Ferro Mechanical Corp.

National Labor Relations Board - Board Decisions

May 21, 1980

249 N.L.R.B. 669 (N.L.R.B. 1980)

FERRO MECHANICAL CORP. 669
Ferro Mechanical Corp. and Sheet Metal Workers
International Association, Local Union No. 13,
AFL-CIO. Case 22-CA-9253
May 21, 1980
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
PENELLO AND TRUESDALE
Upon a charge filed on May 29, 1979, by Sheet
Metal Workers International Association, Local
Union No. 13, AFL-CIO, hereinafter called the
Union, and duly served on Ferro Mechanical
Corp., hereinafter called Respondent, the General
Counsel of the National Labor Relations Board, by
the Regional Director for Region 22, issued a com-
plaint on July 16, 1979, against Respondent, alleg-
ing that Respondent had engaged in and was en-
gaging in unfair labor practices affecting commerce
within the meaning of Section 8(a)(5) and (1) and
Section 2(6) and (7) of the National Labor Rela-
tions Act, as amended. Copies of the charge and
complaint and notice of hearing before an adminis-
trative law judge were duly served on the parties
to this proceeding.
On December 12, 1979, counsel for the General
Counsel filed directly with the Board a Motion for
Summary Judgment, based upon Respondent's fail-
ure to file an answer to the complaint as required
by Sections 102.20 and 102.21 of the Board's Rules
and Regulations, Series 8, as amended. Subsequent-
ly, on January 3, 1980, the Board issued an order
transferring the proceeding to the Board and a
Notice To Show Cause why the General Counsel's
Motion for Summary Judgment should not be
granted. Respondent failed to file a response to the
Notice To Show Cause.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
Upon the entire record in this proceeding, the
Board makes the following:
Ruling on the Motion for Simmary Judgment
Section 102.20 of the Board's Rules and Regula-
tions, Series 8, as amended, provides as follows:
The respondent shall, within 10 days from the
service of the complaint, file an answer there-
to. The respondent shall specifically admit,
deny, or explain each of the facts alleged in
the complaint, unless the respondent is without
knowledge, in which case the respondent shall
so state, such statement operating as a denial.
All allegations in the complaint, if no answer
is filed, or any allegation in the complaint not
249 NLRB No. 83
specifically denied or explained in an answer
filed, unless the respondent shall state in the
answer that he is without knowledge, shall be
deemed to be admitted to be true and shall be
so found by the Board, unless good cause to
the contrary is shown.
The complaint and notice of hearing served on
Respondent specifically states that, unless an
answer to the complaint is filed by Respondent
within 10 days from the service thereof, "all of the
allegations contained in the Complaint shall be
deemed to be admitted to be true and may be so
found by the Board."
Further, according to the memorandum in sup-
port of the Motion for Summary Judgment, coun-
sel for the General Counsel, by letter dated No-
vember 27, 1979, specifically advised Respondent's
president, Michael Ferrarie, that failure to file an
answer to the complaint by December 4, 1979,
would result in the filing of the Motion for Sum-
mary Judgment.
To date, neither an answer to the complaint nor
a response to the Notice To Show Cause has been
filed by either Respondent or Michael Ferrarie. No
good cause to the contrary having been shown, the
allegations of the complaint herein are deemed to
be admitted and are so found by the Board. Ac-
cordingly, we grant the General Counsel's Motion
for Summary Judgment.
On the basis of the entire record, the Board
makes the following:
FINDINGS OF FACT
I. THE BUSINESS OF RESPONDENT
Respondent, a New Jersey corporation, at all
times material herein has maintained its principal
office and place of business at 321 Sherman
Avenue, Newark, New Jersey, where it has en-
gaged in the manufacture, sale, and distribution of
custom sheet metal kitchen equipment, and related
products. In the 12 months preceding issuance of
the complaint, Respondent in the course and con-
duct of its business manufactured, sold, and distrib-
uted at said Newark plant products valued in
excess of $50,000, of which products valued in
excess of $50,000 were shipped from said plant in
interstate commerce directly to States outside the
State of New Jersey.
We find, on the basis of the foregoing, that Re-
spondent is, and has been at all times material
herein, an employer engaged in commerce within
the meaning of Section 2(6) and (7) of the Act, and
that it will effectuate the policies of the Act to
assert jurisdiction herein.
FERRO MECHANICAL CORP. 69
670 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
11. THE LABOR ORGANIZATION INVOLVED
Sheet Metal Workers International Association,
Local Union No. 13, AFL-CIO, is a labor organi-
zation within the meaning of Section 2(5) of the
Act.
III. THE UNFAIR LABOR PRACTICES
The following employees of Respondent consti-
tute a unit appropriate for the purpose of collective
bargaining within the meaning of Section 9(b) of
the Act:
All production and maintenance employees en-
gaged in the manufacture, fabrication, assem-
bly, handling, erection, installation, disman-
tling, reconditioning, adjustment, alteration, re-
pairing, and servicing employed by Respond-
ent at its Newark plant, but excluding all
office clerical employees, professional employ-
ees, guards and supervisors as defined in the
Act.
On or about March 1, 1978, a majority of the
employees in the above-described unit designated
the Union as their representative for the purposes
of collective bargaining with Respondent, and, at
all times material herein, the Union has been and is
now the exclusive representative of the employees
in the above-described unit. At all times material
herein and continuing to date, Respondent and the
Union have been parties to a collective-bargaining
agreement covering the bargaining unit employees,
which agreement provides, inter alia, that Respond-
ent shall make certain contributions to the Union's
pension, welfare, and vacation funds.
Since on or about January 1, 1979, Respondent
unilaterally has changed existing terms and condi-
tions of employment of the unit employees by fail-
ing and refusing to make the required pension, wel-
fare, and vacation funds contributions referred to
above.
Further, on or before April 10, 1979, Respondent
decided to, and did, permanently cease its business
operations at its Newark plant and permanently
laid off all employees in the aforementioned unit.
At all times material herein prior to April 10, 1979,
Respondent neglected and failed to inform or
notify the Union of its decision to permanently
cease operations at its Newark plant. On or about
April 10, 1979, and at other times thereafter, in-
cluding on or about May 21, 1979, the Union re-
quested that Respondent meet and bargain with it
concerning Respondent's decision to cease its oper-
ations at the Newark plant and concerning the ef-
fects of such decision upon employees in the unit.
Nevertheless, at no time prior to April 10, 1979,
did Respondent meet and bargain with the Union
with respect to its decision to cease operations at
the Newark plant or the effects of such decision on
unit employees.
Accordingly, we find that, by the aforesaid con-
duct, Respondent has (1) since on or about January
1, 1979, unilaterally changed the terms and condi-
tions of unit employees without bargaining with
the Union, and (2) since on or about April 10,
1979, refused to bargain with the Union as the ex-
clusive representative of the employees in the ap-
propriate bargaining unit concerning the decision
to close its Newark plant and the effects of that de-
cision on unit employees. By such actions, we con-
clude that Respondent has engaged in and is engag-
ing in unfair labor practices within the meaning of
Section 8(a)(5) and (1) of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR
PRACTICES UPON COMMERCE
The activities of Respondent set forth in section
III, above, occurring in connection with its oper-
ations described in section I, above, have a close,
intimate, and substantial relationship to trade, traf-
fic, and commerce among the several States and
tend to lead to labor disputes burdening and ob-
structing commerce and the free flow of com-
merce.
V. THE REMEDY
Having found that Respondent has engaged in
and is engaging in unfair labor practices within the
meaning of Section 8(a)(5) and (1) of the Act, we
shall order that it cease and desist therefrom, and
take certain affirmative action designed to effectu-
ate the policies of the Act.
As a result of Respondent's unlawful failure to
bargain with the Union over its decision to close
down its Newark plant and the effects thereof, the
displaced employees "have been denied an oppor-
tunity to bargain through their collective-bargain-
ing representative at a time when Respondent was
still in need of their services and a measure of bal-
anced bargaining power existed."' Effectuation of
the Act's policies therefore requires that the em-
ployees whose statutory rights have been invaded
by reason of Respondent's unlawful unilateral
action, and who may have suffered losses in conse-
quence thereof, be reimbursed for such losses until
such time as Respondent remedies its violations by
doing what it should have done in the first place.
Thus, Respondent shall pay employees backpay,
at the rate of their normal wages when last in Re-
spondent's employ, from April 10, 1978, the date
on which Respondent closed its Newark plant and
terminated the unit employees there employed,
P B. Murrie Motor Transporrtation, Inc., 226 NLRB 1325 (1976).
FERRO MECHANICAL CORP. 671
until the occurrence of the earliest of the following
conditions: (1) the date Respondent bargains to
agreement with the Union on those subjects per-
taining to the decision to close its Newark plant
and the effects of the closing on unit employees; (2)
a bona fide impasse in bargaining; (3) the failure of
the Union to request bargaining within 5 days of is-
suance of this Decision, or to commerce negotia-
tions within 5 days of Respondent's notice of its
desire to bargain with the Union; or (4) the subse-
quent failure of the Union to bargain in good faith.
Interest on all such sums shall be paid in the
manner prescribed in Florida Steel Corporation, 231
NLRB 651 (1977).2 Respondent also shall place all
unit employees who were terminated on April 10,
1979, on a preferential hiring list following a non-
discriminatory system, such as seniority, and shall
offer reinstatement to these employees pursuant to
this list in the event Respondent resumes any of the
operations which were discontinued on April 10,
1979.
We also have found that Respondent failed to
make required contributions to the Union's pension,
welfare, and vacation funds since on or about Janu-
ary 1, 1979. In order to dissipate the effect of this
unfair labor practice, we shall order Respondent to
make whole its employees by transmitting the re-
quired contributions to these funds, and by reim-
bursing employees for any medical or dental bills
they have paid directly to health care providers
that the contractual policies would have covered,
as well as any premiums they may have paid to
third-party insurance companies to continue medi-
cal and dental coverage in the absence of Respond-
ent's required contributions. Further, we shall
order Respondent to reimburse any employees for
contributions they themselves may have made for
the maintenance of the Union's pension, welfare,
and vacation funds after Respondent unlawfully
ceased contributing to those funds.3
The Board, upon the basis of the foregoing facts
and the entire record, makes the following:
2 See, generally, Isis Plumbing d Heating Co., 138 NLRB 716 (1962).
a Because the provisions of employee benefit fund agreements are vari-
able and complex, the Board does not provide at the adjudicatory stage
of a proceeding for the addition of interest at a fixed rate on unlawfully
withheld fund payments. We leave to the compliance stage the question
whether Respondent must pay any additional amounts into the benefit
funds in order to satisfy our "make-whole" remedy. These additional
amounts may be determined. depending upon the circumstances of each
case, by reference to provisions in the documents governing the funds at
issue and. where there are no governing provisions, to evidence of any
loss directly attributable to the unlawful withholding action. which might
include the loss of return on investment of the portion of funds withheld,
additional administrative costs. etc., but not collateral losses
CONCLUSIONS OF LAW
1. Ferro Mechanical Corp. is an employer en-
gaged in commerce within the meaning of Section
2(6) and (7) of the Act.
2. Sheet Metal Workers International Associ-
ation, Local Union No. 13, AFL-CIO, is a labor
organization within the meaning of Section 2(5) of
the Act.
3. By failing to bargain about the decision to
close its Newark plant, and about the effects of
that closing on its bargaining unit employees, Re-
spondent has violated Section 8(a)(5) and (1) of the
Act.
4. By unilaterally changing existing terms and
conditions of employment by failing to make re-
quired contributions to the Union's pension, wel-
fare, and vacation funds since January 1, 1979, Re-
spondent has violated Section 8(a)(5) and (1) of the
Act.
5. The aforesaid unfair labor practices are unfair
labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act.
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board hereby orders that the Respondent,
Ferro Mechanical Corp., Newark, New Jersey, its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Failing and refusing to bargain with Sheet
Metal Workers International Association, Local
Union No. 13, AFL-CIO, herein called the Union,
as the exclusive representative of its employees in
the appropriate unit set forth hereinbelow with re-
spect to the decision to close the Newark plant and
the effects of such closing on the unit employees.
The appropriate unit is:
All production and maintenance employees en-
gaged in the manufacture, fabrication, assem-
bly, handling, erection, installation, disman-
tling, reconditioning, adjustment, alteration, re-
pairing, and servicing employed by the Re-
spondent at it Newark plant, but excluding all
office clerical employees, professional employ-
ees, guards and supervisors as defined in the
Act.
(b) Unilaterally changing existing terms and con-
ditions of employment by failing and refusing to
make contributions to the Union's pension, welfare,
and vacation funds as required by the collective-
bargaining agreement between it and the Union.
(c) In any like or related manner interfering
with, restraining, or coercing its employees in the
FERRO MECHANICAL CORP~~~~~~~~~~~~~~~~~~~~~~~. .
672 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
exercise of the rights guaranteed them under Sec-
tion 7 of the Act.
2. Take the following affirmative action which is
designed to effectuate the policies of the Act:
(a) Upon request, bargain in good faith with the
Union as the exclusive bargaining representative of
all employees in the aforesaid appropriate unit with
respect to the decision to close its Newark plant
and the effects of the decision on unit employees,
including any disputes with respect to the effectu-
ation of the remedy set forth herein, and, if an un-
derstanding is reached, embody it in a signed
agreement.
(b) In the event that Respondent resumes oper-
ation of a plant at Newark, New Jersey, or a plant
within the jurisdiction of the Union which is a sub-
stitute for the Newark plant, Respondent shall bar-
gain, upon request, with the Union regarding
wages, hours, and other terms and conditions of
employment of the employees in the appropriate
unit, and embody any agreement reached in a
signed agreement.
(c) Place the names of all unit employees termi-
nated on April 10, 1979, on a preferential hiring list
and offer to such employees full reinstatement to
their former or substantially equivalent jobs in the
event Respondent resumes any of the operations
which were discontinued on April 10, 1979.
(d) Make whole the employees in the appropriate
unit who were terminated on or about April 10,
1979, for any loss of pay or benefits suffered as a
result of the unilateral closing of Respondent's
plant at Newark, New Jersey, in the manner and
for the period set forth in the remedy section of
this Decision.
(e) Make whole the employees in the appropriate
unit by transmitting the contributions owed to the
Union's pension, welfare, and vacation funds since
January 1, 1979, pursuant to the terms of its collec-
tive-bargaining agreement with the Union, and by
reimbursing unit employees for any medical and
dental expenses ensuing from Respondent's unlaw-
ful failure to make such required contributions
since January 1, 1979. This shall include reimburs-
ing employees for contributions they themselves
may have made for the maintenance of the Union's
pension, welfare, and vacation funds after Respond-
ent unlawfully ceased contributing, for any premi-
ums they may have paid to third-party insurance
companies for medical and dental coverage, and
for any medical or dental bills employees have paid
directly to health care providers that the contrac-
tual policies would have covered.
(f) Preserve and, upon request, make available to
the Board or its agents, for examination and copy-
ing, all payroll records, social security payment
records, timecards, personnel records and reports,
and all other records necessary to analyze the
amount of backpay due under the terms of this
Order.
(g) Mail an exact copy of the attached notice
marked "Appendix" 4 to Sheet Metal Workers In-
ternational Association, Local Union No. 13,
AFL-CIO, and to all the employees who were em-
ployed at its former place of business at 321 Sher-
man Avenue, Newark, New Jersey, on April 10,
1979. Copies of said notice, on forms provided by
the Regional Director for Region 22, after being
duly signed by Respondent's authorized representa-
tive, shall be mailed immediately upon receipt
thereof, as hereinabove directed.
(h) Notify the Regional Director for Region 22,
in writing, within 20 days from the date of this
Order, what steps Respondent has taken to comply
herewith.
4 In the event that 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 National Labor Relations Board" shall read "Posted Pursu-
ant to a Judgment of the United States Court of Appeals Enforcing an
Order of the National Labor Relations Board."
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL NOT fail and refuse to bargain
with Sheet Metal Workers International Asso-
ciation, Local Union No. 13, AFL-CIO, con-
cerning the decision to close our Newark,
New Jersey, facility on April 10, 1979, and the
effects of that closing on the employees in the
bargaining unit described below.
WE WILL NOT unilaterally change existing
terms and conditions of employment by failing
and refusing to remit to Sheet Metal Workers
International Association, Local Union No. 13,
AFL-CIO, contributions to the Union's pen-
sion, welfare, and vacation funds, as required
by our collective-bargaining agreement with
the Union.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employ-
ees in the exercise of the rights guaranteed
them under Section 7 of the Act.
WE WILL, upon request, bargain collectively
with Sheet Metal Workers International Asso-
ciation, Local Union No. 13, AFL-CIO, as the
exclusive representative of the employees in
the bargaining unit described below, with re-
spect to our decision to close our Newark,
FERRO MECHANICAL CORP. 673
New Jersey, facility, and the effects upon unit
employees of that decision, and reduce to writ-
ing any agreement reached as a result of such
bargaining.
WE WILL place the names of all unit em-
ployees laid off an April 10, 1979, when we
closed our facility, on a preferential hiring list
and offer to such employees full reinstatement
to their former or substantially equivalent jobs
in the event we resume any of the operations
which were discontinued on April 10, 1979.
WE WILL make whole our employees in the
appropriate unit by paying those employees
who were laid off on April 10, 1979, when we
closed our facility, normal wages for a period
specified by the National Labor Relations
Board, plus interest.
WE WILL make whole our employees in the
appropriate unit by transmitting our contribu-
tions to the Union's pension, welfare, and va-
cation funds due since January 1, 1979, as re-
quired by our collective-bargaining agreement
with Sheet Metal Workers International Asso-
ciation, Local Union No. 13, AFL-CIO, and
by reimbursing unit employees for any medical
and dental expenses ensuing from our unlawful
failure to make such required contributions
since January 1, 1979. This shall include reim-
bursing our employees for contributions they
themselves may have made for the mainte-
nance of the Union's pension, welfare, and va-
cation funds after we unlawfully ceased con-
tributing, for any premiums our employees
may have paid to third-party insurance compa-
nies for medical and dental coverage, and for
any medical or dental bills our employees have
paid directly to health care providers that the
contractual policies would have covered. The
bargaining unit is:
All production and maintenance employees
engaged in the manufacture, fabrication, as-
sembly, handling, erection, installation, dis-
mantling, reconditioning, adjustment, alter-
ation, repairing, and servicing employed at
our Newark, New Jersey, facility, but ex-
cluding all office clerical employees, profes-
sional employees, guards and supervisors as
defined in the Act.
FERRO MECHANICAL CORP.
FERRO MECHANICAL CORP. ._ . z .,