Hastings Industries

National Labor Relations Board - Board Decisions

Mar 24, 2003

338 N.L.R.B. 861 (N.L.R.B. 2003)

HASTINGS INDUSTRIES 861
Eric, Inc. d/b/a Hastings Industries and District
Lodge No. 7, International Association of
Machinists & Aerospace Workers, AFL–CIO.
Case 17–CA–21260

March 24, 2003
DECISION AND ORDER
BY CHAIRMAN BATTISTA AND MEMBERS LIEBMAN
AND WALSH
The General Counsel seeks summary judgment in this
case on the ground that the Respondent has failed to file
an answer to the complaint and the compliance specifica-
tion. Upon a charge filed by District Lodge No. 7, Inter-
national Association of Machinists & Aerospace Work-
ers, AFL–CIO, the Union, on June 29, 2001, as amended
on July 11 and August 21, 2001, the Acting Regional
Director issued the complaint on August 28, 2001,
against Eric, Inc. d/b/a Hastings Industries, the Respon-
dent. The complaint alleges that the Respondent has
violated Section 8(a)(1) and (5) of the Act. On Novem-
ber 13, 2001, the Regional Director issued a compliance
specification against the Respondent and, on November
20, 2001, issued an order consolidating the compliance
specification with the complaint. The Respondent failed
to file an answer to either pleading.
On January 15, 2002, the General Counsel filed with
the Board a Motion for Summary Judgment on all allega-
tions of the complaint and the compliance specification.
On January 16, 2002, the Board issued an order transfer-
ring the proceeding to the Board and a Notice to Show
Cause why the motion should not be granted. The Re-
spondent filed no response. The allegations in the mo-
tion are therefore undisputed.
The National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
Ruling on Motion for Summary Judgment
Section 102.20 of the Board’s Rules and Regulations
provides that the allegations in a complaint shall be
deemed admitted if an answer is not filed within 14 days
from service of the complaint, unless good cause is
shown. In addition, the August 28, 2001 complaint af-
firmatively states that, unless an answer is filed within 14
days of service, all the allegations in the complaint will
be considered admitted.
Similarly, Section 102.56 of the Board’s Rules pro-
vides that the allegations in a compliance specification
will be taken as true if an answer is not filed within 21
days from service of the compliance specification. In
addition, the November 13, 2001 compliance specifica-
tion expressly advised the Respondent of Section 102.56
and the consequences of failing to answer the specifica-
tion.
Further, the undisputed allegations in the Motion for
Summary Judgment disclose that the Region, by letter
dated November 13, 2001, notified John A. Wolf, the
Respondent’s trustee in bankruptcy, of the 21-day period
for filing an answer to the compliance specification. In
the same letter, the Region also advised that, while the
time limit for filing an answer to the complaint had ex-
pired, the Region would accept such an answer if it were
filed within the same 21-day period allotted to answer
the compliance specification. Finally, the Region ad-
vised that, unless timely answers were filed, a Motion for
Summary Judgment likely would be filed.1
In the absence of good cause being shown for the Re-
spondent’s failure to file a timely answer to the com-
plaint or the compliance specification, we grant the Gen-
eral Counsel’s Motion for Summary Judgment.
On the entire record, the Board makes the following
FINDINGS OF FACT
I. JURISDICTION
At all material times, the Respondent, a corporation,
with an office and place of business in Hastings, Ne-
braska, was engaged in the manufacture of commercial
air handling equipment. During the 12-month period
ending June 30, 2001, the Respondent, in conducting its
business operations, sold and shipped from its Hastings,
Nebraska facility goods valued in excess of $50,000 di-
rectly to points outside the State of Nebraska. We find
that the Respondent is an employer engaged in com-
merce within the meaning of Section 2(2), (6), and (7) of
the Act and that the Union is a labor organization within
the meaning of Section 2(5) of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES
The following employees of the Respondent, the unit,
constitute a unit appropriate for the purposes of collec-
tive bargaining within the meaning of Section 9(b) of the
Act:

All employees in the classifications I, IAA, IA, II, III,
IV, V and VI, employed by Respondent at its Hastings,
Nebraska facility, but EXCLUDING all office and
1 The Respondent is in Chapter 7 bankruptcy and has ceased operat-
ing. The bankruptcy proceeding, however, does not deprive the Board
of jurisdiction or authority to process an unfair labor practice case to its
final disposition. See Phoenix Co., 274 NLRB 995 (1985). Board
proceedings, moreover, fall within the exception to the automatic stay
provision for proceedings by a governmental unit to enforce its police
or regulatory powers. See id. Accord: NLRB v. Continental Hagen,
932 F.2d 828, 834–835 (9th Cir. 1991).
338 NLRB No. 124
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 862
clerical employees and supervisors as defined in the
Act.
At all material times, the Union has been the desig-
nated exclusive collective-bargaining representative of
the unit, and has been recognized as the representative by
the Respondent. This recognition has been embodied in
successive collective-bargaining agreements between the
Union and the Respondent, the most recent of which is
effective from May 1, 1999, until April 30, 2002. At all
material times, based on Section 9(a) of the Act, the Un-
ion has been the exclusive collective-bargaining repre-
sentative of the unit.
Since about June 1, 2001, the Respondent has failed
and refused to notify the Union of its decision to close its
Hastings facility. Since about June 22, 2001, the Union
has requested that the Respondent bargain collectively
about the effects of that decision and since that date the
Respondent has failed and refused to do so. The effects
of the Respondent’s decision to close its facility relate to
wages, hours, and other terms and conditions of em-
ployment of the unit employees, and are mandatory sub-
jects for the purposes of collective bargaining.
On about June 12, 2001, the Respondent changed its
policy pertaining to the continuation of employees’ in-
surance coverage after layoff or termination, by
discontinuing its practice of continuing employees’
insurance coverage through the end of the month in
which layoff or termination occurred. The Respondent
engaged in this conduct without prior notice to the Union
and without affording the Union an opportunity to bar-
gain with the Respondent over this change. This change
affected terms and conditions of employment that are
mandatory subjects for the purposes of collective bar-
ga

ining. On about June 22, 2001, the Union, by letter, requested
that the Respondent provide it with the following infor-
mation:
How many employees have been laid off in the months
of April, May and June and upon final closure. How
many management personnel were laid-off on the same
dates and upon final closure. Are there any manage-
ment or employee personnel or people working on be-
half of [Respondent] that will be able to answer ques-
tions from the employees.
This information is relevant and necessary to the Union’s
performance of its duties as the exclusive collective-
bargaining representative of the unit. Since about June
22, 2001, the Respondent has failed and refused to fur-
nish the Union with the information.2

2 The information here includes nonunit information. Such informa-
tion is not presumptively relevant. In Capital City Fire Protection, 332
NLRB No. 129 (2000) (not reported in Board volumes), a “no answer”
CONCLUSIONS OF LAW
1. By failing to notify the Union of its decision to
close its Hastings facility, and by failing to give the Un-
ion an opportunity to bargain over the effects of that de-
cision, the Respondent has engaged in unfair labor prac-
tices affecting commerce within the meaning of Section
8(a)(5) and (1) and Section 2(6) and (7) of the Act.
2. By unilaterally discontinuing its practice of main-
taining employees’ insurance coverage through the end
of the month in which layoff or termination occurred, the
Respondent has engaged in unfair labor practices affect-
ing commerce within the meaning of Section 8(a)(5) and
(1) and Section 2(6) and (7) of the Act.
3. By failing and refusing to provide the Union with
requested information that is relevant and necessary to
the Union’s performance of its duties as the exclusive
collective-bargaining representative of the unit, the Re-
spondent has engaged in unfair labor practices affecting
commerce within the meaning of Section 8(a)(5) and (1)
and Section 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has engaged in cer-
tain unfair labor practices, we shall order it to cease and
desist and to take certain affirmative action designed to
effectuate the policies of the Act.
To remedy the Respondent’s unlawful failure and re-
fusal to notify and bargain with the Union about the ef-
fects of the Respondent’s decision to close its Hastings
facility, we shall order the Respondent to bargain with
the Union, on request, about the effects of that decision.
Because of the Respondent’s unlawful conduct, however,
the terminated unit employees have been denied an op-
portunity to bargain through their collective-bargaining
representative at a time when the Respondent might still
have been in need of their services and a measure of bal-
anced bargaining power existed. Meaningful bargaining
cannot be assured until some measure of bargaining
power is restored to the Union. A bargaining order
alone, therefore, is not an adequate remedy for the unfair
labor practices committed.
Accordingly, we deem it necessary, in order to ensure
that meaningful bargaining occurs and to effectuate the
policies of the Act, to accompany our Order with a lim-
ited backpay requirement designed both to offset some of
the losses suffered by the employees as a result of the
violations and to recreate in some practicable manner a

case, the Board denied summary judgment as to an allegation concern-
ing information that was not presumptively relevant. See fn. 2. How-
ever, the information there (social security information) implicated the
privacy concerns of nonparties to the litigation. That problem is not
present in the instant case.
HASTINGS INDUSTRIES 863
situation in which the parties’ bargaining position is not
entirely devoid of economic consequences for the Re-
spondent. We shall do so by ordering the Respondent to
pay backpay to the terminated unit employees in a man-
ner similar to that required in Transmarine Navigation
Corp., 170 NLRB 389 (1968), as clarified in Melody
Toyota, 325 NLRB 846 (1998). In applying Transma-
rine in this instance, though, we shall grant the General
Counsel’s request that, in light of the Respondent’s
Chapter 7 bankruptcy and cessation of operations, we
simply award the unit employees the minimum 2 weeks
of backpay required by Transmarine, in the amounts set
forth in the compliance specification.
Pursuant to Transmarine, the Respondent normally
would be required to pay its terminated unit employees
backpay at the rate of their normal wages when last in the
Respondent’s employ from 5 days after the date of this
Decision and Order until occurrence of the earliest of the
following conditions: (1) the date the Respondent bar-
gains to agreement with the Union on those subjects per-
taining to the effects of the closing of the Hastings facil-
ity on unit employees; (2) a bona fide impasse in bar-
gaining; (3) the failure of the Union to request bargaining
within 5 business days after receipt of this Decision and
Order, or to commence negotiations within 5 business
days after receipt of the Respondent’s notice of its desire
to bargain with the Union; or (4) the Union’s subsequent
failure to bargain in good faith.
Transmarine provides that the sum paid to any em-
ployee may not exceed the amount the employee would
have earned as wages from the date on which the Re-
spondent terminated its operations, to the time the em-
ployee secured equivalent employment elsewhere, or the
date on which the Respondent shall have offered to bar-
gain in good faith, whichever occurs sooner. But,
Transmarine further provides that the sum paid to any
employee shall not be less than the employee would have
earned for a 2-week period at the rate of his normal
wages when last in the Respondent’s employ. Backpay
for these purposes is typically based on earnings which
the terminated unit employees would normally have re-
ceived during the applicable period, less any interim
earnings, and is computed in accordance with F. W.
Woolworth Co., 90 NLRB 289 (1950), with interest as
prescribed in New Horizons for the Retarded, 283 NLRB
1173 (1987).
As stated, in view of the Respondent’s bankruptcy and
its cessation of operations, the General Counsel in the
compliance specification seeks only the minimum 2
weeks of backpay due the terminated unit employees
under Transmarine. Exhibit 1 to the compliance specifi-
cation sets forth the amount due each employee based on
40 hours of work per week. We shall grant the General
Counsel’s request and order the Respondent to pay the
employees the amounts shown in Exhibit 1, with interest
as prescribed in New Horizons for the Retarded, supra.3
Further, in view of the fact that the Hastings facility is
currently closed, we shall order the Respondent to mail a
copy of the attached notice to the Union and to the last
known addresses of the unit employees in order to in-
form them of the outcome of this proceeding.
Having also found that the Respondent unlawfully
failed to continue the unit employees’ insurance coverage
through the end of the month in which layoff or termina-
tion occurred, we shall order the Respondent to reim-
burse the unit employees for any expenses ensuing from
the Respondent’s failure to continue such coverage. The
compliance specification, in exhibit 2, sets forth the
names of 21 unit employees who incurred such expenses
and the amount due each employee. The Respondent
shall be ordered to pay those employees the amounts set
forth in exhibit 2, with interest as prescribed in New Ho-
rizons for the Retarded, supra.
Finally, we shall order the Respondent to provide the
Union with the information it requested on about June
22, 2001.
ORDER
The National Labor Relations Board orders that the
Respondent, Eric, Inc. d/b/a Hastings Industries, Hast-
ings, Nebraska, its officers, agents, successors, and as-
signs, shall
1. Cease and desist from
(a) Failing to give the Union notice of its decision to
close the Hastings facility and an opportunity to bargain
over the effects of that decision on the unit employees.
The bargaining unit consists of:
All employees in the classifications I, IAA, IA, II, III,
IV, V and VI, employed by Respondent at its Hastings,
Nebraska facility, but EXCLUDING all office and
clerical employees and supervisors as defined in the
Act.

3 In the complaint, the General Counsel seeks an order requiring the
Respondent to reimburse any unit employee entitled to a monetary
award in this case for any extra federal and/or state income taxes that
would or may result from the lump sum payment of the award. We
decline to order this relief at this time. Such remedial relief sought by
the General Counsel would involve a change in Board law. See, e.g.,
Hendrickson Bros., 272 NLRB 438, 440 (1985), enfd. 762 F.2d 990 (2d
Cir. 1985). We do not think it is appropriate, at this time, to consider
such a change in Board law in the absence of a full briefing by the
parties. See Kloepfers Floor Covering, Inc., 330 NLRB 811 fn. 1
(2000); Ishikawa Gasket America, Inc., 337 NLRB 175, 176 (2001),
Cannon Valley Woodwork, 333 NLRB No. 97 fn. 3 (2001) (not re-
ported in Board volumes).
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 864
(b) Unilaterally discontinuing its practice of maintain-
ing employees’ insurance coverage through the end of
the month in which layoff or termination occurred.
(c) Failing and refusing to provide the Union with in-
formation that is relevant and necessary to the perform-
ance of its duties as the exclusive representative of the
unit.
(d) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of the
rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) On request, bargain with the Union over the effects
on unit employees of its decision to close the Hastings
facility, and reduce to writing and sign any agreement
reached as a result of such bargaining.
(b) Make whole the individuals named in the compli-
ance specification by paying them the amounts specified
therein, with interest as prescribed in New Horizons for
the Retarded, 283 NLRB 1173 (1987), minus tax with-
holdings on the backpay due the employees required by
Federal and State laws. The total amount set forth in the
specification is: $89,099.15.
(c) Provide the Union with the information it requested
on about June 22, 2001.
(d) Preserve and, within 14 days of a request, or such
additional time as the Regional Director may allow for
good cause shown, provide at a reasonable place desig-
nated by the Board or its agents, all payroll records, so-
cial security payment records, timecards, personnel re-
cords and reports, and all other records including an elec-
tronic copy of such records if stored in electronic form,
necessary to analyze the amount of backpay due under
the terms of this Order.
(e) Within 14 days after service by the Region, dupli-
cate and mail, at its own expense and after being signed
by the Respondent’s authorized representative, copies of
the attached notice marked “Appendix”4 to the Union
and to all unit employees employed at the Hastings facil-
ity on or after June 1, 2001.
(f) Within 21 days after service by the Region, file
with the Regional Director a sworn certification of a re-
sponsible official on a form provided by the Region at-
testing to the steps that the Respondent has taken to
comply.

4 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading “Mailed by Order of the Na-
tional Labor Relations Board” shall read “Mailed Pursuant to a Judg-
ment of the United States Court of Appeals Enforcing an Order of the
National Labor Relations Board.”
APPENDIX
NOTICE TO EMPLOYEES
MAILED 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 mail 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 bene-
fit and protection
Choose not to engage in any of these protected
activities.

WE WILL NOT fail to give District Lodge No. 7, Inter-
national Association of Machinists & Aerospace Work-
ers, AFL–CIO prior notice of a decision to close our fa-
cility and an opportunity to bargain about the effects of
that decision on employees in the following unit:
All employees in the classifications I, IAA, IA, II, III,
IV, V and VI, employed by us at our Hastings, Ne-
braska facility, but EXCLUDING all office and clerical
employees and supervisors as defined in the Act.
WE WILL NOT unilaterally discontinue our practice of
continuing employees’ insurance coverage through the
end of the month in which layoff or termination oc-
curred.
WE WILL NOT fail to provide the Union with informa-
tion that is relevant and necessary to the performance of
its duties as the exclusive representative of the unit em-
ployees.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the rights
guaranteed you by Section 7 of the Act.
WE WILL, on request, bargain with the Union over the
effects of the closure of our facility on the unit employ-
ees, and put in writing and sign any agreement reached
as a result of such bargaining.
WE WILL pay unit employees limited backpay in the
amounts set forth next to their names in exhibit 1 to the
compliance specification, with interest.
HASTINGS INDUSTRIES 865
WE WILL make unit employees whole for our failure to
continue their insurance coverage through the end of the
month in which their layoff or termination occurred by
reimbursing them the amounts set forth next to their
names in exhibit 2 to the compliance specification, with
interest.
WE WILL provide the Union with the information it re-
quested on about June 22, 2001.
ERIC, INC. D/B/A HASTINGS INDUSTRIES