Disco Fair, et al.

National Labor Relations Board - Board Decisions

Jan 30, 1968

169 N.L.R.B. 426 (N.L.R.B. 1968)

426 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Red-More Corporation, d/b/a Disco Fair, et al. and
Retail Clerks Union , Local No. 899 , Retail Clerks
International Association , AFL-CIO. Case
31-CA-519
January 30, 1968
SUPPLEMENTAL DECISION
By MEMBERS BROWN , JENKINS , AND ZAGORIA
On May 16, 1967, the National Labor Relations
Board issued its Decision and Order in the above-
captioned proceeding, granting the General Coun-
sel's Motion for Summary Judgment that Respond-
ents had refused to bargain with the Charging
Union as the certified representative for an ap-
propriate unit of Respondents' employees.' On
June 5, 1967 , Respondents filed a Motion for
Reconsideration, Motion for Hearing, and Motion
for Opening of Record. No opposition thereto was
filed by either the Charging Union or the General
Counsel.
I. STATEMENT OF THE CASE
A. The Representation Proceedings
On June 28, 1966, the Regional Director issued
a Decision and Direction of Election in which he
found, on the basis of the hearing record, including
license and lease agreements covering departments
at Disco Fair's retail discount operations, that
Disco Fair and its licensees and lessees were joint
employers, and that an overall unit of their em-
ployees was appropriate.2 On July 8, 1966, Disco
Fair filed a request for review with the Board, con-
tending that by virtue .of. certain changes in its
license and lease agreements since the proceeding
in Case 21-RM-1162, there was no basis for a
joint-employer finding. The request for review was
denied by the Board on July 19, 1966, and, in the
ensuing election , a majority of the employees in the
unit voted for the Union. Thereafter, Disco Fair,
again contesting the appropriateness of the unit
based on the joint-employer relationship, filed with
the Regional Director objections to the election, as
well as a Motion for Reconsideration of the Deci-
sion and Direction of Election and a Stay of Certifi-
cation. In a Supplemental Decision issued on Sep-
tember 27, 1966, the Regional Director overruled
the objections, denied the motion, and certified the
Union. Disco Fair made no request for review of
the Regional Director's Supplemental Decision.
1 164 NLRB 638.
z Red-More Corporation, dlbla Disco Fair, Cases 31-RC-210 and
31-RC-21I (not published in NLRB volumes ). The Regional Director
took official notice of the record and decision in Case 21-RM-1 162, is-
sued April 16 , 1965, which also found, contrary to Disco Fair , a joint-em-
B. The Unfair Labor Practice Proceeding
Pursuant to a charge filed by the Union, the Re-
gional Director issued a complaint on October 28,
1966, against Disco Fair and its licensees and les-
sees, alleging violations of Section 8(a)(5) and (1) of
the Act. In substance, the complaint alleged the
Union's certification, as described above, and that
since October 3, 1966, the Respondents have
refused to bargain with the Union, although
requested by the Union to do so. Answers filed by
the Respondents to the complaint admitted the
above-recited matters pertaining to the representa-
tion proceeding and the refusal of the Union's post-
certification request for bargaining, but denied the
finding of a joint-employer relationship and the ap-
propriateness of the unit based thereon. Upon the
General Counsel's Motion for Summary Judgment,
inasmuch as the pleadings presented no issues of
fact or law requiring a hearing, the Board, on
December 30, 1966, issued an Order Transferring
Proceeding to the Board and a Notice to Show
Cause why the General Counsel's motion should
not be granted. Thereafter, the Respondents filed a
Statement in Opposition to Motion for Summary
Judgment, and a Response to Notice to Show
Cause, in which, inter alia, it was contended
generally that the form license and lease agreements
between Disco Fair and the other Respondents
have been changed to clarify or delete the provi-
sions relied upon by the Regional Director to sup-
port his finding of a joint-employer relationship. As
set forth above, the Board granted the General
Counsel's Motion for Summary Judgment. In doing
so, the Board noted that, assuming the agreement
changes referred to in the Response to Notice to
Show Cause were new, such changes were not par-
ticularized, nor were copies of the revised agree-
ments submitted, in order to show the effect, if any,
upon the finding of a joint-employer relationship in
the prior representation proceedings.
II. THE INSTANT MOTIONS
At the outset, Respondent defends its failure
previously to submit the agreement changes on the
ground that the requirement thereof by the Board in
effect grants discovery rights to the General
Counsel .3 This is a procedural misconception. Once
the complaint and answer establish , as in this case,
the certification of the Union in the underlying
representation case , and the subsequent request
and refusal to bargain , a prima facie violation of
Section 8 (a)(5) has been shown . Even assuming that
ployer relationship.
3 In our original decision , we rejected a similar contention that the is-
suance of a notice to show cause gives discovery rights to the General
Counsel which are not available to other parties, and shifts the burden of
proof from the General Counsel to Respondent.
169 NLRB No. 63
RED-MORE CORP. 427
there was a further burden on the General Counsel
to prove the continued existence of the joint-em
ployer relationship, that burden was met by the
finding thereof in the representation case, and the
well-established legal principle that a state of affairs
shown to exist is presumed to continue until the
contrary is shown. The purpose of the Notice to
Show Cause was to afford Respondent an opportu-
nity to rebut the prima facie case so established by
going forward with sufficient evidence to show that
the circumstances upon which the representation
case decision- was based no longer existed. Unit
determinations based upon fully litigated represen-
tation proceedings, such as the joint-employer rela-
tion here involved, are entitled to some degree of
finality in a subsequent related unfair labor practice
case. It is self-evident that we cannot countenance
the circumvention of the joint-employer finding
through the device of a general allegation of
changes in the underlying agreements after each
such finding, for to do so would prolong litigation
and deny bargaining rights to the employees in the
certified unit. Accordingly, we held that such al-
legation by Respondent in its response to the
Notice to Show Cause was insufficient, and granted
summary judgment.
Respondent now seeks belatedly to particularize
the revisions relied upon, asserting that they are
new and were not in existence at the time of the Re-
gional Director's Decision and Direction of Elec-
tion, issued June 28, 1966. The exact date of such
revisions, however, is not set forth in the motions,
and in any event Respondent failed to raise such
revisions prior to the Regional Director's Supple-
mental Decision of September 27, 1966, or to is-
suance of the instant complaint on the following Oc-
tober 28. Moreover, even assuming that the revi-
sions were not executed or effectuated until the
latter date, and therefore could not have been raised
before then, Respondent still showed a lack of
diligence by waiting until after the adverse granting
of summary judgment before taking proper steps to
adduce the revisions which concededly were in ex-
istence at the time of the antecedent notice to show
cause.
In any event, motions based on newly discovered
evidence will not be granted unless such evidence
will probably change the outcome of the litigation.
We have considered the revisions particularized by
Respondent and find them insufficient to establish
that the circumstances upon which the joint em-
ployer finding in the representation case was based
no longer exist. Those circumstances included
uniform provisions in the license and lease agree-
ments whereby (1) the licensees and lessees were
required to abide by the rules and regulations of
Disco Fair; (2) they were required to discharge any
of their employees, whether or not for cause, when
requested to do so by Disco Fair; and (3) they were
required to obtain the written consent of Disco Fair
before entering into collective-bargaining negotia-
tions for their employees, and to give reasonable
notice to Disco Fair concerning the time, place, and
subject matter of such negotiations. According to
the motions, the corresponding revisions provide:
(1) "It is understood and agreed that such rules and
regulations as established by the Landlord shall not
govern or affect the wages, benefits or conditions of
employment of employees employed by Tenant";
(2) "Tenant agrees to maintain an adequate staff of
competent, courteous and efficient personnel to
conduct its business during business hours"; and (3)
"Neither Landlord nor Tenant will enter into any
negotiations or agreements, oral or written, with
any labor organization with respect to employees
without first giving written notice in advance of en-
tering into any such negotiations. Moreover, either
party will allow the other to sit in as an observer in
any negotiations concerning labor relations and
reasonable notice must be given concerning the
time, place and subject matter of such negotia-
tions." In addition, the motions assert that there has
been added to the revised agreements the following
clause: "Further, it is understood that this Agree-
ment is in no way to be construed or interpreted as
creating a partnership, joint venture, employer-em-
ployee, joint-employer or any other relationship
other than Landlord and Tenant."
In our view, the revised agreements are basically
the same as the old agreements in all material
respects. The mere addition of a sentence reciting
that Disco Fair's rules and regulations will not af-
fect conditions of employment is insufficient,
without more, to establish a change in circum-
stances which would undermine the previous unit.
determination. Moreover, the revised item (2) ap-
parently reserves the right to Disco Fair to deter-
mine whether the licensees and lessees have "an
adequate staff of competent, courteous and efficient
personnel." Any possible doubt about the matter,
however, is resolved by an examination of the
revised item (3). Its original form is virtually identi-
cal with a provision which we have previously held
to support a joint-employer finding.4 The revised
form is different only in that it does not require con-
sent from Disco Fair before the licensees and les-
sees enter into collective-bargaining negotiations.
We do not believe this difference is determinative,
since the other restrictions in the revised item (3)
reserve the right to Disco Fair of advance notice
from the licensees and lessees as to the time, place,
and subject matter before they can even discuss
their employees with a labor organization, and
further to attend such discussion . Even though
Disco Fair's consent is no longer required, we be-
lieve that by virtue of these restrictions, Disco Fair
remains in a position substantially to affect. the em-
ployment conditions of the employees of its licen-
4 Frostco Super Save Stores, Inc., 138 NLRB 125, 127-128.
428 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
sees and lessees.5 Accordingly, we are unimpressed ployer relationship previously found, and reaffirm
by the recital in the revised agreements that it is not our finding that Respondents' refusal to bargain
the intent of the parties thereto to create a joint-em- with the Union as the certified representative of the
ployer relationship. We find, therefore, that there employees in the unit heretofore found appropriate
has been insufficient change to affect the joint-em- is violative of Section 8(a)(5) of the Act.
5 S. S. Kresge Company, K-Mart Division , et al., 169 NLRB 422.