Harborlite Corporation

National Labor Relations Board - Administrative Judge Opinions

Mar 8, 2010

27-CA-021386 (N.L.R.B. Mar. 8, 2010)

JD(SF)–11–10
(Alamosa, CO)
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
SAN FRANCISCO BRANCH OFFICE
HARBORLITE CORPORATION
and Case 27-CA-21386
TEAMSTERS LOCAL UNION NO. 455
Michael Cooperman, Esq., for the General Counsel.
Michael J. Belo, Esq., (Berenbaum & Weinshienk, P.C. ),
of Denver, Colorado, for the Union.
J. Thomas Kilpatrick and Jeremy Tucker, Esqs.,
(Alston & Bird LLP) of Atlanta, Georgia,
for the Respondent.
DECISION
Statement of the Case
WILLIAM G. KOCOL, Administrative Law Judge. This case was tried in Alamosa,
Colorado, on January 20, 2010. The charge and amended charge were filed October 13 and
December 9, 2009,1 respectively, by Teamsters Local Union No. 455 (herein the Union) and the
complaint was issued December 22. The complaint alleges that Harborlite Corporation (herein
Harborlite or Respondent) violated Sections 8(a)(1) and (3) of the Act by threatening to lock out
employees and permanently replace them and thereafter locking out employees. Harborlite
filed a timely answer that admitted the allegations of the complaint concerning the filing and
services of the charge and amended charge, jurisdiction, labor organization status, and
supervisory and agency status.
On the entire record, including my observation of the demeanor of the witnesses, and
after considering the briefs filed by the General Counsel, the Union, and Harborlite, I make the
following.
Findings of Fact
I. Jurisdiction
Harborlite, a corporation, is engaged in the operation of a perlite mine located in No
Agua, New Mexico, and has a warehouse and office facility in Antonito, Colorado, where it
annually ships goods and materials values in excess of $50,000 directly to points located

1 All dates are in 2009 unless otherwise indicated.
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outside the State of Colorado. Harborlite admits and I find that it is an employer engaged in
commerce within the meaning of Section 2(2), (6), and (7) of the Act and that the Union is a
labor organization within the meaning of Section 2(5) of the Act.
II. Alleged Unfair Labor Practices
A. Facts
The main issue underlying this case is whether an employer can permanently
replace employees that it has locked out.
As indicated, Harborlite maintains a warehouse and office facilities in Antonito, Colorado,
and a perlite mining location in No Agua, New Mexico. The Antonito plant consists of three
structures: the office complex, the garage, and the loading station. Harborlite is owned by its
parent company, World Minerals, which is, in turn, owned by Imerys. The Union represents a
bargaining unit composed of about 29 Harborlite employees from the production, maintenance
and shipping departments at the Antonito facility and the No Agua mine. The most recent
collective bargaining agreement between the Union and Harborlite began on July 1, 2006 and
ended on June 30, 2009. The agreement was subsequently extended through August 23.
Following the expiration of the most recent contract, the unit employees continued to work for
Harborlite without a contract in place.
From June 30 through the end of August, the Union and Harborlite participated in
approximately eight bargaining sessions. James Adams, the business agent and vice president
for Teamsters Local 455, acted as the chief negotiator for the Union in this matter. Harborlite’s
bargaining teams was lead by J. Thomas Kilpatrick, its attorney, and Chris Bloyer, labor
relations manager; Paul Sowards, the plant manager at Harborlite’s facilities in Antonito and No
Agua, also participated as a member of Harborlite’s bargaining committee.
On August 21 Respondent submitted its last, best and final offer to the Union. On
August 23 the union membership voted to reject Harborlite’s final contract proposal and
continued to work without a contract. On September 17 Harborlite sent the Union a letter that
stated, in pertinent part:
As you recall, we entered into a gentlemen’s agreement that neither party would
resort to economic actions, i.e., strike or lockout, without notifying the other party.
The company hereby terminates any such agreement and notifies you that it is
considering a lawful lockout of employees in support of this bargaining position.
On September 30 Harborlite sent the Union a message confirming that the parties would meet
again on October 6 and 7. Harborlite’s message continued:
Please be advised that if an agreement is not reached by 7:00 PM Mountain
Time on Wednesday, October 7th, the Company will exercise its legal right to lock out
employees beginning with the night shift, 11:00 PM Wednesday night. Further, the
Company will immediately begin hiring permanent replacements for the locked out
employees.
On October 6, 2009, the Union and Harborlite’s respective negotiating committees
reconvened for another bargaining session. The Union’s bargaining committee included two
unit employees. The Union presented Harborlite with a single proposal regarding overtime.
After several hours of consideration, Harborlite rejected this proposal and restated its “last, best
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and final offer.” Harborlite did not make any new proposals at this meeting. Harborlite asked
the Union to present its proposal to the union members again, and suggested another meeting
between both parties on October 7, 2009. Bloyer advised the union negotiating committee that
they had until 11:00 p.m. the following day to ratify Harborlite’s proposal. Bloyer stated that if
the unit employees did not accept Harborlite’s proposed contract Harborlite would “lock out and
permanently replace” the employees.
On October 7, 2009, Adams met with the membership at the Antonito plant and at the
No Agua mine to discuss Harborlite’s proposal. The membership again rejected the offer. Later
that day, Adams, accompanied by the negotiating team including the two unit employees, met
with Harborlite. Adams informed Harborlite of the members’ decision to reject its offer, and
Harborlite reaffirmed that, as a result, it would begin to hire permanent replacements on
October 8, 2009.
On the very same day at roughly 5:00 p.m., Harborlite plant manager Paul Sowards had
a conversation with Harborlite employees Jess Blea and Arthur Martinez. Both Blea and
Martinez were at the loading station when Sowards approached them and noticed a picketing
schedule that the Union had given them. Sowards asked what the schedule was, and Blea
explained that it was a picketing schedule. Sowards urged both employees to reconsider the
contract, explaining that the timing was not right due to the economy and the fact that Harborlite
was not making money. Sowards advised the employees to “pick a fight that they could win and
not lose”, that Harborlite had two high-priced attorneys and that the Union could not win even if
it filed charges against Harborlite. Martinez then asked what was going to happen next and
Sowards said that they would be permanently replaced.2
Also on the same day, October 7, Harborlite sent the Union a letter that read in pertinent
part:
This is to advise you that the Company is exercising its legal right to lock out all
bargaining unit employees at the Company’s Antonito and No Agua facilities in support
of its bargaining demands. All such employees are locked out as of 11:00 PM,
Wednesday, October 07, 2009. Current employees who report to work will be told that
no work is available to them until an agreement is reached on a collective bargaining
agreement.
…
The facilities will continue to operate using supervisory and replacement employees.
Beginning Monday, October 12, 2009, we will begin hiring permanent replacements for
the locked out employees. Any employees who are permanently replaced will be
afforded all of their legal rights under the national Labor Relations Act and other
applicable laws.…
The lockout will end upon acceptance of the Company’s last, best, and final offer. Such
action will let us all get back to the main goal of assuring the viability if (sic) the Antonito
and No Aqua operations.
Effective October 7 at 11 p.m., Harborlite locked out all bargaining unit employees and the next
day gave them a letter explaining them that they were being locked out and that “Beginning
Monday, October 12, 2009, we begin hiring permanent replacements for locked out employees.”

2 These facts are based on a composite of the credible testimony of Blea, Martinez, and
Sowards.
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On October 14 Harborlite sent the Union the following letter.
As you know, the Company has begun the process of hiring replacements for the locked
out employees. We will continue that process and will hire replacements for all locked
out employees. As a gesture of good will, we have decided to make the replacements
temporary until further notice. Although we believe that we have the right to hire
permanent replacements, we will refrain from doing so in an effort to show that the
Company is being more than reasonable. We hope this encourages the membership to
accept the terms of our last, best and final offer. Such action will end the lockout, bring
the locked out employees back to work, and allow us to get back to meeting our goal of
assuring the long term viability of the Antonito and No Agua facilities.
Harborlite did not send this letter to employees; the employees instead learned of the letter from
the Union sometime in mid November.
John Lewis is Vice President of the International Chemical Workers Union
Council/UFCW. That Union represents some employees in an enterprise related to Harborlite.
Lewis urged Harborlite to ends its lockout of the employees involved in this case. On
January 12, 2010, Harborlite informed the Union that it was ending the lockout explaining:
[Lewis] is well respected by our management team and we value his opinions and
suggestions. We have carefully considered [Lewis’s] request. As we have stated
numerous times, we desire a cooperative relationship with our employees and their
representatives. In our current situation, the locked out employees have conducted
themselves professionally. In light of these two considerations, and as a demonstration
of our continued good will and desire to resolve the dispute, we are ending the lockout
effective immediately. Hopefully, this will lead to a mutually satisfactory resolution of the
dispute and the continuation of a good relationship between the Company and the
Union.
On January 16, 2010, all bargaining unit employees returned to work.
B. Analysis
An employer may lock out employees in support of its bargaining position and hire
employees to temporarily replace the locked out employees until the lock out ends. Harter
Equipment, 280 NLRB 597 (1986), affd. sub nom. Operating Engineers Local 825 v. NLRB, 829
F.2d 458 (3d Cir. 1987). The question presented in this case is whether an employer may hire
permanent replacements3 for the locked out employees who would continue to work for the
employer even after the lock out ends. In Ancor Concepts, Inc., 323 NLRB 742, 744 (1997),
enf. denied NLRB v. Ancor Concepts, 166 F.3d 55 (2nd Cir. 1999), the Board stated “An
employer’s use of permanent replacements is inconsistent with a declared lawful lockout in
support of its position.” In the footnote supporting this proposition the Board stated:

3 Permanently replaced employees differ from discharged employees because permanently
replaced employees have certain rights to be recalled to their old jobs once their permanent
replacements leave the employment of the employer. Laidlaw Corp., 171 NLRB 1366, enfd.
414 F.2d 99 (7th Cir. 1969), cert. denied 397 U.S. 920 (1970).
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See Harter Equipment (Harter II), 293 NLRB 647, 648 (1989), in which the Board relied
on the on the fact the locked-out employees were not strikers and therefore could not be
permanently replaced to find that they were entitled to vote in a decertification election.
See also Justice Goldberg’s concurring opinion in Brown Food Store, 380 U.S. 278, 293
(1965), in which he expressed “grave doubts as to whether the act of locking out
employees and hiring permanent replacements is justified by any legitimate interest of
the nonstruck employers.”
More recently in Bud Antle, 347 NLRB 87, 89 (2006), the Board stated “It is well-settled that
locked out employees cannot be permanently replaced.” This language makes clear that an
employer may not lawfully permanently replace its locked out employees. Harborlite argues that
this language is mere dicta that I am free to disregard, but it is clear that the Board does not
consider the issue as still in doubt.
Moreover, even if I were to disregard Board statements on the use of permanent
replacements for locked-out employees, I would nonetheless conclude that such use is
unlawful. This is so because the Board is charged with the initial responsibility of interpreting
and applying the Act in a manner that considers the balance of economic resources available to
labor organizations and employers during the collective bargaining process so as not to
undermine the specific language of the Act. Section 7, the “heart” of the Act, explicitly
guarantees employees the right to attempt to improve their working conditions through collective
bargaining. Allowing employers to lock out employees and then permanently replace them
would seriously undermine this Section 7 right. After all, while being permanently replaced is
different than being discharged, the difference is often more legalistic than real for those
workers who are permanently replaced. In apparent recognition of consequence of allowing
employers to lock out and then permanently replace workers, I have been unable to find any
Board case to support Harborlite’s position in favor of permanent replacement. Put differently,
in the over 75 years of the Act’s existence, no Board or Supreme Court precedent has
supported Harborlite’s position. And there is no evidence in this record of changed
circumstances that would justify providing employers with an additional powerful weapon for use
during collective bargaining at the expense of the Section 7 rights. Harborlite relies heavily on
International Paper Co. v. NLRB, 115 F. 3d 1045 (D.C. Cir. 1997). But that case involved a
situation where an employer permanently subcontracted unit work, and that matter was a
subject of discussion between the union and employer at the bargaining table. In any event,
I am bound to apply Board law in the absence of clear Supreme Court precedent to the
contrary. I therefore conclude that the Act does not allow an employer to permanently replace
workers that it has locked out.
I now address the specific allegations of the complaint. The complaint alleges that on or
about October 6 Bloyer threatened to lock out and permanently replace its unit employees.
I have concluded above that Bloyer did, in fact, state in the presence of unit employees that
Harborlite would lock out and permanently replace the unit employees. Just as it is unlawful to
threaten to permanently replace unfair labor practice strikers, United States Service Industries,
319 NLRB 231, 233 (1995), it follows by threatening to lock out and permanently replace
employees unless the Union acceded to its bargaining demands, Harborlite violated Section
8(a)(1). See, for persuasive value, Wayneview Care Center, 352 NLRB 1089, 1105, 1089 fn. 2
(2008). The complaint alleges that on October 7 Sowards made a similar unlawful statement.
I have concluded above that he did so. By doing so Harborlite again violated Section 8(a)(1).
Finally, the complaint alleges that on October 8 Boyer notified employees that Harborlite was
locking them out and would begin to hire permanent replacements. This allegation too is
supported by the evidence; Harborlite again violated Section 8(a)(1). In making these finding I
have considered the fact that on October 14 Harborlite informed the Union that it would not hire
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permanent replacements. In doing so, however, Harborlite reiterated its right to do so. This
does not undo the effects of its earlier unlawful threats. Passavant Memorial Area Hospital, 237
NLRB 138 (1978). The complaint alleges that the conduct described in this paragraph also
violated Section 8(a)(3) of the Act, but this contention is unsupportable and I dismiss this
allegation.
Pointing to Eads Transfer, 304 NLRB 711 (1991), Ancor Concepts, supra, the General
Counsel contends that the lockout itself was unlawful. In Ancor Concepts the Board stated:
Following the declaration of a lawful lockout, an employer that seeks to continue to
invoke Harter I to justify its failure to reinstate striking employees on their unconditional
offer to return to work must refrain from engaging in conduct inconsistent with an
economic lockout. Such inconsistent conduct ends the lawful lockout and removes the
employer’s privilege of invoking Harter I.
…
In the instant case, the Respondent’s counsel informed the Union by letter dated
November 29 that the replacements were permanent employees. An employer’s use of
permanent replacements is inconsistent with a declared lawful lockout in support of its
bargaining position.[footnote omitted].
Ancor Concepts, supra at 744. The Board concluded that the lawful lockout ended in that case
when the respondent informed the union that the replacements were permanent; the Board
ordered backpay for the employees beginning November 29, the date the lock out no longer
was lawful. See also Eads Transfer, supra. Applying that reasoning to this case, it follows that
when Harborlite unlawfully threatened that it would permanent replace the employees it locked
out, what otherwise might have been a lawful lock out became unlawful. In this case the
unlawful conduct preceded the lock out and the lockout therefore was unlawful at its inception.
In its brief, Harborlite argues that its threats to permanently replace the employees it was
locking out did not have any adverse impact on employee rights. It argues that these threats
would only increase the likelihood that the Union and the unit employees would accede to its
bargaining demands and resolve the bargaining impasse. But this argument ignores the fact
that these unlawful threats complicated the bargaining process by inserting an issue (permanent
replacement of locked out employees) that required resolution through the litigation process
before Harborlite and the Union could return to the bargaining table in an atmosphere clear of
the unlawful threats. Put differently, the employees’ right to support the Union in its bargaining
position and to resist Harborlite’s bargaining demands was significantly undermined by
Harborlite’s unlawful threats. As the Union points out in its brief, the Board in Globe Business
Furniture, 290 NLRB 841, fn. 2 (1988) considered preceding unfair labor practices committed
by an employer in holding that the employer’s lock out violated Section 8(a()3). Harborlite relies
on the Court’s decision in NLRB v. Ancor Concepts, supra, but as indicated I am bound to follow
Board law in the absence of clear Supreme Court precedence. By locking out employees after
threatening that it would permanently replace the locked out employees, Harborlite violated
Section 8(a)(3) and (1).
Conclusions of Law
1. By threatening to lock out and permanently replace employees unless the Union
acceded to its bargaining demands, the Respondent has engaged in unfair labor practices
affecting commerce within the meaning of Section 8(a)(1) and Section 2(6) and (7) of the Act.
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2. By locking out employees after threatening that it would permanently replace the
locked out employees, the Respondent violated Section 8(a)(3) and (1) and Section 2(6) and
(7).
Remedy
Having found that the Respondent has engaged in certain unfair labor practices, I find
that it must be ordered to cease and desist and to take certain affirmative action designed to
effectuate the policies of the Act. The Respondent having discriminatorily locked out
employees, it must make them whole for any loss of earnings and other benefits, computed on a
quarterly basis from October 7, 2009 until January 16, 2010, less any net interim earnings, as
prescribed in F. W. Woolworth Co., 90 NLRB 289 (1950), plus interest as computed in New
Horizons for the Retarded, 283 NLRB 1173 (1987).
On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended.4
ORDER
The Respondent, Harborlite Corporation, its officers, agents, successors, and assigns,
shall
1. Cease and desist from:
(a) Threatening to lock out and permanently replace employees unless the Union
acceded to its bargaining demands.
(b) Locking out employees after threatening to permanently replace the locked out
employees
(c) In any like or related manner interfering with, restraining, 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) Make the locked out employees whole for any loss of earnings and other
benefits suffered as a result of the discrimination against them, in the manner set forth in the
remedy section of the decision.
(b) 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 designated
by the Board or its agents, all payroll records, social security payment records, timecards,
personnel records 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.

4 If no exceptions are filed as provided by Sec. 102.46 of the Board’s Rules and
Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec.
102.48 of the Rules, be adopted by the Board and all objections to them shall be deemed
waived for all purposes.
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(c) Within 14 days after service by the Region, post at its facilities in No Agua, New
Mexico, and Antonito, Colorado, copies of the attached notice marked “Appendix.”5 Copies of
the notice, on forms provided by the Regional Director for Region 27, after being signed by the
Respondent’s authorized representative, shall be posted by the Respondent and maintained for
60 consecutive days in conspicuous places including all places where notices to [employees]
[members] [employees and members] are customarily posted. Reasonable steps shall be taken
by the Respondent to ensure that the notices are not altered, defaced, or covered by any other
material. In the event that, during the pendency of these proceedings, the Respondent has gone
out of business or closed the facility involved in these proceedings, the Respondent shall
duplicate 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 October 7, 2009
(d) Within 21 days after service by the Region, file with the Regional Director a
sworn certification of a responsible official on a form provided by the Region attesting to the
steps that the Respondent has taken to comply.
IT IS FURTHER ORDERED that the complaint is dismissed insofar as it alleges
violations of the Act not specifically found.
Dated, Washington, D.C., March 8, 2010.
____________________
William G. Kocol
Administrative Law Judge

5 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 National Labor Relations Board” shall read “Posted
Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”
JD(SF)–11–10
(Alamosa, CO)
APPENDIX
NOTICE TO EMPLOYEES
Posted by Order of the
National Labor Relations Board
An Agency of the United States Government
The National Labor Relations Board has found that we violated Federal labor law and has
ordered us to post and obey this Notice.
FEDERAL LAW GIVES YOU THE RIGHT TO
Form, join, or assist a union
Choose representatives to bargain with us on your behalf
Act together with other employees for your benefit and protection
Choose not to engage in any of these protected activities
WE WILL NOT threaten to permanently replace employees who we lock out.
WE WILL NOT lock out employees after threatening to permanently replace the locked out
employees
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 WE WILL make the employees that we locked out whole for any loss of earnings and
other benefits resulting from their lock out, less any net interim earnings, plus interest.
Harborlite Corporation
(Employer)
Dated By
(Representative) (Title)
The National Labor Relations Board is an independent Federal agency created in 1935 to enforce the National Labor
Relations Act. It conducts secret-ballot elections to determine whether employees want union representation and it
investigates and remedies unfair labor practices by employers and unions. To find out more about your rights under
the Act and how to file a charge or election petition, you may speak confidentially to any agent with the Board’s
Regional Office set forth below. You may also obtain information from the Board’s website: www.nlrb.gov.
600 17th Street, 7th Floor, North Tower
Denver, Colorado 80202-5433
Hours: 8:30 a.m. to 5 p.m.
303-844-3551.
THIS IS AN OFFICIAL NOTICE AND MUST NOT BE DEFACED BY ANYONE
THIS NOTICE MUST REMAIN POSTED FOR 60 CONSECUTIVE DAYS FROM THE DATE OF POSTING AND MUST
NOT BE ALTERED, DEFACED, OR COVERED BY ANY OTHER MATERIAL. ANY QUESTIONS CONCERNING THIS
NOTICE OR COMPLIANCE WITH ITS PROVISIONS MAY BE DIRECTED TO THE ABOVE REGIONAL OFFICE’S
COMPLIANCE OFFICER, 303-844-6647.