporary rift that had developed
between DAKA and DOT for, on 24 September, D'Orsi
wrote to Maxwell confirming that in their meeting "we
agreed that the last sentence in the second paragraph of
your letter was a misunderstanding." D'Orsi's letter
ended with an expression of a desire for cordial relation-
ships, and without mentioning the question of recogniz-
ing the Union or hiring ATS employees. The record re-
flects no further discussions between the Company and
the State concerning these problems. The union strategy
of seeking to force recognition from DAKA through
state pressure had failed.1 a
On 26 November, Morty Miller wrote a letter to
Terry Vince requesting recognition and bargaining on
behalf of the DAKA employees "in an appropriate bar-
gaining unit" at the T. F. Green Airport. He renewed
his request on 8 December. He received a response from
Attorney Coyne, dated 4 January, declining to recognize
and bargain with Local 217.
E. The Alleged 8(a)(3) and (1) Violations
The complaint alleges that the Respondent discriminat-
ed against the ATS work force because of their member-
ship in and activities on behalf of the Union, and con-
certed activities, prior to 1 September 1984, and in order
to discourage employees' union and concerted activities.
The complaint alleges that the discrimination occurred in
three specific forms: (1) the discouraging of job applica-
tions, (2) failing to accord normal consideration for em-
ployment to employees in the ATS work force, and (3)
the continuing refusal to hire any of the ATS work force
employees at the airport facility since about 3 August
1984.
The General Counsel contends that the Respondent
avoided and refused to hire the ATS employees in order
to avoid the higher labor costs that it assumed would
arise if members of the Union were hired. The General
Counsel contends in his brief "that Respondent's reasons
for failing to consider and hire any ATS employees are
pretextual, and not even blurred with mixed-motive con-
siderations." On the other hand, the Respondent con-
tends (a) that the General Counsel has failed to prove
that DAKA discouraged job applications, because the
application process was open and known to the employ-
ees, (b) that those ATS employees who submitted appli-
cations were afforded normal consideration for employ-
ment up to and including the point at which the Re-
spondent received an unfavorable recommendation con-
cerning them, and (c) the reasons none of the ATS em-
ployees were hired were nondiscriminatory reasons unre-
19 D'Orsi testified that following the 20 September Wakefield meeting,
Director Wood contacted Morty Miller and reviewed with him the out-
come of the Wakefield conference Miller's testimony made no reference
to any further contact from the State in this regard This discrepancy
may be explained by the fact that D'Orsi was apparently confused at this
point in his testimony by the interjections of counsel
DAKA, INC.
lated to their union or protected concerted activity. The
Respondent's defense is based on the mutually corrobora-
tive testimony of Terry Tehrany and Brian Magaw.20 It
is accurate to say that throughout the chain of circum-
stances that unfolded as DAKA successfully bid for the
T. F. Green concession contract and prepared to open
and operate its new facility, Tehrany made the major de-
cisions , supervised, and coordinated DAKA's efforts
while Magaw concentrated on the details of implement-
ing Tehrany's instructions . Thus, both these men de-
scribed in detail their initial conference in early May at
Northeastern University. They agree that it was there
that Tehrany first briefed Magaw on his plans, approved
by Terry Vince, to "gut out" the entire existing oper-
ation at the airport because of the dirty condition of the
facility and the carelessness of the waitresses. He de-
scribed to Magaw how the future food service at the air-
port would be a fast food type of operation similar to
McDonald's or Burger King, and they would not need
waiter/waitresses or dishwashers. Magaw was instructed
to report for work at the Roger Williams Zoo facility
immediately following his upcoming vacation, and to
begin planning there for that operation's part in the 4
July celebration. Magaw began work at the zoo facility
in early June. Thereafter, he met with Tehrany approxi-
mately once a week. Once Tehrany received the 8 June
letter from the State confirming DAKA's selection as
concessioner, Magaw knew that he would become the
future manager of the airport facility and would be re-
sponsible for preparing for its opening. Late in June and
early July, he started making arrangements for vending
machine locations. He also visited the airport with Di-
rector of Merchandising Susan Shea and DAKA Vice
President Ron Cohen concerning how to set up the gift
shop, in order to comply with the State's insistence that
they feature a considerable number of Rhode Island
products and souvenir items.
Following the meeting at which Tehrany approved
the selection of Severance and Doura as assistant manag-
ers, Tehrany and Magaw met again around 4 July. The
purpose of the meeting was to give Magaw his instruc-
tions about his responsibilities concerning preparations
for the airport facility's opening , prior to Tehrany's leav-
ing for his vacation. The chief topic of discussion was
the hiring of the employees for the T. F. Green oper-
ation. It was finally decided at this meeting not to hire
the ATS work force as a group or a unit. Tehrany em-
phasized to Magaw that he had spent much time observ-
ing the ATS operation and had seen the "filthy food
service and lethargic employees." He did not discuss in-
dividual ATS employees. He said the food was not up to
caliber, it was of poor quality, the service was poor, and
the facility was not clean. He described how the kitchen
employees were working without hats or hair restraints,
20 Magaw impressed me as an intelligent and alert young man, who
logically and concisely attempted to give an accurate account of what he
knew under the extreme pressure of 3 days of testimony Generally, I
credit his testimony . In one minor instance , he was not candid He mis-
represented the facts concerning DAKA 's intention to continue using
patio furniture in the airport lobby immediately outside its eating facility
The testimony of D'Orsi shows that the furnishings became permanent
only on the insistence of the State
557
and smoking while they worked. He said they took
smoke breaks in the food preparation area. He assigned
to Magaw the responsibility of making the individual de-
cisions concerning who would work at the airport. He
did not restrict Magaw from selecting individual ATS
applicants who met the criteria of having either fast food
experience or culinary students or graduates.
Pursuant to these instructions, Magaw began consider-
ing and making decisions concerning which individuals
to employ. In the first instance, he observed, he had pre-
viously from time to time made tentative commitments
to part-time DAKA employees at the zoo who desired
full-time work, and former DAKA employees who
wanted to return, to employ them in the future when an
opportunity arose. This reduced the number of slots to
be filled on his manning chart by five people. Magaw in-
sisted that there was never a time when he concluded
that none of the ATS employees would fit his criteria.
He testified that he was willing to consider each individ-
ual based on his/her merits, and never generalized or
considered common drawbacks. He emphasized that he
and his assistants followed his policy of automatically
and initially making a reference check on every individ-
ual's application. He emphasized that none were simply
screened out by just reading the application and deciding
not to hire him/her based on the application alone,
except in instances where the applicant's experience was
unrelated to the job, e.g., an automobile mechanic. He
stated, "It's my standard practice that I don't hire any-
body until, first of all, I check their references. I don't
even interview anybody until I check their references."
Accordingly, beginning 21 August, Magaw, Doura,
and Kevin Condon, the manager at the zoo, began dis-
tributing and receiving applications from job seekers
who came to the zoo facility. As described earlier in this
decision, various ATS employees, who had either seen
the ad or learned of it from Miller or from their fellow
employees, came to the zoo and applied.21 On the morn-
ing of 22 August, Magaw and his associates began
making reference checks on the 21 August applications.
The reference for the ATS applicants was Ed Krzyzek.
Magaw called Krzyzek and gave him the names of the
ATS employee applicants, and asked for a reference.
Krzyzek responded that each of the people Magaw
named worked for him, but that he would not hire any
of them. Magaw thanked Krzyzek and their conversation
ended. Having received this adverse appraisal by Krzy-
zek, Magaw decided not to offer jobs to the ATS appli-
cants. Only those persons who came in and filed an ap-
plication with DAKA were considered. Concerning the
gift shop employees who had worked for Tele-Trip,
Magaw personally checked with Henry Almonte at the
airport concerning their work habits, while his assistant
checked with Tele-Tnp through its parent organization,
Mutual of Omaha. Magaw's criteria for hiring gift shop
21 All the ATS employees' applications received by the Respondent
were placed in evidence as G C Exhs 28 (a) through (p) The applica-
tions and personnel forms of employees hired for or transferred to the
airport are in evidence as G C Exhs 29(a) through (ff) The applications
of persons, other than ATS. employees, not hired by DAKA are in evi-
dence as G C Exhs 30(a) through (x)
558 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
employees was that he wanted persons with retail experi-
ence. 22
The keystone of the General Counsel' s case is the tes-
timony of Edward Krzyzek, manager of ATS's airport
concession. Airport Director Anthony Rosatti requested
Terry Tehrany to consider Krzyzek for employment
with DAKA, as a personal favor. The request came at a
delicate time, when Tehrany had not received formal
written confirmation that DAKA was the successful
bidder. The state airport officials were among those who
submitted recommendations. Pursuant to this request,
Tehrany interviewed Krzyzek. He told him quite frankly
that he really did not want him, and did not intend to
hire the entire ATS work force because DAKA was
planning a buffeteria or cafeteria type of self-service for
T. F. Green, followed by a fast food operation, which
would not require waitresses or utility workers. He told
Krzyzek that he was offering his assistance , if Krzyzek
was interested, as a favor to Rosatti. Krzyzek expressed
an interest in DAKA, and Tehrany took full advantage
of that interest by attempting to secure ATS's actual
sales and cost figures at the airport. Krzyzek refused to
supply them. Nevertheless, Tehrany arranged interviews
for Krzyzek with DAKA's management for a possible
job at another location. Eventually Krzyzek was offered
a job with DAKA in Massachusetts at a salary less than
what he had requested. Krzyzek said he rejected the
offer because he did not want to leave Rhode Island.
What Krzyzek really wanted, and finally requested of
Tehrany, was the manager 's or assistant manager 's posi-
tion at DAKA's forthcoming T. F. Green operation.
Tehrany refused during a conversation between the two
men on 19 July. Thereafter, Krzyzek attempted to ingra-
tiate himself by cooperating with Tehrany at the airport
in various ways, including giving him information. For
example , about 24 to 26 August, he warned Tehrany that
the Union was circulating a petition, and attempting to
get all the airport employees to boycott the new DAKA
facility when it opened. He said that the Union was
going to try to make life miserable for DAKA, and sug-
gested that Tehrany hire Rita Banes and Jane Olsen,
Local 217's shop steward at ATS. However, Tehrany re-
fused, stating he was not worried about the union pres-
sure, since there was nothing he could do about it. Krzy-
zek also told Tehrany on 19 July, and again on 24
August at the airport, that, if he were DAKA, he would
not hire any ATS people. He discussed the deteriorated
condition of the ATS airport facility, and said that if he
were putting up the kind of money DAKA was, he
would "clean house and not hire anybody."
Krzyzek testified that he felt that he had been "led
on" by DAKA, "by dangling the carrot in front of the
horse." He said he felt Tehrany was using him, and
pumping him for information. He also claimed that he
was not disappointed that DAKA had not offered him a
position, other than at Northeastern University. Despite
feeling "used" and being "pumped," he nevertheless pre-
22 Magaw testified that not all of the results of the reference checks
were noted on the application forms, and in some instances a favorable
reference check resulted simply in the application being placed in the
"Okay" stack
tended to have no hostile feelings toward DAKA, a re-
markably inconsistent and almost superhuman attitude
under the circumstances. He then proceeded to testify
concerning numerous conversations he claimed he had
with Tehrany, and one or two with Magaw, but only in
rare instances was he able to give more than a general
idea of when these conversations occurred. In addition,
later in his testimony, he characterized these conversa-
tions as "infrequent." He remembered recommending
Banes and Olsen to Tehrany but claimed that Tehrany
replied, "We don't want any of those union people." On
one other occasion, near the information desk in the air-
port lobby, Krzyzek claimed Tehrany said that he
"didn't want any of those f-g union people," although
he confessed he could not remember any of the conver-
sation that led up to this remark. He also testified that he
recommended gift shop employees Diane Tomassi and
Ellie Gallagher to Tehrany, but received no response.
He could not remember the conversational context of
this remark either. At other times Krzyzek could not re-
member any of an important conversation, for example,
the remarks he made to Tehrany at the 2 April bid open-
ing. I am convinced that Krzyzek's testimony was
strongly biased in a desire to retaliate against the Re-
spondent for failing to agree to employ him at the new
airport location. I am satisfied that this retaliation took
the form of an attempt to assist the ATS employees,
through embellished testimony, in their efforts to gain
jobs with DAKA through this litigation. I find his testi-
mony, for the most part, unreliable, and it is not credited
except where it is specifically corroborated by the testi-
mony of Magaw and Tehrany.
Based on the credible evidence I find that DAKA did
not actively discourage applications from ATS workers,
although it did not go out of its way to cooperate with
the Union. DAKA was not obligated to seek out the
ATS employees at the airport or elsewhere and solicit
their applications. For that matter, Krzyzek never asked
DAKA to supply applications, nor did the Union, who
devoted most of its efforts in the critical month of
August to attempts to pressure the State to force DAKA
to recognize Local 217, rather than insuring that all the
ATS employees applied. DAKA's sole duty to the ATS
work force consisted of affording them an opportunity to
apply for jobs equal to that which was afforded others.
This they did through the newspaper advertisements an-
nouncing 21 August as the date on which to apply at the
zoo facility, and by issuing and receiving applications to
all who appeared at that time, and thereafter. The Gen-
eral Counsel suggests that earlier ads, placed by Paula
Clarke, bearing the telephone number of DAKA's Citi-
zens Bank operation managed by Clarke, were really a
covert effort to recruit for the airport. In this the Gener-
al Counsel engages in mere speculation. Clarke credibly
explained that the purpose of the ads that she placed was
to staff a proposed expansion of the Citizens Bank oper-
ation, later cancelled by the bank. In any event, these ads
ran before DAKA had written confirmation that it was
the successful bidder.
Nor am I impressed with the argument that the fact
that DAKA's name did not appear in any of the adver-
DAKA, INC. 559
tisements that were intended for airport recruiting proves
an unlawful motive on the part of the Respondent. I am
cognizant that in certain other cases involving different
facts, so called "blind ads" have been considered one
factor in assessing discriminatory intent . But the Board
has not held that this is the only factor. Other factors
weigh against drawing that inference here. Unlike other
situations, DAKA had no established presence at the air-
port from which it could conduct the application and se-
lection process. There's no evidence, nor is there any
contention that the airport terminal contained any space
suitable for this purpose, or that such space was ever of-
fered. On the other hand, DAKA's zoo facility was con-
veniently located not far from the airport. It was a loca-
tion well known to the general public. Because it was
the only eating facility at Roger Williams Park, it was
readily identifiable. It was known as a DAKA facility.
No effort was made to conceal the purpose of DAKA's
employment activities there. Thus, when Morty Miller
telephoned DAKA there and pretended to be a job
seeker, the receptionist openly talked about DAKA ac-
cepting applications for the future airport location. There
is no evidence to show that this information would have
been withheld from identified DAKA callers. Beginning
on the advertised date of 21 August, DAKA accepted
applications from all 16 persons who came to the zoo fa-
cility seeking work with the Company at T. F. Green,
including all the ATS applicants who appeared. None
was refused. All were considered. The evidence shows
that there was much discussion among the ATS work
force to the effect that those interested in working for
DAKA should go to the zoo and apply. Nor was there
any talk of futility at that time. There is no credible evi-
dence by any of those who did not apply to explain why
they failed to do so. Only one ATS employee applied
after 21 August, Tracey Smith, and this was a second ap-
plication in September 1984 at a time when there were
no jobs available.
After 21 August, certain employees were invited to
contact Terry Tehrany for consideration in the immedi-
ate future. Eleanor Gallagher, the cashier at the ATS-op-
erated gift shop, testified that on 31 August, as she and
stockroom clerk Diane Tomassi were leaving the shop
for the last time, she wished Tehrany good luck. Teh-
rany answered that he wanted them to know he held
nothing personal against them, and asked if they had
jobs. Gallagher said she might have one in the making.
Tomassi answered that she was going back to school.
Tehrany replied that if anything did not work out, and if
they wanted, they could come to see him in a couple of
weeks. The accounts of this conversation by Gallagher,
Tehrany, and Tomassi are similar. They are credited.
However, I am not impressed with the additional conclu-
sionary testimony by Tomassi, based on a remark alleg-
edly made by Krzyzek, that she did not apply at DAKA
because she felt it was hopeless or futile. Tomassi also
stated, "I'm very picky about my jobs-what I pick."
She also returned to school in September where she had
already been accepted and registered. Tomassi was the
only witness produced by the General Counsel who tes-
tified to having concluded that applying at DAKA was
futile.
Rita Banes, ATS ' assistant manager , worked mostly in
the office doing book work. Banes credibly testified that
one day in August, Tehrany asked her if she would be
interested in working for DAKA. Banes' response was
noncommittal. She said she was tired, and not enthusias-
tic. He responded that she should think about it, and
after a few weeks he might have something for her part
time. She never pursued the matter further.
Tehrany also remembered speaking to Jane Olsen,
ATS' coffee shop cashier from 6 a.m. to 2:30 p.m. on
weekdays, as he passed through the coffee shop one day.
However, he denied having any extended conversation
with her about a job. I credit his denial. Olsen testified
that early in July she introduced herself to Tehrany as
the Union's shop steward, and told him that the Union
had asked her to find out where the ATS employees
could apply for jobs with DAKA. According to Olsen,
Tehrany answered that the papers were not finalized yet,
and that it would be up to the personnel department to
do the hiring. Tehrany denied making this statement. Al-
though this incident allegedly occurred at a time when
the contract between DAKA and the State had not yet
been signed, there is nothing in the entire record to form
the slightest basis for any suggestion that DAKA's per-
sonnel department planned to take any active part, as an
organization, in the hiring process for T. F. Green.
Concerning the alleged discriminatory failure to con-
sider and refusal to hire, the General Counsel's theory is
based on economics. He contends that DAKA's sole mo-
tivation in allegedly failing to consider and in failing to
hire the ATS work force, was a need to maintain low
labor costs in order to offer a favorable percentage of
the gross to the State and still make a profit. According-
ly, the General Counsel reasons that either (1) Tehrany
learned at the outset of his activities at the airport that
ATS was organized and planned from the start not to
hire any ATS employees for this reason, or (2) having
learned at a later time that Local 217 represented the
ATS workers, it decided not to hire them in order to
adjust its labor costs to meet its bid commitment to the
State. In my view, this theory is not supported by the
weight of the evidence, although admittedly Respondent
was mindful of the economic impact of a union wage
scale. There is nothing unlawful in Respondent's not
having wanted to take into its employment the entire
ATS work force, or even a majority of that work force,
so long as it did not act unlawfully.23 The Respondent
had no obligation to hire ATS employees. It was only
required to consider and select them on the same lawful
basis utilized with respect to others it considered and
either selected or rejected. When the evidence is viewed
according to these principles and in the context of the
credible evidence, General Counsel's theory fails.
At the outset it is notable that there is no credible evi-
dence of antiunion animus . In fact, Morty Miller testified
that he had learned from the head of his Union 's Boston
Globe local that they had good relations with DAKA.
DAKA is simply not the classic stereotype of the antiun-
23 For that matter , an employer may even express a desire to operate
nonunion, so long as he does not translate that desire into action violative
of the Act Great Plains Beef Co , 241 NLRB 948 (1979)
560 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
ion employer who is determined to fight to the end to
avoid unionization. Also it is clear that DAKA did not
plot from the very beginning of its effort to obtain the
T. F. Green concessions for the purposes of avoiding
any possible bargaining obligation toward Local 217.
The credited evidence shows that Tehrany did not know
of the Union at ATS until 2 April, when he learned this
fact from Krzyzek during their brief exchange after the
bid opening. Tehrany's testimony in this respect is sup-
ported by Maxwell's testimony and exhibits consisting of
the minutes of weekly Monday morning management
staff meetings at Wakefield, in which the first reference
to the union situation occurs in mid-June.24
The strongest piece of evidence in support of this
phase of the General Counsel's theory is the Maxwell
letter to D'Orsi of 31 August. This letter contains a state-
ment to the effect that DAKA had taken the existence of
the Union into account in preparing its bid. I have given
much study and long consideration to this document,
Maxwell's explanation, and whether or not the represen-
tations contained therein square with the credible evi-
dence. Maxwell's explanation is not credible to the extent
that it attributes the erroneous statements to exuberance
or error. Certainly the letter was a "mistake" only in the
sense that ever since Maxwell had it delivered by Teh-
rany, he had undoubtedly regretted that he ever wrote
the epistle. However, in the end, I have concluded that
the deliberate representation it contains is untrue, as
Maxwell confessed , just as the statement concerning the
alleged duplicity by state officials was also untrue. In
sum, after serious deliberation, I am convinced that the
Maxwell letter is an aberration incompatible with the
pattern established by the credible evidence as a whole,
and that Maxwell really did consciously include these
misrepresentations in a crude effort to apply pressure on
the State, as he described. While this may indeed appear
reprehensible to many , it is not my function in this case
to pass on aggressive business tactics unless the conduct
involved constitutes a violation of the Act.
I do agree, however, that DAKA's decision not to
hire the ATS work force as a group or an entity was
made very early by Tehrany, based on his observations
of dirty conditions and sluggish employees in service,
which he described in detail. Indeed, the State's bid spec-
ifications suggest a strong desire to upgrade the facilities.
Accordingly, I am persuaded that the decision to "gut"
the whole ATS operation and only hire on an individual
basis, may reasonably be inferred to have been included
in Tehrany's presentation to Terry Vince on 16 March,
which was approved. Tehrany's conclusions with respect
to the dilapidated condition of the ATS facilities is
amply supported in the record by the testimony of state
officials D'Orsi, Almonte, and Carcieri. Almonte and
D'Orsi, in particular, testified concerning the State's
desire to upgrade the airport concessions, which they
considered to be a "black eye" and which "cast a
shadow" on their effort to improve the airport . It is clear
24 Maxwell testified , credibly, that Tehrany's discovery that ATS had
a union came up during Monday staff meetings a week or two after 2
April through a comment from Ron Cohen, but conceded that he knew
shortly after 2 April because Tehrany's report had been talked about in
the Wakefield office
that ATS was aware of the State's intentions, and being
unwilling to make the needed improvements, declined to
bid. In fact, Edward Krzyzek and cook Jennie Lawrence
both described the ATS plant as "deteriorated." Further
evidence of the importance that the State assigned to ac-
quiring top flight concession facilities is made obvious by
a comparison of the clauses in the license agreement,
signed by ATS with the State, and that signed by
DAKA. While the ATS document contains only a pass-
ing reference to cleanliness, the ATS lease is replete with
explicit standards relating to cleanliness, quality, and
service, stated in the strongest possible terms. Beginning
with the preamble in the DAKA lease, there are a mini-
mum of eight clauses relating to cleanliness, quality of
service, quality of food, courtesy and efficiency, stand-
ards of sanitation, improvements, and maintenance. One
such clause specifies, "All food, drink, beverages, and
other items shall be of the highest quality, wholesome
and pure." Another requires that the Company's employ-
ees "shall be clean, courteous, efficient, and neat in ap-
pearance at all times," and the Company is required "to
dispense with the services of any employee whose con-
duct is loud or offensive, or otherwise detrimental to the
best interests of the department." This agreement, signed
in July between DAKA and the State, leaves little room
for doubt that DAKA was expected to be selective in
the employees it hired in order to effect a dramatic turn-
around of the condition of the concessions at the airport.
This they proceeded to do in a consistent manner.
Thus, Terry Tehrany outlined his plans for the new air-
port operation to Brian Magaw in May in their meeting
at Northeastern University. He emphasized the poor con-
ditions at the airport and his determination (clearly based
on a prior decision) to correct these measures by install-
ing a different type of eating facility with substantially
different employees. This concept was reemphasized to
Magaw in his planning session with Tehrany about 4
July, at which time Magaw received his instructions con-
cerning hiring. Tehrany told Magaw not to hire the ATS
workers as a group, but to hire individuals who were
qualified based on the type of industry experience
DAKA desired. Within those guidelines he gave Magaw
complete discretion concerning which individuals to
select. In accordance with DAKA's policy manual,
Magaw received the applications personally, or through
his assistants. In his credible testimony he emphasized
that on receiving any application, his first move was to
make a reference check. This also follows the procedure
set forth in DAKA's policy manual. The reference for
the 16 ATS applicants who applied on 21 August, was
ATS Manager Krzyzek. When Krzyzek told Magaw by
phone that he would not hire any of these persons,
Magaw deleted their names from further consideration.
He testified, without contradiction, that this was the
same procedure he utilized in considering other appli-
cants . At the hearing, the General Counsel introduced
into evidence three sets of applications for jobs with
DAKA at the airport. An analysis of the applicants hired
by DAKA reveals that almost all of them had much
more and broader restaurant or fast food experience than
the ATS work force, almost all of whom had only
DAKA, INC. 561
worked at ATS. The most obvious exception was one of
the bartenders for ATS, who had previously worked for
two large hotels. This apparent discrepancy is readily ex-
plainable by the fact that Krzyzek told both Tehrany and
Magaw that he suspected an unidentified ATS bartender
of watering drinks. Likewise, the gift shop employees
hired by DAKA had considerable previous retail experi-
ence. Lastly, an examination of the applications of the
employees, other than ATS employees, not hired by
DAKA (G.C. Exh. 30), reveals that many of these re-
jected applicants had more and varied food service expe-
rience than did the ATS work force. Thus, the applica-
tions, placed in evidence by the General Counsel, do not
support the General Counsel's contention that Respond-
ent acted discriminately. As discussed earlier in the por-
tion of this decision relating to 1 he alleged discourage-
ment of applicants by the Respondent, after 21 August
certain DAKA employees were invited by Tehrany to
contact him at a later time concerning the possibility of
employment. This action on Tehrany's part is hardly
consistent with a supposed desire on Respondent's part
to discriminate against these employees because of their
union membership or sympathies.
Nor am I swayed by the strained rebuttal testimony by
General Counsel's witnesses concerning the wearing of
union buttons in March, from which I am asked to infer
that Tehrany saw during his visits and thereby gained an
earlier knowledge of the Union's existence at ATS.
While I do not believe these employees intentionally
made misrepresentations during this testimony, the Gen-
eral Counsel's efforts strained their memories beyond
their abilities and led them into making unwarranted
guesses, assumptions, and conclusions. They were espe-
cially weak in describing the times of these incidents and
ultimately reveal that these buttons were worn on their
uniforms in inconspicuous places and behind the counter.
Likewise, I find unreliable their testimony with respect
to Tehrany's purported inability to see the cash register
from the seating area of the restaurant. Thus, I find that
the General Counsel has not proved that the Respondent
discriminated against the ATS work force by failing to
consider them for employment, and by discriminately re-
fusing to hire them, in violation of Section 8(a)(1) and (3)
of the Act. Furthermore, even if it were found that the
Respondent in part entertained an antiunion motive in
the consideration and selection of its employee comple-
ment, I would further find that the Respondent, in any
event, would not have hired a majority or a substantial
number of ATS employees or would have selected em-
ployees in a different manner, because of its dominating
lawful desire to raise the poor image of airport services
created by the former ATS operation, as described
above.
F. The Alleged 8(a)(5) Violation
The General Counsel contends that the Respondent is
the successor to ATS's bargaining obligation toward the
Union from and after 1 September 1984, because
DAKA's work force, he argues, would have reflected
the Union's majority status if the Respondent had not un-
lawfully discriminated against them. I disagree. The gov-
erning test for assessing a successorship issue has been es-
tablished by the Supreme Court of the United States in
the case of NLRB v. Burns Security Services, 406 U.S. 272
(1972). The controlling feature of that test is whether
there is a substantial continuity of business operations
from the predecessor to the successor. Factors to be con-
sidered in making this determination are the continuity of
the operation, supervision, machinery and equipment,
methods of production, type of product, and the continu-
ity of the work force and their working conditions.
These various indicia are to be examined in the context
of the total circumstances involved in each individual
case. For this reason, the various precedents cited by the
parties, which I have fully considered, while helpful, are
by no means determinative, since to a very real extent
each case must be determined on the basis of its own set
of facts.
Turning to the instant case, it is evident at the outset
that there exists what might be described as a continuity
of industry, since both ATS and DAKA operate eating
establishments in the food service industry. However, at
this point the similarity ends to the large extent, since it
appears that ATS concentrates its efforts in the areas of
airports and the sports industry, while DAKA has been
most successful in large institutional feeding facilities in
company and college cafeterias, and museums. There is
no evidence concerning the corporate structure or inter-
organization of ATS. Consequently, a comparison with
the highly compartmentalized and specialized structure
of DAKA's organization in Wakefield, cannot be made.
It is clear, however, that considerable differences exist
between the two enterprises at the corporate level.
DAKA also has rather recently embarked into building a
chain of fast food establishments, of which the T. F.
Green operation was one of three being developed at the
time of the hearing. There is no evidence that ATS of-
fered any similar type of service. Turning to a consider-
ation of the ATS and DAKA operations at the airport, it
is immediately clear that there are substantial differences
in these operations. Thus, the General Counsel's remark
in his brief that "put in sophisticated legal terms, an air-
port coffee shop, lounge and gift shop is an airport
coffee shop, lounge and gift shop," represents a gross
oversimplification of the situation.
Although both ATS's concession and DAKA's oper-
ation served the same categories of customers in the
same building on a profit-and-loss basis on behalf of the
same client, their relationship with that client was totally
different. ATS was a licensee that operated a "turn key"
operation. ATS made no capital investment and operated
entirely with state equipment and furniture. In DAKA's
agreement with the State, it was granted a lease and re-
quired to make a considerable capital investment and
purchase furniture and equipment of its own. Moreover,
as has been previously discussed, ATS operated under
only rudimentary requirements in the license agreement
concerning sanitation, and quality of food and service,
while DAKA's lease from the State contains extensive
standards and regulations designed to dramatically up-
grade the quality of concession services in the airport.
This factor cannot be ignored as a significant distinction.
Obviously, ATS thought it was an important departure
562 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
from the way it had been permitted to operate in the
past, because it caused them to decline to bid. Thus,
DAKA did not take over any assets from ATS. The old
equipment utilized by ATS was disposed of. The only
part ATS played in the transition to the new operation
was simply to grant access to the premises to DAKA, in
order to make measurements and assessments of what
work needed to be done in the demolition and construc-
tion phase. It also allowed DAKA setup time on 31
August in order that the temporary cafeteria service
would begin to function on time on 1 September.
Secondly, while, as the General Counsel observed,
there was no hiatus of operations in the traditional sense.
There was a period between 1 September 1984 and Janu-
ary 1985, during the demolition and construction phase
of the changeover, in which DAKA offered very differ-
ent services from those that finally emerged on comple-
tion. Thus, on 1 September, the upstairs lounge closed
for 4 months and all alcoholic beverages were served
downstairs. When the upstairs lounge reopened as a com-
pletely new facility, wall-to-wall, alcoholic beverage
service downstairs was permanently discontinued. Like-
wise, food service in the new upstairs lounge was dra-
matically altered. Downstairs food service temporarily
was offered in a segment of the lobby area in the form of
buffeteria or cafeteria service, while the old restaurant
was demolished and renovated. The reconstruction of
the downstairs restaurant included expansion into an area
previously utilized only for storage. The gift shop was
closed and completely moved across the airport lobby,
into an area never utilized for this purpose before. Con-
sequently, the gift shop reopened as a new facility in
every respect. When the downstairs food service facility
reopened, it was in the form of a completely new fast
food operation, which, unlike ATS' restaurant, did not
have waitresses or table service. Raymond Reed, vice
president of marketing for Paramount Restaurant Equip-
ment Corporation of Providence, testified extensively
concerning the numerous and extensive changes that oc-
curred during the demolition, construction, and renova-
tion stages of the changeover.25 It was Paramount's con-
struction subsidiary that performed these operations. It is
unnecessary to list in this decision every last detail of the
many alterations that were made. Suffice it to say that
they were extensive , and included such major items as
the demolition of walls, the erection of new walls at dif-
ferent locations, the replacement of flooring, relocations,
enlargements, the creation of new corridors, and the in-
stallation of new plumbing, heating, ventilation, and
lighting.
The DAKA airport operation has different supervisory
personnel from the top down. While operating schedules
remain relatively the same, food and gift products are
substantially different. While ATS operated the gift shop
only a short time , after the takeover from Tele-Trip, in a
sort of caretaker capacity, DAKA was awarded the gift
zs Morty Miller also testified about the differences between the ATS
facilities and those installed by DAKA , using photographs Because he
was not actively involved in the demolition and construction process, his
description here is much more general and less reliable Unlike his ac-
count of other events, his testimony in this area tended to minimize the
extent of the renovation to a far greater degree than was warranted.
shop concession in conjunction with the food service, al-
coholic beverage service, and vending machine conces-
sions. It is true that both ATS and DAKA were forced
to obtain their newspapers, magazines , and books from a
single supplier, which had a virtual monopoly on that
business in the area. However, the parallel between the
two operations ends at this point. ATS placed no empha-
sis on Rhode Island products, a constant source of irrita-
tion to the State, while DAKA, pursuant to an explicit
provision in the lease agreement, concentrated on pro-
moting items manufactured in Rhode Island. Further-
more, the DAKA gift shop was entirely new, in that it
was moved to a completely different location and inte-
grated with DAKA's eating facility downstairs in the
airport terminal.
The above considerations are only the major differ-
ences existing between the manner in which ATS operat-
ed, and the workings of the new facility owed and oper-
ated by DAKA. A final consideration is the continuity
of the work force, which in the final analysis is the de-
termining factor. As the General Counsel noted in his
brief, the central requirement for a successorship is
whether the employer utilized a work force that reflects
a union majority status. The General Counsel argues,
"To the extent that the GC's Section 8(a)(3) claims are
deemed fully or largely meritorious, then the majority
status element of the successorship case is established."
Implicit in that observation is the unwritten concession
that the converse is also true. Thus, if an employer does
not hire a majority or a substantial number of the prede-
cessor's work force for reasons unassociated with unlaw-
ful discrimination, there is no successorship. Since I have
found that the Respondent did not hire and would not,
in any event, have hired any substantial number of ATS
employees for lawful reasons, there is no continuity of
the work force in this matter, and consequently no
successorship exists. I find that under these circum-
stances the Respondent had and has no obligation to bar-
gain with the Union, and consequently the Respondent
has not refused to bargain in good faith with Local 217,
in violation of Section 8(a)(5) of the Act.
CONCLUSIONS OF LAW
1. The Respondent is an employer engaged in com-
merce within the meaning of Section 2(2), (6), and (7) of
the Act.
2. The Union is a labor organization within the mean-
ing of Section 2(5) of the Act.
3. The Respondent has not discouraged or attempted
to discourage ATS employees from filing job applica-
tions, nor has it failed to accord normal consideration for
employment to employees in the ATS work force, nor
refused to hire any of the ATS employees because of
their union membership, sympathies, and activities, in
violation of Section 8(a)(1) and (3) of the Act.
4. The Respondent is not the successor to ATS, and,
consequently, has not refused to bargain in good faith
with the Union in violation of Section 8(a)(1) and (5) of
the Act.
5. The Respondent has not violated the Act in any
other respects.
DAKA, INC. 563
On the foregoing findings of fact and conclusions of
law and the entire record, I issue the following recom-
mended26
ORDER
The complaint is dismissed.
Janeann Orsini Gift Shop
Carol Patalano Second floor lounge
Ernie Reinhardt Utility
Tracey Smith Restaurant
Diane Tomassi Gift Shop
Kim Tolley Restaurant
Julie Wagoner Restaurant
26 If no exceptions are filed as provided by Sec 102 46 of the Board's
Rules and Regulations , the findings , conclusions, and recommended
Order shall , as provided in Sec 102 48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses
APPENDIX B
Employees Employed by DAKA at T. G. Green
Airport during the Period September 1, 1984, until
the Present
APPENDIX A Name & Date of Hire or Transfer
Charit Nu ent-8/30/83
Bargaining Unit Employees by Air Terminal
y g
Marion Corning-8/28/84
Services at T.G. Green Airport as of August 31, Tracey Gallagher-8/28/84
1984 Thomas Gibb-8/28/84
Alisa Machado-8/28/84
Name Location Jean McAnaugh-8/28/84
Mattie Albino Ground floor bar Jean O'Rourke-8/28/84
Mary Banes Restaurant Ricky Upole-8/28/84
Sherill Bouthillier Second floor bar Tammy Wagoner-8/28/84
Joe Bracken Restaurant Susan Wayne-8/28/84
Alyce Burke Second floor bar Deborah Jones-8/29/84
Pat Caniglia Restaurant Julio Sanchez-8/29/84
Pat Clancy Restaurant Donna Engstrom-8/31/84
Jack Coletti Second floor bar Ruth Engstrom-8/31/84
Diane Denker Restaurant Cheryl Aponik-9/1/84
Thelma Dufresne Restaurant Erica Engstrom-9/1/84
Gabrielle Ellis Restaurant Steve Moretti-9/1/84
Olive Fitzpatrick Restaurant James Orenberg-9/1/84
Beth Fuyat Restaurant Arnold Engstrom-9/4/84
Eleanor Gallagher Gift Shop Linda Mardigan-9/7/84
David Ghigliotty Restaurant Craig DeVito-9/10/84
Thong Hang Restaurant Renata Wolney-9/11/84
James Hughes Restaurant Robin Gross-9/12/84
Phyllis Kelly Restaurant Michael McIntyre-9/14/84
William Kingma Restaurant Gregory Lowe-9/17/84
Jane La Fazia Second floor lounge Cindy DeGrandpre-9/26/84
Jennie Lawrence Restaurant Gully Keating-10/15/84
Mike Leighton Restaurant Kim Crossley-10/22/84
Claire Matteson Restaurant David Tonge-10/23/84
Dawn Monteiro Restaurant Michael Maguire-11 /8/84
Bernadette Morrell Restaurant Jane Poulin-11/12/84
Laurie Napolillo Restaurant Kimberly White-12/2/84
Jane Olsen Restaurant Robert McCollough-Wk. 12/29/84