Daniel Construction Co.

National Labor Relations Board - Board Decisions

Apr 19, 1977

229 N.L.R.B. 93 (N.L.R.B. 1977)

DANIEL CONSTRUCTION CO.
Daniel Construction Company, a Division of Daniel
International and Local Union No. 4 and its
branches International Union of Operating Engi-
neers. Case 1-CA-11567
April 19, 1977
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
JENKINS AND MURPHY
On November 23, 1976, Administrative Law Judge
James L. Rose issued the attached Decision in this
proceeding. Thereafter, Respondent filed exceptions
and a supporting brief, and a brief in answer to cross-
exceptions. The General Counsel filed a brief and
cross-exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, findings,
and conclusions of the Administrative Law Judge
and to adopt his recommended Order.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge and
hereby orders that the Respondent, Daniel Construc-
tion Company, a Division of Daniel International,
Greenville, South Carolina, its officers, agents,
successors, and assigns, shall take the action set forth
in the said recommended Order.
DECISION
STATEMENT OF THE CASE
JAMES L. ROSE, Administrative Law Judge: This matter
was heard before me on September 23, 1976, at Augusta,
Maine. The complaint alleged, in general terms, that the
Respondent unilaterally subcontracted bargaining unit
work in violation of Section 8(a)(1) and (5) of the National
Labor Relations Act, as amended (29 U.S.C. § 151, et seq.).
At the close of the hearing the General Counsel amended
the complaint to allege that under the same facts the
Respondent also violated Section 8(a)(3).
Upon the record as a whole, including my observation of
the witnesses, briefs, and arguments of counsel, I hereby
make the following:
229 NLRB No. 24
FINDINGS OF FACT
1. BUSINESS OF THE RESPONDENT
The Respondent is a Delaware corporation engaged as
the general contractor in the building and construction
industry with its principal offices in Greenville, South
Carolina. It is the general contractor on a $200 million
project in Maine where the events in this matter took place.
In the course of its business, the Respondent performs
work outside the State of South Carolina in excess of
$50,000 annually. The Respondent admits to be, and I find
is, an employer engaged in commerce within the meaning
of Section 2(2), (6), and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
Local Union No. 4 and its branches, International
Operating Engineers, is admitted by Respondent to be, and
I find is, a labor organization within the meaning of the
Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
A. Factual Background
On the project involved here, the Respondent had
approximately 53 primary subcontractors and an indeter-
minate number of secondary and tertiary subcontractors. It
appears from the testimony that most of the employees for
the Respondent and the subcontractors are represented by
one or more labor organizations and, indeed, the Respon-
dent as well as the Union here are signatories to a "project
agreement."
The Union has several branches, each of which is
responsible for employees performing particular types of
work within the general jurisdiction of the operating
engineers including equipment operation and the like. The
branch involved in this matter deals with the field
engineers (surveyors).
In the fall of 1974, not long after the project commenced,
the Union began organizing the Respondent's field
engineers, which at that time numbered approximately II1.
While the union business agents knew that the Respon-
dent had subcontractors doing the same type of construc-
tion surveying work as the Respondent's employees, they
nevertheless determined only to organize the Respondent's
employees. Business Manager Walter Ryan said that their
plan was to organize only the Respondent's employees,
then negotiate a contract with a subcontractor clause
whereby the Respondent would agree that any subcontrac-
tor's employees doing surveying would be bound by the
terms of the agreement. In short, Ryan testified that it was
the Union's tactic to organize only the Respondent's
employees and, then upon successful negotiation of a
contract, other employees doing surveying work would, in
effect, be automatically organized.
Following a short organizational campaign, an election
was conducted among the Respondent's field engineers,
with the majority voting for the Union. On December 31,
1974, the Union was certified by the Board as the exclusive
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
collective-bargaining representative of the unit of field
engineer employees.'
In the spring of 1975, Ryan and William O'Keefe, the
union business representative in charge of the field
engineers branch, met with company representatives for
the purpose of negotiating a collective-bargaining agree-
ment. They had two sessions and generally agreed to all
noneconomic items including what the Union conceived to
be a stronger subcontracting clause than the one in its
standard construction agreement. However, toward the
end of the second bargaining session the Company
proposed an economic package which was unacceptable to
the Union. There have been no further bargaining sessions.
Rather than continue negotiating, the Union determined
to take the position that the project agreement covered
field engineers. The basic reason the Union chose this
course rather than take economic action to force its
contract demands was that the project agreement con-
tained a clause prohibiting picket lines or the honoring of
the picket lines. Thus, the Union determined that it could
be more effective by arguing that the project agreement
covered these employees.
The Company rejected this contention and the matter
went to arbitration, with the arbitrator ultimately deciding
that the field engineers were not in fact covered under the
project agreement. Thus the matter now stands.
As noted above, even before the Union had begun
organizing Respondent's field engineers, subcontractors of
the Respondent were in fact performing this type of work
and have continued to do so. Specifically, since February
1975, SLF, Inc., has done surveying work as a subcontrac-
tor, and before that was a secondary subcontractor. The
contract between SLF, Inc., and the Respondent, of May
12, 1975, has been modified on nine occasions through
August 11, 1976.
At the time of the election the Respondent employed
nine field engineers, exclusive of party chiefs who the
Respondent contended were supervisors but who neverthe-
less were included in the unit. This number was gradually
reduced during the early part of 1975, such that by March
11, 1975, only three were left,2 plus Don Queen, the party
chief. The three field engineers were terminated on March
19, 1976.
Queen testified that beginning in January 1976 he
noticed that his crew was making more mistakes than is
normal, which he said he documented in his field
notebook. Finally, he recommended to George Crump, the
Respondent's site manager, that these employees be
discharged. This was done following discussion with James
LaCoste, the Respondent's personnel and labor relations
manager.
The three employees in question, however, were not
advised that they were discharged. Rather, they were told
that they were being laid off as a result of a "reduction in
force." The Respondent did not advise, much less bargain
with, the Union about the termination of the bargaining
unit.
I The unit is:
All field engineers employed by the Employer at the Scott Paper
Company's Somerset Project in Hinckley, Maine, including rod men,
transit men and party chiefs, but excluding all other employees, office
Also on March 19, the Respondent made a requisition
for a modification of its contract with SLF, Inc., the
essence of which was that' SLF, Inc., was to furnish an
additional three-man crew.
B. Contentions of the Parties
The General Counsel contends that by subcontracting
unit work to SLF, Inc., without negotiating with the Union
the Respondent thereby violated Section 8(aX5) of the Act
under the authority of Fibreboard Paper Products Corp. v.
N.LR.B., 379 U.S. 203 (1964).
The Respondent, on the other hand, contends that
Fibreboard is not applicable to the building and construc-
tion industry (Tellepsen Petro-Chem Constructors, 190
NLRB 433 (1971)), that the subcontracting occurred more
than 6 months preceding the filing of the charge, thus
finding a violation is barred by Section 10(b), and in any
event the parties did negotiate about subcontracting
generally.
The General Counsel also alleges that these facts make
out a violation of Section 8(aX3). The Respondent argues
that the three were discharged for cause.
C. Findings and Conclusions
The Violation of Section 8(a)(5)
There is no question but that some, if not much, of the
surveying work on the project could have been performed
by the members of the bargaining unit but was in fact done
by employees of subcontractors. Such was the case even
prior to the organizational campaign. Further, there is no
question but that the Company began subcontracting unit
work to SLF, Inc., in February 1975. And on March 12,
1975, the Respondent entered into a subcontract with SLF,
Inc., which was subsequently modified nine times through
August 11, 1976.
Inasmuch as the initial subcontracting to SLF, Inc.,
occurred well beyond 6 months prior to the filing of the
charge herein, pursuant to the provisions of Section 10(b)
of the Act such cannot be found a violation of Section
8(a)(5) nor can it be used as evidence of a violation. The
fact of subcontracting generally and of unit work to SLF,
Inc., specifically is the status quo in this case.
Nevertheless, the facts are that in mid-March 1976 there
was a fundamental change by the Respondent from the
status quo with regard to how the surveying work would be
performed and by whom.
Site Manager George Crump had the direct responsibili-
ty for the field engineers at the time herein material. He
testified that he had been advised by Queen that the field
engineers were making a number of errors thus he
determined, according to his testimony, to put in a
"reduction in force." He testified that he laid off the entire
crew because it was difficult to determine who specifically
was making the mistakes and in any event:
clerical employees, professional employees, guards and supervisors as
defined in the Act.
2 James MacDowell and Gerry A. Garland were employed throughout
this period. Albert A. Fuller was employed from July 1974 to November 20,
1974, and was rehired on January 20, 1975.
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DANIEL CONSTRUCTION CO.
[W]e put a reduction on the force - a reduction in
forces on this thing because that's what we were doing.
We were culling our forces and I chose the individuals
that was doing the poorest workmenship or we were
getting the worse workmenship out him, those were the
ones that we terminated.
James MacDowell testified that on March 18 Queen told
him that the crew was going to be laid off the next day.
On March 19, the Respondent requisitioned a modifica-
tion to the SLF, Inc., contract whereby in addition to the
two survey crews of four men each, SLF, Inc., would
provide one survey crew of three men. Thus the evidence,
including the testimony of the Respondent's site manager,
is that there was a management decision to lay off the
remainder of the bargaining unit and simultaneously to
have SLF, Inc., provide an additional three-man crew. A
summary of the Respondent's records concerning the
number of survey crews SLF, Inc., had on the project
during 1975 and 1976 establishes that the additional crew
was in fact provided.
On March 19, therefore, unit work was still available.
The Respondent took the work from the bargaining unit
employees and gave it to employees of a subcontractor
without even telling the Union, much less negotiating with
it.
Even though there had been a prior history of subcon-
tracting unit work to SLF, Inc., these acts, the elimination
of the bargaining unit jobs while simultaneously providing
that bargaining work be done by subcontractor, are
matters which the Respondent was obligated to bargain
with the Union about. Having failed to do so, the
Respondent thereby violated Section 8(a)(5) of the Act.
Fibreboard Paper Products, Corp. v. N.L R. B., supra.
The Respondent argues that the Fibreboard doctrine does
not apply because it is inapplicable to the construction
industry, citing Tellepsen Petro-Chem Constructors, supra.
The facts of Tellepsen are substantially distinguishable
from the instant case, including the fact that here
bargaining unit employees were put out of work. Further, I
find nothing in the Board's decision in Tellepsen which
would suggest that Fibreboard is not generally applicable to
the construction industry.
Accordingly, I conclude that in changing the method by
which unit work was to be performed - eliminating the
bargaining unit and having that work performed by
employees of a subcontractor - without negotiating with
the Union the Respondent breached its bargaining obliga-
tions.
While the appropriateness of the unit is disputed, I find
that the Union is the certified bargaining representative in
the bargaining unit described above and was so on March
19, 1976. The unit issue was litigated in Case l-RC-13478.
By its action in eliminating the bargaining unit, an order
will be recommended whereby the Respondent will not
only offer reinstatement to the bargaining unit employees
but the certification year of the Union for those employees
will be extended I year.
3 The Respondent's posthearing motion to substitute for G.C. Exh. 12
portions of the fieldbook now identified as Resp. Exh. I is granted.
The Violations of Section 8(a)(3)
During the course of the hearing, the Respondent
contended that in addition to not having an obligation to
bargain about subcontracting, it terminated the three
bargaining unit employees for cause. It is claimed their
work performance was inferior and that irrespective of the
characterization that they were "laid off" as a result of a
"reduction in force," they were discharged for cause.
At the hearing, I allowed the General Counsel to amend
the complaint to allege that these facts constitute a
violation of Section 8(aX3) of the Act.
Essentially the Respondent rested its discharge-for-cause
contention on the testimony of Don Queen, who stated
that beginning about January 1976 he noticed that they
were having a number of problems with the work being
performed by the surveying crew. He testified that he wrote
these incidents in his fieldbook, portions of which were
received into evidence.3
Queen's testimony was general and vague. That the crew
was making inordinate mistakes is not even supported by
his fieldbook notes. Further, his demeanor was not
impressive. On the other hand, the testimony of the three
individuals in question was relatively straightforward.
These individuals were experienced surveyors, all of
whom had worked for the Respondent in excess of a year
without any adverse comment concerning their work
performance.
Additionally, the Respondent seems to have changed
positions; first, that the three employees were laid off due
to a reduction in force, and, second, that they were
discharged for cause. All these factors lead me to the
conclusion that the alleged cause for their termination was
pretextuous.
Aside from its obligation to bargain with the Union
concerning this matter, the Respondent had the right to
discharge these three employees for any reason or no
reason at all, except for engaging in union or protected
concerted activity. But, if the asserted reason is not
reasonable, then that fact is evidence that the true motive
lies elsewhere. "If he [the trier of fact] finds that the stated
motive for a discharge is false, he certainly can infer that
there is another motive." Shattuck Denn Mining Corpora-
tion (Iron King Branch) v. N.LR.B., 362 F.2d 466, 470 (C.A.
9, 1966).
Finding that the alleged reason for the discharges was
false, I infer that the true motive for terminating these three
employees on March 19 was because they were members of
the bargaining unit and were represented by a union which
the Respondent was obligated to bargain with. I conclude
that the Respondent's motive was to eliminate the entire
bargaining unit and thus the necessity for negotiating
further with the Union. Again, the allegations by the
Respondent that there was cause to discharge these three
specific individuals is just too unpersuasive in this factual
context to believe. Accordingly, I conclude that the
Respondent by terminating Fuller, Garland, and Mac-
Dowell on March 19, 1976, violated Section 8(aX3) of the
Act. Town and Country Manufacturing Company, Inc., and
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DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Town & Country Sales Company, Inc., 136 NLRB 1022
(1962).
CONCLUSIONS OF LAW
1. Respondent is, and at all times material herein has
been, an employer engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act.
2. Local Union No. 4 and its branches, International
Union of Operating Engineers, is, and at all times material
herein has been, a labor organization within the meaning of
Section 2(5) of the Act.
3. The unit appropriate for purposes of collective
bargaining is:
All field engineers employed by the Employer at the
Scott Paper Company's Somerset Project in Hinckley,
Maine, including rod men, transit men and party chiefs,
but excluding all other employees, office clerical
employees, professional employees, guards and supervi-
sors as defined in the Act.
4. The Union is, and at all times material has been, the
exclusive representative of employees in the unit described
above.
5. By terminating employees James A. MacDowell,
Gerry A. Garland, and Albert A. Fuller on March 19, 1976,
and arranging to have their work done by a subcontractor,
without bargaining with the Union, the Respondent
violated Section 8(a)(5) of the Act.
6. By discharging employees James A. MacDowell,
Gerry A. Garland, and Albert A. Fuller in order to
dissipate the bargaining unit, the Respondent violated
Section 8(a)(3) of the Act.
THE REMEDY
Having found the Respondent has committed certain
unfair labor practices, it will be ordered to cease and desist
therefrom and to take certain affirmative action designed
to effectuate the policies of the Act. The Respondent will
be ordered to offer James A. MacDowell, Gerry A.
Garland, and Albert A. Fuller immediate and full rein-
statement to their former positions of employment or, if
those positions no longer exist, to substantially equivalent
jobs without prejudice to their seniority or other rights or
privileges, and to make them whole for any loss of wages or
other benefits they may have suffered as a result of the
discrimination against them in accordance with the
formula set forth in F. W. Woolworth Company, 90 NLRB
289 (1950), and Isis Plumbing & Heating Co., 138 NLRB
716 (1962). Whether the Respondent's offer of reinstate-
ment to these three employees was a substantial offer
which would toll the backpay period was not fully litigated
in this matter and will be left to the complaince stage of
this proceeding.
4 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions, and recommended Order herein shall, as provided in Sec.
102.48 of the Rules and Regulations, be adopted by the Board and become
its findings, conclusions, and Order, and all objections thereto shall be
deemed waived for all purposes.
The Respondent will also be ordered to bargain with the
Union as the exclusive representative of employees in the
above-defined unit, with the initial period of certification
beginning on the date the Respondent commences bargain-
ing in good faith with the Union. Howmet Corporation, 197
NLRB 471 (1972).
Upon the foregoing findings of fact, conclusions of law,
the entire record in this case, and pursuant to Section 10(c)
of the Act, I hereby issue the following recommended:
ORDER 4
The Respondent, Daniel Construction Company, a
Division of Daniel International, Greenville, South Caroli-
na, its officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Refusing to bargain with Local Union No. 4 and its
branches, International Union of Operating Engineers, as
the exclusive representative of its employees in the above-
described bargaining unit concerning mandatory subjects
of bargaining.
(b) Discharging or otherwise discriminating against
employees because of their interest in or activity on behalf
of the above-named or any other labor organization.
(c) In any other manner interfering with, restraining, or
coercing employees in the exercise of the rights guaranteed
them by Section 7 of the Act.
2. Take the following affirmative action designed to
effectuate the policies of the Act:
(a) Offer reinstatement to James A. MacDowell, Gerry
A. Garland, and Albert A. Fuller and make them whole for
any losses in accordance with the provisions in "The
Remedy" section above.
(b) Upon request, recognize and bargain with Local
Union No. 4 and its branches, International Union of
Operating Engineers, whose initial certification shall
commence when the Respondent begins bargaining in
good faith.
(c) Preserve and, upon request, make available to the
Board or its agents, for examination and copying, all
payroll records, social security payment records, timecards,
personnel records and reports, and all other documents
necessary and relevant to analyze and compute the amount
of backpay due under this Order.
(d) Post at its facility at the Daniel Construction
Company, a Division of Daniel International, copies of the
attached notice marked "Appendix." 5 Copies of said
notice, on forms provided by the Regional Director for
Region 1, after being duly signed by the Respondent's
authorized representative, shall be posted by it immediately
upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places, includ-
ing all places where notices to employees are customarily
posted. Reasonable steps shall be taken by the Company to
insure that said notices are not altered, defaced, or covered
by any other material.
5 In the event that the Board's Order is enforced by a Judgment of a
United States Court of Appeals, the words in the notice reading "Posted by
Order of the National Labor Relations Board" shall read "Posted Pursuant
to a Judgment of the United States Court of Appeals Enforcing an Order of
the National Labor Relations Board."
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DANIEL CONSTRUCTION CO.
(e) Notify said Regional Director, in writing, within 20
days from the date of this Order, what steps the Respon-
dent has taken to comply herewith.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing in which all parties were represented by
attorneys and afforded the opportunity to present evidence
in support of its respective position, it has been found that
we have violated the National Labor Relations Act in
certain respects and we have been ordered to post this
notice and carry out its terms.
WE WILL offer immediate reinstatement to James A.
MacDowell, Albert A. Fuller, and Gerry A. Garland to
their former jobs or, if such jobs no longer exist, to
substantially similar positions of employment, and WE
WILL make them whole for any loss of wages or benefits
suffered by them as a result of the discrimination
against them with interest at 6 percent per annum.
WE WILL NOT refuse to bargain about mandatory
subjects with Local Union No. 4 and its branches,
International Union of Operating Engineers.
WE WILL recognize and bargain with Local Union
No. 4 and its branches, International Union of
Operating Engineers as the exclusive representative of
our field engineers.
WE WILL NOT in any other manner interfere with,
restrain, or coerce employees in the exercise of rights
guaranteed them by Section 7 of the National Labor
Relations Board.
WE WILL NOT discharge or otherwise discriminate
against employees because of their interest in or activity
on behalf of any labor organization.
DANIEL CoNsTRUC'nON
COMPANY, A DIVISION OF
DANIEL INTEINATIONAL
97