Eagle Transport Corp.

National Labor Relations Board - Board Decisions

Nov 4, 2002

338 N.L.R.B. 489 (N.L.R.B. 2002)

EAGLE TRANSPORT CORP. 489
Eagle Transport Corporation and International Broth-
erhood of Teamsters, Georgia-Florida Confer-
ence, AFL–CIO. Cases 12–CA–21397–3, 12–CA–
21397–4, 12–CA–21397–14, and 12–CA–21494
November 4, 2002
DECISION AND ORDER
BY MEMBERS LIEBMAN, COWEN, AND BARTLETT
On May 15, 2002, Administrative Law Judge Margaret
G. Brakebusch issued the attached decision. The General
Counsel filed exceptions and a supporting brief. The Re-
spondent filed an answering brief.
The National Labor Relations Board has considered the
decision and the record in light of the exceptions and
briefs, and has decided to affirm the judge’s rulings, find-
ings, and conclusions1 and to adopt the recommended Or-
der.
The judge dismissed the Union’s claims that the Re-
spondent unilaterally announced and implemented a
schedule change and rescinded a wage increase in viola-
tion of Section 8(a)(5) and (1) of the Act. We agree with
the judge’s disposition of these claims.
The Respondent operates a petroleum products delivery
business from terminals in several States including Flor-
ida. On December 21, 2000, the drivers and mechanics at
its Cocoa, Florida facility elected the Union as their bar-
gaining representative.
In the fall of 2000, before the advent of the Union, Co-
coa Terminal Manager John Fitzgerald mentioned to sev-
eral of the Cocoa terminal drivers that the Respondent was
considering a new work schedule. On January 1 or 2,
2001, Fitzgerald discussed the proposed change with the
Cocoa employees during a safety meeting and indicated
that drivers would be permitted to begin signing up for
preferred schedules based on seniority. The drivers began
to do so on January 2. On January 4, the Union was certi-
fied, and, on January 15, the Respondent recognized the
Union.
In a letter dated January 22, the Respondent informed
the Union that it intended to modify the drivers’ schedules
and offered to discuss this plan with the Union. On Janu-
ary 23, after receiving the Union’s response that such a
modification would be an unlawful unilateral change, the
Respondent ceased soliciting driver shift preferences. A
new schedule was never implemented.
Thereafter, before bargaining with the Union had begun,
the Respondent notified employees at all of its terminals

1 No exceptions were filed regarding the judge’s conclusion that the
Respondent violated Sec. 8(a)(5) and (1) by unilaterally subcontracting
bargaining unit work, or her dismissal of the complaint allegation that
the Respondent violated Sec. 8(a)(1) by engaging in surveillance of
employees engaged in union activities.
except the Cocoa facility that they would be receiving a
wage increase. However, on February 1, when the in-
crease was implemented, the raise was also granted to the
Cocoa drivers as a result of a computer programming er-
ror. On February 15, when one of the drivers informed the
Respondent of the error, the Respondent corrected the
error, returning the employees to their previous wage rates.
We agree with the judge that the Respondent’s conduct
concerning its planned shift change is distinguishable from
the unilateral changes found unlawful in Kurdziel Iron of
Wauseon, 327 NLRB 155 (1998), and ABC Automotive
Products, 307 NLRB 248 (1992).2 In those cases, the
Board found that the employer’s announcement of
changes would suggest to the employees that their collec-
tive-bargaining representative “had no voice” regarding
the impending change because the changes were effec-
tively implemented when they were announced. Kurdziel,
supra at 156. In this case, by contrast, we find that a rea-
sonable employee would not understand Terminal Man-
ager Fitzgerald’s discussions about the proposed schedule
change as the announcement of a change that was effec-
tively implemented. ABC Automotive, supra at 250.3
Thus, no message that the Respondent was taking it on
itself to set new terms and conditions of employment was
conveyed. Moreover, the Respondent’s discontinuation of
its planned changes after it notified the Union of its plan
and the Union objected would tend to reinforce, not un-
dermine, the Union’s relevance with respect to the em-
ployees’ working conditions.4
We also agree with the judge that the Respondent did
not violate Section 8(a)(5) and (1) by returning unit em-
ployees to their previous wage rates. This was not a situa-
tion involving the granting and subsequent rescission of a
wage increase. Rather, an administrative error resulted in
2 Member Cowen agrees with his colleagues that the instant matter is
distinguishable from Kurdziel Iron and ABC Automotive; thus, he finds
it unnecessary to consider the continuing validity of those decisions.
3 We find it unnecessary to rely on the judge’s finding that Fitzger-
ald did not announce the scheduling change because, even if his con-
duct could be construed as an announcement, it would not have caused
the employees to believe that their working conditions had actually
changed. Cf. Kurdziel, supra at 155–156.
Member Cowen agrees with his colleagues that it is not technically
“necessary” to rely on the judge’s finding regarding the alleged an-
nouncement. Nevertheless, Member Cowen is of the view that it is
important for the Board to provide guidance to the General Counsel and
the public regarding such issues. In this respect, Member Cowen notes
his agreement with the judge that Fitzgerald’s discussions with the
employees did not rise to the level of announcing a change in the
schedules.
4 Member Liebman notes that the General Counsel has neither al-
leged nor argued that the Respondent’s conduct in soliciting driver shift
preferences constituted direct dealing with employees in violation of
Sec. 8(a)(5). In joining this decision, she expresses no opinion on the
viability of such a claim here.
338 NLRB No. 55
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 490
the miscalculation of wages in a single paycheck, and the
Respondent promptly corrected the error upon discovering
it. We find that this correction did not involve a change in
the employees’ terms and conditions of employment and,
therefore, did not require bargaining.
ORDER
The National Labor Relations Board adopts the recom-
mended Order of the administrative law judge and orders
that the Respondent, Eagle Transport Corporation, Cocoa,
Florida, its officers, agents, successors, and assigns, shall
take the action set forth in the Order.

Christopher Zerby, Esq., for the General Counsel.
Thomas Hodges, Esq. and Howard Daniel, Esq., for the Respon-
dent.
DECISION
STATEMENT OF THE CASE
MARGARET G. BRAKEBUSCH, Administrative Law Judge. This
case was tried in Cocoa, Florida, on April 11, 2002. The charge
in Case 12–CA–21397–31 was filed by International Brotherhood
of Teamsters, Georgia-Florida Conference, AFL–CIO (the Un-
ion) on March 21, 2001, against Eagle Transport Corporation
(the Respondent). The original charge in Case 12–CA–21397–4
was filed by the Union on March 21, 2001, and amended on July
27, 2001. The original charge in Case 12–CA–21397–14 was
filed by the Union on March 21, 2001, and amended on June 17,
2001. The Union filed the charge in Case 12–CA–21494 on May
2, 2001. Based on these charges, the Regional Director for Re-
gion 12 of the National Labor Relations Board (the Board) issued
an Order consolidating cases, consolidated complaint, and notice
of hearing on November 30, 2001. The consolidated complaint
alleges that Respondent violated Section 8(a)(5) and (1) of the
National Labor Relations Act (the Act), by announcing and im-
plementing a new work schedule and job bidding system, re-
scinding a wage increase, and subcontracting work without prior
notice to the Union and without affording the Union an opportu-
nity to bargain with respect to conduct. The consolidated com-
plaint further alleges that Respondent violated Section 8(a)(1) of
the Act by engaging in surveillance of employees engaged in
union activities.
Respondent filed an answer denying the essential allegations
in the complaint, and asserting certain defenses.
On the entire record,2 including my observation of the de-
meanor of the witnesses, and after considering the briefs3 filed by
the General Counsel and Respondent, I make the following

1 All dates are in 2001 unless otherwise indicated.
2 In his brief, counsel for the General Counsel confirms that the court
reporting service was notified that portions of the testimony were omit-
ted from the original transcript. By memorandum dated April 25, 2002,
the court reporting service acknowledged that after an extensive audit,
the transcript was redone and an amended and corrected transcript was
submitted.
3 After filing its posthearing brief, Respondent filed a motion to file
a reply brief. Respondent asserts that the motion is based upon its
desire to distinguish a Board case cited by counsel for the General
FINDINGS OF FACT
I. JURISDICTION
The Respondent, a corporation, is engaged in the nonretail
transport and delivery of petroleum products at its facilities in
Cocoa and Jacksonville, Florida, where it annually purchases and
receives goods valued in excess of $50,000 directly from points
located outside the State of Florida. The Respondent admits and
I find that it is an employer engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act and that the Un-
ion is a labor organization within the meaning of Section 2(5) of
the Act.
The Respondent admits, and I find, that the following employ-
ees of the Respondent constitute a unit appropriate for the pur-
poses of collective bargaining within the meaning of Section 9(b)
of the Act:
All full-time and regular part-time drivers (dispatched out of
Cocoa, Florida) and mechanics employed by the Respon-
dent at its Cocoa, Florida facility, excluding all other em-
ployees, guards and supervisors as defined in the Act.4
II. ALLEGED UNFAIR LABOR PRACTICES
A. Background
Respondent is engaged in the business of transporting and de-
livering gasoline and diesel fuel products. In mid-2001, Respon-
dent operated 18 terminals in six States including terminals in
Cocoa, Jacksonville, Tampa, and Fort Lauderdale, Florida. On
December 21, 2000, a majority of the employees in the unit de-
scribed above, elected the Union as their bargaining representa-
tive. On January 4, 2001, the Union was certified as the exclu-
sive bargaining representative of the unit. In a letter dated Janu-
ary 15, Respondent recognized the Union as the exclusive bar-
gaining representative for the Cocoa unit employees and ac-
knowledged its willingness to negotiate with the Union. The first
bargaining session for the Respondent and the Union occurred on
February 28. Respondent’s facility in Cocoa, Florida, remained
in operation until September 2001 when the facility closed. Nei-
ther the closure of Respondent’s Cocoa facility nor any matter
relating to the closure is alleged as a violation in the current pro-
ceeding.
B. Facts as Presented by the Parties
1. Allegation of unilateral implementation of new work
schedule and job bidding system
Paragraph 6 of the consolidated complaint alleges that on or
about a date in January 2001, Respondent announced and began

Counsel in his posthearing brief. Counsel for the General Counsel
subsequently filed an opposition to Respondent’s motion. Attached to
the respective motion and opposition to motion, Respondent and coun-
sel for the General Counsel included the underlying reply brief and
answer to the reply brief. The Board’s Rules and Regulations make no
specific provision for the filing of a reply brief and I set no briefing
schedule to include the filing of a reply brief. After giving due consid-
eration to Respondent’s motion, it is hereby denied.
4 These employees hereinafter will be described collectively as the
unit.
EAGLE TRANSPORT CORP. 491
implementing a new work schedule and job-bidding system for
drivers employed in the unit. The consolidated complaint further
alleges that Respondent did so without affording the Union an
opportunity to bargain with the Respondent concerning this man-
datory subject of collective bargaining.
During 2000 and 2001, John Fitzgerald was employed by Re-
spondent as terminal manager for the Cocoa, Florida terminal
facility. Fitzgerald recalled that in early 2000, Respondent’s
business was growing to such an extent that new drivers and
transportation units were needed at the Cocoa facility. Respon-
dent’s practice was for the newly hired drivers to take whatever
shifts available and as they gained seniority they moved into
more desirable shifts. In fall 2000, Respondent lost Speedway,
which was one of Respondent’s largest customers. Fitzgerald
testified that upon losing this business, Respondent found itself
overstaffed with more drivers than work available. While natural
attrition prevented his having to lay off drivers, he was neverthe-
less faced with gaps in the drivers’ work schedules. Fitzgerald
recalled that even before the Union petitioned for an election, he
began talking with the drivers about his plans to set up a new
work schedule utilizing seniority. Fitzgerald remembered talking
with Paul Brezina, John Pabst, and Chuck Kendrow.5 Fitzgerald
estimated that during the last week of December or the first week
of January, he again talked with Paul Brezina about the change in
schedule. Fitzgerald described Brezina as the lead trainer, his
most senior driver, and someone to whom he could “bounce
ideas off.” He also explained that Brezina had been the union
observer in the election and his “only real contact with the Un-
ion.”
Fitzgerald prepared a proposed schedule preference form
based upon seniority. Beginning on January 2 and continuing
through January 23, Respondent gave its 30 drivers at the Cocoa
facility the opportunity to indicate their shift preference based
upon their seniority.6 Respondent does not deny that during this
period of time when the drivers indicated their shift preference,
there were no discussions with the Union about the proposed
change in schedules. In a letter dated January 22, Respondent’s
vice president of human resources, Ron Thomas, informed the
Union that Respondent intended to modify the drivers’ schedules
with the selection of schedules based on seniority. Thomas con-
firmed however, that Respondent had not made any final decision
in this regard and extended an offer for discussion. In a letter
dated January 22, the Union’s legal department informed Re-
spondent that hours and work schedules are considered manda-
tory bargaining subjects and unilateral changes by the employer
constitute violations of Section 8(a)(5) of the Act. On January
23, Fitzgerald received a telephone call from Thomas, informing
him that he couldn’t continue the schedule change because Re-
spondent had not talked with the Union. Fitzgerald testified that
he immediately stopped the process and none of the drivers’
choices were implemented. Drivers Phil Huddy Jr. and Rafael
Burgos testified that while they were given the opportunity to

5 Driver Phil Huddy recalled that Fitzgerald talked with him about
the proposed schedule change approximately a week before the elec-
tion.
6 The seniority list with the drivers’ preferences was received as GC
Exh. 4.
select a new work schedule in January 2001, the changes were
never implemented.
Thomas testified that Respondent submitted their proposal to
modify the work schedules in their first meeting with the Union
on February 28. Phil Huddy, who served as a union representa-
tive on the negotiating committee, recalled the Union took the
position that it would not agree to interim schedule changes,
wanting only to negotiate a full package covering all subjects.
No agreement was ever reached by the parties concerning the
proposed change in shift schedules.
2. The alleged rescission of the wage increase
Paragraph 7 of the consolidated complaint alleges that on or
about February 15, 2001, Respondent rescinded the February 1,
2001 wage increase that it had granted to drivers employed in the
unit. It is undisputed that on January 31, 2001, Respondent noti-
fied all drivers in 17 of its 18 terminals that they would receive a
wage increase beginning with the February 4 pay period. Drivers
in the Florida terminals were notified that they would receive a 5-
percent increase and the drivers in the other terminals were noti-
fied that they would receive a 2-1/2-percent increase. Ron Tho-
mas testified that the drivers of the Cocoa terminal were excluded
because such a pay increase to them would constitute a unilateral
change. Thomas also explained that since Respondent was
scheduled to begin bargaining with the Union, it needed some-
thing in its pocket for negotiation. Thomas recalled that during
the union campaign, he made speeches to the Cocoa drivers. In
his presentation to the drivers, he told them that if the Union won
the election, the Respondent would have to bargain about wages
and other conditions of employment. Thomas told the drivers
that their wages would be frozen until after bargaining with the
Union.
On the payday when the scheduled increase was to be paid,
Fitzgerald learned from one of the Cocoa drivers that the pay
increase had been mistakenly included in the drivers’ pay. Fitz-
gerald immediately contacted Ron Thomas and informed him
that the Cocoa drivers had received the wage increase. Thomas
testified that he had been a “little upset” upon hearing this and he
then contacted the payroll manager in the corporate office. Tho-
mas learned that because of a malfunctioning computer program,
the Cocoa drivers were inadvertently included in the February
wage increase. The computer error was immediately corrected
and the Cocoa drivers were removed from the wage increase.
Respondent asserts that since the payment of the wage increase
for this one pay period was not the fault of the drivers, the unit
employees were not required to return the money they received in
error. Thomas further testified that while the Union filed charges
concerning the wage increase, the Union never requested to bar-
gain about the recession of the wage increase.
3. The alleged subcontracting of work
Paragraph 8 of the consolidated complaint alleges that from on
or about March 5, 2001, to on or about March 9, 2001, Respon-
dent subcontracted loads of work regularly performed by em-
ployees in the unit to subcontractors Infinger and Tank Wagon.
Respondent does not deny this allegation.
“Runouts” are periods in which customers no longer have
product to sell. Both Fitzgerald and Thomas testified that runouts
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 492
typically occur in Florida during the peak business season from
late fall to early spring. When Respondent has a runout, the cus-
tomer may fine Respondent or give the business to a competitor.
Fitzgerald recalled that Respondent was experiencing frequent
runouts in February and March. He explained that while custom-
ers do not want to see runouts even as often as two or three times
a week, Respondent was experiencing runouts as frequently as
five to six times a day. During this period, Pantry, which was
one of Respondent’s major accounts, not only imposed fines, but
also gave the business to one of Respondent’s competitors. To
balance out the work, Fitzgerald asked for volunteers to come in
for extra shifts. While a few drivers volunteered, there were not
enough to solve the problem. Thomas Lovett, director of opera-
tions, advised Fitzgerald to contract with Infinger and Tank
Wagon to deliver some of excess fuel loads. During the period of
time between March 5 and 9, 35 loads of fuel were subcontracted
to Respondent’s competitors.
Describing the circumstances as an emergency situation, Fitz-
gerald confirmed that there had been no contact with the Union
prior to subcontracting this work. Lovett testified that Respon-
dent had previously used interim subcontracting with outside
carriers for its other terminals during periods when Respondent
could not get the required loads to the customers. The subcon-
tracting to outside carriers is more expensive for Respondent
because the outside carriers charge a higher freight rate than what
Respondent charges its customers. Lovett explained that Re-
spondent had the runouts in March because of its inability to get
enough drivers scheduled properly. He explained that his choices
were to pay the runout charges and jeopardize the relationship
with customers or to use outside carriers. Lovett admitted that
not only had he failed to notify the Union about the subcontract-
ing, he had not even thought about doing so. He said that he had
simply made the decision out of habit because he had done so in
the past. Fitzgerald testified, without contradiction, that this
period of subcontracting had no adverse effect on either the pay
or the hours for the Cocoa drivers.
4. The alleged surveillance by Tom Lovett
It is undisputed that all of Respondent’s terminals are desig-
nated no-smoking areas. Each terminal has a designated smoking
area that must be 25 feet away from the terminal shop area or the
truck parking area. There is no dispute that the designated smok-
ing area for the Jacksonville terminal is the area immediately
outside the door to the metal garage. It is also undisputed that the
Jacksonville designated smoking area is where drivers, dispatch-
ers, and management congregate to not only smoke but also to
“hang out” and talk.
As director of operations for Florida, Lovett has occasion to
visit the Jacksonville facility at least once a month. He estimates
that he may visit more often if he is involved in hiring or training.
While at the facility, he reviews the driver inspection reports and
driver logs and he also inspects the equipment and shop area.
While at the Jacksonville facility, Lovett may leave the building
to smoke in the designated smoke area, to receive calls on his
cellular phone, or to obtain files from his car.7

7 Lovett explained that cellular phone reception is poor within the
metal building at Jacksonville. Lovett also explained that because he
Brad O’Malley testified that as a project organizer for the Un-
ion, he visited Respondent’s Jacksonville terminal facility on
several occasions between February and May 2001. O’Malley
testified that when he visited the terminal, he stood or walked on
the sidewalk at the front of the terminal and attempted to talk
with drivers and give them flyers as they exited the terminal.
O’Malley estimated that he remained outside the terminal for
about an hour during his first visit on February 19. He visited the
terminal more than once between February 25 and 27, and on one
of these visits, he recalled being at the terminal for about 2 hours.
O’Malley visited the terminal again on March 7. When he ar-
rived at approximately 11 to 11:30 a.m., he saw Lovett in the area
where employees congregate to smoke and talk. O’Malley re-
called that Lovett was outside the terminal approximately a half
hour to 45 minutes. O’Malley remained at the terminal for about
2 hours. During the time that Lovett was outside the facility, he
spoke with the three to six drivers who were also outside in the
smoking area and he stood facing east and away from O’Malley.
O’Malley did not speak with Lovett on March 7. When
O’Malley visited the terminal again in April 1,8 he again saw
Lovett outside in the same location and again facing east. He
estimated that Lovett had been about 60 feet away from him. On
that same day, O’Malley walked over to Lovett and told him to
stop surveilling the drivers. Lovett replied, “I’m out here smok-
ing a cigarette.” O’Malley alleges that when he challenged
Lovett on how many times he had seen him smoking a cigarette
in the past, Lovett responded that he could “do whatever the fuck
he wanted to do and watch whomever he wanted.” O’Malley
contends Lovett also stated, “[T]his is my mother-fucking termi-
nal and I will do what I want to do.” O’Malley asserts that he
threatened to file charges against Lovett and then left the area
where Lovett was located. Lovett denied making any of these
statements to O’Malley.
When O’Malley visited the terminal on May 1 or 2, he arrived
sometime between 3 and 3:30 p.m. He testified that he later saw
Lovett outside in the same area around 3:45 to 4 p.m. O’Malley
recalled that Lovett and Terminal Manager Tim Collier remained
outside the terminal until approximately 6 p.m. Jacksonville
driver, Robert Mathis, testified that he had been present with
Lovett and Collier outside the terminal on the day in May when
O’Malley came to the terminal. Mathis confirmed that while he
was smoking with Lovett and Collier, a guy unknown to him
came up and stood in the driveway. Mathis later learned that the
individual was O’Malley. While O’Malley was standing in the
driveway, mechanic James Butler drove out of the driveway and
in the course of doing so spun his tires. Mathis recalled that
O’Malley called out to Lovett, “Is that the way you teach your
damn drivers?”9 While O’Malley yelled out something to Butler,
Mathis had been unable to hear what was said. Mathis heard

travels to the various terminals, his office is virtually in the trunk of his
car.
8 During his testimony, O’Malley refers to the visit as being on both
April 3 and 7.
9 When O’Malley recalled the conversation with Lovett, he recalled
that he had asked Lovett if he taught that kind of driving at the “Tom
school of safety.” O’Malley also recalled that Lovett said, “Get the F—
out of this property, Nobody wants you around here. I’m going to call
the police.”
EAGLE TRANSPORT CORP. 493
Lovett tell O’Malley, “Don’t talk to my drivers like that.” Mathis
recalled that Lovett instructed Collier to contact the police.10
In contrast to O’Malley, Mathis recalled that Lovett was only
outside the terminal for about 10 to 13 minutes on May 1 or 2.
While Mathis recalled that he had remained outside in the smok-
ing area with the other drivers for 30 minutes to an hour, he re-
called that Lovett was inside the building for most of this time.
Mathis also confirmed that this was not the first time that he had
ever seen Lovett outside in this area. During the 2-1/2 years that
Mathis has worked for Respondent, he has often seen Lovett in
this same area.
Analysis and Conclusions
A. New Work Schedule and Job Bidding System
Although the complaint alleges that Respondent announced
and began implementation of a new work schedule and job bid-
ding system, there is no dispute that the proposed schedule
change was never implemented. It has been established that the
“real harm in an employer’s unilateral implementation of terms
and conditions of employment is to the Union’s status as bargain-
ing representative, in effect undermining the Union in the eyes of
the employees.”11 The Board has found that such damage to the
Union’s bargaining authority may be accomplished merely by the
threat to implement, as such threat emphasizes to employees that
there is no necessity for a collective-bargaining agent.12 Relying
upon such authority,13 General Counsel argues that an employer
may not even announce a unilateral change without violating
Section 8(a)(5) and (1) of the Act and a violation occurs even
though the schedule change was never actually implemented by
Respondent. I find the circumstances of this case distinguishable
from those instances in which the mere announcement of a pro-
posed change constitutes a unilateral change in violation of Sec-
tion 8(a)(5).
In the instant case, I do not find the evidence demonstrates that
Respondent threatened or even announced that it would imple-
ment a change in its scheduling of drivers. True enough, Fitzger-
ald spoke with the drivers, including the driver that he perceived
as his “Union contact” about his desire to change the schedule.
He even went so far as to ask them to designate their shift prefer-
ence for a new schedule. Respondent did not however, proceed
beyond this point in its planning and decisionmaking. When
notified by the Union that such schedule change would be viewed
as a unilateral change, Respondent immediately abandoned its
plan to implement a schedule change. The evidence reflects that
even when Respondent could not schedule sufficient drivers to
handle its work in March, Respondent nevertheless refrained
from instituting such desired schedule changes. There is no evi-

10 Lovett testified that he told O’Malley that he (Lovett) could do
whatever he wanted and that he would let the police settle it. Lovett
however, recalled that the incident with Butler had occurred in March
rather than May.
11 Page Litho, Inc., 311 NLRB 881 (1993).
12 ABC Automotive Products Corp., 307 NLRB 248 (1992); J. Jo-
sephson, Inc., 287 NLRB 1188, 1190 (1988).
13 In Kurdziel Iron of Wauseon, 327 NLRB 155 (1998), the employer
summoned employees to the office to inform them of a reduction of
time for their lunchbreaks. The respondent employer also displayed a
written memo announcing the lunchtime reduction.
dence that Respondent’s consideration of the schedule change
and obtaining driver preferences undermined the Union’s posi-
tion in bargaining on this issue. The evidence reflects that Re-
spondent first discussed this change with drivers even before the
Union was elected to represent the unit employees and the pro-
posed change was discontinued prior to any bargaining with the
Union. Accordingly, I find insufficient evidence to support that
the Respondent announced and implemented a new work sched-
ule and job bidding system in violation of Section 8(a)(5) of the
Act.
B. Unilateral Recession of Wage Increase
There is a long line of Board and court opinions that have con-
sistently held that an employer is obligated to maintain the status
quo, as it existed before the Union achieved representational
status during its initial bargaining with a newly certified Union.
General Motors Acceptance Corp., 196 NLRB 137 (1972), enfd.
476 F.2d 850 (1st Cir. 1973). An employer is prohibited from
changing the wages, hours, terms, and conditions of employment
of its bargaining unit employees without giving notice to their
bargaining representative and affording the representative the
opportunity to bargain over the change. NLRB v. Katz, 369 U.S.
736 (1962). General Counsel argues that Respondent violated
Section 8(a)(5) of the Act by its recession of the February 2001
wage increase to the bargaining unit employees. Respondent
however, argues that it did not rescind the wage increase but
merely corrected a computer programming error that mistakenly
included the bargaining unit employees in a wage increase. Re-
spondent argues that its actions were simply returning the em-
ployees’ wages to what existed prior to the Union and maintain-
ing the status quo as mandated by the Board and the courts.
The pivotal question becomes to what extent Respondent’s
wage increase was customary or established through past prac-
tice. An employer violates Section 8(a)(5) and (1) of the Act by
withholding a customary across-the-board wage increase. Bur-
rows Paper Corp., 332 NLRB 82 (2000). Even where the
amount of the increase is discretionary, the employer nonetheless
violates the Act when it withholds a wage increase from unit
employees where the granting of the increase has become an
established practice. Central Maine Morning Sentinel, 295
NLRB 376 (1989). The Board has long held that to the extent
that a wage increase is devoid of discretion, the employer is obli-
gated to continue such wage increase even without notice or
bargaining. To the extent that the employer retained discretion
however, it is obligated to consult with the employees’ bargain-
ing representative before taking any action. Hanes Corp., 260
NLRB 557 (1982);14 Oneita Knitting Mills, Inc., 205 NLRB 500,
fn. 1 (1973). In Daily News of Los Angeles, 315 NLRB 1236
(1994),15 the Board affirmed the proposition that an employer
that has a practice of granting merit raises that are fixed as to
timing but discretionary as to amount may not discontinue that
practice without bargaining to agreement or impasse with the
union.
14 Overruled in part on other grounds in Adair Standish Corp., 292
NLRB 890 (1989).
15 Enfd. 73 F.3d 406 (D.C. Cir. 1996), cert. denied 519 U.S. 1090
(1997).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 494
In American Mirror Co., 269 NLRB 1091, 1093 (1984), the
Board affirmed the judge’s decision in finding no violation in the
employer’s withholding of wage increases where the increases
were not an established practice because of their variance in past
years as to both timing and amount. The judge stated that to find
otherwise would subject the employer involuntarily to grant some
type of interim raises, while facing the obligation to negotiate an
additional or different wage program without certainty in its out-
come or economic effect.
As stated by the Board in Daily News of Los Angeles, supra at
1237 “The cases make it crystal clear that the vice involved in
both the unlawful increase situation and the unlawful refusal to
increase situation is that the employer has changed the existing
conditions of employment. It is this change which is prohibited
and which forms the basis of the unfair labor practice charge.”
The overall evidence of this case fails to show an established
practice of Respondent in the timing or the amount of wage in-
creases to its employees. On the contrary, the evidence shows
that even in the February wage increase, employees at Respon-
dent’s Florida terminals received a different amount than em-
ployees in other terminals. General Counsel does not allege nor
is there evidence to show that Respondent has a past practice of
awarding wage increases at any established time or in any spe-
cific amount. There was no evidence that this was a customary
wage increase or that there was an established practice of an
annual wage increase.
Counsel for the General Counsel submits in his brief that mis-
takenly implemented changes require the employer to give notice
and an opportunity to bargain before the employer can rescind
the change, citing JPH Management, Inc., 337 NLRB 72 (2001).
In JPH Management, the employer and union were involved in
negotiations for a successor collective-bargaining agreement. A
tentative agreement was reached and the bargaining unit employ-
ees ratified the agreement. Seven days later the employer im-
plemented the wage increase that had been included in the
agreement. After the employees had been receiving the wage
increase for approximately 5 weeks, the employer’s president
rescinded the wage increase upon her return to the United States.
In the instant case, Respondent corrected the computer error that
resulted in an incorrect payment to employees in one paycheck. I
find these circumstances distinguishable from JPH Management
where the respondent appeared to simply revoke the collective-
bargaining agreement and rescinded the wage increase after 5
weeks. Accordingly, I do not find that Respondent rescinded the
February 2001 wage increase to bargaining unit employees in
violation of Section 8 (a)(5) and (1) of the Act.16
C. Subcontracting Work
The Board has clearly held that subcontracting is a mandatory
subject of bargaining. Torrington Industries, 307 NLRB 809
(1992), and the bargaining obligation endures even when the
subcontracting does not result in the loss of work for unit em-
ployees. See Acme Die Casting, 315 NLRB 202 fn. 1 (1994). In
Bottom Line Enterprises, 302 NLRB 373 (1991), the Board held
that where parties are engaged in negotiations for a collective-
bargaining agreement, an employer’s obligation to refrain from

16 Lamonts, Apparel, Inc., 317 NLRB 286 (1995).
unilateral changes extends beyond the mere duty to provide no-
tice and an opportunity to bargain about a particular subject mat-
ter. The Board recognized that the employer must also refrain
from implementation at all, absent overall impasse on bargaining
for the agreement as a whole. The Board however, also noted
two limited exceptions to this general rule: when a union engages
in tactics designed to delay bargaining and “when economic
exigencies compel prompt action.” Respondent argues that its
subcontracting was clearly motivated by economic reasons and
was an attempt to salvage relationships with customers.
In Winn-Dixie Stores, 243 NLRB 972, 974 fn. 9 (1979), the
Board identified some circumstances that would justify or excuse
an employer’s taking action while bargaining is ongoing. These
circumstances were described in Winn-Dixie as involving “ex-
tenuating circumstances” and a “compelling business justifica-
tion.” The Board recognizes “compelling economic considera-
tions” as extraordinary, unforeseen events having a major eco-
nomic effect that requires the employer to take immediate ac-
tion.17 Since its decision in Bottom Line, the Board has further
characterized the economic exigency exception as requiring a
heavy burden, and involving the existence of circumstances
which require implementation at the time the action is taken or an
economic business emergency that requires prompt action.18 In
Hankins Lumber Co., 316 NLRB 837, 838 (1995), quoting An-
gelica Healthcare Services, 284 NLRB 844, 852–853 (1987), the
Board identified “extraordinary events which are ‘an unforeseen
occurrence, having a major economic effect [requiring] the com-
pany to take immediate action” as the only compelling economic
considerations that would entirely excuse bargaining. In RBE
Electronics of S.D., 320 NLRB 80, 81 (1995), the Board reiter-
ated its position that absent a dire financial emergency, economic
events such as loss of significant accounts or contracts, operation
at a competitive disadvantage, or supply shortages do not justify
unilateral change.19
In its decision in RBE Electronics, the Board also identified
other economic exigencies that although not sufficiently compel-
ling to excuse bargaining altogether, should nonetheless fall
within the Bottom Line exception. Where an employer is con-
fronted with an economic exigency compelling prompt action
short of the type relieving the employer of its obligation to bar-
gain entirely, it will satisfy its statutory obligation by providing
the union with adequate notice and an opportunity to bargain.
The Board clarified that because the Bottom Line exception is
limited only to those exigencies in which time is of the essence
and which demand prompt action, an employer will be required
to show a need that the particular proposed action be imple-
mented promptly. The employer must additionally demonstrate
that the exigency was caused by external events, was beyond the
employer’s control, or was not reasonably foreseeable. If the
employer has demonstrated that a situation meets these require-
17 Maple Grove Health Care Center, 330 NLRB 775, 779 (2000),
citing Hankins Lumber Co., 316 NLRB 837, 838 (1995).
18 Our Lady of Lourdes Health Center, 306 NLRB 337, 340 fn. 6
(1992); Firefighters, 304 NLRB 401 (1991); and Intermountain Rural
Electric Assn., 305 NLRB 783 (1991), enfd. 984 F.2d 1562 (10th Cir.
(1993).
19 Farina Corp., 310 NLRB 318, 321 (1993); Triple A Fire Protec-
tion, Inc., 315 NLRB 409, 414, 418 (1994).
EAGLE TRANSPORT CORP. 495
ments, it would satisfy its statutory obligations by providing ade-
quate notice and an opportunity to bargain over the changes that
it proposes in to respond to the exigency. Thus, even where the
employer has demonstrated that the changes were compelled by
an exigency caused by external events, not reasonably foresee-
able, and beyond the employer’s control, the employer was none-
theless under an obligation to provide the union with adequate
notice and an opportunity to bargain.
In its brief, Respondent cites General Electric Co., 264 NLRB
306 (1982),20 for the proposition that an employer’s unilateral
subcontracting of unit work will not be held to be an unfair labor
practice where certain criteria are met. The criteria are identified
as: (1) the subcontracting is motivated solely by economic con-
siderations; (2) it comports with the company’s traditional meth-
ods of conducting its business operations; (3) it does not vary
significantly from prior established practices; (4) it does not have
a demonstrative adverse impact on the employees in the bargain-
ing unit; and (5) the union had the opportunity to bargain about
changes in existing subcontracting practices at general negotiat-
ing meetings. Respondent argues that the facts of this case estab-
lish each criterion. I agree that Respondent presented evidence in
support of the first four criteria set out by Judge McLeod in this
1982 decision. With respect to the fifth criteria, Respondent
asserts that the Union and Respondent discussed the schedule
problems and the effect on the terminal’s ability to service its
customers at every negotiation meeting, and thus, the Union had
the opportunity to negotiate the issue. This assertion however, is
not supported by the testimony of Respondent’s own witnesses.
Lovett admits that no notice was given to the Union prior to the
subcontracting in issue. Contrary to counsel’s argument, Fitzger-
ald admitted that the first bargaining session with the Union in
which schedule changes were discussed was after the subcon-
tracting of work.
In this case, Respondent would argue that it was faced with an
economic exigency of such a compelling nature as to relieve it
from all bargaining obligations. Lovett testified that he chose to
subcontract 35 loads rather than to pay runout charges and jeop-
ardize Respondent’s relationship with customers. John Fitzger-
ald testified that there was no contact with the Union about sub-
contracting and characterized the circumstances as an emergency
situation. He said that he was concerned that customers would
pull their business because he had seen this happen with other
terminals. I note that in a recent case, the Board found that the
fact that an employer had been threatened with liquidated dam-
ages by its customer was insufficient to sustain the claim of dire
financial emergency. See Ryder/Ate, Inc., 331 NLRB 889
(2000). As the Board stated in Farina Corp., 310 NLRB 318,
321 (1993), “Loss of a customer account does not constitute a
compelling economic consideration justifying a failure to bar-
gain.” Respondent argues that the need to subcontract was trig-
gered by its inability to schedule its drivers more evenly and it
was unable to change the schedules because of the opposition of
the Union. Respondent also admits however, that these runouts
occurred during the seasonal period when runouts are likely.
Thus, while the employer may have been limited in its ability to

20 The Board affirmed the decision of Administrative Law Judge
Philip P. McLeod without comment.
schedule drivers, the likelihood of runouts was certainly foresee-
able.
Applying the principles of the Board’s holdings in similar
cases, it is clear that the Respondent’s claimed exigency is not the
type of “extraordinary event” that justifies unilateral action with-
out bargaining. The question then follows as to whether it is of a
compelling type defined in RBE Electronics, i.e., whether the
employer would be entitled to take unilateral action if bargaining
over the particular matter resulted in impasse. Based upon the
testimony of Fitzgerald and Lovett, it is apparent that time was of
the essence and prompt action was required in dealing with its
“runouts.” It is undisputed however, that even if Respondent’s
claimed exigency met the criteria for the less compelling event,
Respondent made no attempt to notify the Union or initiate any
bargaining about the subcontracting of its work. Lovett admitted
that he not only failed to notify the Union, but he had not even
thought about doing so. He implemented the subcontracting out
of habit because he had done so in the past.
In summary, Respondent had a statutory obligation to provide
notice and an opportunity to bargain with the Union before mak-
ing any changes in the existing terms and conditions of employ-
ment of its employees. Respondent makes no claim of impasse
or that the Union was engaging in delay tactics in bargaining. As
discussed above, the Respondent has failed to establish an eco-
nomic exigency that would waive its bargaining obligation. In a
recent case, a Respondent employer argued that liability and
customer dissatisfaction contributed to its need to unilaterally
subcontract unit work. Citing Vincent Industrial Plastics, 328
NLRB 300 (1999), enfd. in relevant part 209 F.3d 727 (D.C. Cir.
2000), the Board acknowledged that the risks faced by the em-
ployer may have led to its decision to make changes, but were not
so compelling as to justify unilateral implementation of these
changes. Brede, Inc., 335 NLRB 71 (2001). Accordingly, I find
that by unilaterally subcontracting the delivery of loads of fuel in
March 2001, the Respondent violated Section 8 (a)(5) and (1) of
the Act.
D. Lovett’s Alleged Surveillance
In support of complaint paragraph 11, General Counsel pre-
sented only the testimony of union organizer, Brad O’Malley.
O’Malley recalled visiting the Jacksonville terminal a number of
times between February and May 2001. While at the facility, he
usually stood on the public sidewalk or walked across the drive-
way and appeared to always have a full view of the entrance to
the facility. Any individuals standing in the designated smoking
area just outside the front door would likewise have had the op-
portunity to view O’Malley as he attempted to talk with drivers
and hand out union flyers. O’Malley testified that when he vis-
ited the terminal on or about May first or second, he saw Thomas
Lovett outside the terminal at approximately 3:45 to 4 p.m. He
asserts that Lovett remained outside the terminal with Terminal
Manager Timothy Collier until 6 p.m.21 In contrast to
O’Malley’s testimony, Mathis testified that on this same day,
Lovett had only been outside the terminal for 10 to 13 minutes.
Mathis recalled that while he had been outside in the designated
21 Collier neither recalled how long he and Lovett had been outside
the terminal nor how long O’Malley remained in the terminal.
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 496
smoking area for 30 minutes to an hour, Lovett had been back in
the building for most of that time. I found Mathis’ testimony to
be credible and straightforward. He appeared to give a truthful
account of events without any attempt to embellish or exaggerate.
Generally the testimony of current employees is entitled to con-
siderable weight because it is not likely to be false. Normally
such weight is accorded the employee’s testimony because such
testimony is adverse to an employee’s pecuniary interest.22 In
this instance, I am cognizant that Mathis was in a more tenable
position as he was testifying on behalf of the Respondent. In
evaluating the testimony of O’Malley and Mathis, I nevertheless
find Mathis to be more credible. While O’Malley asserts that
Lovett engaged in surveillance on May 1, he also acknowledges
that Lovett was in the same area when O’Malley visited the facil-
ity on prior occasions. On both March 7 and April 1, Lovett
stood in the smoking area facing away from O’Malley.
O’Malley does not deny that he spoke first to Lovett on both
April 1 and May 1. While O’Malley visited Respondent’s Jack-
sonville facility numerous times from February to May and saw
Lovett in this same area previously, he alleges that Lovett en-
gaged in surveillance only on May 1.
Even without my crediting the testimony of Mathis and Lovett,
the evidence does not support a finding of unlawful surveillance.
An employer’s mere observation of open public union activity on
or near its property does not constitute unlawful surveillance.
Villa Maria Nursing & Rehabilitation, 335 NLRB 1345 (2001).
Emenee Accessories, 267 NLRB 1344 (1983). As the Board
found in Milco Inc., 159 NLRB 812, 814 (1966), enfd. 388 F.2d
133 (2d Cir. 1968), “union representatives and employees who
choose to engage in their union activities at the employer’s prem-
ises should have no cause to complain that management observes
them.” One administrative law judge has stated in a decision
adopted by the Board, “The notion that it is unlawful for a repre-
sentative of management to station himself at a point on man-
agement’s property to observe what is taking place at the plant
gate is too absurd to warrant comment. If a union wishes to or-
ganize in public it cannot demand that management must hide.”
Tarrant Mfg. Co., 196 NLRB 794 (1972).
In his brief, counsel for the General Counsel agrees that in
general when union activity is conducted on or near an em-
ployer’s premises, there can be no complaint that the employer is
engaging in surveillance of that activity. Brown Transport Corp.,
294 NLRB 969 (1989). General Counsel points out however,
that the Board in Brown also identified factors that may indicate a
deliberate interference with union activity and thus constitute
unlawful observation. In the instant case, there is no evidence of
any other acts to interfere with the Union’s handbilling nor is
there any evidence that Lovett’s presence outside the terminal
was a departure from his customary or normal practice while at
the Jacksonville terminal. In crediting the testimony of Mathis,
there was no evidence that Lovett’s observation of O’Malley’s
union activity was of such a duration as to be suspect. During
General Counsel’s cross-examination of Lovett, he acknowl-
edged that he was the same Tom Lovett mentioned in Penn Tank

22 Shop-Rite Supermarket, Inc., 231 NLRB 500 (1977); Georgia Rug
Mill, 131 NLRB 1304, 1305 (1961), modified on other grounds 308
F.2d 89 (5th Cir. 1962).
Lines, 336 NLRB 1066 (1999). General Counsel argues that the
Board’s finding of Lovett’s past unlawful response to union or-
ganizing campaigns is further support for finding that Lovett’s
observation of O’Malley on May 1 was violative of 8(a)(1) of the
Act. In its brief, Respondent argues that the Penn Tank Lines
case reveals no discussion of any alleged surveillance by Lovett.
A review of the case indicates that an employee solicited em-
ployees to sign a petition in support of the union after unsuccess-
ful negotiations and the respondent employer’s withdrawal of
recognition of the union. The judge found that the employer’s
terminal manager, Tom Lovett, observed the employee soliciting
drivers’ signatures for the petition and accused the employee of
harassing and threatening other drivers. When the employee
denied the accusations, Lovett suspended him. The judge found
that Lovett later met with the employee and offered him rein-
statement if the employee would stop “harassing” the other driv-
ers. The employee refused and was not reinstated. The Board
ultimately found that Lovett’s admonition to the employee to
“leave the men alone” would reasonably tend to interfere with the
employee’s free exercise of his Section 7 right to solicit employ-
ees to sign the petition favoring the Union, in violation of Section
8(a)(1). While the Board’s order included an order to cease and
desist from conditioning reinstatement to employment on em-
ployees refraining from engaging in union or protected activities,
there was no finding nor any order concerning unlawful surveil-
lance. I do not find that Lovett’s conduct in Penn Tank Lines
evidences a proclivity for engaging in unlawful surveillance or a
basis to find that he has engaged in such conduct herein. Accord-
ingly, I find insufficient evidence to support paragraphs 11 and
12 of the consolidated complaint.
CONCLUSIONS OF LAW
1. Respondent, Eagle Transport Corporation, is an employer
within the meaning of Section 2(2), (6), and (7) of the Act.
2. The Union, International Brotherhood of Teamsters, Geor-
gia-Florida Conference, AFL–CIO, is a labor organization within
the meaning of Section 2(5) of the Act.
3. By unilaterally subcontracting bargaining unit work, the
Respondent has violated Section 8(a)(1) and (5) of the Act.
4. Respondent did not violate the Act in the other ways al-
leged in the complaint.
5. The unfair labor practices committed by Respondent are
unfair labor practices affecting commerce within the meaning of
Section 2(6) and (7) of the Act.
REMEDY
As the evidence in this case does not show that the unilateral
changes have had any material or measurable effect on the earn-
ings of the bargaining unit employees, I conclude that no backpay
remedy is warranted. Nevertheless, as these changes affect and
tend to undermine the process of good-faith bargaining, I find
that the Respondent must be ordered to cease and desist and to
take certain affirmative action designed to effectuate the policies
of the Act.
On these findings of fact and conclusions of law and on the en-
tire record, I issue the following recommended23
23 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and recom-
EAGLE TRANSPORT CORP. 497
ORDER
The Respondent, Eagle Transport Corporation, Cocoa, Florida,
its officers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Unilaterally subcontracting bargaining unit work per-
formed at its Cocoa, Florida facility.
(b) In any like or related manner interfere with, restrain, or co-
erce employees in the exercise of the rights guaranteed them by
Section 7 of the Act.
2. Take the following affirmative action necessary to effectu-
ate the policies of the Act.
(a) On request, bargain with the Union regarding any changes
in wages, hours, or other terms and conditions of employment for
the employees in the bargaining unit described in the decision
above.
(b) Within 14 days after service by the Region, post at its of-
fice copies of the attached notice marked “Appendix.”24 Copies
of the notice, on forms provided by the Regional Director for
Region 12, after being signed by the Respondent’s authorized
representative, shall be posted by the Respondent immediately
upon receipt and maintained for 60 consecutive days in con-
spicuous places including all places where notices to employees
are customarily posted. Reasonable steps shall be taken by the
Respondent to ensure that the notices are not altered, defaced, or
covered by any other material. Inasmuch as the Respondent has
closed the facility involved in these proceedings, the Respondent
shall duplicate and mail, at its own expense, a copy of the notice
to the Union and to all current unit employees and former unit
employees employed by the Respondent at any time since March
5, 2001.
(c) Within 21 days after service by the Region, file with the
Regional Director a sworn certification of a responsible official

mended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
24 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 Na-
tional Labor Relations Board” shall read “Posted Pursuant to a Judg-
ment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”
on a form provided by the Region attesting to the steps that the
Respondent has taken to comply.
Insofar as the complaint alleges matters not found herein to
have violated the Act, the complaint is dismissed.

APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government

The National Labor Relations Board has found that we violated
Federal labor law and has ordered us to post and obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join or assist a union
Choose representatives to bargain with us on your be-
half
Act together with other employees for your benefit and
protection
Choose not to engage in any of these protected activi-
ties.

WE WILL NOT refuse to bargain collectively with the Union by
unilaterally subcontracting bargaining unit work.
WE WILL NOT in any like or related manner interfere with, re-
strain, or coerce you in the exercise of the rights guaranteed you
by Section 7 of the Act.
WE WILL, on request, bargain with the Union as the exclusive
representative of our employees in the bargaining unit regarding
any changes in wages, hours, and terms and conditions of em-
ployment and put in writing and sign any agreement reached on
terms and conditions of employment for our employees in the
bargaining unit:

All full-time and regular part-time drivers (dispatched out of
Cocoa, Florida) and mechanics employed by the Employer
at its Cocoa, Florida facility, excluding all other employees,
guards and supervisors as defined in the Act.

EAGLE TRANSPORT CORPORATION