H. S. Brooks Electric, Inc.

National Labor Relations Board - Board Decisions

Dec 2, 1977

233 N.L.R.B. 889 (N.L.R.B. 1977)

H. S. BROOKS ELECTRIC, INC.
H. S. Brooks Electric, Inc., K & F Electric Co., Inc.,
and Waldemar Nikolai, their agent and Interna-
tional Brotherhood of Electrical Workers, Local
Union No. 43, AFL-CIO. Case 3-CA-6908
December 2, 1977
DECISION AND ORDER
BY MEMBERS JENKINS, PENELLO, AND MURPHY
On July 15, 1977, Administrative Law Judge
Norman Zankel issued the attached Decision in this
proceeding. Thereafter, Respondent filed exceptions
and a supporting brief, and the General Counsel filed
limited exceptions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, findings,
and conclusions of the Administrative Law Judge
and to adopt his recommended Order, as modified
herein.
The Administrative Law Judge found, and we
agree, that H. S. Brooks Electric, Inc., and its alter
ego, K & F Electric Co., Inc., violated Section 8(a)(5)
and (1) of the Act by refusing to recognize the Union
and apply the terms of the collective-bargaining
agreement to its employees, and Section 8(a)(3) and
(I) of the Act by laying off employees Frank
Formica, Richard Hemings,' Peter Van Zwehl, and
A. DiNiro. As a remedy, the Administrative Law
Judge recommended, inter alia, that Respondent
bargain with the Union, retroactively apply the
contract, pay to the Union various fund payments
due under the contract, offer the four named
discriminatees reinstatement, and pay to the discri-
minatees and any other employees the difference
between what they were paid and what they would
have been paid under the bargaining agreement.
The Administrative Law Judge did not include in
his recommended remedy, order, or notice a provi-
sion making the four named discriminatees whole for
any loss of pay suffered. We find merit in the
General Counsel's exceptions thereto and shall
accordingly amend the recommended Order and
notice. We are aware that, even absent the unfair
labor practices, the discriminatees might have been
discharged in the normal course of business at the
completion of the projects on which they were
working. There is insufficient evidence in the record
as it now stands to make such a determination. Thus,
I The Administrative Law Judge refers to Jake Hemmings; the correct
name is Richard Hemings
233 NLRB No. 122
the matter is properly deferred to the compliance
stage of this proceeding.
Respondent has excepted to the Administrative
Law Judge's recommendation that Waldemar Niko-
lai be held personally responsible to remedy the
violations. Nikolai was named in the complaint as an
agent of Respondent and not as a separate Respon-
dent. Absent special circumstances (which are not
present here), the corporate officer or agent is
responsible only for taking necessary steps to
effectuate the Board's Order and is not to be held
personally liable for backpay due the employees
discriminated against or other monetary remedies.
Riley Aeronautics Corp., 178 NLRB 495, 501 (1969).
Accordingly, we shall amend the recommended
Order and notice to delete Nikolai's individual
liability.
Respondent further contends that the recommend-
ed remedy with respect to backpay is too broad in
that backpay may be due both to the discriminatees
and to the employees actually hired, during the same
period of time. Since such a remedy would impose
liability for a greater number of employees than
would have been employed by Respondent, absent
any unfair labor practice, Respondent argues that to
impose such "double liability" is punitive and not a
proper make-whole remedy. However, as indicated
above, there is insufficient evidence in the record to
determine whether or not the discriminatees would
have continued in Respondent's employment or even
to determine the extent of employment subsequent to
the commission of the unfair labor practices. The
matters raised by Respondent are, thus, properly
deferred to the compliance stage of this proceeding.
Respondent, of course, is not precluded from raising
the matter at that stage.
We shall also modify the remedy so that backpay is
computed as set forth in F. W. Woolworth Company,
90 NLRB 289 (1950), and interest thereon is
computed in the manner prescribed in Florida Steel
Corporation, 231 NLRB 651 (1977).2
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge as herein
modified and hereby orders that the Respondent, H.
S. Brooks Electric, Inc., and K & F Electric Co., Inc.,
Syracuse, New York, its officers, agents, successors,
and assigns, shall take the action set forth in said
recommended Order, as modified below:
2 See, generally, Isis Plumbing d Heating Co., 138 NLRB 716 (1962).
889
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
1. Add the following as paragraph 2(e) and
reletter the following paragraphs accordingly:
"(e) Make Frank Formica, Richard Hemings, Peter
Van Zwehl, and A. DiNiro whole for any loss of
earnings, plus interest, suffered as a result of their
being laid off or terminated by reason of the
discrimination against them."
2. Substitute the attached notice for that of the
Administrative Law Judge.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing in which all parties had the
opportunity to present evidence, it has been decided
that we violated the law. We have been ordered to
take certain steps to correct our violations and have
been ordered to post this notice. We intend to abide
by the Order and do the following:
First, we notify you that the National Labor
Relations Act gives all employees these rights:
To engage in self-organization
To form, join, or help unions
To engage in collective bargaining
through a representative of your own choice
To act together for collective bargaining
or for other mutual aid or protection
To refrain from any and all these things.
WE WILL NOT in any other manner interfere
with, restrain, or coerce you in your exercise of
any of these rights.
WE WILL NOT discriminate against you by
terminating your employment or by any other
means, in violation of the National Labor
Relations Act.
WE WILL NOT refuse to fail or bargain collec-
tively and in good faith with your collective-
bargaining representative.
WE WILL immediately offer full reinstatement
to Frank Formica, Richard Hemings, Peter Van
Zwehl, and A. DiNiro to their former jobs,
without loss of seniority or other privileges they
previously had, or, if those former jobs no longer
exist, WE WILL offer them substantially equivalent
positions of employment, or their old jobs, as
such positions become available.
WE WILL make Frank Formica, Richard
Hemings, Peter Van Zwehl, and A. DiNiro whole
for any loss of earnings, plus interest, they have
suffered as a result of our discrimination against
them.
WE WILL pay the above-named employees, and
any other employees working for us since August
3, 1976, who may have received less pay than
called for in the 1976-78 contract between
Central New York Chapter, National Electrical
Contractors Association, Inc., and International
Brotherhood of Electrical Workers, Local Union
No. 43, AFL-CIO, the difference in pay each
such employee actually received and that which
each would have received if we had observed the
terms of that contract, and the payment will be
with interest.
WE WILL immediately recognize and, upon
request, bargain collectively in good faith with the
above-named Union as your exclusive collective-
bargaining representative in the following appro-
priate bargaining unit:
All employees engaged in electrical work
employed by the employer-members of
Central New York Chapter, National Elec-
trical Contractors Association, Inc. and
signatories to the NECA-Union contract or
letters of assent, including H. S. Brooks
Electric, Inc., and K & F Electric Co., Inc.
WE WILL honor and apply all the terms and
conditions of the 1976-78 collective-bargaining
contract between NECA and the above-named
Union, retroactive to the date in September 1976,
on which K & F Electric Co., Inc., became a
corporation.
WE WILL pay to the above-named Union any
and all amounts due in health and welfare,
pension, annuity, and vacation fund, and all other
fund payments required by the 1976-78 NECA-
Union contract for all employees of ours in the
bargaining unit described above since August 3,
1976, including the four persons to whom we shall
offer reinstatement, together with interest.
H. S. BROOKS ELECTRIC,
INC. K & F ELECTRIC
Co., INC.
DECISION
STATEMENT OF THE CASE
NoRMAN ZANKEL, Administrative Law Judge: This case
was heard before me on May 5, 1977. The Charge was filed
on February 3, 1977, by International Brotherhood of
Electrical Workers, Local Union No. 43, AFL-CIO
(hereinafter the Union). On March 21, 1977, the Regional
Director for Region 3 of the National Labor Relations
Board (hereinafter the Board) issued a complaint and
notice of hearing against H. S. Brooks Electric, Inc., K & F
Electric Co., Inc., and Waldemar Nikolai, their agent
890
H. S. BROOKS ELECTRIC, INC.
(hereinafter jointly called Respondent or, separately,
Brooks, K & F, or Nikolai), alleging that Respondent
violated Section 8(a)(1), (3), and (5) of the National Labor
Relations Act, as amended (hereinafter the Act) by having
refused to bargain collectively in good faith with the Union
when Respondent failed and refused to recognize the
Union as the collective-bargaining representative of its
employees in an appropriate bargaining unit. Specifically,
the complaint alleges that Respondent Corporations, as a
single integrated employer (and K & F as an alter ego of
Brooks), together with Nikolai as their agent, unlawfully
refused, in December 1976,1 to recognize the Union as the
collective-bargaining representative of their employees in
an appropriate unit and failed to apply the terms of an
agreement between the Union and Central New York
Chapter, National Electrical Contractors Association, Inc.
(hereinafter NECA) to those employees. The 8(aX3)
allegation does not appear as an independent violation, but
rather is derivative of the 8(aX5) alter ego theory.
Respondent filed a timely answer, which was orally
amended at the hearing, admitting some, but denying the
substantive, allegations of the complaint.
All parties were represented at the hearing and were
afforded full opportunity to participate, to examine and
cross-examine witnesses, and to argue orally. The Board's
General Counsel and counsel for Respondent filed post-
hearing briefs 2 which have been carefully considered.
Upon the entire record in the case, including my
observation of the demeanor of the witnesses, I make the
following:
FINDINGS AND CONCLUSIONS
I. JURISDICTION
Brooks, a New York corporation engaged in the
electrical contracting business, at all times material herein
maintained its principal place of business at 309 East
Division Street, Syracuse, New York. During 1976, Brooks
performed services, in the course and conduct of its
business, having a value in excess of $50,000, of which
services exceeding $50,000 in value were furnished to New
York Telephone and Continental Can Company, among
others, in New York State. It was admitted by Respondent
that New York Telephone and Continental Can Company
each receives goods valued in excess of $50,000 annually
transported to places of business within New York State
directly from states of the United States other than New
York. Brooks admitted the above facts and that it was, at
all times material herein, an employer engaged in com-
merce within the meaning of Section 2(6) and (7) of the
Act, and I so find.
K & F is a New York corporation engaged in the
electrical contracting business with a principal place of
business at 309 East Division Street, Syracuse, New York.
I All dates hereinafter are in 1976. unless otherwise stated.
2 After having filed its bnef, Respondent submitted a letter memoran-
dum replying to the General Counsel's brief Respondent's reply has not
been considered by me in this Decision inasmuch as the Board's Rules and
Regulations do not provide for submission of such replies.
3 The record reveals the use of an assent letter denoted "Letter of Assent
It was incorporated in September 1976. The complaint
contains no specific jurisdictional allegations with refer-
ence to the business operations of K & F. However, as I
shall find, infra, that K & F is the alter ego of Brooks, the
Board's jurisdiction will attach to K & F. Accordingly, I
find that K & F is an employer engaged in commerce
within the meaning of Section 2(6) and (7) of the Act. See
Joseph E. Cote, 101 NLRB 1486 (1952).
NECA is, and at all times material herein has been, an
association comprised of various employers engaged in the
electrical contracting business, which employer members
have delegated to NECA the authority to represent them
for the purpose of collective bargaining.
II. THE LABOR ORGANIZATION INVOLVED
The parties agree, the record reflects, and I find, that
International Brotherhood of Electrical Workers, Local
Union No. 43, AFL-CIO is, and at all times material
herein has been, a labor organization within the meaning of
Section 2(5) of the Act.
Ill. THE ALLEGED UNFAIR LABOR PRACTICES
A. Facts
The material facts herein are not disputed. On July 3,
1973, Nikolai and his wife, Charlotte, became the sole
stockholders of all the common stock of Brooks. Nikolai
first entered the electrical trade in 1951 at the age of 16
years as an electrician's apprentice. Later, he worked as an
electrician for a variety of employers and, upon moving to
Syracuse, New York, in 1965, he joined the Union.
Thereafter, he continued working as an electrician in the
Syracuse area until his acquisition of Brooks.
On July 9, 1973, Nikolai visited the Union office and, at
the request of Edward Murphy, the Union's Business
Manager, signed a letter of assent (G.C. Exh. 2) which
provided, in relevant part:
. . . (Brooks) does hereby authorize (NECA) as its
collective-bargaining representative for all matters
contained in or pertaining to the current approved
Inside Labor agreement between (NECA) and the
(Union). This authorization, in compliance with the
current approved labor agreement, shall become
effective on the 9th day of July 1973. It shall remain in
effect until terminated by (Brooks) giving written notice
to (NECA) and to the Local Union at least one
hundred fifty (150) days prior to the then current
anniversary date of the aforementioned approved labor
agreement.
Nikolai signed the letter of assent, designated "Letter of
Assent - A,"3 as "owner" of Brooks. At the time of
execution, there was in effect a collective-bargaining
agreement (G.C. Exh. 3) between NECA and the Union,
- B," but there is no evidence as to its contents. Respondent elicited this
information through cross-examination of Murphy who only testified such a
form existed and would be used, rather than the form signed by Nikolai,
only if employers requested its use. The significance of this testimony
remains unexplained.
891
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
which was for the period July 1, 1973, through June 30,
1975. That agreement was extended by amendment (see
insert to G.C. Exh. 3) through May 31, 1976. A new
agreement (G.C. Exh. 4) was negotiated between NECA
and the Union and became effective June 1, 1976, for a
period through May 31, 1978. No one participated in the
negotiations for the latter agreement on behalf of Brooks.
There is no dispute that the aforesaid agreements apply
to a bargaining unit consisting of all employees engaged in
electrical work employed by the various employer-mem-
bers of NECA and those which sign letters of assent. While
Respondent disputes that Brooks and/or K & F employees
are includable in the contractual unit, Murphy's uncon-
tradicted testimony is that approximately 32 employers
(nonmembers of NECA) have signed letters of assent,
thereby committing themselves and their employees to the
contract and unit coverage. Moreover, Respondent does
not deny that, since signing the letter of assent in 1973 and
at least through June 1976, Brooks operated pursuant to
the collective-bargaining agreement, utilizing the job
referral procedure and making the required health and
welfare and pension and annuity fund payments and
vacation fund deductions, and observing all other contract
provisions.
Murphy testified, without contradiction,4 that in July,
and thereafter continuing into August, September, Octo-
ber, and November, Brooks was delinquent in its fund
payments to the Union. During this period, Murphy orally
requested payment of Nikolai who said he would pay them.
Payment, however, never has been made.
Meanwhile, in July or August, Nikolai sought legal
advice as to methods to eliminate undisputed financial
losses suffered by Brooks, particularly during 1976. It was
decided that Brooks should terminate its business opera-
tions and a new corporation be formed. During his
testimony, Nikolai freely acknowledged that decision was
made, in part, because Brooks had been committed to pay
the Union's wage rates and fringe benefits. Additionally,
Frank Formica, employed by Brooks from August until
December 24, testified without contradiction that, begin-
ning in the third week of his employment Nikolai told him
that he (Nikolai) was not making money from the Brooks
operation because of the Union; that Brooks was not able
to be competitive; and that Nikolai was "going to get out
of the Union." When Formica was laid off by Nikolai,
from Brooks, on December 24, Nikolai told him there
would be no further hiring through the Union. According
to Formica, whom I credit, Nikolai then said, "I'm closing
shop, and I'm not going to be affiliated with the Union
anymore."
In September, K & F was incorporated. Brooks contin-
ued its corporate existence because the electrical license
obtained by Nikolai for Brooks was not due to expire until
4 Nikolai was called as a witness by the General Counsel to testify
principally upon the relationship between Brooks and K & F. He was cross-
examined by Respondent's counsel but was not asked to refute any of
Murphy's testimony, which I credit. I also credit Nikolai who, as will be
shown hereinbelow, was forthright and candid in his testimony, much of
which constituted admissions against his own interests.
I The committee was established in the 1973, 1975, and 1976 agreement.
See art. 1, sec. 1.05, 1.06.
December 31. Nonetheless, K & F operated during the last
4 months of 1976 with Nikolai soliciting jobs from former
customers of Brooks. During this period, though Brooks
nominally was awarded certain work, in reality it was K &
F which performed the services.
During November and December, Murphy and Assis-
tant Business Manager Daniel Bova visited certain jobsites
to inspect who was performing work on them. (Murphy
had somehow learned of K & F about that time.) On one of
those sites, Bova credibly testified he recognized electrician
Hillman who told him (on November 3) that he was
employed by K & F and it was Charlotte Nikolai who
signed his paychecks. Murphy also testified that, on
another occasion, two electrical employees on another
jobsite told him they were employed by K & F. Having
been so advised, a Joint Conference Committee meeting
was convened on November 17. This committee, establish-
ed by the collective-bargaining agreement and consisting of
equal numbers of representatives from NECA and the
Union, is designed to resolve disputes arising under the
contract.5 Nikolai appeared with his attorney, George H.
Lowe but at the Union's insistence, Lowe was not present
during the discussion concerning Nikolai's operations of
Brooks and/or K & F. Respondent claims that Nikolai, in
effect, was present under protest, Lowe having then
indicated he believed Brooks was no longer a party to the
NECA-Union collective-bargaining agreement. Although
Murphy could not recall that position explicitly having
been taken by Lowe on November 17, Murphy conceded
"it's possible" Lowe made that comment. In any event,
after Lowe removed himself, Nikolai was advised of
charges of contract violation against Brooks and was
interrogated regarding K & F. Nikolai responded he had
"nothing to do with" K & F.6 The November 17 meeting
terminated with no apparent result.
By letter dated December 8, receipt of which by Brooks
was acknowledged, Murphy formally advised Brooks of the
specific contract violations claimed to exist, and that the
Joint Conference Committee would meet on December 21
to consider them (G.C. Exh. 6). No one representing
Brooks attended the December 21 session. No evidence
was proffered to explain what transpired at that meeting.
It was stipulated that in late December, a telephone
message was left at the union office for Murphy, informing
him that Brooks was going out of business and all current
employees would be laid off. Murphy recalled he received
that message on December 17. Nikolai testified (as did
Formica) that Formica was laid off on December 24; and
also that Brooks' employees Jake Hemmings, Peter Van
Zwehl, and A. DiNiro were laid off on December 31.7
The evidence, all of which was supplied by Nikolai,
relative to the structure, organization and operation of
Brooks and K & F is summarized as follows:
6 By this response, Nikolai apparently was drawing his own distinction
between his position as President and Treasurer of Brooks and his position
as "Foreman" of K & F. As will be noted, infra, Nikolai holds no office or
directorship in K & F.
7 It is not crucial to resolve the date on which Murphy received the
phone message relative to the layoffs. Hillman became an employee of K &
F, as observed in the comparative chart of Brook's and K & F's structure,
infra.
892
H. S. BROOKS ELECTRIC, INC.
Factor
1. Incorporated
2. President and
Treasurer
3. Secretary
4. Directors
5. Address
6. Bookkeeper-Office
Clerical
7. Part-time clerical
8. Supervisor
9. Nature of business
10. Employees
11. Equipment
Brooks
Sometime before 1973
Waldemar Nikolai
Dennis O'Hara
None, according to
Nikolai
309 East Division
Street, Syracuse,
Nev York
Mrs. Pezzuti
Charlotte Nikolai
Waldesar Nikolai
Residential and
Commercial Electrical
Contracting
Hillman
Formica
tlemmings
Van Zwehl
Di Niro
Not identified
K & F
September 1976
Charlotte Nikolai
Meisner
None, according to
Nikolai
309 East Division
Street, Syracuse,
New York
Mrs. Pezzuti
Charlotte Nikolai
Waldemar Nikolai
Residential and
Commercial Electrical
Contracting
Hillman
Formica (until 12/24/76)
Uses equipment
formerly of Brooks
Additionally, Nikolai testified that it was he who was in
total control of Brooks operations, bidding for jobs,
preparing job estimates, performing onsite supervision of
employees, hiring, discharging, laying off, and disciplining
them. He admitted that he performs precisely the same
functions as "foreman" for K & F, except that he cannot
sign K & F checks because he is not an officer of that
corporation. The record reveals that, although Nikolai's
wife has assumed the position of president-treasurer of K &
F, her knowledge of and experience in the electrical
contracting business is derived solely from her office
activity since July 1973, when they became owners of
Brooks. Within the K & F operation, it is Nikolai himself
who sets the wage rates paid to employees. The evidence
further reveals that K & F has assumed responsibility for
the debts of Brooks, including the obligation to repay a
loan made by the Small Business Administration.
To complete the recitation of the facts of this case, it is
significant that the record clearly reflects that at no time
subsequent to July 9, 1973, has Nikolai or any other
representative of Brooks informed, by written notice,
NECA or the Union of an intention to revoke Brooks'
letter of assent or to decline to be bound by the
multiemployer bargaining.
B. Analysis
1. The alter ego issue
It is well established that the tests for determining
whether two or more business entities constitute a single
integrated employer within the meaning of the Act are: (1)
interrelation of operations; (2) common management; (3)
common ownership; and (4) centralized control of labor
relations. Sakrete of Northern California, Inc., 137 NLRB
1220, 1222 (1962), affd. 332 F.2d 902 (C.A. 9, 1964), cert.
denied 380 U.S. 255 (1965). These tests were cited with
approval by the Supreme Court in Radio & Television
Broadcast Technicians Local Union 1264, International
Brotherhood of Electrical Workers, AFL-CIO, v. Broadcast
Service of Mobile, Inc., 379 U.S. 812 (1965). The Board
elaborated upon these criteria in Gerace Construction, Inc.,
et al., 193 NLRB 645 (1971), emphasizing the degree of
common control of labor relations policies is a critical
factor in such determinations, and that such common
control must be "actual or active, as distinguished from
potential control."
A fair assessment of the evidence herein persuades me
that each of the requisite factors are present. The facts
reveal that Brooks and K & F are substantially interrelat-
ed. Thus, each corporation is engaged in precisely the same
business, interchanged employees, facilities such as princi-
pal business location, and equipment. Additionally, it is
clear that there also is commonality of customers. That
Brooks and K & F operated under common management
is equally apparent from Nikolai's testimony that he
performed all managerial functions, including (but not
limited to) setting employees' wage rates, and estimating
and bidding for jobs, for both corporations. As to common
ownership, while the record reflects no stock was issued in
K & F and there is no direct evidence in the record
893
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
describing who owns K & F, this situation does not prevent
resolution of this factor. In Mackie's Roofing and Sheet
Metal Co., Inc., 221 NLRB 277 (1975), despite the fact no
stock had been issued by a successor corporation, other
evidence demonstrated that entity was an alter ego of its
predecessor. Similarly, I conclude it appropriate to use
such other evidence to determine the presence herein of the
factor of common ownership. Thus, it is admitted that
Nikolai and his wife were the sole owners of Brooks at all
times since July 3, 1973. All the testimony reveals that the
only changes made after incorporation of K & F were to
designate Charlotte Nikolai as president and treasurer, to
add a new corporate clerk, to make Nikolai "foreman,"
and to dismiss most of Brooks' employees. If there had
been a change in ownership, it was incumbent upon
Respondent to adduce such evidence. It did not do so but,
instead, (though cross-examining Nikolai when he testified
as a General Counsel witness) Respondent rested its case
without preferring affirmative evidence in its defense. In
these circumstances, and viewing the totality of the record,
I deem it reasonable to infer that no change in ownership
occurred at the formation of K & F, and I do so. As to
common control of labor relations, the record amply
demonstrates that Nikolai both possesses and exercises
actual and active control of the labor relations of both
corporations. In addition to the testimony that Nikolai sets
the wage rates, hires, discharges, lays off employees and
otherwise affects their personnel status in both corpora-
tions, I take cognizance of the testimony which undeniably
establishes that it is Nikolai who principally made and
implemented the decision to terminate Brooks' operations
and to form K & F. Upon all the foregoing, I find that all
the prescribed tests for a single employer finding have been
satisfied and, accordingly, find that, at all times material
herein, Brooks and K & F constitute a single integrated
employer as alleged in the complaint.
As previously indicated, the General. Counsel further
contends that K & F is the alter ego of Brooks and is
thereby bound to remedy any unfair labor practices, if any,
committed by Brooks. Respondent, on the other hand,
maintains the evidence does not sustain the General
Counsel's position. In the face of the admitted fact that K
& F was incorporated in order to relieve Brooks of the
financial burden imposed by its relationship to the Union,
and the entire record evidence, summarized above, it is
virtually inescapable that K & F is an alter ego of Brooks.
All the testimony reveals that K & F is but a disguised
continuation of Brooks. One factor buttressing this posi-
tion and not heretofore reported is that K & F finished
some jobs which Brooks had undertaken before ending its
operations. It would serve no useful purpose to recapitulate
each of the various shreds of evidence bearing upon this
issue, nor to engage in extensive legal discussion thereon.
Based upon the record as a whole, I find that K & F is an
alter ego of Brooks. See P. A. Hayes, Inc., 226 NLRB 230
(1976); Wayne Electric Inc., 226 NLRB 409 (1976); The
Bell Company, Inc., 225 NLRB 474 (1976); Rushton &
Mercier Woodworking Co., Inc., 203 NLRB 123 (1973);
Mackie's Roofing and Sheet Metal Co., Inc., supra.
2. The refusal to bargain
The General Counsel urges that by repudiating its letter
of assent and relationship with the Union, Brooks refused
to bargain in violation of the Act, and that K & F, as
Brooks' alter ego is bound to rectify that violation.
Respondent argues that neither Brooks nor K & F is
contractually bound to observe the 1976-78 NECA-Union
agreement because the letter of assent makes it clear it was
intended to apply only to the 1973-75 agreement. Specifi-
cally, Respondent relies upon the phrases "current ap-
proved" and "aforementioned approved" agreement as
appears in the letter of assent (See sec. III, A, supra) to
support its position. Respondent claims that because the
1973-75 agreement was the only "current approved" and
"aforementioned approved" agreement in effect when
Nikolai signed the letter of assent, Brooks was under no
legal compulsion to continue its bargaining relationship
beyond the period of that agreement. Inasmuch as the
record reveals the 1973-75 agreement was extended, except
in certain respects, to May 31, 1976, 1 presume it is this
latter date which, at the very latest, is the terminal date of
obligation under Respondent's theory. Additionally, Re-
spondent asserts its interpretation finds support in the
1976-78 agreement which contains the following language:
. . . (this agreement) shall apply to all firms who sign
a letter of assent to be bound by this Agreement . . .
The term Employer shall mean an individual firm who
has been recognized by an assent to this Agreement.
[G.C. Exh. 4, page 1. Emphasis supplied.]
It is noteworthy (although not discussed by Respondent)
that the above-quoted language also appears, verbatim, in
the 1973-75 agreement (G.C. Exh. 3.).
Respondent accurately observes that General Counsel
does not claim that either corporation signed any other
letter of assent than that executed by Nikolai on July 9,
1973. Utilizing the emphasized language of the letter of
assent and current collective-bargaining agreement, and
applying traditional principles of "hornbook" contract law,
Respondent in its brief vigorously insists that "there is no
room for judicial construction" beyond the "plain, unambi-
guous ... (and). . . clear" result that Brooks' 1973 letter
of assent applied only to the agreement then existing. I
disagree. A collective-bargaining agreement is not an
ordinary contract for the purchase of goods and services,
nor is it governed by the same common law concepts which
control such private contracts. John Wiley & Sons, Inc. v.
Livingston, 376 U.S. 543, 550 (1964). The underlying origin
of collective-bargaining agreements is derived, in part,
from the statutory philosophy which seeks to protect
employees' rights by establishing and maintaining collec-
tive-bargaining relationships. In deciding whether an
employer and Union have arrived at an agreement, the
Board is not bound by technical rules of contract law.
Lozano Enterprises v. N.LR.B., 327 F.2d 814, (C.A. 9,
1964). Among the relevant factors in such determinations
are the practice of the parties and their dealings with one
another.
Herein, the record reflects that after Brooks became a
party to the 1973 letter of assent and, through at least June
894
H. S. BROOKS ELECTRIC, INC.
1976, that corporation operated pursuant to all the terms of
the NECA-Union agreements in effect during that time. It
was not until July 1976 (I month after the 1976 agreement
became effective), that Brooks lapsed into arrears in its
fringe benefit payments. Moreover, it appears that Brooks
sought and obtained employees by means of the contrac-
tual referral procedure (See art. IX, G.C. Exhs. 3 and 4)
even beyond that period and as late as November II,
1976. 8 Additionally, Murphy's undenied testimony, as
noted above, indicates that Nikolai signified the arrearage
in fringe benefits would be paid. All this evidence impels
me to conclude that Brooks, through Nikolai, ostensibly
indicated its recognition of the existence of a contractual
obligation to observe the NECA-Union agreement. It is
recalled, in this connection that, at no time, had Brooks
served a written 150-day notice (required by the letter of
assent) to withdraw its assent. Such inaction, applying
Respondent's own standards of contract construction,
lends support to General Counsel's position because the
agreement which Respondent concedes was binding upon
Brooks is, by its terms, self-extending (G.C. Exh. 3, art. 1,
sec. 1.01) unless appropriate notice is given. Although that
notice is to be given by parties to the agreement (NECA
and the Union), and Brooks was not a member of NECA,
that language serves to show that the words "current
approved," "aforementioned approved" and "this agree-
ment" comprehend a broader base than merely the
document in which those phrases and words appear.
Respondent, in its brief, implicitly suggests that it should
not be held to answer to such legal nuances because
Nikolai (as the record reveals) is foreign-born and is not
possessed of extensive formal education. While I am
sympathetic to this situation, this emotional reach cannot
serve to determine the issues. It is clear that when
confronted with Brooks' precarious financial plight, Niko-
lai sought and obtained advice of counsel. Moreover, the
record reveals Nikolai had been working in the jurisdiction
of the Union for at least 7 years prior to signing the letter of
assent, and that he read that document prior to affixing his
signature on it, In these circumstances, it is clear Nikolai
was acquainted with the local trade practice and, had he
any doubts as to the meaning of the letter of assent, those
doubts could have been resolved by seeking counsel in
1973.
Finally, as to the practice of participants to the letters of
assent, Murphy credibly testified that new letters of assent
were not required of signatories at or near the times
successor agreements were negotiated. It was only when
those signatories underwent a change in ownership that the
new letters of assent were required. Indeed, that practice is
precisely the genesis of Brooks' signing the 1973 letter of
assent. Respondent submits that Wayne Electric, Inc.,
supra, is distinguishable from the instant case and, if of any
value herein, supports its contentions because the Board
there held letters of assent binding upon respondent therein
based upon reexecuted letters of assent. This argument,
however, ignores the fact that, in Wayne Electric, the
established practice differed from that proved herein. In
Wayne, it is clear the practice was to require new letters of
8 G.C. Exh. 5, a list of referrals to Brooks, shows Formica was referred
on August 18. Hemmings on July 6, and Van Zwehl on November I I.
assent with each new collective-bargaining agreement.
Thus, I reject Respondent's effort to distinguish that case.
The complaint alleges that the following-described unit is
appropriate for collective bargaining:
All employees engaged in electrical work employed by
the employer-members of Central New York Chapter,
National Electrical Contractors Association, Inc., and
signatories to the NECA-Union contract or letters of
assent including H. S. Brooks Electric, Inc. and K & F
Electric Co., Inc.
Although no specific evidence as to the appropriateness
of the unit was adduced at the hearing I find it to be an
appropriate collective-bargaining unit, based upon the
bargaining history demonstrated by the evidence herein
and the totality of the record. Respondent, of course,
denied that Brooks and K & F are properly encompassed
within the unit but, based upon all the foregoing contained
in this section, I find that Brooks was, and is, bound to the
1976-78 NECA-Union agreement. Based upon my finding
that K & F is an alter ego of Brooks, I find K & F is also
bound to that agreement.
On the basis of the entire record, I conclude that Brooks
did not effectively terminate its 1973 letter of assent and
find that Brooks, and its alter ego, K & F, by refusing and
failing to recognize the Union and to apply the terms of the
NECA-Union 1976-78 agreement to their employees in the
appropriate unit in December 1976, and by laying off
employees Formica, Hemmings, Van Zwehl, and Di Niro,
refused to bargain collectively and discriminated against
employees in violation of Section 8(aX I), (3), and (5) of the
Act. Wayne Electric, Inc., supra; P. A. Haynes, Inc., supra;
Central New Mexico Chapter, NECA, 152 NLRB 1604,
1606 (1965).
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
The activities of Respondent set forth above, occurring
in connection with the operations of Brooks and K & F,
have a close, intimate, and substantial relationship to trade,
traffic, and commerce among the several States and tend to
lead, and have led, to labor disputes burdening and
obstructing commerce and the free flow of commerce.
Upon the basis of the foregoing findings of fact,
conclusions, and the entire record, I make the following:
CONCLUSIONS OF LAW
i. H. S. Brooks Electric, Inc., and K & F Electric Co.,
Inc., each, is an employer engaged in commerce within the
meaning of Section 2(6) and (7) of the Act.
2. K & F Electric Co., Inc., is and, at all times material
herein, has been an alter ego of H. S. Brooks Electric, Inc.
3. H. S. Brooks Electric, Inc., and K & F Electric Co.,
Inc., at all times material herein, have been a single
integrated employer within the meaning of the Act.
4. International Brotherhood of Electrical Workers,
Local Union No. 43, AFL-CIO is and, at all times material
895
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
herein, has been a labor organization within the meaning of
Section 2(5) of the Act.
5. Central New York Chapter, National Association of
Electrical Contractors, Inc., is and, at all times material
herein, has been an association of various employers
engaged in the electrical contracting business, which
association engages in collective bargaining on behalf of its
members and other employees which execute letters of
assent.
6. Waldemar Nikolai is, and, at all times material
herein, has been an agent of Brooks and K & F.
7. Since July 9, 1973, and continuing to date, Brooks
and K & F, as its alter ego have been, and are, bound to the
current collective-bargaining agreement between NECA
and the Union.
8. All employees engaged in electrical work employed
by the employer-members of Central New York Chapter,
National Electrical Contractors, Inc., and signatories to the
NECA-Union contract or letters of assent, including H. S.
Brooks Electric, Inc., and K & F Electric Co., Inc.
constitute a unit appropriate for collective bargaining
pursuant to Section 9(b) of the Act.
9. By failing and refusing to recognize and bargain with
the Union as the exclusive collective-bargaining represen-
tative of all its employees in the unit described in
paragraph 8, above, Brooks, and its alter ego K & F, since
December 1976, refused to bargain in good faith, in
violation of Section 8(a)(5) and (1) of the Act.
10. By laying off, or otherwise terminating the employ-
ment of Frank Formica, Jake Hemmings, Peter Van Zwehl,
and A. Di Niro on various dates in December 1976, Brooks
and its alter ego, K & F, discriminated against employees in
violation of Section 8(a)(3) and (1) of the Act.
THE REMEDY
Having found that Brooks and K & F engaged, and are
engaging, in certain unfair labor practices, I shall recom-
mend that they cease and desist therefrom and take certain
affirmative action designed to effectuate the policies of the
Act.9
Having found that Respondent engaged in and is
engaging in unfair labor practices within the meaning of
Section 8(a)(5) and (1) of the Act, I shall recommend that it
be ordered to cease and desist therefrom and recognize the
Union as the exclusive collective-bargaining representative
of its employees in the aforesaid unit, and honor the 1976-
78 NECA-Union contractual commitments covering the
terms and conditions of their employment. This obligation
shall be retroactive to September 1976, when K & F was
incorporated. See The Bell Company, Inc., supra.
I shall also recommend that Respondent make whole all
its unit employees and former unit employees for any losses
they may have sustained by reason of Respondent's failure
to honor and apply the terms of the aforesaid collective-
bargaining agreement; and make contribution on behalf of
9 In order to achieve the maximum remedial results, it is recommended
that Nikolai, also, be obligated to satisfy the terms of the Order to be set
forth below. He is alleged as Respondent in the complaint, and I find, by
virtue of his various activity, that the commission of the violations are
directly attributable to him.
10 Six months prior to the filing of the instant Charge.
those employees for all fringe benefits such as health and
welfare, pension, annuity and vacation fund, and other
benefits as may be required under the terms of the
aforesaid labor agreement (See Mackie's Roofing and Sheet
Metal Co., Inc., supra) with interest as prescribed in Isis
Plumbing & Heating Co., 138 NLRB 716.
Having found that Respondent unlawfully discriminated
against Frank Formica, Jake Hemmings, Peter Van Zwehl,
and A. DiNiro by terminating their employment, I shall
recommend Respondent cease and desist from such
discriminatory practice and offer each of those employees
immediate reinstatement to their former jobs without
prejudice to seniority or other rights and privileges which
they formerly enjoyed, discharging if necessary other
employees who may have been hired in their places; or, if
those jobs no longer exist, to former or substantially
equivalent positions of employment as such positions
become available; and make each of them whole for any
losses of pay incurred as a result of the discrimination by
payment to each of them of a sum equal to the difference in
pay each actually received for work performed for
Respondent since August 3, 1976,'0 and what they would
have been paid if Respondent had complied with the
provisions of the 1976-78 NECA-Union contract; with
interest on said difference in amounts computed at 6
percent per annum.
In view of Respondent's unfair labor practices as found
herein, I shall further recommend that Respondent cease
and desist from infringing in any other manner on the
rights of its employees protected by Section 7 of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record in this proceeding, and pursuant to
the provisions of Section 10(c) of the Act, I hereby issue the
following recommended:
ORDER it
The Respondents, H. S. Brooks Electric, Inc., K & F
Electric Co., Inc., and Waldemar Nikolai, Syracuse, New
York, their officers, agents, successors, and assigns, shall:
I. Cease and desist from:
(a) Refusing to recognize and bargain with International
Brotherhood of Electrical Workers, Local Union No. 43,
AFL-CIO, as the exclusive collective-bargaining represen-
tative of their employees in the unit described in section V,
paragraph 8, above.
(b) Refusing and failing to honor and apply the terms
and conditions of the 1976-78 collective-bargaining agree-
ment between the aforesaid Union and Central New York
Chapter, National Electrical Contractors Association, Inc.
(c) Discriminating, by termination or other means,
against employees.
(d) Interfering with, restraining, or coercing employees,
in any other manner, in the exercise of their rights under
Section 7 of the Act.
II In the event no exceptions are filed as provided by Sec. 102.46 of the
Board's Rules and Regulations, the findings, conclusions and recommended
Order herein shall, as provided in Sec. 102.48 of the Rules and Regulations,
be adopted by the Board and become its findings, conclusions, and Order,
and all objections thereto shall be deemed waived for all purposes.
896
H. S. BROOKS ELECTRIC, INC.
2. Take the following affirmative action necessary to
effectuate the policies of the Act:
(a) Immediately recognize and, upon request, bargain
collectively in good faith with International Brotherhood
of Electrical Workers, Local Union No. 43, AFL-CIO, as
the exclusive collective-bargaining representative of all of
their employees engaged in electrical work in the unit
described in section V, paragraph 8, above.
(b) Honor and apply all the terms and conditions of the
1976-78 collective-bargaining agreement between Central
New York Chapter, National Electrical Contractors Asso-
ciation, Inc., and the aforesaid Union, retroactive to the
date in September 1976, when K & F Electric Co., Inc.,
became incorporated.
(c) Pay to the Union any and all amounts due in health
and welfare, pension, annuity, and vacation fund, and all
other fund payments required by the aforesaid collective-
bargaining agreement for all unit employees employed by
Respondents since August 3, 1976, and for all the
aforenamed discriminatees found herein, together with
interest thereon computed at 6 percent per annum.
(d) Immediately offer Frank Formica, Jake Hemmings,
Peter Van Zwehl, and A. DiNiro full reinstatement to their
former positions of employment, without loss of seniority
or other privileges enjoyed, discharging if necessary other
employees who may have been hired in their places. If
those positions no longer exist, then the offers of reinstate-
"L In the event the Board's 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 Pursuant to a
ment shall be to their former or substantially equivalent
positions of employment as such positions become avail-
able.
(e) Pay to Frank Formica, Jake Hemmings, Peter Van
Zwehl, A. DiNiro, and any other employee of Respon-
dents' working since August 3, 1976, and who may have
received less pay than provided by the aforesaid collective-
bargaining agreement, the difference in pay each such
employee actually received and that which each would
have been paid if Respondent had complied with the
provisions of said collective-bargaining agreement, with
interest on said difference to be computed at 6 percent per
annum.
(f) Post at its Syracuse, New York, location copies of the
attached notice marked "Appendix."'2 Copies of the
notice on forms provided by the Regional Director for
Region 3, after being signed by a duly designated
representative of Respondent, shall be posted by Respon-
dent immediately upon receipt thereof, and shall be
maintained by it for 60 consecutive days thereafter, in
conspicuous places, including all places where notices to
employees customarily are posted. Reasonable steps shall
be taken by Respondent to insure that such notices are not
altered, defaced, or covered by any other material.
(g) Notify the Regional Director, in writing, within 20
days from the date of this Order, what steps Respondents
have taken to comply herewith.
Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board."
897