Dorothy Shamrock Coal Co.

National Labor Relations Board - Board Decisions

May 30, 1986

279 N.L.R.B. 1298 (N.L.R.B. 1986)

1298 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Dorothy Shamrock Coal Company and Jack
Wilson . Case 25-CA-14734
30 May 1986
DECISION AND ORDER
BY CHAIRMAN DOTSON AND MEMBERS
DENNIS AND JOHANSEN
On 24 February 1983 Administrative Law Judge
John H. West issued the attached decision. The Re-
spondent filed exceptions and a supporting brief,
and the General Counsel filed an answering brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs and has
decided to affirm the judge's rulings,' findings,2
and conclusions as modified herein, and to adopt
the recommended Order as modified.
We affirm the judge's findings, for the reasons he
stated that the Respondent violated Section 8(a)(1)
by repeatedly threatening to close its facility or to
convert solely to owner-operators and by convey-
ing to employees that joining a union would be
futile. For the reasons which follow, we affirm the
judge's finding that the Respondent violated Sec-
tion 8(a)(3) and by ceasing to operate its trucks and
laying off its drivers, but reverse his finding that
the Respondent violated Section 8(a)(4) and (1) by
refusing to reinstate the drivers and informing them
that its refusal resulted from their having filed
unfair labor practices with the Board.
As is more fully explained in the judge's deci-
sion, the Respondent's president and owner, Frank
Carr, resolved on 29 July 1982,3 some 7 weeks
after a representation election which the Union
lost,4 to cease running company trucks and lay off
employee drivers and to rely solely on independent
truckers and trucking firms (owner-operators or
leased drivers) to deliver coal. On 30 July Daryl
Douglass, marketing manager of the Respondent's
I The Respondent excepted to the judge's refusal to admit into evi-
dence an 18 October 1982 newspaper article about increased reliance on
leased dnvers in the financially troubled trucking industry Inasmuch as
the article was published after the Respondent laid off its drivers and it
played no part in the Respondent 's decision to do so, we affirm the
judge's ruling
2 The Respondent has excepted to some of the judge 's credibility find-
ings The Board's established policy is not to overrule an administrative
law judge's credibility resolutions unless the clear preponderance of all
the relevant evidence convinces us that they are incorrect Standard Dry
Wall Products, 91 NLRB 544 (1950), enfd 188 F 2d 362 (3d Cir 1951)
We have carefully examined the record and find no basis for reversing
the findings
3 All dates refer to 1982
* The Union involved in the election was the Coal, Ice, Building Mate-
rial, Supply Drivers, Riggers, Heavy Haulers, Warehousemen and Help-
ers, Local Union No 716 No objections to the election were filed by the
parties
parent company,5 read a letter prepared by Carr to
the drivers announcing their immediate layoff and
attributing the decision to their failure to adhere to
a newly implemented maintenance invoice proce-
dure and the Respondent's efforts to streamline
maintenance costs. The drivers were again assem-
bled 2 August and were read another letter pre-
pared by Carr. This letter attributed Carr's decision
to the drivers' failure to follow instructions, a 34-
percent increase in insurance rates, and a "consist-
ency [sic] of mechanical and other increases." The
letter stated as well that those drivers with good
work records would be considered for reemploy-
ment in the event the Respondent reactivated its
trucks and that the drivers would receive another
announcement in approximately 2 weeks. That day
a charge was filed with the Board in this proceed-
ing. Thereafter, Carr prepared and mailed to the
drivers a letter dated 20 August which stated: "Be-
cause a complaint [sic] has been filed with the Na-
tional Labor Relations Board, we have been ad-
vised by council [sic] not to discuss reinstitution of
operations or any other matters at the present time.
We will keep in touch with you, hopefully by next
week." There were no further announcements to or
correspondence with the drivers.
The judge found that the General Counsel estab-
lished a prima facie case that the layoff was moti-
vated by the employees' recent organizing activity.
We agree.6 Well before the advent of union activi-
ty, Supervisor Ben Henry twice told employee
Wilson that the Respondent was not union, never
had been, and never would be. Supervisor William
Scruggs made pre- and postelection 8(a)(1) threats
to many employees to the effect that the Respond-
ent would close or convert solely to owner-opera-
tors. Given the Respondent's avowed commitment
to keep its operation nonunion and its oft-repeated
plan to accomplish this goal, combined with the
timing of the conversion on the heels of the union
election and the Respondent's shifting reasons for
the layoff, there is ample evidence to establish a
prima facie showing that the Respondent's layoff of
drivers and its conversion to owner-operators were
unlawfully motivated.7
5 The parent, Dorothy Coal Sales Company, is also owned by Frank
Carr It is not a party to these proceedings
6 In affirming this finding, we do not rely on the judge 's discussion of
the reasonableness of the Respondent 's institution of the new maintenance
invoice system We also find it unnecessary to rely on the judge' s finding
that by taking I week to change a tire on driver Jack Wilson 's truck after
implementation of the invoice procedure, the Respondent was "teaching
Wilson a lesson "
7 The dissent discounts the ominous character of the Respondent's
threats to convert to owner-operators by pointing out that they were pre-
mised on a union victory that did not occur The credited evidence estab-
lishes, however , that these threats were not contingent on the Union's
Continued
279 NLRB No. 174
DOROTHY SHAMROCK COAL CO 1299
Further, we agree with the judge's finding that
the Respondent failed to establish that the layoff
would have occurred notwithstanding its drivers'
organizing activity. We rely on the fact that the
Respondent advanced shifting reasons for the
layoff and, more importantly, the fact that some of
its asserted reasons are unsupported by the record.
Specifically, the Respondent asserted that rising
maintenance and insurance costs, low sales, de-
creased rates charged by owner-operators and their
higher contribution to profit, and problems with
the Interstate Commerce Commission necessitated
the layoff. The initial explanation in the July
memorandum cited the drivers' failure to complete
truck repair forms properly and the Respondent's
unsuccessful attempts to streamline maintenance
costs. The August memorandum additionally. attrib-
uted the layoff to a 34-percent increase in the cost
of insurance. The other justifications were first ad-
vanced during the course of this proceeding. The
shifting reasons for the layoff cast doubt on the va-
lidity of the Respondent's defenses and support the
inference that the Respondent had another, unlaw-
ful, reason for the layoff.8
Further, the prima facie case that the 8(a)(1)
threats and timing establish is not rebutted by the
lack of direct evidence that Company Owner Carr
"authorized" his supervisors' threats. Section 2(13)
of the statute makes it clear that an employer is
bound by the acts and statements of its supervisors
whether specifically authorized or not. The judge
found that the drivers looked to Henry and
Scruggs (rather than Carr) for supervision and spe-
cifically rejected the Respondent's claim that
Scruggs' comments about conversion were expres-
sions of personal opinion.
Apart from the shifting nature of these explana-
tions, the record fails to substantiate several of the
Respondent's claims. We note that only two driv-
ers completed the truck repair forms improperly,
and the Respondent failed to show that the inaccu-
rate completions detracted from the efficiency of
its operations. More importantly, the Respondent
admitted that the drivers' errors in filling out the
forms were attributable to its own failure to in-
struct them. Regarding rising insurance costs, the
Respondent failed to introduce documentary evi-
dence either that its insurer actually planned to in-
crease rates or that the Respondent in fact canceled
its insurance. Such evidence was peculiarly within
the Respondent's possession.9 The Respondent's
contention that low sales and an industrywide
slump contributed to its decision to lay off drivers
is also flawed. The record establishes that the Re-
spondent's year-to-date total income for 1982 was
almost twice that for the same period in 1981 and,
in fact, exceeded total income for all of the preced-
ing year. In any event, seasonal slumps were
shown to be the industry norm. The Respondent's
past practice was to take advantage of such slumps
by performing major repairs on its trucks without
laying off its drivers. The Respondent does not
adequately explain why this practice was not fol-
lowed in 1982.10 Additionally, although the Re-
spondent was experiencing a net loss before taxes,
6 of the 10 company trucks showed year-to-date
profits for 1982 and 7 showed profits for June. Fur-
ther, although owner-operators and leased drivers
handled a great deal of the increased 1982 sales, I I
9 of the 15 owner-operators had ceased working
for the Respondent in June, a month before the
layoff occurred, because the Respondent an-
nounced a 10-percent rate reduction for their serv-
ices. This fact undermines the Respondent's claim
that owner-operators were willing to haul at
"break-even" rates, making their use more profita-
ble. Because owner-operators and leased drivers
would not render the same steady service as com-
pany drivers operating company trucks, there was
a need to retain the employee work force. Frank
Carr as much as conceded this point in his testimo-
ny.
Finally, we note that it was not the operation of
its own trucks that ran afoul of interstate com-
merce regulations as the Respondent implies, but
the use of leased and owner-operated vehicles in
interstate commerce. How the layoff of its own
employees and its total reliance on leased and
owner-operator vehicles would solve the Respond-
ent's ICC problems remains unexplained.
In view of the foregoing, we find that the Re-
spondent failed to rebut the General Counsel's
showing that the layoffs were discriminatorily mo-
tivated. Therefore, we affirm the judge's finding
that the Respondent violated Section 8(a)(3) and
(1) by laying off its drivers in retaliation for their
attempt to gain union representation.12
success or failure at the polls In fact. Scruggs' prediction that Company
President Carr "might close the facility down or that the arrangements
had already been made for Dorothy Shamrock to go strictly owner-oper-
ator" was delivered after the election and during a discussion where em-
ployees aired concerns about retaliation Thus, for the Respondent, con-
versation remained the one sure way of squelching union activity and nd-
ding itself of unions once and for all
8 Aker Plastics Co, 262 NLRB 1128 (1982), United Plastics, 255 NLRB
178 (1981)
8 See Limestone Apparel Corp, 255 NLRB 722 (1981), and Town do
Country LP Gas Service Co, 255 NLRB 1149 (1981)
10 We note that by undertaking major repairs on its trucks, the Re-
spondent acted inconsistently with its claim of economic hardship
I I The Respondent for years had used outside drivers to supplement its
employee work force.
12 In his recommended Order, the judge inadvertently failed to include
an expunction order See Sterling Sugars, 261 NLRB 472 (1981). We shall
Continued
1300 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The judge also found that the Respondent violat-
ed Section 8(a)(4) and (1) of the Act by deciding
that it would not discuss reinstitution of operations
or reemployment with employees because they
filed unfair labor practice charges with the Board,
and that it further violated Section 8(a)(1) by con-
veying this decision to employees in its 20 August
letter. We disagree.
The letter complained of evidences the Respond-
ent's attempt to keep its word to employees by
contacting them and, by its very language, ex-
presses nothing more than a perceived incapacity,
or at best a temporary reluctance, to delve into the
matter of reemployment. Clearly it is not a patent
refusal to reactivate its trucks and reinstate the
drivers.' 3 Thus, we find that, despite the Respond-
ent's reference to the invocation of Board process-
es, the full text of the 20 August letter makes it
clear that neither the Respondent's disinclination to
discuss matters nor the conveyance of its decision
was unlawful . Accordingly, we reverse these find-
ings of the judge.
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge as modified below and orders that the Re-
spondent, Dorothy Shamrock Coal Company, Indi-
anapolis, Indiana, its officers, agents , successors,
and assigns , shall take the action set forth in the
Order as modified.
1. Delete paragraph 1(c) and reletter the para-
graphs accordingly.
2. Delete from paragraph 1(d)
"and refusing to reinstate employees because of
their protected, concerted activities and because a
charge was filed with the Board."
3. Insert the following as paragraphs 2(b) and (c)
and reletter the subsequent paragraphs accordingly.
"(b) Remove from its files any reference to the
unlawful layoffs and notify the employees in writ-
ing that this has been done and that the layoffs will
not be used against them in any way.
"(c) Mail to employees Jack Wilson, Glen Sharp,
Duane Henry, Don Beauchamp, Barry Cole, Rus-
modify his order by requiring that the Respondent expunge from its files
any reference to the layoffs of Jack Wilson, Glen Sharp, Duane Henry,
Don Beauchamp , Barry Cole, Russell Stidd , and Norman Partlow
12 In finding that the Respondent has not violated Sec 8(a)(4),
Member Johansen relies solely on evidence that the Respondent was not
capable of resuming operations at the time it is alleged to have denied
employees recall because only 2 of its 10 trucks met state licensing re-
quirements on that date and at the time of the hearing and the number of
customers the Respondent serviced had decreased drastically Contrary
to his colleagues and for reasons stated by the judge, he would find that
the 20 August letter to the drivers constituted an independent violation of
Sec 8(aXl)
sell Stidd, and Norman Partlow copies of the at-
tached notice immediately upon its receipt."
4. Substitute the attached notice for that of the
administrative law judge.
IT IS FURTHER ORDERED that the complaint is
dismissed as to any alleged violation of the Act not
found.
CHAIRMAN DOTSON, dissenting in part.
Although I agree with the majority's findings in
all other respects, I would find that the General
Counsel failed to establish a prima facie case that
the Respondent discriminatorily laid off its drivers
in violation of Section 8(a)(3) and (1). In finding a
prima facie case my colleagues rely on: (1) evi-
dence of antiunion hostility apparent in preelection
and postelection statements by Supervisor William
Scruggs that the Respondent would either close or
convert solely to owner-operators if the Union
were successful; (2) a statement made by Division
Manager Ben Henry 2 months before the advent of
any union activity and more than 5 months before
the layoff that the Respondent was not union,
never had been, and never would be; and (3) the
fact that the Respondent cited different reasons for
the layoff of its employees.' These facts fall short
of a prima facie showing that the Respondent's de-
cision to lay off its drivers was unlawfully motivat-
ed.
Although I agree that Scruggs' and Henry's
statements constitute threats and an expression of
futility that are unlawful, I find it particularly note-
worthy that the statements attributed to Scruggs
expressly conditioned any adverse change in oper-
ations on the Union' s winning the 11 June election.
In view of the fact that the Union lost the election,
those statements, even if true expressions of the Re-
spondent's intent had the Union won, are not indic-
ative of the Respondent's motive at the time Carr
decided to lay off the drivers.2 Also, there is no
' The majority indicates that they "find it unnecessary" to rely on an
additional factor cited by the judge , i e, the fact that the Respondent's
new maintenance procedure resulted in I week 's downtime for driver
Jack Wilson Indeed, consideration of this fact would be improper The
judge concluded that it was a retaliatory measure taken against Wilson
and that the new system was unreasonable The judge ignored, however,
the fact that the new procedure was implemented after the organizational
effort failed and was applied equally to all company trucks and drivers
See generally Motor Inn of Perrysburg Y NLRB, 647 F 2d 692 (6th Cir
1981) Further , his consideration of the reasonableness of this practice is
irrelevant inasmuch as the judge may not substitute his business judge-
ment for that of the Respondent
2 Significantly, the record contains two versions of Scruggs ' postelec-
tion comment Wilson testified that he and another driver , Glen Sharp,
had a conversation with Scruggs in which they inquired about any forth-
coming retaliation and Scruggs responded that he knew of none but was
still concerned about his pension and that "Frank Carr might close the
facility down or that the arrangements had already been made for Doro-
thy Shamrock to go strictly owner-operator " Sharp testified in pertinent
part that Scruggs said, "if the union had got in-the election would have
Continued
DOROTHY SHAMROCK COAL CO. 1301
evidence that Henry's statements, which preceded
the drivers' organizing activity and were far re-
moved in time from the actual layoff, or Scruggs'
statements were authorized by Carr. It is undis-
puted that Carr was solely responsible for the deci-
sion to rely only on owner-operators to haul coal.
Thus, there is no logical nexus between the super-
visors' utterances and the layoff of the drivers.
Further, although the initial announcement of
the layoff did not provide a full explanation of the
basis for the layoffs, I would not characterize the
reasons given in July and August layoff announce-
ments and as further clarified during this proceed-
ing as "shifting." The July announcement attributes
Carr's decision to efforts to streamline maintenance
costs and the drivers' failure to observe the new
maintenance procedure. The second announcement,
which was made to clarify the first, lists as reasons
the drivers' failure to follow instructions and "a
consistency of mechanical and other increases," as
well as rising insurance costs. The failure to follow
instructions obviously refers to the drivers' failure
to complete new maintance invoices properly, and
the "consistent mechanical increases" referred to
relate to the previously stated efforts to streamline
maintenance costs. In short, there is nothing incon-
gruous about the two announcements. Even assum-
ing that a negative inference ought to be drawn
from the Respondent's failure to mention insurance
costs in its initial announcement , such an inference
is insufficient to establish a prima facie case of a
discriminatory motive. The Respondent's additional
explanations for operating exclusively with owner-
operators or leased drivers are not inconsistent
with the initial explanation.
Moreover, the record reveals that on 1 July,
after the election but before receiving the dismal fi-
nancial report from his accountant, Carr granted
the drivers a wage increase. The increase was insti-
tuted during the same period that the Respondent
implemented its new maintenance repair form
policy. Such an act is hardly characteristic of a
went the other way-that Frank would have locked the gates or it was
already set up that they'd have leased drivers , that they would let leased
drivers run the coal " Although Sharp 's account contains the conditional
language which comports with Scruggs' preelection statements, the
judge, without explanation , relied on Wilson's characterization of the in-
cident, which in any event clearly indicates that Scruggs did not know
the Respondent 's current business plans My colleagues' use of Wilson's
version is critical to their decision , yet they ignore the presence of
Sharp 's very different version This is another instance of conduct criti-
cized , inter alia , by the Court of Appeals for the District of Columbia in
Yellow Taxi Co. of Minneapolis v NLRB, 721 F 2d 366 (D C Cir 1983)
The court noted (id at 383 fn 39) a tendency that "overemphasizes and
overstates facts favorable to its conclusion, underemphasizes
and refuses to acknowledge facts that are favorable and disdains
even entertaining contrary implications where facts may cut both ways "
The court also commented on the necessity to assess and weigh the "total
factual context ," quoting NLRB v. United Insurance Co of America, 390
US 254 , 258 (1968)
hostile employer contemplating revenge because its
employees attempted to organize.
On the basis of the foregoing, I would find that
counsel for the General Counsel failed to meet his
burden of establishing a prima facie case that the
Respondent ceased operating its trucks and laid off
its drivers because of their unsuccessful union ac-
tivities. Accordingly, I would find it unnecessary
to pass on the validity of the Respondent's asserted
economic defenses.3 However, even assuming that
Scruggs' and Henry's preelection predictions and
Carr's announcements about the layoff give rise to
a prima facie showing of discrimination, I would
find that the Respondent successfully rebutted the
General Counsel's case with evidence pertaining to
its economic condition. Thus, despite evidence that
six company trucks showed increased year-to-date
contributions to profit, the record establishes that
the Respondent was still operating at a loss, owner-
operators contributed substantially more to profit
than company trucks, company trucks were in dire
need of repair,4 and maintenance costs had risen.
That year-to-date losses were lower than the previ-
ous year's losses does not erase the fact that the
Respondent's financial picture was bleak. Further-
more, Carr was not given and did not study the
company financial report until mid-to late July. In
my view, his electing to cease running the less
profitable part of the operation and overhaul the
company trucks is directly attributable to his
review of that dismal report and the need for main-
tenance. Yet, the majority minimizes these facts
and finds evidence of retaliatory motive in Carr's
decision to deal with another year of losses in a dif-
ferent manner from in the past. In so doing, the
majority ignores the fact that employees received a
wage increase after the election and, in effect, sub-
stitutes the Board's business judgment for that of
the Respondent.
a The establishment of a prima facie case does not turn on the relative
soundness or weakness of an employer's business decision Mini-Indus-
tries, 255 NLRB 995 (1981)
4 Employee Barry Cole threatened to park his truck and never drive it
again if the brakes were not repaired The remarks were made to Vice
President John Carr and reported to Frank Carr
APPENDIX G
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
1302 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
WE WILL NOT threaten our employees with plant
closure or elimination of their jobs because of their
union activity.
WE WILL NOT inform our employees that it
would be futile to select a union to represent em-
ployees.
WE WILL NOT lay off or discharge employees be-
cause they engage in activities protected by the
National Labor Relations Act.
WE WILL NOT discharge you, or otherwise dis-
criminate in regard to your hire or tenure of em-
ployment or any term or condition of employment,
to discourage membership in the Coal, Ice, Build-
ing Material, Supply Drivers, Riggers, Heavy
Haulers, Warehousemen and Helpers, Local Union
No. 716.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce you in the exer-
cise of the rights guaranteed you by Section 7 of
the Act.
Section 7 of the Act gives employees these
rights.
To organize
To form, join, or assist any union
To bargain collectively through representa-
tives of their own choice
To act together for other mutual aid or pro-
tection
To choose not to engage in any of these
protected concerted activities.
Our employees are free to exercise any or all of
these rights, including the right to join or assist the
Coal, Ice, Building Material, Supply Drivers, Rig-
gers, Heavy Haulers, Warehousemen and Helpers,
Local Union No. 716, or any other union. Our em-
ployees are also free to refrain from any or all such
activities.
WE WILL offer Jack Wilson, Glen Sharp, Duane
Henry, Don Beauchamp, Barry Cole, Russell
Stidd, and Norman Partlow reinstatement to the
jobs which they were unlawfully deprived or, if
such jobs no longer exist, to substantially equiva-
lent jobs, without prejudice to their seniority or
other rights and privileges enjoyed, and make them
whole, with interest, for any loss of pay they may
have suffered by reason of their discharges.
WE WILL mail to the above-named employees
copies of this notice.
WE WILL notify each of them that we have re-
moved from our files any references to his layoff
and that the layoff will not be used against him in
any way.
DOROTHY SHAMROCK COAL COMPANY
Walter Steels, Esq., for the General Counsel.
Donald Smith, Esq. (Smith & Murdock), of Indianapolis,
Indiana, for the Respondent.
DECISION
STATEMENT OF THE CASE
JOHN H WEST, Administrative Law Judge. Upon a
charge filed August 2, 1982,1 by Jack Wilson, as amend-
ed on September 16, a complaint was issued by the Na-
tional Labor Relations Board (the Board) on September
16 alleging that Respondent2 violated Section 8(a)(1) of
the National Labor Relations Act (the Act) in that asser-
tedly (1) in May and June its admitted supervisor, Wil-
liam Scruggs,3 threatened Respondent's employees with
closure of Respondent's facility and with the elimination
of their jobs if the employees selected Local No. 716 of
the Internationl Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America (the Union) as
their collective-bargaining representative, (2) Respond-
ent's division manager , Ben Henry, in February informed
Respondent's employees that it would be futile for them
to select a union as their collective-bargaining represent-
ative, and (3) Respondent's president and owner, Frank
Carr, by memorandum dated August 20, informed Re-
spondent's employees that Respondent would not discuss
reinstitution of its operations or any other matters be-
cause a "complaint" had been filed with the Board; that
Respondent violated Section 8(a)(1) and (3) of the Act in
that about July 30 Respondent laid off or terminated em-
ployee Wilson, along with six other specified employ-
ees,4 because they engaged in concerted, protected activ-
ity, and since July 30 Respondent has failed and refused
to recall or reinstate these employees; and that Respond-
ent violated Section 8(a)(1) and (4) of the Act in that it
has failed and refused to recall or reinstate its employees
because they filed a charge and gave testimony against
the Respondent before the Board Respondent denies
that it violated the Act in the manner described above.
A hearing was held in Indianapolis, Indiana, on Octo-
ber 21 and 22. On the entire record in this case, includ-
' All dates are in 1982 unless otherwise stated
2 Albeit Respondent refers to itself in some of the exhibits introduced
herein as Dorothy Shamrock Coal Company, Inc, in others the "Inc " is
not included Apparently the correct name of Respondent does not in-
clude this designation
3 The complaint (G C Exh 1(e)), in addition to giving Scruggs' posi-
tion, a truck supervisor and dispatcher , also alleges that at all times mate-
rial Scruggs was a supervisor of Respondent within the meaning of Sec
2(11) of the Act Respondent 's answer (G C Exh 1(h)) admitted that
Scruggs held the position specified in the complaint The answer did not
specifically deny that Scruggs is a supervisor under the Act According-
ly, under Sec 102 20, of the Board's Rules and Regulations this allegation
of the complaint was admitted and no attempt was made to specifically
amend that answer Respondent counsel's attempt, on brief, to take the
position that Scruggs is not a supervisor under the Act, in the circum-
stances, does not overcome the original admission Also, a review of the
evidence of record supports this allegation in that Scruggs, who is com-
pensated on a salary basis, had authority to, as brought out by counsel for
Respondent during the hearing, and did, assign hauls and grant drivers'
request for time off and, as testified to by Henry, Scruggs, in Henry's ab-
sence, was authorized to sign up new owner operators Scruggs' author-
ity was not of a merely routine or clerical nature
4 The six other employees are Glen Sharp, Duane Henry, Don Beau-
champ, Barry Cole, Russell Stidd, and Norman Partlow
DOROTHY SHAMROCK COAL CO.
ing my observation of the demeanor of the witnesses and
consideration of the briefs filed on December 20 by the
General Counsel and Respondent , I make the following
FINDINGS OF FACT
1. JURISDICTION
Respondent, which maintains its principal place of
business in Indianapolis , is engaged in the sale and distri-
bution of coal. The complaint alleges, the Respondent
admits, and I find that at all times material herein Re-
spondent has been an employer engaged in commerce
within the meaning of Section 2(2), (6), and (7) of the
Act, and the Union has been a labor organization within
the meaning of Section 2(5) of the Act.
II THE ALLEGED UNFAIR LABOR PRACTICES
A. The Facts
When Wilson inquired about a job with Respondent in
June 1981, Henry asked him if the job he then held was
a union job and when Wilson said, "Yes," Henry advised
him that driving for Respondent "is not a union job,
we've never been union . and never will be." Wilson
was hired by Respondent in November 1981. Approxi-
mately 3 months later , Wilson advised Scruggs that he
wanted some time off since Wilson was "out of hours."5
Scruggs responded: "Sounds like you're trying to run
this like a union shop." And Henry, who was present
during this exchange, then said, "We're not Union, we
never have been, and we never will be."
Wilson, who testified that he was upset with
"[w]orking conditions, being more or less forced to run
illegal , overweight, out-of-hours, [and the] low rate of
pay," contacted the Union in Aprils He obtained driv-
ers' signatures on the authorization cards given to him by
the Union, and at the end of April or beginning of May
he returned the completed cards to the Union
By memorandum dated April 19 7 from Henry to Carr
(R. Exh 31) it was proposed that Respondent's drivers
receive pay increases of up to $1 an hour depending on
their length of continuous service. Before Carr acted on
this proposal, Respondent received the Union's petition
for certification, which was filed May 3, 1982. Respond-
ent was advised by its counsel at that time "that to insti-
tute a pay increase after the receipt of the petition for
election could be construed to prejudice the election in
. . . [Respondent's] favor or buying a vote by giving
someone a pay increase."
s As explained by Wilson, on a truckdriver's log, "You're allowed to
run 70 hours in 8 days, or 60 hours in 7 days We were running consider-
ably more than that "
6 At that time Wilson was paid $5 per hour Wilson testified that about
this same time he overheard Scruggs advise an owner-operator utilized
by Respondent that "before Frank Carr would allow a Union to get in
here, he'd just shut the gate " Another driver, Cole , testified that when
Respondent found out what the drivers were doing, which he believed
was about the middle of April, Scruggs told Cole "that it would be more
than likely that if the Union was voted in that they would close the yard
down "
7 Carr and Henry had discussed this matter before Henry drafted the
memorandum
1303
Henry testified that he first learned of the Union's or-
ganizing drive on May 4. Nine days later, May 13, James
Beaty applied for a job as a truckdriver with Respond-
ent. Beaty had previously worked for an employer
which had formerly employed one of Respondent's driv-
ers, Sharp. On submitting his application (R. Exh. 4)
Beaty was asked by Henry, who reviewed the applica-
tion, if he knew Sharp because he and Sharp formerly
worked for the same employer.8 Beaty was advised that
business was a little slow at that time but Respondent ex-
pected to hire drivers sometime in the future. Subse-
quently, Beaty returned to Respondent's facility on three
occasions to inquire about work. On the first of these
three subsequent visits, Scruggs told Beaty that Respond-
ent was "in the middle of some labor disputes and that it
wouldn't be until that situation was taken care of before
they would be even in the situation to hire."9 On the
third visit to talk to Scruggs and Henry, Beaty was told
that Respondent "had a couple of people in there causing
trouble, wanting to get the union in there"; and that
Beaty "knew one of them . . . from the outfit . . .
[Beaty and he] used to work for."10 Beaty returned to
Respondent's facility for the fourth and last time the
week before the election. He was advised that Respond-
ent was not hiring because "it hadn't settled anything
yet."11
Four of Respondent's truckdrivers, Wilson, Stidd,
Sharp, and Cole, testified that after Respondent was
placed on notice regarding the organizing drive Scruggs
told them at various times before the election of June 11
that if the Union was voted in Respondent would close
9 Henry told Beaty that Sharp was complaining a lot about his truck
needing repairs At one point in his testimony , Henry stated that he possi-
bly could not recall what he said to someone outside the hearing room I
minute before testifying herein Henry 's denial that he "interviewed"
Beaty and his assertion that any discussions he had with Beaty "could
probably best [be] describe[d] [as] Just in passing maybe just a
hello or name , maybe the purpose of his visit, and that would be it"
cannot be credited It might be that Henry did not conduct what he un-
derstands to be an interview since Respondent did not have an opening
for Beaty at the time (Respondent hired one other driver , David Fisher,
during the time Beaty visited Respondent But Fisher, who was hired
June 1, filed his application before Beaty, viz, May 5 ) but this does not
refute Beaty's testimony that Henry looked at the application and ques-
tioned Beaty An employee of Respondent , Jerry Ayers, testified that he
originally gave Beaty the application form and when Beaty returned the
completed form he gave it to Ayers who in turn placed it on a desk used
by Henry and others Ayers did not know whether Beaty talked to
anyone else at Respondent 's facility that day
0 Scruggs testified that he did not know Beaty and that he did not re-
member talking to him Even after fully reviewing Beaty's application
and, notwithstanding his confusion about dates and names, it is my opin-
ion, based on the witness' demeanor and the fact that portions of his testi-
mony were corroborated , that Beaty was a credible witness Scruggs'
denial was equivocal And the individual who originally gave Beaty the
application form, Ayers, could not testify that Beaty did not talk to
Scruggs In fact, Ayres told Beaty that he did not know whether Re-
spondent was hiring and he told Beaty to speak to Scruggs
10 Beaty told Sharp of this conversation At one point Beaty character-
ized the visit as his last, but later in his testimony he indicated that there
was a later visit Henry 's equivocal denial that he did not recall talking to
Beaty about the Union cannot be credited
I Subsequently Beaty called Sharp and was advised of the above-de-
scribed layoff Beaty's erroneous testimony that this call occurred a week
or two after his last visit to Respondent 's facility does not, in my opinion,
preclude me from relying on other portions of what I believe to be credi-
ble testimony
1304 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
down or cease operating company trucks. 12 Albeit, ac-
cording to Wilson, Scruggs did not say that he heard this
from Carr, Wilson assumed that to be the case On the
other hand, Stidd assumed that Scruggs, albeit he did not
say so, was rendering his personal opinion. Scruggs did
not respond when his nephew, Cole, asked why Re-
spondent would close the gates. Cole also testified that
Scruggs did not indicate that this was just his opinion.
Scruggs testified that he did discuss the effects of the
Union with Ayers and some of the drivers; i 3 that he
told Ayers and the drivers that Respondent may or may
not close up; that, albeit he did not tell the drivers, he
based his opinion on what a former employee of his told
him years ago; and that Carr never told him Respondent
would close 14
At one point Stidd testified that Henry, at some un-
specified time, told Stidd and at least one other driver
who was present that "there may be a possibility we may
have to park the trucks on account of not being able to
pay the higher wages, what they was figuring on was
around $11.00-$12.00 an hour." Three questions later,
however, on being asked by the General Counsel, "Did
Mr. Henry say anything about closing up the Company
trucks, or shutting down the Company's trucks, if the
Union got in." Stidd responded: "I think he did, but I
can't-I never-I wasn't paying that much attention to
it, I wasn't thinking about-anything about it." Henry
testified that he did not tell any employee that Respond-
ent would close if the Union was voted in. The com-
plaint does not allege a violation regarding this matter
and Stidd's testimony is at best unreliable.
Wilson and Sharp testified that after the organizing
drive began, Respondent changed its policy of allowing
the drivers to take company trucks home in that initially
it terminated the practice with respect to those drivers
living in Marion County, Indiana (Respondent's facility
is located in this county and of the drivers only Wilson
and Sharp reside in this county), and eventually Re-
spondent terminated the practice altogether. Of the three
other drivers also called by the General Counsel, the
first, Stidd, testified that his residence was closer to the
mines than Respondent's facility and although he contin-
ued to take his truck home up to the time he went on
vacation just before the above-described layoff, it was
with the understanding that he would go directly from
his residence to the mines to pick up coal the following
12 Stidd testified that Scruggs said Respondent "might have to" not
that it "would " Wilson testified that Scruggs told Wilson that Scruggs
was upset because he "didn 't have that much time to go on his job, of a
pension-some type of a pension that he was supposed to get and he was
afraid if the Union got in that Frank [Carr] would close the Company
down" or "just go to owner operators "
13 Apparently Scruggs does not include Wilson and Sharp in this cate-
gory He was asked the following question by counsel for Respondent
Q Did you ever discuss anything about the-what effects, advan-
tages, disadvantages, or anything that might come about in the event
the-with either Jack Wilson or Frank Wilson pnor to the-Glen
Sharp prior to the election in last June?
He responded , "No, sir " As noted the question speaks only to "prior to
the election" and, therefore , does not cover that period subsequent to the
election
14 Carr testified that he never told Scruggs or any other employee that
if the Union was voted in, Respondent would close the doors or cease
using company equipment
morning. Beauchamp and Cole described Respondent's
policy basically as being one in which a driver could
take a company truck home if it would eventually save
Respondent driving time either to or from a mine.
Marion County drivers were prohibited from taking
trucks home as of the winter or spring of 1982, accord-
ing to Beauchamp and Cole. Cole testified that in mid-
May he was told that in view of the repairs required on
the trucks, Respondent was going to hire a mechanic to
work the night shift. Subsequently, according to Cole,
drivers were again allowed to drive the trucks home if it
was in conjunction with a movement to or from a mine
located nearer their home than Respondent's facility.
An election was held on June 11 with two votes cast
for the Union and five against One ballot was chal-
lenged The results were certified by the Board on June
21.
Shortly before the election, Wilson, who had been told
by Sharp that Beaty relayed what he had been told,
namely, that one of the union instigators had formerly
worked with Beaty, told Scruggs and Henry that Wilson,
and not Sharp, was the union instigator.
Carr testified that he was advised by owner-operators,
who are paid on a rate-per-mile basis from a mine to the
destination, in the beginning of June that they were not
necessarily looking for a profit but they would transport
Respondent's coal if they could just "break even." About
June 15, Carr testified, Respondent notified the approxi-
mately 15 owner-operators it utilized that it would be
necessary to reduce their rates by approximately 10 per-
cent. Six of the fifteen continued to render service at the
reduced rate. Assertedly, Respondent continued to re-
ceive inquiries about providing service from owner-oper-
ators and fleet owners.
On June 17 two representatives from the Interstate
Commerce Commission (ICC) visited Carr's office in
Cincinnati. One week later Carr received a phone call
from the ICC and, on July 2, he received the following
letter (R. Exh. 34) from the ICC:
This will confirm those matters recently dis-
cussed with you and with your attorney, Joseph
Murdock.
It is my understanding that Dorothy Coal Sales,
Inc., has a primary business of buying and selling
coal and as such had formed a subsidiary, Dorothy
Shamrock Coal Company, to perform the transpor-
tation for the parent. Dorothy Shamrock owns
some over-the-road equipment and supplements this
fleet with six to ten independent contractors or
owner-operators under lease agreements.
There are several issues to be resolved before a
determination can be made as to whether Dorothy
Shamrock may lawfully perform transportation for
the parent.
The first issue is whether Dorothy Coal Sales,
Inc., is engaged in a business other than transporta-
tion to which the transportation is within the scope
of and furthers that primary business . Section 10524
U.S.C. Title 49 (Revised). You may obtain an infor-
mal opinion from the Office of Compliance and
Consumer Assistance (OCCA), Interstate Com-
DOROTHY SHAMROCK COAL CO.
merce Commission, Washington, D.C. 20423. A
complete description of how the business of Doro-
thy Coal Sales, Inc., is conducted including such
items as if and when title to the coal passes from
the producer/owner, whether your company main-
tains an inventory of stock in trade, etc., Schenley
Distilleries Motor Division, Inc., Contract Carrier Ap-
plication, 44 M.C.C. 171, 176 (1944).
Once it is determined that Dorothy Coal Sales,
Inc., has [met] the "primary business" test to which
the transportation is incidental , Dorothy Shamrock
may then perform the transportation for the parent
under the exemption mentioned if the terms speci-
fied in sub-paragraphs (b)(1)(2)(3)(4) are met. This
exemption is commonly called Compensated Inter-
corporate Haul (CIH).
With respect to the leasing of equipment and
driver from a single source, this creates a rebuttable
assumption that the owner-operator or lessor is con-
ducting for-hire operations requiring authority from
this Commission. I am enclosing our Notice No. I
which addresses both issues of primary business
tests and shipper leases with appropriate case cita-
tions
The restrains to shipper lease arrangements may
be modified in Ex Parte MC 122 (Sub-No. 2) Lease
of Equipment and Drivers to Private Carriers, 132
M.C.C. 351, 353, 355 (1980). The Commission has
proposed to remove the significant burdens test "in
light of the intercorporate hauling changes
brought about by the Motor Carrier Act of 1980
(Public Law 96-296, July 1, 1980). The Ex Parte
MC 122 (Sub-No. 2) proceeding is still pending in
the courts.
You may wish to pursue a second alternative by
applying for operating authority on behalf of the
subsidiary. Application forms and instructions may
be obtained from this office upon request.
Please furnish me with a reply as to your under-
standing and position in this matter by July 27,
1982.
Wilson testified that after the election "around the first
of July" he and Sharp had a conversation with Scruggs
with these drivers asking whether there would be any re-
taliation . Scruggs responded that he did not know of any
at that time. Also, Scruggs stated "that he was still con-
cerned . . about his pension, and that Frank might
close it down or that the arrangements had already been
made for Dorothy Shamrock to go strictly owner-opera-
tor." Sharp testified that after the election he and Wilson
had a conversation with Scruggs during which Sharp
told Scruggs about what he heard from Beaty and he
told Scruggs that Sharp was not a union instigator; that
Scruggs stated that "they found out that . . . [Sharp]
wasn't the one to start it"; and that, additionally, Scruggs
stated that "if the Union had got in-the election would
have went the other way-that Frank [Carr] would have
locked the gates or it was already set up that they'd have
1305
leased drivers, that they would let leased drivers run the
coal." 15
Respondent implemented a new procedure on July 1
requiring drivers to record on their pay records the ori-
gins, destinations, weights, and times of their hauls. On
the reverse side of this record, drivers were required to
record start-stop mileage for the day, fuel and oil added,
repairs, purchase order numbers, where a part was ob-
tained, and the downtime of the truck.' a Under the old
systems, with minor exceptions, the mechanics took care
of the paperwork, and seldom did a minor repair, i.e.,
changing a tire, take more than 1 day. Under the new
system the driver would advise Respondent's mechanics
of the problem. According to Wilson's testimony, a req-
uisition was then drafted and forwarded to Carr in Cin-
cinnati by regular mail, and the approval was returned to
Indianapolis by regular mail.'' Under the new system
Wilson's truck was inoperable for 1 week because one
tire had to be changed.' 8 In the past, Wilson testified,
without contradiction, a tire could be fixed in 30 min-
utes.
Carr initially testified that on July 2 Respondent re-
ceived written notification from its insurer that in view
of the accidents Respondent experienced, its insurance
premiums would be increased 34 percent across the
board (on the trucks alone the increase assertedly would
have amounted to 65 percent) over what it paid for in-
surance in 1981. Later he testified that the July 2 written
notification indicated that the premium increase was ef-
fective July 1 19
In early July (Henry testified that he thought the pay
raises he recommended in April became effective on July
1) the above-described pay raises were granted.
A computerized statement of Respondent's operations
(G.C. Exh. 8) was received by Carr in mid-July, and he
reviewed it between July 21 and 27. It covered the first
6 months of 1982 and it showed a financial picture which
Carr testified demonstrated that Respondent's "repair
and maintenance costs [for its trucks] had prohibitively
increased in a manner as to where we could not continue
to operate with what it was costing us to operate the
trucks. 1120
is For the reason indicated in In 13, supra, it is concluded that
Scruggs did not specifically deny this conversation
IB At least one driver, Stidd , made an error filling out the new forms
17 Respondent did not dispute Wilson's description of the method uti-
lized
18 On returning at the end of the I week Wilson discovered that the
brakes on his truck would not release and he was out of work for a
second week He telephoned Carr in Cincinnati, complained about the ex-
cessive downtime, and was told that his request to drive for one of Re-
spondent's lease operators while his truck was being repaired could not
be granted since it was against company policy
18 The written notification was not introduced into evidence Carr tes-
tified that on receiving it he went to six other insurance companies in-
quiring about insurance for the trucks Five of the companies would not
insure the vehicles and the sixth wanted $70 ,000 per year or more than
double what Respondent had been paying for insurance
20 Although Carr continuously reviewed requisitions and purchase
orders, Respondent had changed comptrollers in March and at that time
its books were 4 months behind It took the new comptroller several
months to acquaint himself with Respondent 's operation and, therefore,
Carr did not have an exact financial picture until the mid-July Portions
of the above-described computerized statement are treated more fully,
Continued
1306 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
About July 22, Beauchamp told one of Respondent's
supervisors that his truck was unsafe to drive, that he
wanted it repaired, and that if it was not repaired he
would park it and refuse to drive it. Within 2 days Carr
was advised of Beauchamp's statement.
Approximately 6 days later, Sharp received a memo
from Respondent's comptroller that Sharp had failed to
sign his timecard for the week of July 23 and he had to
sign it before receiving his pay. Sharp testified that he
was upset over this and at the time he might have said,
"I'm going to knock Frank Carr on his ass."
Carr testified that on the following day, July 29, he
decided to lay off Respondent's drivers. He drove to In-
dianapolis, arriving about 4 p.m., to make the announce-
ment to the drivers. On being advised that all the drivers
could not be available until some time after 6 p.m., Carr
left Indianapolis and returned to Cincinnati.
By letter dated July 29, Respondent, as here pertinent,
advised its insurance broker that, with the exception of
two trucks, it was not renewing its liability insurance. As
pertinent, payment was enclosed for this coverage and
for comprehensive insurance on all the trucks for July
and August.
By letter dated July 30, Carr advised Respondent's in-
surance broker that eight of the tractor trailer units were
parked and the liability coverage was continued on two
other units so that they could be used for emergency
shipments from central storage (Indianapolis). Carr went
on to state in the letter, "Personally, I enjoy doing busi-
ness with . . . [you], but you have forced us to check
out the market."21
Also on July 30, Carr forwarded the following letter
to the ICC:
This will acknowledge receipt of your letter
dated July 2, 1982 in reference to Dorothy Coal
Sales, Inc. and Dorothy Shamrock Coal Company.
First of all I want to apologize for my tardiness
in responding to your letter.
As I previously discussed with you on the tele-
phone, I head up both corporations Dorothy Coal
Sales, Inc. and Dorothy Shamrock Coal Company.
Most of the transportation including legal authority,
permits and all other legal matters has been handled
under the leadership and direction of a law firm in
Indianapolis, Indiana by the name of Smith & Mur-
dock. Likewise, during our phone conversation I
gave you the name of Mr. Joseph Murdock with an
address of Suite 945/900 Keystone Crossing-Indi-
anapolis , Indiana 46240 . Mr. Murdock's telephone
number as given to you is (317) 846-6655.
By date of this letter I am going to forward your
letter to Mr. Murdock and ask him to correspond
with us regarding your questions.
Once again, I apologize for my tardiness and
trust that you will continue to be patient for a few
infra. It need only be noted at this point that , contrary to the implication
of the testimony of Carr , the total relevant repair and maintenance costs,
when considered as a percentage of income , actually decreased in the
first 6 months of 1982 when compared to the first 6 months of 1981
$i Carr testified that this letter was prepared shortly after lunch on
July 30
more days so that we may address your questions as
outlined.
Cordially,
Dorothy Coal Sales, Inc.
Frank Carr, President
cc: Mr. Joseph Murdock
Mr. Ben Henry
FC/slw
P.S. Joe,
I find myself apologizing to everyone this morn-
ing for my tardiness . However this is the latest in-
formation I have in reference to our phone conver-
sation about one month ago and Mrs . Wehners' in-
quiry. Will you please review and advise me by
written letter of our present position and your rec-
ommendation . Please call me in the event that we
can be of further assistance.22
Because he was going on vacation the next day, Carr
gave the following memorandum to Daryl Douglass,
who drove to Indianapolis and at approximately 7 p.m.
read it to most of Respondent's drivers:
July 30, 1982
My name is Daryl Douglass . I am Marketing Man-
ager for Dorothy Coal Sales in Cincinnati.
I have been asked by Mr. Frank Carr, President of
Dorothy Coal Sales, Inc., and Dorothy Shamrock
88 R Exh 55 . Carr testified that it was determined in the "latter part
of July" that Respondent was operating illegally in interstate commerce
and would have to do something about it He later testified that he was
present on October 15 when one of his attorneys , Donald Smith, tele-
phoned the ICC Later that day Smith forwarded the following letter (R.
Exh 38) to the [CC
In confirmation of my telephone call to your office, this is to
advise that I have reviewed the operations of Dorothy Coal Sales,
Inc. and Dorothy Shamrock Coal Company and made the following
findings
Dorothy Coal Sales, Inc is in the business of mining and selling
coal This is its entire business Dorothy Coal Sales, Inc is under
100% common control with Dorothy Shamrock Coal Company,
which has conducted operations in transporting coal in both intra-
state and interstate commerce for Dorothy Coal Sales, Inc. The
interstate operations are conducted under an authorization to per-
form incorporate hauling by letter notice by the Interstate Com-
merce Commission
The intercorporate hauling was generally performed with Compa-
ny owned equipment and full time employees of Dorothy Shamrock
Coal Company Since approximately May 15 , 1982 no interstate op-
erations have been conducted and it is not contemplated that any op-
erations will be reinstated in the future In the event it is determined
that Dorothy Shamrock Coal Company intends to conduct interstate
operations with other than company owned equipment in the future,
it will apply for the necessary authority to perform the service as a
contract carrier for Dorothy Coal Sales, Inc
The following appears in the lower left -hand corner of the letter "cc- F.
Carr " Carr testified that he understood, in response to the following
question from Respondent 's counsel.
And, as far as you're concerned , you understand at this time, and
are you willing to abide by the representation of the Interstate Com-
merce Commission that your company will not conduct anymore
interstate operations until such time as you may obtain operating au-
thority from the Interstate Commerce Commission as long as you're
using leased equipment
DOROTHY SHAMROCK COAL CO.
Coal Company to read to you the following mes-
sage:
MEMORANDUM
TO: Dorothy Shamrock Coal Company Employees
FROM: Frank Carr, President
REFERENCE: Employment
For some time I have attempted to combat or
perhaps streamline expenses within the company. Of
course, in order to do this, it required cooperation
from all employees plus strict controls by local
management. The first of July, your Division Man-
ager, Ben Henry, held a meeting with you and in-
troduced a new driver form. This form was to assist
us in our endeavor. Many of you have ignored the
form and failed to carry out instructions and per-
form your duties as ordered. Local management has
been negligent and careless in enforcing of [sic] this
policy.
Therefore, effective immediately, some Shamrock
personnel have been terminated, with the exception
of BEN HENRY.
You are asked to remove all personal belongings
from your trucks and turn your keys in to William
Scruggs.
A personal letter will follow from Mr. Carr to
each of you.
Frank Carr.
P.S. to: William Scruggs, Terry Carr, Jerry
Ayers
(1) It would be appreciated since two of you are
salaried employees to carry out the functions in
handling deliveries until Ben returns.
(2) #9 and #11 trucks are the only trucks that
are to be used after midnight tonight for emergency
purposes only. Trailers should be parked orderly
and all tractors should be placed in the garage,
leaving the oldest tractors outside of the garage.23
The following day, Saturday, July 31, Ayers called the
drivers and advised them that they had been terminated
and not laid off; and that they should attend a meeting at
Respondent's Indianapolis yard on Monday, August 2.
According to Carr's testimony, the drivers were laid
off because of the increased insurance premiums, the
question of whether Respondent's interstate operations
were lawful , the increased maintenance and repair costs
for the trucks, and the availability of owner-operators or
leased trucks to handle Respondent's traffic at a reduced
rate.
On Sunday, August 1, Carr, while on vacation in
South Carolina, placed a long-distance telephone call to
Henry instructing him to inspect all the trucks and deter-
mine the extent of repairs needed . Carr testified that at
23 G C. Exh, 4 Two of the drivers , Cole and Sharp , testified that
Douglass did not say the drivers were terminated but rather he said they
were laid off Three of the drivers, Wilson, Stidd, and Sharp, testified
that there was no warning of an impending layoff
1307
no time before this had Respondent ever taken all of its
trucks out of service at the same time to make repairs.24
The next day the following (G.C. Exh. 5) was read to
Respondent's drivers who had assembled in its Indianap-
olis yard:
August 2, 1982
MEMORANDUM
TO: All Dorothy Shamrock Employees
FROM: Frank Carr
REFERENCE: Announcement dated Friday, July
30, 1982
This past Friday evening, July 30, 1982, an an-
nouncement was made to several of you during a
meeting held in Indianapolis . The announcement
was made by written letter and read by Mr. Daryl
Douglass, Marketing Manager for Dorothy Coal
Sales , Inc. Mr . Douglass was sent to Indianapolis to
make this announcement due to the fact that your
division manager , Mr. Ben Henry , remained on va-
cation and the Vice President of Operations, Mr.
John Carr, was likewise on vacation.
Sometime the following day, Saturday, July 31,
Mr. Douglass placed a phone call to Dorothy
Shamrock and spoke with Mr. Jerry Ayers. It is my
understanding that Mr. Ayers was instructed by
Daryl Douglass to place a phone call to all Sham-
rock drivers and notify them that each of them had
been terminated.
As president of this company, I want you to
know that this was not a directive by the manage-
ment of this organization and it is not known at this
time why the directive was made by another em-
ployee.
Therefore, in order to clarify and perhaps add to
the previous announcement of Friday, July 30, I
have chosen to make another announcement which
you are now receiving. This announcement will be
read to you by either John Carr or Ben Henry.
As far as the notification as to termination, the
first announcement remains . It is my feeling that
some of you have been terminated due to your fail-
ure to perform your duties and carry out instruc-
tions in a satifactory manner with management.
This will take some time to evaluate your past per-
formance and will be answered to you in a personal
letter by me as stated in the first announcement.
Whereas some of you may be innocent and you
have performed your job, carrying out duties and
instructions satisfactorily to management . Those of
you that fall into this category would be considered
for employment once again with Dorothy Sham-
rock in the event that management decides to acti-
vate our trucks once again. Therefore, during the
interim, management realizes that some of you will
24 Scruggs at one point testified that he thought that in 1980 Respond-
ent took all the trucks out and made repairs on them , but later he testified
that he did not recall if all the trucks were ever taken out of service at
the same time before July 1982
1308 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
be and shall be entitled to unemployment compensa-
tion . Obviously, this is not a management decision.
Management recently received notice that our in-
surance had increased approximately 34% over and
above last year's cost. An increase such as this
along with a consistency of mechanical and other
increases weighed in making my announcement.
You will receive another announcement approxi-
mately the week of August 16. Until then , we will
not have any work for you.
FC: je:
Frank Carr, President
Its reader, John Carr, later extemporaneously remarked
to the assembled drivers "that he didn 't see how Frank
Carr could stay in business 30 days not running his own
trucks."
On August 3 Henry told Respondent's mechanics to
inspect the trucks and estimate repair costs . One of the
mechanics, Ayers, testified that it took 2 weeks to com-
plete this assignment , and that 70 percent of repairs listed
by the mechanics were required with the remainder
being of a minor nature. 2 5
On August 17 Respondent received the following
letter from its insurance brokers:
Yesterday we sent you a letter from Aetna Insur-
ance Company indicating that they would send you
direct notice of cancellation of your policy No.
CP44-75-07 on August 19, 1982, giving you 30
days notice of cancellation of your policy.
This letter is to give you formal notice that the
company is not under obligation to give you 30
days notice of cancellation because your premimum
has not been paid. The company is only under obli-
gation to give you 10 days notice of cancellation.
Therefore, this letter will give you formal notice that
all coverages provided under policy No. CP44- 75-07 is
being canceled as of August 31, 1982 at 12:01 A.M.
This cancellation date can be extended to Septem-
ber 19, 1982 by the receipt in our office of $2,300
premium before August 25.
If $2,300 premium is received by us before
August 25, we will send you another letter extend-
ing the cancellation date to September 19, 1982. If
you do not receive such a letter, then your insur-
ance has been canceled , as indicated above, as of
12:01 A.M. on August 31, 1982.
We have no other markets that are willing to
consider writing your insurance . We are very sorry
to have to take this action.28
as Respondent 's interoffice memorandum covering the repairs and
costs, dated August 27, 1982 , was received as G.C. Exh. 3. At $8 an hour
for labor (what Respondent pays its own mechanics ) the total projected
repair costs was $17,654 Estimated at the "going" rate for a mechanic
the figure was increased to $21,454 Henry testified that at the time of the
hearing herein no single truck was completely repaired but one or two
would pass a Department of Transportation inspection.
sa R Exh 37. By letter dated August 31 this letter was rescinded in
that it indicated that the Aetna policy would be canceled on September
29
Three days later Respondent sent the following memo-
randum to its drivers:
Date: August 20, 1982
INTER-OFFICE MEMORANDUM
TO: Russell Stidd, J. Wilson, G. Sharp, B. Cole
D. Henry, D. Beauchamp, N. Partlow
FROM: Frank Carr
REFERENCE:
On Monday, August 2, 1982, you were informed
that during the week of August 16, 1982, we would
make another announcement concerning our previ-
ous announcements to you dated July 30 and
August 2.
Because a complaint has been filed with the Na-
tional Labor Relations Board, we have been advised
by council [sic] not to discuss reinstitution oper-
ations or any other matters at the present time. We
will keep in touch with you, hopefully by next
week.
Frank Carr
President27
This was the last correspondence Respondent sent to
its drivers. Frank Carr testified that at one time Re-
spondent served 21 industrial plants but by the time of
the hearing herein it had only one full-time customer
under contract and two part-time customers;28 and that
Respondent
... lost an order. We were notified in April and
May that we were going to lose the business; and
we lost that business in May, and that was a loss of
25 truckloads per day, approximately, or a gross
revenue of approximately $275,000 a month.29
And that if Respondent's business increased considerably,
it would put its own drivers back to work to fulfill its
contracts to supply particular customers. Respondent has
used owner-operators since at least 1978,30 and Respond-
29 G C. Exh. 6.
ss Employees were not informed of this Frank Carr testified on this
matter as follows.
I don't think that it is any of the employees' business because we-I
do not feel that it is necessary to notify each and every employee of
the financial burden that we are experiencing-especially truck driv-
ers because truck drivers jump from company to company, and 1-I
just didn 't feel that it was necessary to share , other than-I mean, to
share these confrontations that we were experiencing because of the
difficulty that it could get us in with competitive companies Its [sic]
like all of your secrets going to the coal fields of Indiana I was
afraid of that at the beginning , and I was trying to save this compa-
ny, now [sic] tell every employee the exact dollar losses other than
just to give them a general idea of what we had been experiencing
29 Income statements introduced in this proceeding, discussed infra, do
not show that Respondent 's gross revenue was reduced by about
$275,000 in May 1982
so In 1978 Respondent owned four trucks and used four owner-opera-
tors . In 1979 it owned eight trucks and used eight owner-operators
During 1980 Respondent increased its company fleet to 10 trucks, the
same number it operated through July 1982 (except that it had 11 compa-
ny trucks in July 1981 ), and used between 7 and 10 owner-operators In
addition to its own fleet, Respondent utilized the services of between 8
and 10 owner -operators (depending on the season) in 1981 and either 9 or
10 owner-operators in the first 6 months of 1982 (R Exh 12 )
DOROTHY SHAMROCK COAL CO 1309
ent asserts that they contribute to profit more than.com-
pany drivers. However, when demand for transportation
service is great the owner-operators follow the "highest
dollar" and, according to Frank Carr, their service
would become inconsistent . Consequently, to properly
serve its customers , some of which have scheduled trans-
portation needs , Respondent would need its own trucks
and drivers when business improves.
Respondent, through Dorothy Coal Company's comp-
troller, Frederick Fink, who "keeps" Respondent's
books, introduced, as here pertinent, income statements
for 1980 and 1981 and for the first 6 months of 1982.
They are attached hereto as Appendices A,B, and C, re-
spectively.3 i Also, Fink sponsored an exhibit (R. Exh.
19) which is attached hereto as Appendix D, and which
is an analysis of leased driver profit contribution and a
comparative analysis of contribution to profit or loss by
leased and company drivers for, as here pertinent, the
first 6 months of 1982.32
Fink also sponsored exhibits covering Respondent's
repair and maintenance costs. As here pertinent, Re-
spondent's Exhibit 10 shows that from January through
June 1982 Respondent had a total expense (not including
a yard vehicle used to load trucks) of $37,459.33 Another
exhibit (R. Exh. 9) shows the following annual repair
costs:
1978 $30,385
1979 46,464
1980 50,728
1981 3454,683
Respondent's Exhibit 9 shows that it had repair costs of
$20,551 in May 1982. The previous 1-month high was
$13,959 which occurred in January 1981. Apparently the
exceptional May 1982 expense occurred because truck
number 3 "blew" an engine due to a mechanic's mistake.
The General Counsel introduced portions of a printout
which was the document underlying certain of the
above-described exhibits. Two pages of General Coun-
sel's Exhibit 8 are attached hereto as Appendices E and
F. As here pertinent, they cover, respectively, income
and specified truck expenses for the first 6 months of
1981 and for the same period in 1982.
B. Contentions
On brief, the General Counsel contends that albeit a
vague attempt was made, Scruggs never specifically
denied any of the alleged plant closing conversations he
had with Wilson and Sharp; that neither Scruggs' nor
31 R Exhs 21 , 20, and 15, respectively
32 The exhibit includes figures for July but this information would
only be probative if it was available to Frank Carr for consideration prior
to his July 30 decision regarding Respondent 's company drivers. Such
was not shown to be the case Up to August 1982 all general administra-
tive expenses were charged against the company trucks and none of it
was allocated to the owner -operators Respondent 's total sales in July (in-
cluding both company and leased drivers) was $58,255
33 The exhibit also shows that Respondent had repair and maintenance
expenses of $2472 for July 1982 (excluding the loader)
94 Respondent included the loader in calculating its expenses for 1982
It is assumed , therefore, that the 1978 through 1981 figures also include
the loader but the extent of such costs are not specifically stated
Henry's plant closing statements had any factual basis to
establish that the adverse consequences of closure was
beyond Respondent's control, that Henry did not deny
that he, in effect, advised Wilson in February 1982 of the
futility of seeking union representation; that the true
reason for the mass discharges or layoffs was merely the
first step in an attempt to rid itself of the two suspected
union supporters and to subsequently rehire those em-
ployees Respondent believed were antiunion ; that the
conclusion that Respondent embarked on its illegal plan
despite the fact the Union lost the election is inescapable
when the intense union hostility and the implausible,
shifting, and inconsistent reasons given by Respondent
for its actions are carefully scrutinized; that Carr's failure
to inform the employees of the real reason for their dis-
charge or layoff "suggests" that the reasons given at the
hearing and in the July 30 memorandum to employees
were not in fact the real ones; that Respondent did not
demonstrate that there was a substantial increase with re-
spect to the 1982 maintenance costs as compared to pre-
vious years;' that leased units always contributed more to
profit than did company units and, therefore, if Respond-
ent was that concerned about this, it would have used
leased units exclusively long before July 30; that in July
1982 business was booming for Respondent in that its
gross sales for the first 6 months of 1982 doubled those
from the same period in 1981; that Respondent's financial
records also show that it was ahead of the 1981 pace
with respect to net profit; that most revealing of Re-
spondent's illegal scheme is the nature of the major re-
pairs that were to be made to some of the company
trucks;35 that normally, from a business point of view, it
would not be prudent to take trucks which were making
a net profit out of service, and four of Respondent's
trucks did just that during the first 6 months of 1982 and
six of the trucks had a net profit during June 1982; and
that Vice President John Carr's August 2 extemporane-
ous remark questioned "this unusual, unprecedented and
irrational decision" and, when coupled with Scruggs'
statement that the arrangements had already been made
to go strictly to owner-operators, reveals the pretext.
It is asserted by the General Counsel that a prima facie
case has been made and that under Wright Line, 251
NLRB 1083 (1980), Respondent did not come forward
with evidence sufficient to rebut the case made by the
General Counsel.
With respect to the August 20 memorandum, the Gen-
eral Counsel contends that it violated the Act; that
[t]he hostility and illegal intent [of Respondent] is
seen in the phrase "or any other matters." It would
have suffice[d] to stop with discussion of any other
reinstitution of the operation. However, Respondent
sought to make it plain, that there was now abso-
lutely nothing to discuss with its employees since
the charges had been filed;
35 The General Counsel cites those costs listed in G C Exh 3 for
truck and trailer number 4, viz, $20 to repair a speedometer , $ 100 for
miscellaneous parts and supplies, and $50 for labor Also the General
Counsel cites tractor and trailer number 9 which had estimated repair
costs over 40 percent of which was the replacement of tires
1310 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and that there was no intervening circumstances which
could justify Respondent 's decision to cease consider-
ation of reopening.
Respondent , on brief, contends that the General Coun-
sel has failed to establish that the July 30 "shutdown"
was unlawful since "mere suspicion cannot substitute for
proof of an unfair labor practice ." It is Respondent's po-
sition that since the Union lost the election by a substan-
tial margin, even if assuming arguendo Scruggs and
Henry did make the alleged "plant closing or Respond-
ent will use owner operator statements ," such remarks
would not support a prima facie inference of discrimina-
tion because they were, according to Respondent , condi-
tioned on the Union's winning the election . It is argued
by Respondent that the "lack of coercive character in
those remarks is substantiated by the fact that they were
not deemed serious enough to even warrant an objection
to the June 11 election." Respondent contends that the
General Counsel has failed to establish any connection
between the actions alleged to be unlawful under Section
8(a)(1) and the July 30 "shutdown." Contrary to the po-
sition of the General Counsel , Respondent contends that
the July 1982 wage increase indicates that at that time
Frank Carr intended to keep operating with company
drivers. Even assuming arguendo that the General Coun-
sel has made a prima facie showing that the July 30
"shutdown" was motivated by earlier employee concert-
ed activity, Respondent contends that it has presented an
overwhelming amount of evidence that the "shutdown"
decision was prompted by legitimate circumstances
which either arose or came to a head after mid-July.
Specifically, Respondent contends that there was a coal
industry slowdown , a reduction in Respondent 's business
volume , and reduced rates for leased equipment. Also,
Respondent contends that although its use of leased driv-
ers resulted in a loss on this aspect of its operations of
$4718 in 1980, during 1981 leased drivers were operated
at a profit of $18 ,442 and in the first 6 months of 1982
the leased drivers operations contributed a profit of
$75,676. According to Respondent, there was a dramatic
increase in its truck maintenance costs in 1982 , Respond-
ent was faced with an increase in its insurance premium
which it did not pay, and the ICC challenged certain of
Respondent's operations.
Thompson Transport Co., 165 NLRB 746 (1967), modi-
fied on other grounds 406 F .2d 698 (10th Cir. 1969), and
U.S. Contractors, 257 NLRB 1180 (1981), are cited by
Respondent for the proposition that although it was con-
cluded in both of these cases that the respondents therein
had violated the Act during a union organizing drive,
the Board concluded that in both instances the respond-
ents had lawful economic motives for closing shortly
after losing an election to a union.
With respect to the alleged 8(aX4) violation, Respond-
ent contends that the evidence shows that its failure to
recall employees after July 30 was lawfully motivated
and not the result of the pending Board proceeding.
C. Analysis
For the reasons set forth below, it is my opinion that
the General Counsel has proven that Respondent violat-
ed the Act to the extent set forth in the complaint. As
alleged in paragraph 5(b) thereof, Henry told Wilson in
February 1982 that Respondent was not union , it never
had been, and it never would be. Contrary to Respond-
ent's assertion on brief (Br. 32), Henry did not specifical-
ly deny making this statement . It violates Section 8(a)(1)
of the Act in that it was made in an attempt to induce
Wilson to believe that union activities are futile. Fred
Lewis Carpet, 260 NLRB 843 (1982).
As alleged in paragraph 5(a) of the complaint, Re-
spondent, through Scruggs , violated Section 8(a)(1) of
the Act when he threatened Respondent 's employees
with closure or elimination of their jobs if they selected
the Union as their collective -bargaining representative.
For the reasons specified in footnote 3, supra , Scruggs is
a supervisor . Inasmuch as Frank Carr worked out of
Cincinnati, Respondent 's drivers looked , on a day-to-day
basis, to Henry and Scruggs for supervision. When
Henry was absent, Scruggs , under normal circumstances,
was the drivers ' only on-location supervisor. If, as
claimed by Scruggs , he was stating his personal opinion
this was not made known to the drivers . And even if
Scruggs couched his statements in terms of "might," this
would not have modified the coercive nature of the
statements . When asked by Cole why Respondent would
close its gates , Scruggs did not tell his own nephew that
this was just Scruggs ' opinion and that it was purely
speculation on his part. In the circumstances , Scruggs'
closure or elimination of jobs statements were unlawful
threats. 3 a
With respect to the allegation in paragraph 6(a) of the
complaint that Respondent unlawfully laid off or termi-
nated the above -described employees, it is concluded
that the General Counsel made a prima facie case of un-
lawful motivation . Respondent was openly hostile to
unionization . The man who ran the Indianapolis facility,
Henry, did not deny that he made the above-described
antiunion statements to Wilson . Scruggs also made un-
lawful antiunion statements . Scruggs did not deny his
postelection antiunion statements since as pointed out in
footnote 13, supra , his vague denial of discussing the
Union with Wilson and Sharp speaks only to that period
which occurred before the election. Consequently, it is
96 The cases cited by Respondent (Brs 31 and 32 ) can be distin-
guished Contrary to Respondent 's assertion on brief, the Board refused
to adopt the trial examiner 's characterization of the involved supervisor
in Wendt-Sonis Co., 138 NLRB 855 (1962), as a "minor supervisor" But
the Board agreed with the trial examiner that the supervisor's statements
were noncoercive expressions of personal opinion because the supervisor
initially responded that he "did not know " when an employee asked what
respondent's position on the union would be , and only after the employ-
ees specifically asked the supervisor for his personal opinion did the su-
pervisor state , " It wouldn't surprise him of anything , anything wouldn't
surprise him what would happen . . , it wouldn't surprise him if the
place wouldn't shut down , he didn 't know, that was his opinion " [Empha-
sis added ] It is noted that Respondent herein [Br 31] provided less than
the material quoted by the trial examiner in Wendt-Sonis Co, supra at
867 The trial examiner in Wendt concluded
It is reasonable to infer that [the involved supervisor] was ex-
pressing neither the Company's policy nor his personal conviction
that the plant would be closed to defeat the Union At most it was a
pure guess which [the] employee . persisted in obtaining Hence I
find that [the supervisor's] statement contained no threat of re-
pnsel against those who desired to unionize the plant
In the instant proceeding, Scruggs' closure or elimination of jobs state-
ments could reasonably be understood to be the position of Respondent
DOROTHY SHAMROCK COAL CO 1311
not refuted that Scruggs told Wilson and Sharp shortly
after the election that arrangements had been made to
handle Respondent's hauls strictly with leased drivers or
owner-operators. Respondent had been placed on notice
by Wilson that he was the "union instigator." Subse-
quently, Wilson was out of work for 1 week in July be-
cause his truck needed a tire changed. Respondent did
not even attempt to refute Wilson's testimony that in the
past this type of problem could be remedied in 30 min-
utes but that under a system implemented by Respondent
shortly after the election to have a tire changed, among
other repairs, a requisition had to be drafted in Indianap-
olis, it had to be forwarded by regular mail to Frank
Carr in Cincinnati, it had to be approved, and if ap-
proved it was returned to Indianapolis by regular mail. It
is not asserted by Respondent that this is a reasonable
business practice. In my opinion, Respondent was teach-
ing Wilson a lesson; it was once again demonstrating its
union animus . When the drivers were laid off or termi-
nated on July 30, they were advised that this action was
being taken because "[m]any of you have ignored the
[new driver] forms and failed to carry out instructions
and perform your duties as ordered."
On August 2 the drivers were advised:
Management recently received notice that our
truck insurance had increased approximately 34%
over and above last year's cost. An increase such as
this along with a consistency of mechanical and
other increases weighed in makng my announce-
ment.
As noted, supra, Respondent did not introduce the no-
tification it received regarding increased premiums. It
did introduce a letter from its insurance broker which
advised that the broker could not locate another compa-
ny willing to insure Respondent. The problem, however,
was not that Respondent's insurer was going to cancel
the coverage Rather, it was going to increase the premi-
ums. While Respondent chose not to pay the increase
premium, apparently, in light of the quotation Respond-
ent received from another insurer-$70,000 versus the
premium for truck insurance it would be charged by its
regular insurer-the increased premium could not be
characterized as clearly unreasonable. In deciding not to
pay the premium, Respondent did not sell its trucks so as
to obviate the need for insurance in the future. Rather, it
kept its trucks, and repaired them with the expectation of
using them in the future. If it does, Respondent would
have to insure them. With its present position, Respond-
ent has not escaped this business cost. Rather, it has
simply put it off. Was Frank Carr's decision to cancel
the insurance on the company trucks in the summer of
1982 justifiable from a business standpoint. With the in-
formation available at that time, it is my opinion that
Frank Carr's choice cannot be justified strictly on an
economic basis.
With respect to Frank Carr's referring to "a consisten-
cy of mechanical and other increases" it is noted that
there was an increase in Respondent's total sales in the
first 6 months of 1982 over the first 6 months of 1981.
While owner-operators and leased drivers handled a
great deal of the increased sales, the portion of sales han-
dled in company trucks in the first 6 months of 1982 in-
creased about 25 percent on a dollar basis over that han-
dled during the first 6 months of 1981. Admittedly, a
portion of the increased dollar amount of sales might be
attributable to inflation. But otherwise it should be ex-
pected that with increased sales there would be increased
utilization of equipment and, therefore, increased repairs
and maintenance costs. Approximately 21 percent of the
total sales for the first 6 months of 1981 were offset by
repairs and maintenance costs. Slightly less than 22 per-
cent of the total sales for the first 6 months of 1982 were
offset by repair and maintenance costs. In my opinion
this increase was not drastic enough standing alone or
even when considered a long with the other alleged
problems Respondent was experiencing at this time to
cause it to cease, for a period, utilizing company
trucks.3 7
One of the other problems Respondent cited at the
hearing herein is the above-described ICC inquiry. How
this could weigh in determining temporarily to cease uti-
lizing company trucks is difficult to understand. Al-
though Carr testified that it was determined in the latter
part of July that Respondent was operating illegally in
interstate commerce, he was, by letter dated Friday, July
30, asking his attorney's advice in this matter. The July
30 letter, set out above, does not indicate that it had al-
ready been determined that Respondent was operating il-
legally in interstate commerce. Indeed, it was not until
mid-October that one of Respondent's attorneys gave
Respondent's position to the ICC verbally and then later
that same day, October 15, by letter. See footnote 22,
supra. This letter provides information which apparently
demonstrates, regarding one part of the ICC inquiry, viz,
intercorporate hauling, that company trucks were used
"under an authorization to perform intercorporate haul-
ing by letter notice by the [ICC]." Because the October
15 letter goes on to indicate that interstate movements
ceased about May 15 (before the ICC began its inquiry),
it can be concluded that the latter notice was filed prior
to May 15 or, in other words, prior to the involved
layoff. The October 15 letter goes on to state that Re-
spondent would apply to the ICC if it conducted inter-
state operations with leased equipment. So the problem
was not with company-owned equipment but rather with
leased equipment. At the hearing herein, Carr testified
that when he testified he understood this. From any rea-
sonable standpoint, the ICC inquiry could not be a justi-
fication for temporarily terminating the use of company-
owned equipment.
Without Scruggs' statement to Wilson and Sharp,
made shortly after the election, that arrangements had
been made to use strictly owner-operator or leased driv-
ers, it would be difficult to understand why Frank Carr
did just that as of July 30. The inadvisability of such an
approach as of July 30 was highlighted in John Carr's
extemporaneous remarks made to the laid-off drivers on
81 The loader is not included in the 1982 calculation Apparently it is
included in the 1981 figures but the evidence of record does not reveal
the extent This factor , however, should not cause that great a change in
the 1981 costs so as to make these conclusions invalid
1312 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
August 2. Approval for arrangements for Respondent to
use only owner-operators or leased drivers had to come
from Frank Carr. And, as pointed out by the timing of
Scruggs' undemed statement, such arrangements were
made before Carr was in possession of the printout cov-
ering the financial condition of Respondent for the first 6
months of 1982. When the layoff or termination oc-
curred, Respondent's sales were comparatively high.
Frank testified that owner-operators or leased drivers
cannot be counted on to continually render the same
type of service as company drivers operating company
trucks. He realized the need to operate company trucks
and to supplement the company fleet with owner-opera-
tors. As of July 1982 there was no reason for not believ-
ing that Respondent would not continue to need the use
of company equipment in conjunction with owner-opera-
tors. Indeed, even though Frank Carr took company
trucks out of service, he did not sell them for he fully
appreciated the need for company equipment. His posi-
tion at the hearing, however, was that when Respond-
ent's business improves, it would again need the compa-
ny equipment. But what Respondent's business was alleg-
edly like at the time of the hearing herein in October
1982 cannot be used to justify a decision made in June or
July 1982. Carr's assertion that he could get the type of
service he needed at that time from owner-operators and
did not need to use company equipment is belied by the
fact, as testified to by Carr, that when Respondent re-
duced the rate it paid owner-operators in June 1982, 9 of
the 15 owner-operators it had been utilizing ceased to
render service to Respondent. Carr did not impress me
as being a credible witness and his testimony that owner-
operators were not "necessarily" concerned with making
a profit but would render service if they could "break
even" cannot be credited without some type of corrobo-
ration.
The alleged business justifications supplied by Re-
spondent for the July 30 layoff or termination are, in my
opinion, pretextual. But if this portion of the proceeding
were to be disposed of under Wright Line, 251 NLRB
1083 (1980), it is concluded that the General Counsel
made a prima facie case that in laying off or terminating
the drivers Respondent was reacting to the attempt to
unionize. Absent this, the layoff or termination would
not, in my opinion, have occurred. The alleged business
justifications advanced by Respondent, standing along or
viewed collectively, do not explain Respondent's July 30
action. Therefore, one is left with the unlawful motiva-
tion as being the cause of Respondent utilizing only
owner-operators.38
Does the above-described August 20 memorandum
which states: "[b]ecause a compalint [sic] has been filed
with the . . . Board, we have been advised by council
[sic] not to discuss reinstitution of operations or any
other matters at the present time" violate Section 8(a)(1)
of the Act? In my opinion it does. Respondent, in argu-
ing the contrary, cites a number of cases which can be
99 Cases cited by Respondent, i.e, Thompson Transport Co, 165 NLRB
746 (1967), and US Contractors, 257 NLRB 1180 ( 1981), are distinguish-
able in that in those cases there were bona fide economic reasons for re-
spondents' action
distinguished from the instant proceeding. Respondent
points out that in the first, Charlton Press, 129 NLRB
1352 (1960), the Board held that an employer confronted
with Board proceedings is entitled to pause to have its
legal position evaluated without violating the Act. In
Charlton Press, supra, it was found that the respondent
therein did not refuse to give an individual a job because
a charge had been filed with the Board but merely post-
poned the final decision on the job offer until respondent
could consult its attorney. Here, on its face the August
20 memorandum demonstrates that Respondent herein
had already consulted its attorney. In fact it was acting
in accord with the advice of its attorney. Once again,
Respondent fails on brief to provide all the relevant por-
tions of a quote. In quoting portions of S.L. Industries,
252 NLRB 1058 (1980), on page 45 of its brief Respond-
ent left out the following found at 1071-1072 of the deci-
sion:
I find that reinstatement had been denied the three
employees before the charge was filed and that the
filing of the charge did not cause denial of reinstate-
ment to them. However, as Wright's [a supervisor]
statement to Miller [an employee] conveyed that the
filing of the charge had cut off further consideration
of the possibility of reinstatement, I find that her
statement violated Section 8(a)(1) of the Act. [Em-
phasis added, footnote omitted.]
Whereas it is Respondent's contention that S.L. Indus-
tries, supra, stands for the proposition that an employer
can refuse without violating Section 8(a)(4) to discuss re-
instatement with unlawfully discharged employees until
Board proceedings are resolved, the Board's notice at
1059 of S.L. Industries states , "WE WILL NOT convey to
our employees that they cannot be reinstated because
charges in their behalf are pending." Although on
August 2 the employees were advised that Respondent
might "activate" its trucks once again and those drivers
who performed their jobs would be considered for em-
ployment at that time, Respondent, after discussing with
its attorney the fact that a charge had been filed with the
Board, decided, on advice of counsel, not to discuss with
employees the possibility of reinstitution of operations or
any other relevant matter. The August 20 memorandum
conveyed this to the employees. Respondent's decision
not to discuss reinstitution on operations or other matters
was not made before the charge was filed. To make this
decision, even on advice of counsel, solely because the
charge was filed violates Section 8(a)(4) of the Act. And
in conveying this to employees Respondent violated Sec-
tion 8(a)(1) of the Act.
CONCLUSIONS OF LAW
1. The Respondent is an employer engaged in com-
merce within the meaning of Section 2(2), (6), and (7) of
the Act.
2. The Union is a labor organization within the mean-
ing of Section 2(5) of the Act.
3. By threatening employees with closure or elimina-
tion of their jobs, and by informing an employee that it
would be futile to select a union to represent employees,
DOROTHY SHAMROCK COAL CO.
Respondent has engaged in unfair labor practices in vio-
lation of Section 8(a)(1) of the Act.
4. By laying off or terminating the seven employees
described below on July 30 and by failing and refusing
to recall these employees, Respondent violated Section
8(a)(1) and (3) of the Act.
5 By informing its employees on August 20 that it
would not discuss reinstitution of its operations or any
other matters because a charge had been filed with the
Board, and by failing and refusing to recall or reinstate
its employees, Respondent violated Section 8(a)(1) and
(4) of the Act
6. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
THE REMEDY
Having found that Respondent has engaged in certain
unfair labor practices, I shall recommend that Respond-
ent be ordered to cease and desist therefrom and to take
certain affirmative action designed to effectuate the pur-
poses of the Act.
Having found that Respondent unlawfully laid off or
discharged Jack Wilson, Glen Sharp, Duane Henry, Don
Beauchamp, Barry Cole, Russell Stidd, and Norman
Partlow in violation of Section 8(a)(1) and (3) of the Act,
I recommend that Respondent offer them immediate and
full reinstatement to their former jobs or, if those jobs no
longer exist, to substantially equivalent positions without
prejudice to their seniority or other rights and privileges,
and take those steps necessary to reinstitute the use of
company trucks. The above-named individuals shall be
made whole for any loss in pay they may have suffered
as a result of the discrimination against them by payment
to them of a sum of money equal to that which they
would have earned as wages during the period from the
date of their layoffs or termination to the date on which
Respondent offers reinstatement less their net earnings, if
any, during the period, with interest thereon to be com-
puted in the manner set forth in F. W. Woolworth Co., 90
NLRB 289 (1950), and Florida Steel Corp, 231 NLRB
651 (1977).39
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
ed4o
99 See generally Isis Plumbing Co, 138 NLRB 716 (1962)
40 If no exceptions are filed as provided by Sec 102 46 of the Board's
Rules and Regulations , the findings , conclusions, and recommended
Order shall, as provided in Sec 102 48 of the Rules, be adopted by the
1313
ORDER
The Respondent, Dorothy Shamrock Coal Company,
Indianapolis, Indiana, its officers, agents, successors, and
assigns, shall
1. Cease and desist from
(a) Threatening employees with closure or elimination
of their jobs for exercising rights guaranteed by Section
7 of the Act.
(b) Informing employees that it would be futile to
select a union to represent employees.
(c) Conveying to employees that reinstitution of oper-
ations or any other matter would not be discussed be-
cause a charge had been filed with the Board.
(d) Laying off or discharging employees because they
engaged in activities protected by the Act and refusing
to reinstate employees because of their protected con-
certed activities and because a charge was filed with the
Board.
(e) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of the
rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Offer Jack Wilson, Glen Sharp, Duane Henry, Don
Beauchamp, Barry Cole, Russell Stidd, and Norman
Partlow immediate and full reinstatement to their former
jobs or, if their jobs no longer exist, to substantially
equivalent positions, without prejudice to their seniority
or other rights and privileges, taking those steps neces-
sary to reinstitute the use of company trucks. These indi-
viduals shall be made whole for their lost earnings in the
manner set forth in the remedy section of the decision.
(b) Post at its facility in Indianapolis, copies of the at-
tached notice marked "Appendix G."41 Copies of the
notice, on forms provided by the Regional Director for
Region 25, after being signed by the Respondent's au-
thorized representative, shall be posted by the Respond-
ent immediately upon receipt and maintained for 60 con-
secutive days in conspicuous places including all places
where notices to employees are customarily posted. Rea-
sonable steps shall be taken by the Respondent to ensure
that the notices are not altered, defaced, or covered by
any other material.
(c) Notify the Regional Director in writing within 20
days from the date of this Order what steps the Re-
spondent has taken to comply.
Board and all objections to them shall be deemed waived for all pur-
poses
41 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading "Posted by Order of the Nation-
al 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 "
1314 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX A-Dorothy Shamrock Statement of Operations Before Yearend Adjustments
Overall for the Year 1980
Jan. Feb. Mar Apr May June July Aug. Sept. Oct. Nov. Dec. Total
Total Sales $73,981 $86,474 $95,636 $76,695 $67,842 $57,914 $75,733 $56,140 $69,919 $86,549$114,981$161,590 $1023,454
Cost of
Sales 75,633 96,551 80,036 86,841 72,446 51,752 65,913 61,520 53,543 69,265 104,600 154,240 972,340
Gross Profit
(Loss) (1,652) (10,077) 15,600 (10,146) (4,604) 6,162 9,820 (5,380) 16,376 17,284 10,381 7,350 51,114
Selling
Expenses 3,284 3,251 2,872 2,968 3,029 3,066 3,305 4,713 3,449 3,247 3,347 6,307 42,838
Gen. &
Adm.
Expenses 3,929 3,772 3,983 3,794 3,340 6,648 7,495 4,761 3,879 9,866 4,346 3,186 58,999
Net Profit
(Loss)
Before
Taxes $8,865)($17,100) 8,745($16,908)($10,973) $3,552) $980)($14,854) 9,048 4,171 $2,688 ($2,143) $50,723)
APPENDIX B-Dorothy Shamrock Statement of Operations Before Yearend Adjustments
Overall for the Year 1981
Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec Total
Total
Sales $193,135 $131,108 $129,490 $41,515 $19,339 $63,400 $27,665 $57,206 $47,411 $79,300 $117,824 $255,721 $1,163,114
Cost of
Sales 209,136 150,057 136,882 49,299 28,023 53,477 37,577 51,792 40,671 65,407 86,436 251,918 1,160,675
Gross
Profit
(Loss) ($16,001) ($18,949) ($7,392) ($7,784) ($8,684) $9,923 ($9,912) $5,414 $6,740 $13,893 $31,388 $3,803 $2,439
Selling
Ex-
penses $2,669 $2,999
$5,007 $2,203 $273 $1,861 $3,344 $2,933 $2,912 $3,051 $2,797 $8,769 $38,818
Gen. &
Adm.
0Ex- 0penses 12,813 3,993 5,299 6,899 11,305 5,905 4,906 6,351 5,433 6,120 6,910 22,495 98,429 O
Net
Profit
(Loss)
Before
Taxes $31,483) $25,941) $17,698) $ 16,886) $20,262) 2,157 $18,162) $3,870) $1,605) 4,722 21,681 $27,461) $134,808) Y
0
A
A
O
r
A
0
1316 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX C-Statement of Operations Before Yearend Adjustments
Overall for the Period 1/1/82-6/30/82
Jan Feb Mar Apr May June Total
Total Sales $276,147 $226,210 $267,572 $256,417 $128,367 $99,140 $1,253,853
Cost of Sales 247,856 228,562 254,328 235,030 139,287 95,680 1,200,743
Gross Profit (Loss) $28,291 ($2,352) $13,244 $21,387 ($10,920) $3,460 $53,110
Selling Expenses $4,064 $3,132 $2,910 $3,614 $3,279 $3,139 $20,138
General Adm. Expenses 7,047 7,568 5,860 23,377 12,441 10,307 66,600
Net Profit (Loss) Before Taxes $17,180 ($13,052) $4,474 ($5,604) ($26,640) ($9,986) ($33,628)
APPENDIX D-Dorothy Shamrock-Analysis of Leased Drivers Profit Contribution Before Audit Adjustments
for the Period Ending September 30, 1982
Jan. Feb Mar Apr May June Total July Aug Sept Total
Total Sales $219,895 $182,254 $212,882 $204,734 $87,160 $54,489 $961,414 $16,026 $49,984 $51,901 $1,079,325
Cost of Sales 192,198 169,262 205,114 189,725 $78,767 $50,672 $885,738 $14,436 $32,133 $49,417 $981,724
Gross Profit (Loss) $27,697 $12,992 $7,768 $15,009 $8,393 $3,817 $75,676 $1,590 $17,851 $2,484 $97,601
Dorothy Shamrock-Comparative Analysis of Contribution to Profit (Loss) Before Taxes Before Audit Adjustments
for the Period Ending September 30, 1982
Profit (Loss) Jan. Feb. Mar. Apr. May June Total July Aug Sept Total
Leased Drivers $27,697 $12,992 $7,768 $15,009 $8,393 $3,817 $75,676 $1,590 $17,851 $2,484 $97,601
Shamrock Drivers ($10,517) ($26,044) ($3,294) ($20,613) ($35,033) ($13,803) ($109,304) ($1125) - - ($110,429)
1318 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX E-Dorothy Shamrock Coal Company, Inc.
Statement of Operations Overall
CURRENT PERIOD YEAR TO DATE
Fr Jun 01 82 to Fr Jun 01 81 to Van- Fr Jan 01 82 to Fr Jan 01 81 to Variance
Jun 30 82 Jun 30 81 ance Jun 30 82 Jun 30 81
Amt Pct. Amt. Pct Amt. Amt Pct. Amt. Pct.
Amt. Pct.
Income
Commissions-Dorothy
Coal 19,373.53 306 19,374- 20,177.21 3 5 20,177- 1000
Fees Hauling-Dorothy
Coal 69,567.66 702 44,026.27 69.4 25,541 914,773.84 73.0 557,809 52 96 5 356,964 64.0
Fee Hauling D.S -Stor-
age 29,57209 29.8 29,572 339,079.33 27.0 339,079
Total Income 99,139.75 1000 63,399. 80 100.0 35,740 1,253,853.17 100.0 577,986.73 100.0 675,866 116.9
Cost of Sales
per Schedule C1 95,680.27 965 53,476.48 84 .3 42,204 1,216,414 26 97.0 617,980 57 1069 598,434 96.8
Gross Profit 3,459.48 3.5 9,923 32 15.7 37,438.91 3.0
Gross Loss 6,464- 39,993.84- 6.9 77,433 193.6
Selling Expenses
per Schedule S1 3,139.14 3.2 1,86069 29 1,278 20,419 24 16 15,010.88 2.6 5,408 36.0
Gen. & Adm.
per Schedule GI 7,569 52 76 3,523.46 5.6 4,046 51,673.59 41 26,868 88 4.6 24,805 92.3
Other Income & Expense
Interest Income 175 12 175- 100.0
Rental Income 78000 1 78000 1
Other Income 1 ,666.66 1.7 1,666.66 26 10,303 64 8 12,215.76 2 1 1,912- 15.7
Interest Expense 4,403 36- 4.4 4,048.81- 64 355- 25,649 59- 20 24,055.01 4.2 1,595- 6.6
Total Other Income
& Expense 2 ,736.70- 28 2,382 15- 3.8 355- 14,565.95- 1.2 10,884.13- 1.9 3,682- 33.8
Profit Before Taxes 2,15702 34
Pretax Loss 9,985 88- 101 12,143- 49,219.87- 3.9 92,757.73- 16.0 43,538 46.9
Net Profit 2,157.02 3.4
Net Loss 9,985 .88- 10 1 12,143- 49,219.87- 39 92,757 73- 160 43,538 46.9
APPENDIX F-Dorothy Shamrock Coal Company, Inc.
Statement of Operations Overall
CURRENT PERIOD YEAR TO DATE
Fr Jun 01 82 to Fr Jun 01 81 to Van- Fr Jan 01 82 to Fr Jan 01 81 to Variance
Jun 30 82 Jun 30 81 ance Jun 30 82 Jun 30 81
Amt Pct Amt. Pct Amt Amt. Pct. Amt. Pct. Amt Pct.
Cost of Sales Schedule C1
Salaries Truck Management 1,54270 16 651.71 1.0 891 11,326 36 .9 7,682.69 1.3 3,644 47.4
Salaries Trucking 8,67701 8.8 10,254.19 162 1,577- 57,224.38 46 59,781.46 10.3 2,557- 4.3
Salaries Maintenance 2,573.94 2.6 545 45 9 2,028 14,867.63 12 7,216.13 1.2 7,652 106.0
Payroll Txs & Fringe Benefit 2,798.29 28 1,839,82.00 2.9 958 16,259 36 1.3 13,130.63 2.3 3,129 23 8
Hauling Expense-Contractor 33,644 87 33 9 33,645 624,408 90 49 8 324,036.85 56.1 300,372 92.7
Hauling Storage Contractors 17,065 83 17 2 17,066 259,439.57 207 259,440
Truck Insurance 1,99100 20 2,598.43 41 607- 12,327 00 10 14,443 10 2.5 2,116- 147
Truck Fuel/Oil 6,91677 70 16,118.38 25.4 9,202- 102,737 32 8.2 89,692.73 15 5 13,040 14.5
Truck Tires 2,738.22 28 1,493 64- 2.4 4,232 10,386 77 .8 3,951.72 7 6,435 162.8
Truck Tire Repair 9140 1 91 135.57 136
Truck Repairs & Maint 5,35004 5.4 12,777.84 202 7,428- 44,943.95 3.6 36,095.17 62 8,849 24.5
Truck Other Exp. 1,847.20 19 2,327 20 3.7 480- 16,205.51 13 8,378.52 1.4 7,827 93 4
Truck Interest 855 15 .9 2,011 10 3.2 1,156- 5,185.11 .4 16,154.40 28 10,969- 67.9
Truck Depreciation 5,58600 5.6 5,296.00 84 290 33,51600 2.7 32,751.00 57 765 2.3
Yard Equip. Depreciation 64000 .6 550.00 .9 90 3,840.00 3 3,293.00 6 547 16.6
Yard Maintenance 3,361.85 3.4 3,362 3,61083 3 1,368.17 2 2,243 1639
Total Cost of Sales 95,680.27 96 5 53,476.48 84 3 42,204 1,216,414.26 970 617,980.57 1069 598,434 96.8
Selling Expenses Schedule SI
Salaries-Management 2,541.66 2.6 1,145.84 1 8 1,396 15,399.96 1 2 9,854.22 1.7 5,546 563
Salary Incentive Pay 224.32 4 224- 2,665.56 5 2,666- 100.0
DOROTHY SHAMROCK COAL CO 1319
APPENDIX F-Dorothy Shamrock Coal Company, Inc -Continued
Statement of Operations Overall
CURRENT PERIOD YEAR TO DATE
Fr Jun 01 82 to Fr Jun 01 81 to Vari- Fr Jan 01 82 to Fr Jan 01 81 to Variance
Jun 30 82 Jun 30 81 ance Jun 30 82 Jun 30 81
Amt. Pct. Amt Pct. Amt Amt. Pct. Amt. Pct.
Amt Pct
Advertising 18.00- 18 - 355.60- 53.40 409- 765.9
Auto Expense 356 03 .4 240.53 4 116 2,913.23 .2 937.70 .2 1,976 210.7
Consulting Fee 500.00 500
Travel & Entertainment 9.45 9 461.65 462
Depriciation-Auto 250.00 .3 25000 4 1,50000 1 1,50000 3
Total Selling Expenses 3,139.14 3.2 1,86069 29 1,278 20,419 24 1 6 15,010 .88 2.6 5 ,408 36.0