Falcon Wheel Division, L.L.C.

National Labor Relations Board - Board Decisions

Nov 20, 2002

338 N.L.R.B. 576 (N.L.R.B. 2002)

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 576
Falcon Wheel Division L.L.C. and General Truck
Drivers, Chauffeurs & Helpers of San Pedro,
Wilmington, Long Beach & Vicinity, Local 692,
International Brotherhood of Teamsters, AFL–
CIO. Case 21–CA–34646
November 20, 2002
DECISION AND ORDER
BY MEMBERS LIEBMAN, COWEN, AND BARTLETT
The General Counsel seeks summary judgment in this
case because the Respondent has failed to file an answer
to the complaint. Upon a charge filed by the Union on
July 5, 2001, the General Counsel issued the complaint
on October 31, 2001, against Falcon Wheel Division
L.L.C., the Respondent, alleging that it has violated Sec-
tion 8(a)(5) and (1) of the Act. The Respondent failed to
file an answer.
On December 12, 2001, the General Counsel filed a
Motion for Summary Judgment with the Board. On De-
cember 18, 2001, the Board issued an order transferring
the proceeding to the Board and a Notice to Show Cause
why the motion should not be granted. The Respondent
filed no response. The allegations in the motion are
therefore undisputed.
Ruling on Motion for Summary Judgment
Sections 102.20 and 102.21 of the Board’s Rules and
Regulations provide that the allegations in the complaint
shall be deemed admitted if an answer is not filed within
14 days from service of the complaint, unless good cause
is shown. In addition, the complaint affirmatively states
that unless an answer is filed within 14 days of service,
all the allegations in the complaint will be considered
admitted. Further, the undisputed allegations in the Mo-
tion for Summary Judgment disclose that the Region, by
letter dated November 19, 2001, notified the Respondent
that unless an answer was received by November 26,
2001, a Motion for Summary Judgment would be filed.
Our dissenting colleague argues that the complaint
fails to allege a prima facie case because the General
Counsel did not allege that the layoff constituted a mate-
rial, substantial, and significant change in the terms and
conditions of employment of the unit employees. We
disagree.
It is well established that “a layoff of employees ef-
fects a material, substantial, and significant change in the
affected employees’ working conditions.” Odebrecht
Contractors of California, Inc., 324 NLRB 396, 402
(1997), citing NLRB v. Katz, 369 U.S. 736, 747 (1962);
Ladies Garment Workers Local 512 v. NLRB, 795 F.2d
705, 710–711 (9th Cir. 1986); Rangaire Co., 309 NLRB
1043, 1047 (1992). Accord: NLRB v. Advertisers Mfg.
Co., 823 F.2d 1086, 1090 (7th Cir. 1987) (“Laying off
workers works a dramatic change in their working condi-
tions (to say the least). . . .”). Thus, it is not necessary
for the General Counsel to separately allege that a layoff
is a material, substantial, and significant change in order
to establish a prima facie case. Rather, the significance
of the change is inherent in the laying off of the employ-
ees.
The language cited by the dissent from Taino Paper
Co., 290 NLRB 975, 978 (1988), is not inconsistent with
our position. In Taino, the judge merely stated that the
General Counsel had established a prima facie case by
demonstrating that the union was the bargaining repre-
sentative, the layoff was a mandatory subject of bargain-
ing, the company did not give notice to or bargain with
the union about the layoff, and that the layoff was a ma-
terial, substantial, and significant change in the employ-
ees’ terms and conditions of employment. The judge did
not in any way indicate that the General Counsel was
required to allege and prove the significance of the
change as a separate element in order to establish a prima
facie case.
In addition, the other cases cited by our dissenting col-
league involved changes other than layoffs, and therefore
do not establish that the General Counsel must separately
allege that a layoff is a significant change in order to
establish a prima facie case. See United Technologies
Corp., 278 NLRB 306 (1986) (change not significant
because it was merely an incentive to review bills to de-
tect over billing); Golden Stevedoring Co., 335 NLRB
410 (2001) (formalization of disciplinary procedure con-
stituted a significant change); Millard Processing Ser-
vices, 310 NLRB 421, 425 (1993) (changes to shifts,
insurance carriers, increase in health insurance premi-
ums, decrease in wage rates, reduction in bus transporta-
tion, and imposition of fee for lost checks constituted
significant changes); Peerless Food Products, 236
NLRB 161 (1978) (limitation on access by union to em-
ployees while working not a significant change).
The dissent also states that the General Counsel has
not alleged any change in the employees’ terms and con-
ditions of employment, let alone a material change. Cer-
tainly, as discussed above, being laid off from a job has
been held to be a change in the terms and conditions of
an employee’s employment, since the employee would
go from having a job to not having a job. However, as-
suming that our colleague means that the General Coun-
sel has not alleged that there was a change in the em-
ployer’s past practice of laying off employees, we note
that an employer has a duty to bargain with a newly cer-
tified union over layoffs, even where the employer con-
tends that the layoffs at issue are consistent with an es-
338 NLRB No. 70
FALCON WHEEL DIVISION L.L.C. 577
tablished past practice. See Adair Standish Corp., 292
NLRB 890 fn. 1 (1989), enfd. in relevant part 912 F.2d
854, 863 (6th Cir. 1990) (employer’s “unilateral mainte-
nance of its lay-off policy following the election directly
contravened section 8(a)(5).”); Accord: NLRB v. Adver-
tising Mfg. Co., supra, 823 F.2d at 1090 (unilateral layoff
of employees violated the Act, and “[i]t is not a good
answer that the company did nothing different from . . .
what it did before there was a union”). Thus, if an em-
ployer violates the Act by failing to bargain with the un-
ion about layoffs where it is merely maintaining its pre-
viously established layoff policy, then it follows that
alleging that the layoffs constituted a change in the em-
ployer’s past practice cannot be considered a separate
and necessary element of the prima facie case.
Here, the complaint alleges that the Union was certi-
fied on September 27, 2001, as the bargaining represen-
tative for a unit of the Respondent’s employees; that on
February 23, 2002, the Respondent laid off employee
Jose Martell; that this is a mandatory subject for collec-
tive bargaining; and that the Respondent took this action
without prior notice to the Union and without affording
the Union an opportunity to bargain with it concerning
this conduct. These allegations in the complaint are suf-
ficient to establish a cause of action. Further, by choos-
ing not to file an answer to the complaint, the Respon-
dent has admitted each of these allegations, and has fur-
ther admitted that it has failed and refused to bargain
collectively with the exclusive collective-bargaining rep-
resentative of its employees in violation of Section
8(a)(1) and (5) of the Act.
Accordingly, in the absence of good cause being
shown for the failure to file a timely answer, we grant the
General Counsel’s Motion for Summary Judgment.
On the entire record, the Board makes the following
FINDINGS OF FACT
I. JURISDICTION
At all material times, the Respondent, a corporation
with an office and place of business in Gardena, Califor-
nia, has been engaged in the production and nonretail
sale of wheels and other molded parts. During the 12-
month period ending August 18, 2000, a representative
period, the Respondent, in conducting its business opera-
tions, sold and shipped from its Gardena, California fa-
cility goods valued in excess of $50,000 directly to
points outside the State of California. We find that the
Respondent is an employer engaged in commerce within
the meaning of Section 2(2), (6), and (7) of the Act and
that the Union is a labor organization within the meaning
of Section 2(5) of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES
The following employees of the Respondent constitute
a unit appropriate for purposes of collective bargaining
within the meaning of Section 9(b) of the Act:

All full-time and regular part-time production and
maintenance employees employed by the Employer at
its facility located at 407 E. Redondo Beach Boulevard,
Gardena, California; excluding all other employees, of-
fice clerical employees, professional employees, guards
and supervisors as defined in the Act.

On September 27, 2000, the Union was certified as the
exclusive collective-bargaining representative of the unit.
At all times since September 27, 2000, based on Section
9(a) of the Act, the Union has been the exclusive collec-
tive-bargaining representative of the unit.
About February 23, 2001, the Respondent laid off em-
ployee Jose Martell. This conduct relates to wages,
hours, or other terms and conditions of employment of
the unit employees and is a mandatory subject for the
purposes of collective bargaining.
The Respondent engaged in the above conduct without
affording the Union an opportunity to bargain with the
Respondent with respect to this conduct.
CONCLUSION OF LAW
By the acts and conduct described above, the Respon-
dent has been failing and refusing to bargain collectively
with the exclusive collective-bargaining representative of
its employees, and has thereby engaged in unfair labor
practices affecting commerce within the meaning of Sec-
tion 8(a)(5) and (1) and Section 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has engaged in cer-
tain unfair labor practices, we shall order it to cease and
desist and to take certain affirmative action designed to
effectuate the policies of the Act. Specifically, having
found that the Respondent has violated Section 8(a)(5)
and (1) of the Act by laying off employee Jose Martell
about February 23, 2001, without notice to or bargaining
with the Union, we shall order the Respondent to offer
Jose Martell full reinstatement to his former position or,
if that position no longer exists, to a substantially equiva-
lent position, without prejudice to his seniority or any
other rights or privileges previously enjoyed, and to
make him whole for any loss of earnings and other bene-
fits suffered as a result of the Respondent’s unlawful
conduct. Backpay shall be computed in accordance with
F. W. Woolworth Co., 90 NLRB 289 (1950), with inter-
est as prescribed in New Horizons for the Retarded, 283
NLRB 1173 (1987).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 578
ORDER
The National Labor Relations Board orders that the
Respondent, Falcon Wheel Division L.L.C., Gardena,
California, its officers, agents, successors, and assigns,
shall
1. Cease and desist from
(a) Failing and refusing to bargain with General Truck
Drivers, Chauffeurs & Helpers of San Pedro, Wilming-
ton, Long Beach & Vicinity, Local 692, International
Brotherhood of Teamsters, AFL–CIO as the exclusive
representative of the employees in the unit set forth be-
low, by unilaterally changing terms and conditions of
employment, including the layoff of employees, without
notifying the Union and affording it an opportunity to
bargain about these changes:

All full-time and regular part-time production and
maintenance employees employed by the Employer at
its facility located at 407 E. Redondo Beach Boulevard,
Gardena, California; excluding all other employees, of-
fice clerical employees, professional employees, guards
and supervisors as defined in the Act.

(b) 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) On request, bargain in good faith with the Union
concerning terms and conditions of employment, includ-
ing the layoff of employees.
(b) Within 14 days from the date of this Order, offer
full reinstatement to Jose Martell to his former position
or, if that position no longer exists, to a substantially
equivalent position, without prejudice to his seniority or
other rights and privileges previously enjoyed.
(c) Make Jose Martell whole for any loss of earnings
and benefits he may have suffered as a result of his lay-
off, plus interest, as set forth in the remedy section of this
decision.
(d) Preserve and, within 14 days of a request, or such
additional time as the Regional Director may allow for
good cause shown, provide at a reasonable place desig-
nated by the Board or its agents, all payroll records, so-
cial security payment records, timecards, personnel re-
cords and reports, and all other records, including an
electronic copy of such records if stored in electronic
form, necessary to analyze the amount of backpay due
under the terms of this Order.
(e) Within 14 days after service by the Region, post at
its facility in Gardena, California, copies of the attached
notice marked “Appendix.”1 Copies of the notice, on
forms provided by the Regional Director for Region 21,
after being signed by the Respondent’s authorized repre-
sentative, shall be posted by the Respondent and main-
tained for 60 consecutive days in conspicuous places
including all places where notices to employees are cus-
tomarily posted. Reasonable steps shall be taken by the
Respondent to ensure that the notices are not altered,
defaced or covered by any other material. In the event
that, during the pendency of these proceedings, the Re-
spondent has gone out of business or closed the facility
involved in these proceedings, the Respondent shall du-
plicate and mail, at its own expense, a copy of the notice
to all current employees and former employees employed
by the Respondent at any time since February 23, 2001.
(f) Within 21 days after service by the Region, file
with the Regional Director a sworn certification of a re-
sponsible official on a form provided by the Region at-
testing to the steps that the Respondent has taken to
comply.

MEMBER COWEN, dissenting.
Contrary to my colleagues, I would deny the General
Counsel’s Motion for Summary Judgment because the
complaint on which it is based fails to allege a violation
under Section 8(a)(5) and (1) of the Act. The complaint
alleges that after the Union was certified as the exclusive
bargaining representative of a unit of the Respondent’s
employees, the Respondent, on February 23, 2001, laid
off employee Jose Martell without affording the Union
an opportunity to bargain with the Respondent with re-
spect to the layoff. The complaint also alleges that the
layoff is a mandatory subject of bargaining. However,
the complaint fails to allege that the layoff constituted a
unilateral change.1 To establish a prima facie case in the
situation before us, the General Counsel must show that

(1) the Union was the bargaining representative of the
laid-off employees at the time of their layoff, (2) the
layoff was a mandatory subject of bargaining, (3) the
Company did not give notice to, nor did it bargain with,
the Union about the decision to have a layoff or its im-

1 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.”
1 Cf. Kal-Die Casting Corp., 221 NLRB 1068 (1975) (routine pro-
duction scheduling and adjustments relating to diminishing available
hours of work without bargaining with the union does not violate Sec.
8(a)(5) in the absence of evidence that this activity varied from the
employer’s past practice); KDEN Broadcasting Co., 225 NLRB 25, 35
(1976) (failure to bargain over scheduling changes not violative of Sec.
8(a)(5) in absence of evidence that changes inconsistent with em-
ployer’s past practice of making scheduling changes).
FALCON WHEEL DIVISION L.L.C. 579
pact on unit employees, and (4) the layoff constituted a
material, substantial, and significant change in the
terms and conditions of employment of unit employees.

Taino Paper Co., 290 NLRB 975, 978 (1988). The Board
has consistently reaffirmed that it is not enough that an al-
leged unilateral change involves a mandatory subject of
bargaining; it also must be a material, substantial, and sig-
nificant change in the terms and conditions of employment
to trigger the employer’s statutory bargaining obligation. Id.
at 977-978 (citing United Technologies Corp., 278 NLRB
306 (1986)); Golden Stevedoring Co., 335 NLRB 410, 415
(2001) (quoting Millard Processing Services, 310 NLRB
421, 425 (1993)); and Peerless Food Products, 236 NLRB
161 (1978). Although the complaint in this case alleges the
first three elements of a prima facie case, the General Coun-
sel has not alleged any change in the terms and conditions
of employment, let alone a material change. Thus, an ele-
ment of the prima facie case is missing from the complaint
allegation, and the Board cannot find a violation of Section
8(a)(5). Accordingly, the General Counsel’s Motion for
Summary Judgment should be denied.
In reaching a different conclusion, my colleagues ar-
gue that layoffs are somehow different from all other
alleged unilateral changes in working conditions, which
they acknowledge require proof of “change” to establish
an unfair labor practice. This argument does not with-
stand scrutiny.
My colleagues assert that layoffs are so obviously a
“change” in working conditions that it is not necessary to
require the General Counsel to allege the obvious. While
I agree that a layoff frequently involves a “change” in
working conditions, this is not universally so, and absent
a universal truth, the General Counsel should not be ex-
cused from the simple pleading requirement of alleging a
“change.”
For example, many industries experience seasonal
fluctuations in the size of the work force. And in these
industries, many companies have well-established sys-
tematic layoff and recall procedures. In such circum-
stances, the layoff and recall procedures may very well
be working conditions that may not be changed unilater-
ally. Cf. California Date Growers Assn., 118 NLRB
246, 260–261 (1957), enfd. 259 F.2d 587 (9th Cir. 1958)
(seniority system established prior to union relationship
unlawfully changed for striking employees where senior-
ity was basis for conducting seasonal layoffs).
Moreover, even in nonseasonal industries, layoff and
recall practices may represent established working condi-
tions upon which the employees rely. Particular employ-
ees may have requested periodic layoff to attend to other
affairs, layoffs may be rotated on a regular cycle, or there
may be an established seniority system. In any event, the
layoff and recall practices may be sufficiently stable and
predictable to constitute an established working condi-
tion. See NLRB v. Frontier Homes Corp., 371 F.2d 974,
980 (8th Cir. 1967) (established seniority-based layoff
practice may not be changed without consultation with
union; considerations of ability allowed by expired con-
tract not controlling).
It is true that we do not know whether any of these cir-
cumstances—or others not enumerated here—are present
in this case. But that is exactly my point. Without an
allegation that the layoff at issue constitutes a change in
working conditions, we simply do not know whether a
“change” has occurred. And without a “change” it can-
not be said that the Employer has violated Section
8(a)(5) of the Act by unilaterally changing working con-
ditions.
As a final matter, to the extent that my colleagues
point to some cases as implying that no “change” is nec-
essary to find an unlawful unilateral change regarding a
layoff, the cited cases do not support that conclusion and
my colleagues offer no rationale for this curious proposi-
tion. It is true that the Board has considered and rejected
various factual arguments that a particular case involves
a preexisting layoff and recall procedure that is suffi-
ciently stable and predictable to constitute an established
working condition. But these cases do not abandon
“change” as the touchstone of the violation; rather, they
embrace it. Adair Standish Corp. v. NLRB, 912 F.2d
854, 864 (6th Cir. 1990) (“This argument [that the layoff
policy could be continued as the status quo] unjustifiably
presumes that the company’s lay-off practice prior to the
election was systematic, as opposed to sporadic”); NLRB
v. Advertisers Mfg. Co., 823 F.2d 1086, 1090 (7th Cir.
1987) (“The rule that requires an employer to negotiate
with the union before changing the working conditions in
the bargaining unit is intended to prevent the employer
from undermining the union . . .”).
In sum, a layoff does not always constitute a change in
existing working conditions. This being so, where the
General Counsel alleges a violation of Section 8(a)(5) of
the Act based upon an alleged layoff, he is not excused
from alleging and proving that the layoff is a “change” in
the employees’ working conditions. Since my colleagues
do not hold the General Counsel to this simple pleading
requirement, I dissent.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government

DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 580
The National Labor Relations Board has found that we vio-
lated the Federal labor law and has ordered us to post and
obey this notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist any union
Choose representatives to bargain with us on
your behalf
Act together with other employees for your bene-
fit and protection
Choose not to engage in any of these protected
activities.

WE WILL NOT fail and refuse to bargain with General
Truck Drivers, Chauffeurs & Helpers of San Pedro,
Wilmington, Long Beach & Vicinity, Local 692, Interna-
tional Brotherhood of Teamsters, AFL–CIO as the exclu-
sive representative of the employees in the unit set forth
below, by unilaterally changing terms and conditions of
employment, including the layoff of employees, without
notifying the Union and affording it an opportunity to
bargain about these changes:

All full-time and regular part-time production and
maintenance employees employed by us at our facility
located at 407 E. Redondo Beach Boulevard, Gardena,
California; excluding all other employees, office cleri-
cal employees, professional employees, guards and su-
pervisors as defined in the Act.

WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the rights
guaranteed you by Section 7 of the Act.
WE WILL, on request, bargain in good faith with the
Union concerning terms and conditions of employment,
including the layoff of employees.
WE WILL, within 14 days from the date of the Board’s
Order, offer full reinstatement to Jose Martell to his for-
mer position, or, if that position no longer exists, to a
substantially equivalent position, without prejudice to his
seniority or other rights and privileges previously en-
joyed.
WE WILL make Jose Martell whole for any loss of
wages and benefits he may have suffered as a result of
his layoff, plus interest.

FALCON WHEEL DIVISION L.L.C.