Daniel I. Burk Enterprises

National Labor Relations Board - Board Decisions

May 20, 1994

313 N.L.R.B. 1263 (N.L.R.B. 1994)

1263
313 NLRB No. 230
DANIEL I. BURK ENTERPRISES
1 The Respondent argues, inter alia, that it cannot be ordered to
provide any monetary relief to its former employees because it has
filed a chapter 11 bankruptcy petition in the United States Bank-
ruptcy Court for the Central District of California, automatically
staying all legal proceedings against the Respondent. It is well set-
tled, however, that the institution of bankruptcy proceedings does not
deprive the Board of jurisdiction or authority to entertain and proc-
ess an unfair labor practice case to its final disposition, including or-
dering payment of backpay or other monetary relief. Board proceed-
ings fall within 11 U.S.C. § 362(b)(4) and (5), the exception to the
automatic stay provision for proceedings by a governmental unit to
enforce its police or regulatory powers. Phoenix Co., 274 NLRB 995
(1985).
1 RR also purchased the exclusive right to the use of S&S’ name,
trademark, etc. For that reason, BE was created to retain title to
S&S’ remaining assets.
Daniel I. Burk Enterprises, Inc., a California Cor-
poration formerly named Sammons & Sons;
Rapid Rack Industries, Inc. and General Ware-
housemen, Local 598, International Brother-
hood of Teamsters, AFL–CIO. Cases 21–CA–
28020 and 21–CA–28134
May 20, 1994
DECISION AND ORDER
BY MEMBERS STEPHENS, DEVANEY, AND
BROWNING
On November 16, 1993, Administrative Law Judge
George Christensen issued the attached decision. The
Respondent Daniel I. Burk Enterprises, Inc., a Califor-
nia Corporation formerly named Sammons & Sons
filed exceptions and a supporting brief.
The National Labor Relations Board has delegated
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 brief and has de-
cided to affirm the judge’s rulings, findings,1 and con-
clusions and to adopt the recommended Order.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Daniel I. Burk Enterprises,
Inc., a California Corporation formerly named
Sammons & Sons, City of Industry, California, its offi-
cers, agents, successors, and assigns, shall take the ac-
tion set forth in the Order.
Ami Silverman, Esq., for the General Counsel.
Stephen R. Kilstofte of Cayer (Kilstofte & Craton), of Long
Beach, California, for Burk Enterprises/Sammons & Sons.
Donald R. Samuels and Jonathan M. Brenner (Sidley & Aus-
tin), of Los Angeles, California, for Rapid Rack Industries.
John A. Siquieros (Wohlner, Kaplan, Phillips, Vogel &
Young), of Encino, California, for Local 598.
DECISION
STATEMENT OF THE CASE
GEORGE CHRISTENSEN, Administrative Law Judge. On
July 22, 1993, I conducted a hearing at Los Angeles, Califor-
nia, to try issues raised by a consolidated, amended com-
plaint issued on April 29, 1993, based on charges filed by
Local 598 of the International Brotherhood of Teamsters,
AFL–CIO (Union) in Case 21–CA–28020 on April 22 and
August 21, 1991, and in Case 21–CA–28134 on June 27 and
August 21, 1991.
The complaint alleges and the answers thereto filed by
Daniel I. Burk Enterprises, Inc./Sammons & Sons (BE &
S&S) and Rapid Rack Industries, Inc. (RR) admit following
the sale by S&S of much of its equipment, machinery, blue-
prints, inventory, customer and supplier lists and specifica-
tions, accounts and notes receivable, etc. to RR, S&S ceased
operations, terminated its production and maintenance em-
ployees covered by a currently effective collective-bargaining
agreement between S&S and the Union, RR moved the pur-
chased equipment, machinery, blueprints, and inventory from
the S&S plant to RR’s plant in Mexicali, Mexico, moved the
S&S customer and supplier lists to RR’s California head-
quarters, began manufacturing the products formerly manu-
factured by S&S with RR’s Mexicali work force, hired S&S’
managers, engineers, and sales personnel, and began to sell
the S&S products it was manufacturing to S&S’ former cus-
tomers (as well as customers developed by RR).1
The complaint further alleges and S&S/BE and RR denies
the terms of the sales contract between S&S and RR gave
RR sufficient control over the wages, hours, and working
conditions of the employees covered by the S&S-union
agreement to make S&S/BE and RR joint employers of
S&S’ production and maintenance employees between the
date the sales contract was signed and the date S&S’ produc-
tion and maintenance employees were terminated; and thus
the two employers, by failing to afford the Union adequate
notice and an opportunity to bargain over the effects of S&S’
cessation of business and termination of S&S’ union-rep-
resented employees and S&S’ failure to comply with the
Union’s posttermination request for information concerning
the details of the sale and the amount and nature of payments
made to the union-represented employees on their termi-
nation, violated Section 8(a)(l) and (5) of the National Labor
Relations Act (Act).
The complaint also alleges and S&S/BE and RR denies
Daniel I. Burk was an agent of S&S/BE; that the Union was
a labor organization within the meaning of Section 2 of the
Act; that the employee unit covered by the S&S-union agree-
ment was appropriate for collective-bargaining purposes
within the meaning of Section 9 of the Act; that the Union
at times material was the duly designated exclusive collec-
tive-bargaining representative of the employees within that
unit; and advanced affirmative defenses which will be de-
tailed and determined below.
The issues created by the foregoing are whether:
1. At times material Daniel I. Burk was an agent of
S&S/BE within the meaning of Section 2 of the Act.
1264 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
2 While every apparent or nonapparent conflict in the evidence has
not been specifically resolved below, my findings are based on my
examination of the entire record, my observation of the witnesses’
demeanor while testifying, and my evaluation of the reliability of
their testimony; therefore any testimony or other evidence in the
record which is inconsistent with my findings is discredited.
3 These findings are based on the undisputed testimony of Union
Business Representative William Summers.
4 These findings are based on the testimony of Daniel I. Burk, cor-
roborated by Summers.
2. At times material the Union was a labor organization
within the meaning of Section 2 of the Act.
3. At times material the employee unit described in the
complaint was appropriate for collective-bargaining purposes
within the meaning of Section 9 of the Act.
4. At times material the Union was the duly designated ex-
clusive collective-bargaining representative of the employees
within that unit.
5. At times material S&S/BE and RR were joint employers
of the employees within that unit.
6. S&S/BE (and RR, if a joint employer) violated Section
8(a)(1) and (5) of the Act by:
a. Failing to provide the Union with adequate notice and
an opportunity to bargain over the effects of S&S’ ceasing
operations and terminating its production and maintenance
employees prior to such cessation and termination.
b. Failing to comply with the Union’s request for informa-
tion concerning the details of the sale and the amount and
nature of payments made to S&S’ union-represented employ-
ees on the termination of their employment.
7. If violations are found, whether one or more of the af-
firmative defenses advanced by S&S/BE or RR warrant a
finding and conclusion S&S/BE (and RR, if a joint em-
ployer) did not violate the Act by such failures.
The General Counsel, the Union, S&S/BE, and RR ap-
peared by counsel and were afforded full opportunity to ad-
duce evidence, to examine and cross-examine witnesses, to
argue, and to file briefs. The General Counsel, S&S/BE, and
RR filed briefs.
Based on my review of the entire record, observation of
the witnesses, perusal of the briefs and research, I enter the
following
FINDINGS OF FACT2
I. JURISDICTION
The complaint alleged, S&S/BE and RR admitted, and I
find at all material times S&S/BE and RR were employers
engaged in commerce in a business affecting commerce
within the meaning of Section 2 of the Act.
II. LABOR ORGANIZATION
At all times material the Union represented its members
for the purpose of bargaining collectively on their behalf
with their employers for the purpose of achieving wages,
rates of pay, hours, and working conditions those employees
desired; to secure collective-bargaining agreements reflecting
those members’ rates of pay, wages, hours, and working con-
ditions; to assure employer compliance with the terms of
those agreements, including the adjustment of employee/-
member grievances over alleged employer violation of those
terms; and the Union carried out those functions over many
years in representing its members employed by S&S, includ-
ing all times material.3
I therefore find and conclude at all pertinent times the
Union was a labor organization within the meaning of Sec-
tion 2 of the Act.
III. THE UNIT & THE UNION’S REPRESENTATIVE STATUS
For several years prior to S&S’ ceasing operations and ter-
minating its production and maintenance employees, Daniel
I. Burk was the president of S&S/BE; bargained on behalf
of S&S with the Union concerning the rates of pay, wages,
hours, and working conditions of S&S’ production and main-
tenance employees, including the adjustment of their griev-
ances; executed a series of collective-bargaining agreements
with the Union on behalf of S&S, including the last agree-
ment for a term extending from October 1, 1988, through
September 30, 1991.
At all pertinent times S&S recognized and dealt with the
Union as the exclusive collective-bargaining representative of
S&S’ production and maintenance employees.4
The 1988–1991 S&S-union agreement (and, presumably,
prior agreements) provided:
Article I, Section l (a):
The Employer recognizes and acknowledges that the
Union affiliated with the International Brotherhood of
Teamsters is the exclusive representative of all Produc-
tion and Maintenance employees, Shipping and Receiv-
ing employees, Warehousemen, and Truck Driver em-
ployees for the purpose of collective bargaining as pro-
vided in the National Labor Relations Act.
At all material times S&S conducted its operations at 29ll
Norton Avenue, Lynwood, California, and the wages, rates
of pay, hours, and working conditions of all S&S employees
employed therein in the classifications just described were
governed by the terms of the successive agreements between
S&S and the Union and the Union was recognized by S&S
as the exclusive representative of those employees for collec-
tive-bargaining purposes.
On the basis of the foregoing, I find and conclude at all
times material the following unit, as described in the com-
plaint, was appropriate for collective-bargaining purposes
within the meaning of Section 9 of the Act and that the
Union was the duly designated exclusive collective-bargain-
ing representative of all the employees within that unit,
namely:
All production and maintenance employees, shipping
and receiving employees, warehousemen, and truck
driver employees employed by S&S at 29ll Norton Av-
enue, Lynwood, California; excluding all other employ-
ees, office clerical employees, confidential employees,
professional employees, guards and supervisors as de-
fined in the Act.
1265DANIEL I. BURK ENTERPRISES
5 Bergman previously contacted Burk to discuss a possible sale of
S&S to RR, or a merger. At that time Burk told Bergman that S&S
was not interested.
6 Bergman was aware S&S’ production and maintenance employ-
ees were covered by a collective-bargaining agreement at the time
the terms of the purchase and sale terms were negotiated; as noted,
Bergman specified RR would not assume any obligation under that
agreement nor to S&S’ employees, only wishing to reserve to RR
the right to offer employment to S&S’ managerial, engineering, and
sales employees (i.e., what he considered ‘‘at will’’ employees).
7 Bergman explained he instructed RR’s counsel to so require be-
cause, as he told Burk during the negotiations, RR intended to offer
employment to S&S’ management, engineering, and sales personnel
Continued
IV. DANIEL BURK’S STATUS
Daniel Burk became an S&S employee in about 1969 and
subsequently its president. As noted above, he signed the
1988–1991 agreement between S&S and the Union on behalf
of S&S and as president of S&S. His functions as president,
among others, included, on behalf of S&S, the hire and fire
of employees, disciplining employees, and engaging in col-
lective bargaining on behalf of S&S with the Union concern-
ing the wages, rates of pay, hours, and working conditions
of S&S’ production and maintenance employees.
On the basis of the foregoing, I find and conclude at all
pertinent times Daniel Burk was an officer, supervisor, and
agent of S&S acting on its behalf within the meaning of Sec-
tion 2 of the Act.
V. THE ALLEGED JOINT EMPLOYER AND UNFAIR LABOR
PRACTICES ISSUES
A. Facts
S&S, a closely held family corporation, commenced oper-
ations in the 1930s, manufacturing and selling heavy storage
racks for industrial use.
By the 1980s S&S employed approximately 50 production
and maintenance employees who, in and after 1973, were
represented by the Union and covered by a succession of col-
lective-bargaining agreements between S&S and the Union,
including a final agreement for a term extending from Octo-
ber 1, 1988, through September 30, 1991.
By mid-1990, a general economic downturn caused about
a 50-percent decline in S&S’ sales, losses were mounting,
and S&S was relying on constant draws on its line of credit
at its bank to continue operations. S&S’ accountant warned
Daniel Burk in late 1990 S&S had to reduce its costs dras-
tically to survive. By the end of the year S&S’ losses mount-
ed to over $600,000 and its unsecured debt rose to about
$400,000.
In January 1991 Daniel Burk, convinced S&S could not
reduce its costs and increase its income sufficiently to stay
in business, contacted Gerald Bergman, the president and
chairman of RR.5
Bergman expressed an interest in purchasing certain S&S
assets, namely, S&S’ inventory, including raw materials,
work in progress, finished goods and supplies; fixtures, tool-
ing, machinery, and equipment utilized to manufacture S&S’
products; S&S’ goodwill, tradenames, copyrights, customer
specifications, customer lists, unfilled customer orders, and
the S&S name; books and records relating to customer ac-
counts, suppliers of goods and services, and related intangi-
bles; and all accounts and notes receivable outstanding and
unpaid. Bergman was also interested in employing S&S’
managerial, sales, and engineering personnel. He disclaimed
any interest, however, in employing S&S’ production and
maintenance employees, stating he intended to move the pur-
chased assets utilized in manufacturing S&S’ products to
RR’s Mexicali, Mexico plant for use in resuming the manu-
facture of S&S’ products there by RR’s production and
maintenance employees in Mexico for sale under the S&S
name to S&S’ former customers, as well as any additional
customers RR was able to develop. Bergman specifically
stated RR did not wish to assume any of S&S’ liabilities, in-
cluding any obligations S&S had under its agreement with
the Union or otherwise to S&S’ production and maintenance
employees.
Burk accepted Bergman’s terms and the two agreed on the
amount of money to be paid to S&S.
Bergman advised RR’s counsel of the terms of the agree-
ment between RR and S&S and instructed counsel to draft
an asset purchase and sale contract reflecting the terms of the
agreement.
Burk did not inform the Union of the impending sale fol-
lowing his reaching of agreement with Bergman concerning
the sale and cessation of S&S’ operations between the date
he reached agreement concerning the terms of the sale and
cessation (January) and the date he and Bergman executed an
asset purchase and sale contract reflecting the terms of the
agreement (March 21), though he had several contacts with
union representatives between the two dates.
On March 21, 1991, Burk and Bergman signed an asset
purchase and sale contract on behalf of S&S and RR which
contained the following provisions:
1.06 Liabilities and Assets not Included. The parties
hereto acknowledge that (i) RR is purchasing the assets
of Sammons free of any and all liabilities, (ii) RR is
not assuming any debts or obligations of Sammons of
any nature . . . .
1.09 Close of Escrow. The closing of the purchase
and sale through escrow shall occur on April 15, 1991
. . . .
1.11 Retained Employees. RR is not, as part of this
transaction, agreeing to hire any of Sammons’ employ-
ees, although nothing shall prevent RR from hiring any
employee of Sammons who is an ‘‘at will’’ employee.
In all events, Sammons shall be responsible for comply-
ing with all plant closing laws and undertakings, and
for paying all severance pay, accrued vacation and sick
leave, and accrued payroll. RR does not assume any ob-
ligation under, and shall have no duty to comply with,
any collective bargaining agreement to which Sammons
is a party.6
5.01 Operations Prior to Closing. Pending con-
summation of the sale and purchase described in this
agreement, Sammons shall continue to operate said
business in substantially the same manner as it has been
operated in the past and shall:
(d) Grant no increases in salary, pay, or other em-
ployment related benefits to any of its employees, or
agents of said business without the written consent of
RR, not to be unreasonably withheld.7
1266 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
at their current S&S pay and benefit levels and wanted to avoid any
increases therein prior to closure of the transaction.
8 Summers was assigned by the Union to provide services to the
S&S employees represented by the Union.
9 Burk conceded, however, the purported notice was not given to
the employees when they received their final paychecks at the plant
on April 12, 1991, and stated he did not know whether, when and
how the purported notice was delivered to the employees.
(e) Enter into no contract or transactions, except in
the ordinary course of business, on account of said
business without the written consent of RR.
The Escrow Closed on April 15, 1991
During the 22 days between the date Burk and Bergman
signed the purchase and sale agreement (March 21, 1991)
and the date the escrow closed (April 15, 1991), S&S made
no changes in the pay and benefit levels of any of S&S’ em-
ployees. During the same period, S&S did not enter into any
contracts or transactions other than those entered into in the
ordinary course of business (raw materials purchases, product
sales).
Neither Burk nor any other representative or agent of S&S
notified the Union or the S&S employees represented by the
Union of the impending sale of S&S’ assets and cessation of
business between March 21 and April 10, when Burk met
with S&S’ union-represented employees.
On Wednesday, April 10, 1991, Daniel Burk called a
meeting of all production and maintenance employees in the
plant during the workshift. He told the employees S&S’ bank
had called its note securing its line of credit, S&S was out
of funds, business had dropped drastically, and without suffi-
cient money or orders to enable S&S to continue in business,
S&S was going to cease operations on Friday, April 12,
1991—unless some miracle intervened.
This was the first notice the employees received of S&S’
plan to cease operations.
Ernest Medina, an S&S production and maintenance em-
ployee who had been designated as the Union’s job steward,
telephoned the Union’s office and requested that Summers
come to the plant.8 The message was relayed to Summers,
he arrived at the plant a few hours later and met with Me-
dina and several other union-represented employees. Medina
and the employees informed Summers what Burk told them
and asked him to find out what was going to happen to
them.
Summers tried but was unable to contact Burk, and left a
message at S&S’ office requesting that Burk contact him.
Burk telephoned the union office the next day but did not
make contact with Summers.
Paychecks were normally distributed by supervisors on the
shop floor at about 10:30 a.m. The checks were not distrib-
uted at the normal time on Friday, April 12, but were distrib-
uted at a later time by Daniel Burk and S&S Vice President
John Moreno. The two toured the plant floor, contacted each
employee individually, and told each employee this was the
last day the plant was going to be in operation, shook each
employee’s hand, and presented each employee with his final
paycheck. In response to a question concerning what was
going to happen to the plant, Burk responded everything was
going to be sold.
At the time Burk contacted Medina, he told Medina to go
to Moreno’s office later, Moreno had something to tell him.
Medina went to Moreno’s office later that day. Moreno told
Medina there was some work for him the following week.
Medina contacted Summers and reported what had tran-
spired; Summers advised Union Secretary-Treasurer Joe
Campbell.
Burk did not recall whether he talked to Summers on Fri-
day, April 12, and Summers asked him to talk to Campbell,
but recalled he did speak to Campbell and tell Campbell that
‘‘after 62 years, the Company had closed.’’ This was the first
time S&S advised the Union of the closure.
Medina reported for work on Monday, April 15, 1991. Ed-
ward Morton of the maintenance department instructed him
to dismantle, clean, and pack machinery and equipment in
the plant used to manufacture S&S’ racks, it had been sold.
The packed machinery and equipment was shipped to RR at
Mexicali, Mexico. The lists, books, and records purchased by
RR were shipped to RR’s California headquarters. During the
week of April 15, 1991, Medina also packed and shipped fin-
ished products to the S&S customers who had ordered those
products. Medina worked out the week and was not further
employed. RR did not offer him any employment, though the
two S&S production/maintenance employees who worked
alongside Medina that week (Morton and Louis Knox) were
employed by RR.
Following the shipment to Mexicali, the following equip-
ment and machinery remained in or at the S&S facility:
seven overhead hoists, two paint lines, two paint booths, one
bake oven, one dry-off oven, one wash unit, and one vehicle.
On April 15, 1991, the Union received formal notification
from counsel for S&S that S&S ceased operations on April
12, 1991, all employees represented by the Union were ter-
minated on that date and the October 1, 1988–September 30,
1991 agreement between S&S and the Union was also termi-
nated. S&S’ counsel enclosed a copy of a notice dated April
12, 1991, signed by Daniel Burk and addressed to all em-
ployees purporting to notify each employee S&S had agreed
to sell substantially all its business assets to RR, S&S was
ceasing operations on April 12, 1991, and that each em-
ployee was receiving a final paycheck covering all his ac-
crued wages, vacation benefits, and sick leave, prorated
through April 12, 1991.9
There is no evidence of record during the 22-day period
between the date S&S and RR signed the purchase and sale
contract and the date S&S’ union-represented employees
were terminated, any RR officer, representative, agent, or
employee hired, fired, disciplined, terminated, paid, or di-
rected the work of any S&S union-represented employee.
Burk set the date S&S ceased operations and notified
S&S’ union-represented employees of their termination with-
out consulting RR; Burk decided the amount each terminated
employee was paid and what that final payment covered
without consulting RR.
At all pertinent times S&S/BE and RR were separately
owned corporations, separately managed, separately financed,
and conducted operations at different locations with different
work forces. There were no interrelated operations, no em-
ployee exchanges between them, and the negotiations be-
tween S&S/BE and RR which led to the purchase and sales
contract between them was negotiated at arm’s length.
1267DANIEL I. BURK ENTERPRISES
10 Laerco Transportation & Warehouse, 269 NLRB 324, 325
(1984).
On April 22, 1991, Campbell addressed a letter to S&S’
counsel which requested that the Union be furnished:
1. A full copy of the purchase and sales contract between
S&S and RR; and
2. A seniority list as of April 11, 1991, showing the
names, addresses, telephone numbers, seniority dates, and
final amounts paid to each employee within the employee
unit covered by the 1988–1991 collective-bargaining agree-
ment between S&S and the Union.
On April 24, 1991, counsel for S&S responded with a let-
ter stating the Union was only entitled to information which
was necessary and relevant to contract negotiations; the in-
formation Campbell requested neither was necessary nor rel-
evant for collective-bargaining purposes, inasmuch as S&S
had ceased operations and there was nothing to negotiate;
and failed to tender the requested information.
Following the April 12, 1991 cessation of S&S’ oper-
ations, S&S managerial, engineering, and sales personnel,
Daniel Burk, John Moreno, Buddy Burk, John Beech, Robert
Icola, and Anthony Hart were hired by RR, as were S&S
production/maintenance employees Morgan and Knox.
On May 7, 1991, Daniel Burk formed BE and took title
in that name to S&S’ remaining assets.
On October 1, 1991, BE filed a voluntary petition in bank-
ruptcy under Chapter 11 of the Bankruptcy Code and became
the debtor-in-possession.
During the proceeding a copy of the March 21, 1991 pur-
chase and sale contract between S&S and RR was introduced
into evidence, though it failed to include several attachments
referred to in the body of the contract. A list dated April 14,
1991, and prepared by Daniel Burk from S&S records was
also introduced which named the union-represented S&S em-
ployees on S&S’ active payroll on April 12. The names of
34 employees were identified as full-time S&S production
and maintenance employees, along with their hiring dates, in-
cluding one employee on vacation at that time and five em-
ployees on medical leave. The names and hiring dates of five
part-time production and maintenance employees were also
listed. The document, however, did not include the addresses
or telephone numbers of the employees, nor a description of
the final payment made to each employee and what the pay-
ment covered.
B. The Joint Employer Issue
Counsel for the General Counsel and for the Union con-
tend at times material (during the 22 days between the date
S&S and RR signed the purchase and sale contract and the
date S&S ceased operations and terminated its union-rep-
resented employees) S&S/BE and RR were joint employers
of S&S’ union-represented employees.
The National Labor Relations Board (Board) has stated:
The joint employer concept recognizes that two or more
business entities are in fact separate but that they share
or codetermine those matters governing the essential
terms or conditions of employment. Whether an em-
ployer possesses sufficient indicia of control over em-
ployees employed by another employer is essentially a
factual issue. To establish joint employer status there
must be a showing that the employer meaningfully af-
fects matters relating to the employment relationship
such as hiring, firing, discipline, supervision, and direc-
tion.10
In Clinton’s Ditch Cooperative v. NLRB, 778 F.2d 132,
138 (2d Cir. 1985), cert. denied 107 S.Ct. 67 (1986), the
Second Circuit Court of Appeals spelled out five indicia to
be considered in determining whether an employer had suffi-
cient control over the employees of another employer to sup-
port a finding and conclusion the former employer was a
joint employer of the latter employer’s employees:
1. Hiring and firing.
2. Discipline.
3. Pay, insurance and records.
4. Supervision.
5. Participation in collective bargaining process.
During the 22 days between the date S&S and RR signed
the purchase and sale contract and the date S&S ceased oper-
ations and terminated its union-represented employees, there
is no evidence RR hired, fired, disciplined, paid, and main-
tained insurance and other records for or supervised S&S’
union-represented employees; nor is there any evidence RR
participated in any collective bargaining concerning S&S’
union-represented employees. In fact, in the purchase and
sale contract RR specified it would not assume any of S&S’
collective-bargaining obligations or any obligation to S&S’
union-represented employees.
It is reasonable to presume the General Counsel and the
Union failed to produce any evidence RR hired, fired, dis-
ciplined, paid, maintained insurance and other records for or
supervised S&S’ union-represented employees during the pe-
riod noted above because no such evidence existed or exists.
This view is further fortified by the General Counsel’s and
the Union’s reliance in their briefs and argument solely on
the language of sections 501(d) and (e) of the asset purchase
and sale contract (quoted above) as the only evidence of
record establishing RR was a joint employer of S&S’ union-
represented employees during the 22-day period.
Their reliance on that contract language is misplaced.
In Sun Refining & Marketing Co. v. Building Trades
Council of Philadelphia, 117 LRRM 2127 (D.C.Pa. 1984),
Sun contracted with a nonunion insulating company to per-
form work at the refinery. The contract between Sun and the
insulator provided the insulator would not enter into any col-
lective-bargaining agreement with any labor organization that
increased the rates of pay or the hours of work of the
insulator’s employees without obtaining Sun’s approval. The
court held this an insufficient basis for a joint employer find-
ing, inasmuch as the insulator’s employees were hired, fired,
supervised, paid, and directed by the insulator, Sun and the
insulator were separate business entities, and the contract be-
tween them was negotiated at arm’s length. To similar effect,
Teamsters Local 773 v. Cotter & Co., 128 LRRM 3198
(D.C.E.Pa. 1988).
In numerous cases, the Board and reviewing courts have
reached a similar conclusion, holding where two employers
are not commonly owned, managed, do not share financial
control, facilities, officers, supervisors, plants, offices or
work forces, and the former employer does not exercise di-
1268 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
11 Dextra Industries, 273 NLRB 1660 (1985); Chesapeake Foods,
287 NLRB 405 (1987); So. Cal. Gas Co., 302 NLRB 456 (1991);
G. Wes Ltd., 309 NLRB 225 (1992); Cabot Corp., 223 NLRB 1388
(1976), enfd. 561 F.2d 253 (D.C. Cir. 1977); TLI Inc., 271 NLRB
798 (1984), affd. 772 F.2d 896 (3d Cir. 1985); Island Creek Coal
Co., 279 NLRB 858 (1986).
12 First National Maintenance Corp. v. NLRB, 452 U.S. 666 at
681–682 (1981).
13 Penntech Papers v. NLRB, 706 F.2d 18, 26 (1st Cir. 1983).
rection or control over the hire, fire, discipline, pay, super-
vision, or direction of the work performed by employees of
the latter employer, nor does the former employer participate
in collective bargaining between the latter employer and the
union representing its employees, the former employer is not
a joint employer of the latter employer’s employees.11
S&S/BE and RR at all material times were separate busi-
ness entities; there is no evidence at any time RR exercised
any control over the hire, fire, discipline, pay, employee rec-
ordkeeping, or direction of the work of S&S’ union-rep-
resented employees, including the 22-day period between the
date S&S and RR executed the purchase and sale contract
and the date S&S ceased operations and terminated its union-
represented employees; and there is no evidence RR partici-
pated in any collective bargaining over the wages, of S&S’
union-represented employees. Thus the ‘‘stand still’’ provi-
sions of the S&S-RR purchase and sales contract fall far
short of establishing RR ‘‘meaningfully affected’’ the terms
of employment of S&S’ union-represented employees.
I therefore find and conclude the General Counsel and the
Union failed to establish at any material time RR was a joint
employer of S&S’ union-represented employees.
C. The Alleged 8(a)(5) Violations
1. Union notice and bargaining opportunity
The complaint alleged S&S/BE violated Section 8(a)(5)
and (1) of the Act by failing to give the Union timely notice
of, and an opportunity to bargain, over the effects of its
planned cessation of operation and termination of its union-
represented employees.
In 1981 the Supreme Court established the principle a
union representing the employees of an employer who plans
to cease operations and terminate its union-represented em-
ployees is entitled to ‘‘a significant opportunity to bargain
. . . in a meaningful manner and at a meaningful time’’ over
the effects of the employer’s decision to cease operations and
terminate its union-represented employees.12
Applying the principle, the First Circuit Court has ruled
‘‘meaningful bargaining’’ means ‘‘timely notice to the
union’’ of the planned closure and termination.13
The court went on to find the 1-day notice given the union
in that case inadequate; in similar fashion the Seventh Circuit
Court has ruled a 3-day notice is inadequate (NLRB v.
Emsing’s Supermarket, 872 F.2d 1279 (1989)); and the Third
Circuit has ruled when the union is presented with a fait
accompli, there is a complete failure to comply with the no-
tice requirement (NLRB v. National Car Rental Systems, 672
F.2d 1182 (3d Cir. 1982). To similar effect, NLRB v. St.
Mary’s Foundry Co., 860 F.2d 679 (6th Cir. 1988); P. J.
Hamill Transfer Co., 277 NLRB 462 (1985); Metropolitan
Teletronics, 279 NLRB 957 (1986); Signal Communications,
284 NLRB 423 (1987); John R. Cowley & Bros., 297 NLRB
770 (1990); Los Angeles Soap Co., 300 NLRB 289 (1990);
Willamette Tug & Barge Co., 300 NLRB 282 (1990).
Compliance with the preimplementation notice requirement
has been excused only in cases of emergency, such as the
sudden refusal of the employer’s bank to continue extending
credit (Raskin Packing Co., 246 NLRB 78 (1979)); the unan-
ticipated denial of an employer’s loan request (M & M
Transportation Co., 239 NLRB 73 (1978)); a bankruptcy
trustee’s closure of a business and termination of employees
on learning serious mismanagement by management existed
and there were no employees working at the plant (Yorke,
Trustee v. NLRB, 709 F.2d 1138 (7th Cir. 1983)).
This case presents no ‘‘emergency’’ situation; S&S was
aware in the fall of 1990 it was in dire straits; received final
confirmation of that fact in early 1991; realized it was going
to have to cease operations and in early 1991 negotiated a
purchase and sale contract with RR which meant the ces-
sation of all operations at its California facility and the termi-
nation of its employees; and continued to operate through
April 12.
S&S thus had ample opportunity, between the time it de-
cided to cease operations and the time it did so, to notify the
Union of its decision and to provide the Union with an op-
portunity to bargain over the effects of that decision on the
employees.
In this case the Union did not receive formal notice of
S&S’ April 12 cessation of operations, S&S’ termination of
its union-represented employees, and S&S’ termination of its
current collective-bargaining agreement with the Union until
April 15, 3 days after the closure, long after S&S realized
and decided it could not continue in business; and subse-
quent to the time S&S sold its business assets and terminated
its work force.
Even presuming arguendo the informal communication to
the union steward on April 10 and the informal communica-
tion to the union secretary-treasurer on April 12 constituted
S&S notice to the Union that S&S was ceasing operations
and terminating the employees on April 12, those notices
clearly failed to afford the Union an opportunity to bargain
over the effects on the union-represented employees of the
cessation and termination at a time the Union still had some
bargaining power.
S&S’ contention it concealed its intentions from the Union
and the affected employees in order to keep them employed
as long as possible is not a valid defense. It is just as reason-
able to conclude S&S’ admitted (by Daniel Burk) conceal-
ment of its negotiated sale of its business, planned cessation
of operations, and termination of its union-represented em-
ployees from the Union and its employees between the time
it decided to sell its business and terminate its work force
in order the maximize S&S’ income during the period in
question and prevent the Union, with an earlier notice when
it had more bargaining power, from offering concessions en-
abling S&S to continue operations and/or requesting conces-
sions to cushion the effects of their terminations on the em-
ployees, such as severance pay.
S&S’ counsel complains the Union failed to request bar-
gaining following its April 15 receipt of formal notice of the
cessation of S&S’ operations, termination of its union-rep-
resented employees, and termination of the S&S-union agree-
ment.
1269DANIEL I. BURK ENTERPRISES
14 John R. Cowley & Bros., supra at 771; NLRB v. National Car
Rental System, supra; Perrella Gloves, 304 NLRB 489 (1991);
Chrissy Sportswear, 304 NLRB 988 (1991).
15 NLRB v. Acme Industries Co., 385 U.S. 432, 437 (1967); also
see Detroit Edison Co. v. NLRB, 440 U.S. 301 (1979), and NLRB
v. Truitt Mfg. Co., 351 U.S. 149 (1956).
16 St. Mary’s Foundry, 284 NLRB 221 (1987), enfd. 860 F.2d 679
(6th Cir. 1988); Barnard Engineering Co., 282 NLRB 617 (1987);
Knappton Maritime Corp., 292 NLRB 236 (1988); NLRB v. New
England Newspapers, 856 F.2d 409 (1st Cir. 1988); Mary Thompson
Hospital v. NLRB, 943 F.2d 741 (7th Cir. 1991); Chun Cha Fu, Inc.,
305 NLRB 143 (1991).
17 San Diego Newspaper Guild Local 95 v. NLRB, 548 F.2d 863
(9th Cir. 1977), and cases cited therein; Leland Stanford University,
262 NLRB 136, 139 (1982); Jakel Motors, 292 NLRB No. 58 (Jan.
18, 1989) (not published in Board volumes). 18 EPE, Inc., 284 NLRB 191 (1987).
Where the cessation and terminations have been decided
on and implemented at the time the Union received notice
thereof, the Union has no duty to request bargaining over the
effects on the terminated employees it represents.14
In any event, the Union did request and S&S refused to
bargain when, in response to the Union’s April 22 letter re-
quest for information concerning the amounts paid to each of
the employees it represented when they were terminated and
statement it wished to bargain with S&S on receipt of that
information, S&S’ counsel refused to supply the requested
information and to bargain, stating there was ‘‘nothing to ne-
gotiate.’’
On the basis of the foregoing, I find and conclude
S&S/BE violated Section 8(a)(1) and (5) of the Act by fail-
ing to provide the Union timely notice of, and an opportunity
to bargain over, the effects of its April 12, 1991 cessation
of operations and termination of its union-represented em-
ployees prior to the implementation of its decision to cease
operations and terminate those employees.
2. Failure to provide information
In 1967, the Supreme Court stated where there was a
‘‘probability that the desired information (a union sought
from an employer whose employees it represented) was rel-
evant, and that it would be of use to the union in carrying
out its statutory duties and responsibilities,’’ the employer
was obligated to furnish the requested information and vio-
lated Section 8(a)(5) of the Act by failing or refusing to sup-
ply the requested information.15
In a number of subsequent cases, the Board and reviewing
courts have held an employer who has sold its assets or busi-
ness to another employer and ceased operations has violated
the Act by failing or refusing to provide the union represent-
ing its employees with a copy of the contract of sale between
the employer and the asset purchaser. Those decisions were
grounded on the premise the requested information would
enable the union to determine if the employer and the pur-
chaser were a single employer or the purchaser was the alter
ego or successor of the employer, to aid the union in decid-
ing whether to file an appropriate action against the em-
ployer.16
The Board and reviewing courts have also held when a
union requests wage data from an employer whose employ-
ees the union represents, that information is ‘‘presumptively
relevant,’’ since it is ‘‘intrinsic to the core of the employer-
employee relationship.’’17
In its April 22 letter to S&S’ counsel, the Union pointed
out article II, section 1 of its unexpired agreement with S&S
provided:
This Agreement and any supplemental agreements here-
to . . . shall be binding upon the parties hereto, their
successors, administrators, executors and assigns. In the
event an entire operation is taken over by sale, transfer,
lease, assignment, receivership or bankruptcy proceed-
ing, such operation shall continue to be subject to the
terms and conditions of this Agreement for the life
thereof. The Employer shall give notice of the existence
of this Agreement to any purchaser or transferee, les-
see, assignee, etc. of the operations covered by this
Agreement or any part thereof. Such notice shall be in
writing with a copy to the Union, at the time the seller,
transferor or lessor executes a contract or transaction as
herein described. The Union shall also be advised of
the exact nature of the transaction, not including finan-
cial details.
The Union advised S&S’ counsel in the April 22 letter it
sought a copy of the purchase and sale agreement between
S&S and RR, omitting financial details if S&S so desired,
because the Union believed RR was a ‘‘successor’’ to S&S
and bound under the agreement provision just cited to em-
ploy S&S’ employees covered by the agreement to continue
manufacturing S&S’ products and, in the event S&S failed
to so provide in its sales contract with RR, as well as by fail-
ing to provide the Union with a copy of the sales contract
and by failing to advise the Union of the exact nature of the
transaction between S&S and RR, S&S had breached section
1 of article 2 of the S&S-union agreement and that it sought
the information in question to support a grievance so alleg-
ing.
In the same letter, the Union requested a current seniority
list showing names, addresses, telephone numbers, seniority
dates, and final amounts paid to the S&S employees it rep-
resented. It is clear the Union could not determine whether
the final payments tendered to the employees by S&S: (1)
included payments at the rates set out in the agreement for
all hours worked by each employee during the final pay pe-
riod, nor (2) included payments for any and all benefits ac-
crued under the agreement based on length of service (such
as vacations) without the latter information, and could not
determine if all bargaining unit employees had been properly
compensated without the names, addresses, telephone num-
bers, and seniority dates requested.
I find the information sought by the Union was relevant
and necessary to its performance of its statutory duty, rep-
resenting S&S’ production and maintenance employees.18
I therefore conclude S&S/BE violated Section 8(a)(1) and
(5) of the Act by failing to provide the requested information
in a timely manner.
3. The affirmative defenses
In their answers to the complaint, S&S/BE and RR as-
serted numerous affirmative defenses, as well as denying
most of the complaint allegations. Summarizing the affirma-
1270 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
19 This was a repeat of RR’s denial in its answer to the allegations
in the complaint stating RR was a joint employer of S&S’ employ-
ees and jointly liable for S&S’ violations of the Act. This issue has
been resolved and will not be considered below. 20 Buck Brown Contracting Co., 272 NLRB 951 (1984).
tive defenses, they alleged the complaint should be dismissed
because:
1. The complaint failed to state a cause of action.
2. The S&S-union agreement authorized S&S to cease op-
erations.
3. Federal case law permitted S&S to cease operations.
4. The Union waived and/or is estopped from filing
charges alleging S&S’ cessation of operations and employee
terminations violated the Act.
5. S&S’ concealment from its employees and the Union of
its plan to cease operations and terminate its employees until
implementation was imminent benefited the employees.
6. S&S’ concealment from its employees and the Union of
its plan to cease operations and terminate its employees until
implementation was imminent mitigated any damages the
employees suffered by affording them the opportunity to earn
wages they would not have received, had S&S ceased oper-
ations sooner.
7. S&S performed all its obligations under the S&S-union
agreement, including payment of accrued vacation, sick time,
and other payments required under the agreement and Cali-
fornia labor law.
8. The facts which formed the basis for the Union’s griev-
ance alleging S&S violated the S&S-union agreement in
ceasing operations and terminating its employees are suffi-
ciently similar to the facts underlying the unfair labor prac-
tice allegations of the complaint to warrant Board deferral to
the agreement’s grievance/arbitration provisions for resolu-
tion of the dispute.
9. The automatic stay provisions of the Federal bankruptcy
statute requires the Board refrain from issuing any decision
in this case at this time.
10. The complaint is time-barred under Section 10(b) of
the Act.
11. RR is not liable for any acts or omissions of S&S.19
12. There should be no recovery in this case by the em-
ployees because the Union failed to mitigate damages.
13. Any relief in this case is barred under the doctrines
of res judicata and collateral estoppel.
Neither S&S/BE nor RR specifically addressed these con-
tentions in their posthearing briefs nor supplied supporting
authority (other than RR’s defense against the complaint alle-
gation it was a joint employer of S&S’ employees).
a. Failure to state a cause of action
The complaint set forth factual allegations supporting the
charge S&S/BE violated the Act by failing to timely notify
and provide the Union an adequate opportunity to bargain
over the effects on the employees of its plan to cease oper-
ations and terminate the employees, as well as factual allega-
tions supporting the charge S&S/BE, by failing to provide re-
quested information enabling the Union to ascertain facts
supporting its theory of agreement and Act violation. The
complaint also set forth sufficient facts to warrant determin-
ing on its merits the issue of whether RR exercised sufficient
control over S&S’ employees to warrant assessing joint em-
ployer liability against RR for S&S’ failure to provide the
Union adequate notice, an opportunity to bargain and union-
requested information. Thus the contention the complaint
failed to state facts sufficient to constitute a cause of action
is rejected.
b. Agreement authorization and Federal law
condonation of S&S’ cessation of operations and
employee terminations
Assuming arguendo the S&S-union agreement authorized
S&S to cease operations and conceding S&S did not violate
the Act by ceasing operations, these factors are irrelevant to
the major issue raised by the complaint, i.e., whether
S&S/BE violated the Act by failing to give the Union timely
notice and an opportunity to bargain over the effects of the
cessation on the employees prior to implementation. This
contention lacks merit and is rejected.
c. Union waiver and/or estoppel
The fact the S&S-union current and past agreements con-
templated layoffs during economic downturns and such lay-
offs occurred during the term of those agreements is likewise
irrelevant to the issue of whether S&S/BE was obligated
under the Act to provide timely notice and an opportunity to
bargain over the effects on its employees of a complete ces-
sation of operations. This contention also is rejected.
Nor does the fact the Union filed a grievance under the
S&S-union agreement over the cessation of operations and
terminations preclude the Union from filing unfair labor
practices over that cessation and terminations. The resort to
a private forum where no determination of statutory rights
could or was determined does not preclude the Union from
vindicating public rights under the statute.20
d. S&S acted in the employees’ best interests
The contention S&S was acting in the best interests of the
employees in concealing its plan to cease operations and ter-
minate them until immediately prior to implementation of the
plan and therefore should not be held to any liability for its
failure to timely notify the Union of its plan does not warrant
serious consideration. The statutory requirement of timely
union notice is imposed to enable a union to bargain over
the effects of a cessation on affected employees at a time the
union, if afforded an opportunity to bargain, might be able
to offer concessions enabling the employer to continue oper-
ations and/or afford the union an opportunity to seek and se-
cure concessions cushioning the effects of the terminations
on the affected employees (such as securing severance pay
based on length of service).
In this case, S&S/BE received material benefits by con-
tinuing operations following its decision to cease operations
and sale thereof, so its claimed altruism is highly question-
able. This contention is rejected.
S&S’ contention it concealed its plan to cease business to
mitigate the damage to its employees also fails, on the
grounds set out above.
e. Alleged performance of the agreement
Presuming arguendo S&S made all and any payments to
the union-represented employees required by the S&S-union
1271DANIEL I. BURK ENTERPRISES
21 That question is undetermined, in view of S&S’ failure to sup-
ply the Union with a breakdown of the amounts paid to each termi-
nated employee, for what purposes, and how calculated.
22 Collyer Insulated Wire, 192 NLRB 837 (1971).
23 Postal Service, 307 NLRB 1105, 1108 (1992).
24 St. Louis Gateway Hotel, 286 NLRB 863 (1987).
25 Masters, Mates & Pilots (Seatrain Lines), 220 NLRB 164
(1975).
26 Days Hotel of Southfield, 311 NLRB 856 fn. 3 (1993); Frayn
Printing, 308 NLRB No. 45 fn. 1 (Aug. 12, 1992) (not reported in
Board volumes); FJN Mfg., 305 NLRB 656, 657 fn. 8 (1991).
agreement and California labor law,21 this is irrelevant to the
issue of whether S&S/BE performed its statutory obligation
to afford the Union timely notice and an opportunity to bar-
gain over the effects of the cessation of operations prior to
implementation and to provide the Union information ena-
bling the Union to perform its statutory obligations in rep-
resenting the affected employees. This contention is rejected.
f. The Collyer issue
Exercising its discretionary powers, the Board decided in
1971 when a dispute between an employer and the union was
resolvable either by the Board in an unfair labor practice pro-
ceeding or an arbitration pursuant to the terms of a collec-
tive-bargaining agreement between the employer and the
union and the two submitted the dispute to an arbitrator, the
Board would defer to the agreement the parties had made (so
long as they did proceed to arbitration and the proceeding
was fair and equitable).22
However, the Board has consistently refused to defer a
dispute wherein a complaint was issued on the basis of a
union charge an employer violated Section 8(a)(1) and (5) of
the Act by failing or refusing to supply the union information
necessary and relevant to the union’s performance of its stat-
utory duties as the collective-bargaining representative of the
employer’s employees,23 when a complaint alleged an em-
ployer who ceased operations failed to bargain over the ces-
sation, substantial time had passed, and it would be a waste
of resources and only delay disposition of the dispute to
defer24 and when an arbitrator lacked jurisdiction to bring
before him or order relief against a third party purchaser of
the employer’s assets.25
These factors are all present here; an arbitrator considering
the grievance filed by the Union against S&S/BE under the
grievance/arbitration provisions of the S&S-union agreement
would not be able to consider and rule on the Union’s con-
tention S&S/BE violated Section 8(a)(1) and (5) of the Act
by failing to furnish the Union the wage data it requested
following S&S’ cessation of operations; that arbitrator would
not have any power to join RR to the dispute, determine
whether RR was a joint employer of S&S/BE’s employees,
nor issue any directives or orders against RR; and substantial
time has passed and it would appear to be a waste of re-
sources and delay disposition of the dispute to now defer de-
termination on those issues raised by the Union’s grievance
to an arbitrator for disposition.
I therefore reject the contention the Board should defer
disposing of the merits of the issues raised by the complaint
issued in this case to an arbitrator designated pursuant to the
grievance/arbitration provisions of the S&S-union agreement.
g. Stay of action due to bankruptcy
The Board has noted in several cases:
It is well settled that the institution of bankruptcy pro-
ceedings does not deprive the Board of jurisdiction to
process unfair labor practice cases.26
Thus the Board regularly processes and decides on their
merits complaints alleging a bankrupt employer either prior
to or during bankruptcy has committed unfair labor practices.
I therefore reject this affirmative defense.
h. The 10(b) defense
Section 10(b) of the Act bars the Board from considering
on its merits a complaint based on a charge filed more than
6 months after the date an alleged unfair labor practice was
committed.
The original charge in Case 21–CA–28020 alleging S&S
violated the Act by failing to give the Union timely notice
of and an opportunity to bargain concerning S&S’ cessation
of operations and termination of its employees was filed on
April 22, 1991, 10 days after the Union received formal no-
tice of the cessation and layoffs. Even assuming arguendo
the April 10, 1991 notice to the employees was valid notice
to the Union, the charge was filed 12 days after the cessation
and layoffs.
The amended charge in Case 21–CA–28020 adding BE
and RR as named violators was filed on August 21, 1991,
less than 5 months after the cessation and terminations.
The original charge in Case 21–CA–28l34 alleging S&S
and RR violated the Act by failing to furnish wage and relat-
ed data requested by the Union was filed on June 27, 1991,
less than 3 months after the date S&S failed and refused to
supply the wage and related data requested.
The amended charge in Case 21–CA–28l34 adding BE as
a named violator was filed on August 21, 1991, less than 5
months after the cessation and terminations.
Thus the Union charges that S&S/BE and RR violated the
Act by failing to provide adequate and timely notice to the
Union of the cessation of operations and terminations and a
union opportunity to bargain, as well as union charges
S&S/BE and RR violated the Act by failing to provide the
Union requested wage and related data enabling the Union
to discharge its statutory functions were filed and served on
S&S/BE and RR less than 6 months after the date the Union
learned of the cessation of operations and terminations and
received a refusal to supply the requested information.
I therefore reject the affirmative defense based on Section
10(b) of the Act.
i. Alleged union failure to mitigate damages
While S&S/BE and RR failed to advance any argument or
cite authorities supporting this contention, apparently they
contend the Union failed to seek bargaining in a sufficiently
aggressive manner following the belated receipt of notice of
the cessation of operations and terminations, barring the af-
fected employees from any relief under the Act.
When timely union notice of a cessation and termination
is not provided, the union has no duty to actively pursue bar-
1272 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
27 John R. Cowley, supra; National Car Rental Systems, supra, 672
F.2d at 1187–1189; Los Angeles Soap Co., supra; Chrissy Sports-
wear, supra.
gaining, in view of the futility of such pursuit following ces-
sation and termination.27
The union notice in this case was untimely and, in any
event, the Union pursued a grievance and was thwarted in
its effort to process that grievance, a bargaining effort, by
S&S/BE’s refusal to supply necessary and relevant informa-
tion.
I therefore reject this affirmative defense.
10. The res judicata and collateral estoppel defenses
Again S&S/BE and RR failed to develop any argument or
cite any authorities in support of this affirmative defense.
I have cited case law supporting my findings and conclu-
sions S&S/BE violated the Act by failing to provide the
Union with timely notice of its planned cessation of oper-
ations and termination of its union-represented employees
and rejected the affirmative estoppel defense above.
I therefore reject this affirmative defense.
Conclusion
In view of the foregoing, I find and conclude the affirma-
tive defenses advances by S&S/BE and RR do not warrant
findings and conclusions S&S/BE did not violate the Act by
its failure to provide the Union timely notice of its planned
cessation of operations and termination of its union-rep-
resented employees prior to implementation thereof and its
failure and refusal to supply information requested by the
Union which was necessary and relevant to the Union’s per-
formance of its statutory obligations on behalf of the em-
ployees it represented.
CONCLUSIONS OF LAW
1. At all pertinent times S&S/BE and RR were employers
engaged in commerce in business affecting commerce within
the meaning of Section 2 of the Act.
2. At all pertinent times Daniel I. Burk was a supervisor
and agent of S&S/BE acting on their behalf within the mean-
ing of Section 2 of the Act.
3. At all pertinent times the Union was a labor organiza-
tion within the meaning of Section 2 of the Act.
4. At all pertinent times the following employee unit was
appropriate for bargaining purposes within the meaning of
Section 9 of the Act:
All production and maintenance employees, shipping
and receiving employees, warehousemen and truck-
driver employees employed by S&S/BE at the facility
located at 2911 Norton Avenue, Lynwood, California;
excluding all other employees, office clerical employ-
ees, confidential employees, professional employees,
guards and supervisors as defined in the Act.
5. At all pertinent times the Union was the duly designated
exclusive collective-bargaining representative of the employ-
ees in the aforesaid unit.
6. RR is not and has not at any pertinent time been a joint
employer of S&S/BE’s employees within the aforesaid unit.
7. S&S/BE violated Section 8(a)(1) and (5) of the Act by:
a. Failing to provide the Union adequate and timely notice
of its planned cessation of operations and termination of its
employees within the unit and an opportunity to bargain with
respect to the effects thereof on those employees prior to its
April 12, 1991 implementation of its planned cessation and
terminations.
b. Failing and refusing to provide the Union with nec-
essary and relevant information requested by the Union on
April 22, 1991, to aid the Union in the performance of its
statutory duties on behalf of the unit employees.
8. RR did not violate the Act.
9. The aforesaid violations affected and affects interstate
commerce within the meaning of Section 2 of the Act.
THE REMEDY
Having found S&S/BE engaged in unfair labor practices in
violation of Section 8(a)(1) and (5) of the Act, I recommend
S&S/BE be ordered to cease and desist therefrom and to take
certain affirmative actions designed to effectuate the pur-
poses of the Act.
As a result of S&S/BE’s unlawful failure to provide the
Union with notice of its planned cessation of operations and
termination of its union-represented employees at a time
when the Union had an adequate opportunity and sufficient
power to bargain effectively over the effects thereof on the
employees it represented, I recommend S&S/BE be ordered
to comply with the remedies set forth in Transmarine Navi-
gation Corp., 170 NLRB 389 (1968). I therefore recommend
S&S/BE be ordered to pay to each of the employees on the
S&S/BE’s active payroll on April 12, 1991, backpay at the
rate of their normal wages on that date from 5 days after the
date the Board issues its Order in this case until the occur-
rence of the earliest of the following conditions: (1) the date
S&S/BE bargains to agreement with the Union concerning
the effects of the cessation of operations on its union-rep-
resented employees; (2) a bona fide impasse in bargaining;
(3) the failure of the Union to request bargaining within 5
days of the issuance of the Board’s Order, or to commence
negotiations within 5 days of S&S/BE’s notice of desire to
bargain with the Union; or (4) the subsequent failure of the
Union to bargain in good faith; but in no event shall the sum
paid to the employees exceed the amount he or she would
have earned as wages from April 12, 1991, the date S&S/BE
ceased operations, to the time he or she secured equivalent
employment elsewhere, or the date on which S&S/BE should
have offered to bargain, whichever occurs sooner; provided,
however, that in no event shall this sum be less than the em-
ployees would have earned for a 2-week period at the normal
rate of their normal wages when last in S&S/BE’s employ.
Interest on all such sums shall be paid in the manner pre-
scribed in New Horizons for the Retarded, 283 NLRB 1173
(1987).
1273DANIEL I. BURK ENTERPRISES
28 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
29 If this Order is enforced by a judgment of a United States Court
of Appeals, the words in the noticed 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.’’ The mailed notices shall be
written both in English and in Spanish.
I also recommend S&S/BE be ordered to furnish the
Union with a complete copy of the purchase and sale agree-
ment between S&S and RR, including all attachments, the
addresses and telephone numbers of each of the union-rep-
resented employees in S&S/BE’s employ on April 12, 1991,
to the extent available, the total amount paid to each such
employee on his termination, and a breakdown of the com-
position of the final paycheck into the components covered
thereby.
Since S&S/BE has ceased operations, I further recommend
S&S/BE be ordered to mail signed copies of the attached no-
tice to the Union and to all the unit employees employed on
April 12, 1991, in Spanish and in English, since many of the
employees have a limited understanding of the English lan-
guage.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended28
ORDER
The Respondent, S&S/BE, its officers, agents, successors,
and assigns, shall
1. Cease and desist from
(a) Failing to timely notify and bargain with the Union as
the exclusive collective-bargaining representative of its em-
ployees in the appropriate unit set out below with respect to
the effects on those employees of its decision to cease oper-
ations and terminate their employment:
All production and maintenance employees, shipping
and receiving employees, warehousemen and truck driv-
er employees employed at S&S/BE’s facility located at
2911 Norton Avenue, Lynwood, California; excluding
all other employees, office clerical employees, con-
fidential employees, professional employees, guards and
supervisors as defined in the Act.
(b) Failing and refusing to furnish the Union information
necessary and relevant for the Union’s performance of its
statutory obligations to the unit employees.
(c) In any like or related manner interfering with, restrain-
ing, or coercing employees in the exercise of rights guaran-
teed to them by Section 7 of the Act.
2. Take the following affirmative action necessary to ef-
fectuate the policies of the Act.
(a) Pay the terminated employees their normal wages for
the period set forth in the remedy section of this decision.
(b) Furnish the Union the information set forth in the rem-
edy section of this decision.
(c) On request, bargain in good faith with the Union con-
cerning the effects on the unit employees of its decision to
cease operations and terminate its union-represented employ-
ees;
(d) Preserve and, on 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 records necessary to analyze and
determine the amount of backpay due under the terms of this
Order.
(e) Mail an exact copy of the attached notice marked ‘‘Ap-
pendix’’29 to the Union and to all employees employed by
S&S/BE in the unit on April 12, 1991. Copies of that notice,
on forms provided by the Regional Director for Region 21,
upon receipt thereof, shall be immediately signed by an au-
thorized representative of S&S/BE and mailed upon receipt
thereof, and shall be written in both Spanish and English.
(f) Notify the Regional Director in writing within 20 days
from the date of this Order, what steps the Respondent has
taken to comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board found we violated the
National Labor Relations Act and ordered us to notify you
we will comply with the following. You are therefore ad-
vised:
WE WILL NOT fail or refuse to give timely notice to and
bargain with General Warehousemen Local 598, International
Brotherhood of Teamsters, Chauffeurs, Warehousemen &
Helpers of America, AFL–CIO, the exclusive collective-bar-
gaining representative of our employees in the unit set out
below, with respect to the effects on those employees of our
decision to cease operations and terminate their employment.
The unit is:
All production and maintenance employees, shipping
and receiving employees, warehousemen and truck driv-
er employees employed at our facility located at 2911
Norton Avenue, Lynwood, California; excluding all
other employees, office clerical employees, confidential
employees, professional employees, guards and super-
visors as defined in the Act.
WE WILL NOT fail or refuse to furnish Local 598 with in-
formation necessary and relevant for performance of Local
598’s duty under the Act to represent our unit employees.
WE WILL NOT in any like or related manner interfere with,
restrain, or coerce our employees in the exercise of their
rights under Section 7 of the Act.
WE WILL, on request, bargain with Local 598 with regard
to the effects on the unit employees of our decision to cease
operations and terminate their employment.
WE WILL furnish Local 598 with information necessary
and relevant for performance of its duty under the Act to
represent our employees and requested by Local 598 follow-
ing our cessation of operations and termination of our unit
employees.
1274 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
WE WILL pay to our unit employees who were terminated
on April 12, 1991, when we ceased operations and termi-
nated them, their normal wages for a period specified by the
National Labor Relations Board, with interest on the sums
due.
DANIEL I. BURK ENTERPRISES, INC., FOR-
MERLY KNOWN AS SAMMONS & SONS