Herman Brothers Pet Supply, Inc.

National Labor Relations Board - Board Decisions

Sep 27, 1962

138 N.L.R.B. 1087 (N.L.R.B. 1962)

HERMAN BROTHERS PET SUPPLY, INC., ETC. 1087
WE WILL NOT discourage membership in or activity in behalf of Warehouse
Processing & Distribution Workers' Union, Local 26, International Longshore-
men's and Warehousemen's Union , or any other labor organization of our
employees, by discriminating in any manner in regard to hire or tenure of
employment , or any term or condition thereof, except to the extent permitted
under Section 8 (a) (3) of the Act.
WE WILL offer to the employees named below immediate and full reinstate-
ment to their former or substantially equivalent positions, without prejudice
to seniority or other rights and privileges, and we will make them whole for
any loss of pay suffered as a result of our discrimination against them.
Flight Electronic Supply Corp.:
Shirley A. McCright Margie Harbeck
Jean Marie Donahue Elvin E. Talley
Jacqueline King Roger B. Williams
Liberty Electronics Corp.:
Kenneth Gene McBride
Valerie E. Glover
Glen T. Harbeck
Esther Gallegos
Rene L. Thezan
Gwendaline Lynes
Irene Davis
Betty Fletcher
Jackie Jackson
Fred Martinez
Alice Miller
WE WILL NOT in any manner interfere with, restrain , or coerce our em-
ployees in the exercise of their right to selforganization , to form labor organiza-
tions, to join or assist the above-named or any other labor organization, to
bargain collectively through representatives of their own choosing , to engage
in concerted activities for the purpose of collective bargaining or other mutual
-aid or protection , and to refrain from any or all such activities, except to the
extent that such right may be affected by an agreement requiring membership
in a labor organization as a condition of employment , as authorized in Sec-
tion 8 (a) (3) of the National Labor Relations Act.
All our employees are free to become or remain , or refrain from becoming or
remaining, members of the above-named or any other labor organization.
LIBERTY ELECTRONICS CORP . AND FLIGHT
ELECTRONIC SUPPLY CORP.,
Employers.
Dated------------------- By-------------------------------------------
(Representative ) ( Title)
This notice must remain posted for 60 days from the date thereof, and must not
be altered , defaced, or covered by any other material.
Employees may communicate directly with the Board 's Regional Office, 849
South Broadway, Los Angeles, California, Telephone Number, Richmond 9-4711,
Extension 1031, if they have any question concerning this notice or compliance
with its provisions.
Herman Brothers Pet Supply , Inc.; and . Francis Herman, d/b/a
Herman Brothers Bird Products ; and Leon Herman, d/b/a
Herman Brothers Seed Merchants; and Julius J. Herman and
Joseph M . Gondek . Case No. 7-CA-3376. September 27, 1962
DECISION AND ORDER
On April 3, 1962, Trial Examiner David London issued his Inter-
mediate Report in the above-entitled proceeding, finding that the
Respondents had engaged in and were engaging in certain unfair labor
practices and recommending that they cease and desist therefrom and
take certain affirmative action, as set forth in the attached Interme-
diate Report. Thereafter, the Respondents and the General Counsel
138 NLRB No. 104.
1088 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
filed exceptions to the Intermediate Report and briefs in support
thereof.'
Pursuant to the provisions of Section 3(b) of the National Labor
Relations Act, the Board has delegated its powers in connection with
this case to a three-member panel [Chairman McCulloch and Members
Leedom and Brown].
The Board has reviewed the rulings made by the Trial Examiner
at the hearing and finds that no prejudicial error was committed. The
rulings are hereby affirmed. The Board has considered the Inter-
mediate Report, the exceptions, the briefs, and the entire record in
this case, and hereby adopts the Trial Examiner's findings, con-
clusions, and recommendations with the following additions.2
The Trial Examiner found, and we agree, that the Respondents by
discharging Leonard Bieganski, Leonard Calcaterra, Anthony Licausi,
Joseph Gondek, Walter Wilson, and Edna Wilon, violated Section
8 (a) (3) and (1) of the Act. The General Counsel has excepted to the
failure of the Trial Examiner to find further that the Respondents,
by transferring Bieganski, Calcaterra, and Licausi, on June 19, 1961,
from a retail store to a warehouse operated by Herman Brothers Pet
Supply, Inc., and by reducing Bieganski's hourly wage rate from
$1.75 to $1.35, violated Section 8(a) (1) of the Act.3 We find merit in
these exceptions.
In March 1961 the Union was certified as the duly designated repre-
sentative of the employees of Respondent Herman Brothers Pet Sup-
ply, Inc., herein referred to as Pet Supply, which was operated as a
one-man business by Respondent Julius Herman. At that time, Pet
Supply had a retail store on Buchanan Street and a wholesale opera-
tion at its Central Avenue warehouse. On June 17 the equipment
and merchandise of the retail operation were moved to a new location
on Michigan Avenue. Bieganski, Calcaterra, and Licausi had been
employed at the Buchanan Street retail store but, after the move, they
were refused employment at the new retail location. They were told
by Respondent Julius Herman that only nonunion employees would
be hired there. In fact, their jobs at the retail location were subse-
quently filled by new employees. Bieganski, Calcaterra, and Licausi
were transferred to the Central Avenue warehouse, which then em-
ployed three regular warehouse employees. They worked only 3 days
at the warehouse, and were discharged on June 23, purportedly be-
cause of lack of work. One week later, the three regular warehouse
employees were also discharged.
1 The Respondents' request for oral argument is hereby denied as the record in this
proceeding, including the exceptions and briefs of the parties , adequately presents the
issues and positions of the parties.
awe hereby correct the following inadvertence in the Intermediate Report: the retail
business of Herman Brothers Pet Supply, Inc., was last conducted at Buchanan Street on
June 17, not June 19.
8 The complaint alleges this conduct to be violative only of Section 8(a) (1) of the Act.
HERMAN BROTHERS PET SUPPLY, INC., ETC. 1089
The Respondents contend that these transfers and discharges re-
sulted because Julius Herman and Pet Supply ceased doing business,
and transferred all the equipment and merchandise of this operation
to Leon Herman and Francis Herman. Leon was the son and Francis
was the brother of Julius Herman. According to the Respondents,
Leon became the principal purchaser of the retail business supplies,
and Francis became the principal purchaser of the wholesale business
supplies. The Trial Examiner found, however, and we agree that
Julius, who had asserted that he intended never to recognize or bar-
gain with the Union, made the purported transfers, shortly after the
Union was certified, to avoid the obligation to bargain; that the
transfers were a "sham," and the operation of Pet Supply actually
continued as theretofore ; and that Leon and Francis were in this
connection, the alter egos of Pet Supply. We agree, therefore, with
the Trial Examiner that the six employees were discharged by the
Respondents, pursuant to Respondent Julius' announced intention
never to bargain with the Union, in violation of Section 8(a) (3) and
(1) of the Act. In addition, however, we find that, because the trans-
fer of the three retail employees to the warehouse on June 19, and the
reduction in Bieganski's rate of pay constituted an intervening step
in carrying out the same unlawful purpose, that the Respondents
thereby violated Section 8 (a) (1) of the Act. Therefore, with regard
to the Trial Examiner's recommendation that the discriminatees be
made whole for any losses of pay because of the Respondents' dis-
crimination against them, the date of such discrimination as to
Bieganski, Calcaterra, and Licausi is June 19, the date of their
transfers.4
ORDER
The Board adopts as its Order the Recommended Order of the Trial
Examiner with the following modifications :
(1) The backpay obligation of the Respondents shall include the
payment of interest at the rate of 6 percent to be computed in the
manner set forth in Issis Plumbing cC Heating Co., Inc., 138 NLRB
716.5
(2) The following note shall be added to the bottom of the notice
immediately below the signature :
NOTE : We will notify any of the above-named employees
presently serving in the Armed Forces of the United States of
their right to full reinstatement upon application in accordance
with the Selective Service Act after discharge from the Armed
Forces.
* See Burke Golf Equipment Corporation , 127 NLRB 241, 246.
5 Member Leedom dissents from the inclusion of interest in the backpay obligation for
the reasons given in his dissent in the Isis Plumbing case.
1090 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(3) Change the notice by substituting the words "60 consecutive
days from the date of posting," for the words "60 days from the date
hereof, ...."
INTERMEDIATE REPORT
STATEMENT OF THE CASE
Upon a charge and an amended charge duly filed and served,' the Regional Di-
rector for the Seventh Region issued a complaint, and an amended complaint,2
against Respondents Herman Brothers Pet Supply, Inc. (hereinafter referred to as
"Pet Supply"), Francis Herman, d/b/a Herman Brothers Bird Products (herein-
after referred to as "Francis"), Leon Herman, d/b/a Herman Brothers Seed Mer-
chants (hereinafter referred to as "Leon"), and Julius J. Herman (hereinafter re-
ferred to as "Julius").
The amended complaint ialleges; that all of the aforementioned Respondents en-
gaged in violations of Section 8(a)(1) of the National Labor Relations Act, as
amended, hereinafter referred to as the Act, by specifically alleged conduct which
had the effect of interfering with, restraining, and coercing their employees in the
exercise of the rights guaranteed in Section 7 of the Act. With respect to alleged
violations of Section 8(a)(3) of the Act, the amended complaint charges that Re-
spondent Pet Supply, between June 23 and 30, 1961, laid off and discharged six
named employees 3 because they had engaged in union activities and in order to
avoid its legal obligation to bargain with the duly certified collective-bargaining rep-
resentative of the employees. With respect to these latter violations, it is the con-
tention of the General Counsel that Respondents Francis and Leon "are merely
alter egos and/or agents of Respondent Pet Supply" and that the "purported" sale
of the wholesale and retail business of Pet Supply to Francis and Leon, respectively,
was a mere sham and designed to avoid Pet Supply's liability under the Act. It
is the contention of all the Respondents that the sales aforementioned were bona
fide transfers of the business of Pet Supply.
Pursuant to due notice, a hearing was held before Trial Examiner David London
at Detroit, Michigan, on and between January 30 to February 1, 1962. The Gen-
eral Counsel and Respondents were represented at the hearing by counsel and
were afforded full opportunity to be heard, to introduce relevant evidence, to pre-
sent oral argument, and to file briefs. Since the close of the hearing, briefs have
been received from the General Counsel and Respondents and have been duly
considered. Upon the entire record, the briefs of the parties, and my observation
of the witnesses as they testified, I make the following:
FINDINGS OF FACT
I. THE BUSINESS OF RESPONDENTS
Respondent Pet Supply is, and has been at all times material herein, a corpora-
tion duly organized under and existing by virtue of the laws of the State of Michigan,
and whose principal stockowner and president is Julius J. Herman. At all times
material herein, Respondent Pet Supply has maintained its principal office and place
of business in Detroit, Michigan, engaged in the manufacture, sale, and distribution
of pet supplies, and related products. During the calendar year 1960, which period
is representative of all times material herein, Respondent Pet Supply purchased,
transferred, and had delivered to its Detroit place of business, bulk bird seed, grains,
and other goods and materials valued in excess of $130,000, of which goods and
materials valued in excess of $100,000, were transported to said place of business
directly from suppliers and distributors located in the States of the United States
other than the State of Michigan. I find that Respondent Pet Supply is engaged in
commerce within the meaning of the Act.
Respondent Francis Herman, an individual, is and has been at all times material
herein, an individual proprietor doing business under the trade name and style
of Herman Brothers Bird Products.
1 The original charge was filed October 2, 1961 ; the amended charge on November 8,
1961.
$ The complaint was issued on November 28, 1961, and was amended on January 18,
1962
$ Leonard Bleganski, Leonard Calcaterra, Anthony Licausi, Joseph Gondek, Walter
Wilson, and Edna Wilson.
HERMAN BROTHERS PET SUPPLY, INC., ETC. 1091
II. THE LABOR ORGANIZATION
Local 283, International Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America, herein referred to as Local 283, is and has been at all
times material herein, a labor organization within the meaning of Section 2(5)
of the Act.
Ill. THE UNFAIR LABOR PRACTICES
Julius Herman, hereafter referred to as Julius, has been in the pet supply business,
wholesale and retail, since 1929. In 1954, he incorporated the business under the
name of Herman Brothers Pet Supply, Inc., hereinafter referred to as Pet Supply,
and, together with his wife, Adeline, became the owner of all its capital stock.
From the time of incorporation, Julius, his wife, and his brother Francis constituted
its board of directors with Julius as president, and Francis as vice president.
The sales office of Pet Supply, both retail and wholesale, was located at 5624
Buchanan Street, Detroit, Michigan. The corporation also occupied a substantial
part of a large building or warehouse at 3021 Central Avenue, Detroit, where seeds
were stored, mixed, and blended. The remainder of the Central Avenue premises
were occupied by Francis and by Chester Herman who were also engaged in the
bird supply business. Both properties were owned, individually, by Julius. At
the Buchanan location, Pet Supply employed two clerks, Barbara (Bush) Campbell
and Anthony Licausi, truckdriver Leonard Calcaterra, and Leonard Bieganski as
bookkeeper and clerk. At the Central warehouse, Pet Supply employed two ware-
housemen, Joseph (Mike) Gondek and Walter Wilson, and Edna Wilson, as packer.
On or about October 4, 1960, the Board of Education of Detroit commenced
condemnation proceedings to acquire title to the Buchanan premises. These pro-
ceedings culminated in a notice to Julius, on February 3, 1961, that the acquisition
had been completed and that possession could be acquired by the board of education
any time thereafter upon 30 days' written notice. Possession of the Buchanan
premises was surrendered by Pet Supply on or about June 17, 1961?
In the meantime, during January, several of the employees complained to Gondek
because their holiday pay had been eliminated. Gondek, who had been a union
member since 1937 and employed by Julius since 1949, suggested that they join
the Union and secured signed cards from them designating Local 283 of the Team-
sters as their collective-bargaining representative. This choice was confirmed by
a 5-to-2 vote at a Board-conducted election on February 27, 1961. Pursuant to
that election, the Board, on March 7, certified Local 283 as the duly designated
representative of Pet Supply's warehousemen, packers, salesclerks, bookkeepers,
and truckdrivers.
In January, after Julius received a telegraphic demand for recognition from Local
283, he asked Bieganski whether he knew anything about the telegram. When
Bieganski replied that he did not, Julius told him that he guessed that Walter Wilson
and Mike Gondek "started the union business because they were dissatisfied with
the way things were going at Central." He also told Bieganski "that he would never
sign a union contract" and that he could never be forced to do so, a threat which
he repeated to Calcaterra in April.
Also in January, during conversations with Barbara Campbell, Julius interrogated
her "trying to find out just which of the members were involved, who had signed
up, and things like that." On several occasions, both before and after the election,
Julius told her "he would never let the Union in and he would close up before he
would admit a union into his business." After the election, and pursuant to Julius'
instructions, Bieganski taught her "how to handle the Company's books," a job
which she completely took over when Bieganski was subsequently transferred to
more menial work at the Central warehouse.
In the latter part of January, Leonard Calcaterra overheard Julius tell Francis
that he was "going to get rid of [Calcaterra] if it is the last thing he does." About
a week before the election, Julius told Walter Wilson that if the employees "should
happen to lose the election, he would fire Mike Gondek and make [Wilson] a fore-
man, and approximately a month later he would hire a man to work with [him]."
Right after the election, Julius told Wilson that Gondek and Bieganski would be
fired "because they were instigators in this union matter." A week or two after
the election, Julius told Licausi that "he would fire [Gondek] the first chance he got
whether it took a year or two."
Early in March, shortly after the certification, Louis Ralston, business agent for
Local 283, contacted Julius and forwarded a proposed collective-bargaining agree-
' Unless otherwise specified , all further reference to dates herein are to the year 1961.
662353-63-vol. 13 8-7 0
1092 DECISIONS Or NATIONAL LABOR RELATIONS BOARD
ment to him. Ralston later called on Julius to schedule a meeting between the
parties and was advised that he had no intention of signing a contract with the
Union.
Ralston told Julius he was going to enlist the services of the State mediation
board and was informed that he could do as he pleased but that he, Julius, "wouldn't
even show up." He did, however, attend a meeting at the State board office where he
again stated he would not sign a contract with the Union. The State board official
advised Ralston it had no jurisdiction, and suggested that unfair labor practice
charges against Pet Supply be filed with the Board which the Union did.
Following the filing of that charge, the General Counsel of the Board and Pet
Supply, on June 19, 1961, entered into a settlement stipulation in that proceeding,
known as Case No. 7-CA-3139, which stipulation was subsequently approved by
the Board and incorporated in a Decision and Order. By the terms of the settlement
stipulation, Pet Supply was required, and by the Board's Decision and Order, was
ordered, to cease and desist from (a) threatening its employees with discharge or
other reprisals if they became or remained members of Local 283; (b) admonishing
its employees that it would not sign a collective-bargaining agreement with Local
283; (c) discouraging membership in Local 283 by laying off or reducing the hours
of employment of any of its employees; (d) refusing to bargain collectively with
Local 283. By that stipulation and Order, Pet Supply was also required (1) to
restore Gondek's hours of employment which he previously enjoyed, and to make
him whole for any loss he may have suffered as a result of Pet Supply's earlier dis-
crimination against him, and (2) upon request, to bargain collectively with Local 283.
Pursuant to the settlement stipulation aforementioned, Julius met with Ralston
and Gondek at the Central warehouse on Tuesday or Wednesday, June 20 or 21,
to commence negotiations. During their conversation, Julius told Ralston that the
Buchanan property had been condemned by the board of education "and he was
going to have to move to a new location." Ralston made a substantial number of
concessions from the demands contained in the proposal previously submitted by
the Union and full agreement on all terms was reached, including a wage increase of
15 cents an hour, effective June 26. Julius volunteered to immediately sign the
contract. Ralston suggested, however, that the contract would first have to be
ratified by the employees, and that he also thought it advisable for Julius to submit
the contract to his lawyer for a check of "the wording of the contract." The parties
agreed to meet on the following Friday, June 23, to sign the contract.
Late Thursday or early on Friday of the same week, Ralston's secretary was
advised by telephone that Julius was sick and could not keep his appointment with
Ralston and asking that Ralston contact Julius during the following week. Ralston,
who had planned to leave Detroit on June 29 to attend a Teamsters' convention
in Miami, tried several times to reach Julius at his office during that week, but
was unable to do so.
On June 29, Gondek informed Ralston that several employees had been notified
that they were being laid off. At about 7:30 p.m. of that day, Ralston called Julius
at his home and the latter's daughter answered the telephone. She asked who was
calling and Ralston identified himself, whereupon she told him that Julius was
not at home. Ralston insisted that Julius was at home because he "could hear him
talking in the background, telling her to say that he wasn't home." The daughter
then admitted "he was home, but was ill, and didn't want to talk to [him] " 5
Ralston left Detroit that evening and did not return until July 12 when Gondek
informed him that "all of the people definitely had been laid off, and there were
no people working in the warehouse. [Julius] had told them he sold his business
to his brother." Ralston called Julius who told him "there was no use signing the
contract, he was out of business, he had no more employees and he had sold the
business to his brother."
Pet Supply's retail business was last conducted at Buchanan Street on Saturday,
June 19, at which time its stock of merchandise and most of its fixtures were moved
to a new location at 5842 Michigan Avenue, approximately 21/2 blocks away.
These latter premises, like those at Buchanan and Central, were also owned by
Julius in his individual capacity. Calcaterra, Licausi, and Bieganski, who had been
employed at Buchanan Street, were transferred by Julius to the wholesale operation
at Central. Barbara Campbell was transferred to the Michigan store but was first
8 There was uncontradicted testimony, however, that Julius drove to and appeared at
the Central warehouse on Saturday, June 24, and that he was engaged in his normal
work on Monday, June 26. Gondek also testified, credibly, that late in June he saw
Julius "doing carpenter work, sawing wood and using a crow bar to rip the blocks off
the floor and move the steel desk around."
HERMAN BROTHERS PET SUPPLY, INC., ETC. 1093
asked by Julius and his son Leon to sign "a paper stating that [she] quit from
Herman Bros. Pet Supply of [her] own free will ... so he wouldn't have any trouble
with the union."
Bieganski, who had been working for Julius since March 1952, began working
at Central on Monday, June 19, packing cuttlebone, at which time his pay was
reduced from $1.75 to $1.35 an hour. On Wednesday, June 21, Julius told him
that the men were only going to work 3 days that week and that he could pick
up his check on the following Friday. When Bieganski returned on Friday for
that purpose, he found a notice on the bulletin board stating that due to the lack
of work, he, Licausi, and Calcaterra were being laid off and that their checks
could be picked up at Francis' office.
On June 28, the following notice was posted on the bulletin board at Central:
JUNE 28, 1961.
NOTICE TO ALL EMPLOYEES
Due to the serious decline and loss of business, we find it necessary to dis-
continue our operations as of June 30, 1961.
Accordingly, employment of all hourly rated employees will terminate as
of the close of business on that date.
We are sorry for this decision and express our appreciation for the past
loyalty and service of all employees.
HERMAN BROS. PET SUPPLY, INC.,
JULIUS J. HERMAN, Pres.
When Licausi asked Julius whether he could work at the Michigan store he was
refused that opportunity because, Julius said, "Leon was hiring all un-union [sic]
workers." Gondek, Walter Wilson, and Edna Wilson, were discharged on June
30, at which time they were handed a letter, signed by Julius, and reading as follows:
JUNE 30, 1961.
To ALL EMPLOYEES
As you have been previously notified by Bulletin, we regret to advise that
after many years in business, we find it necessary to discontinue operations.
Regretfully we give you herewith notification of termination of your services.
You may apply for your unemployment compensation.
Yours, truly,
HERMAN BROS. PET SUPPLY, INC.,
By JULIUS J. HERMAN, Pres.
When Edna Wilson, who had been employed since 1953, was handed her check,
Julius told her that she was going to have a long vacation, and it would be up to
her brother and son to support her and that "if it wasn't for the trouble, [she] would
still be working."
As previously indicated, it is the contention of the Respondents that the retail
portion of Pet Supply's business at Buchanan Street was sold to Leon, the son of
Julius, on March 21, 1961, for an alleged consideration of $5,000, but that pos-
session was not delivered until the Buchanan Street premises were vacated on
June 17. With respect to the wholesale business on Central Avenue, it is their
contention that it was sold and transferred to Francis by a bill of sale, dated July 6,
acknowledging the receipt of $22,066.91 as consideration for that transfer .6 After
the alleged transfers to Leon and Francis, replacements were hired for the alleged
discriminatees named in footnote 3, supra.
On the entire record, and my observation of the demeanor of the persons in-
volved as they appeared at the hearing, I am convinced and find that the purported
sales of the business and/or assets of Pet Supply to Leon and Francis were a sham
and a dodge designed to avoid Pet Supply's obligations to its employees guaranteed
by the Act.7
5In support of this contention , there was received in evidence a promissory note of
Francis, dated July 6, for the sum of $ 21,066.91 and a check of Francis for $1 ,000, dated
July 17, which carried a notation , however, that it represented the "down payment on
purchase of bulk sale merchandise "
7 Pet Supply's attorney, on August 4, in acknowledging, in behalf of his client, receipt
of the Board's Decision and Order based on its approval of the settlement stipulation
of June 19, sought to assure the "Board that the labor problem or the complaints of the
Union was not the principal factor in discontinuing the operations" of Pet Supply
(Emphasis supplied.]
1094 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Though there were received in evidence bills of sale, promissory notes, leases,
and financial statements seeking to bolster the defense offered by Respondents, all of
which, on their face, appeared to be in proper form, nevertheless, in my 14 years
experience as a trier of fact for the Board, have I been less impressed that truthful
testimony was being offered than I was by the demeanor, and the studied and de-
signed efforts to deceive put forth by Julius, Francis, and Leon, as they testified
concerning the documents aforementioned and otherwise sought to establish their
defense herein.
This was especially true of the testimony of Leon, a most immature young man
who had just reached his 21st birthday about the time when he claimed to acquire
Pet Supply's retail business. He, both while testifying and when he sat at the
counsel table, displayed a most flippant attitude toward the entire proceeding, as
though he was enjoying a comedy being enacted in the hearing room.
To support his testimony, there was received into evidence a bill of sale, dated
March 21, from Julius, as an individual's to Leon, in which Julius acknowledged
that on that date Leon had paid him $5,000 for "stock on hand" 9 and equipment
which the bill of sale falsely represented was then "located" at the Michigan Avenue
premises.
Leon further testified that of the $5,000, $1,000 was paid in cash on June 5.
According to Leon, he "remarried back into the Catholic church [on June 3] and
received $1,000 from that, gifts," which cash he turned over to his father. Another
$1,000, he testified, was given to Julius on July 12 and the final $3,000 on December
7. This $3,000, he testified, he obtained on a loan from his mother-in-law, Fay
Alongi, on December 5', for which he gave her his non-interest-bearing promissory
note, payable $100 per month, but all due "within 90 days." No payments have
been made by him on this note.
In addition to the bill of sale dated March 21, there was also received in evidence
a lease from Julius to Leon dated March 21 and purporting to lease the Michigan
Avenue premises for a term of 5 years commencing March 21, 1961, and a trade
name certificate filed by Leon on March 16 indicating that he was the person "own-
ing and conducting" the business known as "Herma [sic] Bros. Feed Merchants" at
5852 Michigan Avenue. Significantly, however, all three of these instruments are
dated but a few days after March 7, the date the Union had been elected and certi-
fied as bargaining representative of Pet Supply's employees and had submitted a
proposed bargaining agreement to Pet Supply.
There are other critical factors present which have brought me to the ultimate
conclusion announced above. If, as Respondents contend, Pet Supply's retail busi-
ness was sold to Leon on March 21, why did Julius, in entering into the setlement
stipulation with the General Counsel on the following June 19, after Leon had
allegedly taken possession of the retail business, still acknowledge on that day that
it was Pet Supply that then maintained the retail business on Buchanan Street and
that Pet Supply would, as the employer at that location, bargain with the Union
concerning wages and working conditions. And why if, on June 19, Pet Supply
was not the employer of Mike Gondek, did Julius, in behalf of Pet Supply, agree
on that date to restore Gondek's hours of employment to those he previously en-
joyed and to make him whole for any loss he may have suffered as a result of
Pet Supply's earlier discrimination against him. And, why did Pet Supply on
June 19 agree to prominently post a notice at both of its premises, signed by it as
the "Employer," notifying its employees that it would take the action described in
the settlement stipulation described in earlier portions of this Report. Also, why
did Julius tell Ralston on June 21 that it was he, and not Leon, who "was going
to have to move to a new location" because the Buchanan Street premises had been
condemned. And, why in his further conversation with Ralston as late as July 12,
did he fail to make any mention of the sale of the retail business to Leon but
only that he had "sold the business to his brother." The obvious answer to all
these questions is that, in truth and fact, Pet Supply continued to be the owner and
operator of the business.
Turning now to the purported sale of the wholesale operations at Central to
Francis, Julius testified that it was about June 26 or 27 that he decided to go out
of the wholesale business. When asked by General Counsel to state the reason
for doing so, he testified that it was because (1) "there [was] no way that [he]
8 Respondents , in their brief, state that although Pet Supply "was a corporation, it was
practically a one-man business operated by Julius Herman "
9 No testimony was offered that any inventory was made of the "stock on hand" on
March 21, or whether that stock was larger or smaller on or about June 17 when
possession was allegedly delivered to Leon.
HERMAN BROTHERS PET SUPPLY, INC., ETC. 1095
could supervise the business due to [his] illness" and (2), he was operating the
business at a loss "the last 4, 5, 6 years."
Though the record establishes that Julius had been suffering from bronchitis and
a heart condition since 1957 which required his occasional absence from work,
it fails to disclose that this condition was any worse in June 1961 and thereafter
than it was for several years before that time. Thus, Walter Karolak, who had
regular employment at the Ford Motor plant, but also had part-time employment
at the Central warehouse, testified, credibly, that about the time his vacation at the
Ford plant began on July 1, he received a call from Julius asking him to report for
work. Karolak did so and, under orders from Julius, worked for 2 to 3 weeks
mixing gravel and feed. During that entire period, Julius worked there "every day"
filling and sewing bags.
Barbara Campbell, who impressed me most favorably as a trustworthy witness,
testified that from June 19 until she was discharged on October 17, Julius came to
the Michigan store one to three times every day. Walter Wilson testified that just
prior to his termination on June 30 he saw Julius "show the boys how to load the
truck" and observed him "hustling" and lifting 100-pound bags. And, as has
previously been found, late in June, Julius was able to use a crowbar to lift blocks
off the floor and do carpenter work in remodeling his premises. And, though I
am satisfied that he had a heart condition, the testimony is undisputed that it was
not serious enough to prevent him from driving his automobile to and from work.
Turning now to the second reason assigned by Julius for closing out Pet Supply's
business, Respondents offered in evidence profit-and-loss statements for the 4 fiscal
years preceding July 31, 1961, prepared by a certified public accountant, showing
that the corporation operated at a loss during each of those years. According to
these statements, Pet Supply's sales and operating losses during this period were in
the amounts designated below:
Fiscal year ending July 31: sales
Operatting
Loss
1958______________________________________ $219,969.42 $90.13
1959______________________________________ 198,840.24 5,778.70
1960______________________________________ 204,245.38 3,901.86
1961______________________________________ 173,282.46 11,554.02
I find it difficult to believe that if Julius was really incapacitated and ill during
the past 5 years to the extent claimed by him that he would, nevertheless, continue
in business year after year while his losses continued to mount, year after year. Nor
was any credible, probative evidence offered that any unusual incident involving his
physical condition occurred on June 26 or 27 when the claimed decision to go out
of business was made. Indeed, it was only 5 or 6 days earlier that Julius, though
not requested to do so, volunteered to append his signature to a contract for a
term extending to March 31, 1962. It seems incredible that he should, on June 21,
offer to bind himself to a contract of that duration if his health, and the unprofitable
operation of his business, were as bad as they are now claimed to have been.
There is, however, other testimony which I credit that causes me to reject Respond-
ents' contention that Pet Supply's losses were in the amounts reflected by the profit
and loss statements, if, indeed, it cannot reasonably be surmised therefrom that there
were no losses at all. Bieganski, Pet Supply's bookkeeper, and Barbara Campbell,
who also acted in that capacity, both testified, credibly, that false cash register tapes
were both made, and submitted to them, .by Julius for posting on Pet Supply's books
and which tapes failed to include substantial cash payments previously received and
rung up by each of these witnesses.i° Julius' brief and perfunctory denial of this
practice failed to impress me as trustworthy. This dishonest practice not only
impugns Julius' veracity as a witness concerning his alleged business losses, but
must also be considered in weighing the remainder of his testimony.
My refusal to give the effect which normally would be given to all the written
documents Respondents offered in support of their defense is based not only on the
demeanor of the witnesses involved as they testified concerning these matters, and
the findings entered above, but also on the relationship of the parties involved. It
must be remembered that the parties to these alleged transactions were not strangers
to one another, dealing at arm's length. Two brothers and a son, members of a
closely knit family, are the actors here. This is not the first time that written
documents have been executed, and moneys exchanged, by members of a family to
avoid liability of one kind or another.
10 The certificate of the certified public accountant , which accompanied the profit and
loss statements aforementioned , contained the caveat that they were prepared "without
verification" of the "records and other data furnished by" Pet Supply.
1096 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Also casting grave doubt on the claim that Pet Supply had been losing substan-
tial amounts during the previous 4 to 5 years is the uncontradicted testimony that
on June 21, at the first and only bargaining conference with Local 283, Julius agreed
to grant his employees a substantial wage increase effective the following Monday.
It would be extremely naive for anyone familiar with the practice of collective
bargaining to believe that a businessman, who was operating his business at a loss
and at a time when he was as ill as Julius claimed to be, would, at a first bargaining
conference, agree to grant a substantial wage increase to his employees In the
case of Pet Supply, on June 21, 1961, this has even greater significance. Its profit-
and-loss statements for the fiscal year ending July 31, 1961, purport to show a loss
of $11,554 01, an amount almost three times as great as great as the purported loss
of the preceding fiscal year.
Not only has Pet Supply failed to establish either of the reasons assigned by it
for the sale of its assets or business, but the record compels a finding that after the
alleged tranfers Julius continued his management in the same manner he did prior
thereto This is not to say that he devoted a full workday, every day, to his business,
but neither did he do so before.
By reason of all the foregoing, I find that the alleged sales and transfers to Leon
and Francis were a sham to cover Julius' intention, announced shortly after the
Union was certified on March 7, to never recognize or bargain with Local 283. It
was at that time that the plot to deceive was hatched by the execution of the lease
to Leon, and the filing of the latter's trade name certificate.
I further find that the manipulations noted above resulted in no change in the
employer-employee relationship at Pet Supply other than to constitute Leon and
Francis as mere alter egos of Pet Supply, and that the six employees named in
footnote 3, supra, were discharged solely to forever rid that corporation of any
obligation to recognize or bargain with Local 283. By that conduct, Respondents
violated Section 8(a) (3) and (1) of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE
The activities of Respondents set forth in section III, above, occurring in con-
nection with the operations of Pet Supply described in section 1, above, have a
close, intimate, and substantial relation to trade, traffic, and commerce among the
several States, and tend to lead to labor disputes burdening and obstructing commerce
and the free flow of commerce
V. THE REMEDY
It having been found that Respondents violated Section 8(a)(1) and (3) of the
Act, it will be recommended that they cease and desist therefrom and take certain
affirmative action designed to effectuate the policies of the Act
Having found that Leon and Francis are but the alter egos of Pet Supply, they,
together with Pet Supply, are, for the remedial purposes of the Act, a single "em-
ployer" within the meaning of Section 2(2) of the Act. Julius, as president of
Pet Supply, acted as agent of that corporation at the time the unfair labor practices
were committed and he, too, is therefore an "employer" for the remedial purposes
of the Act.
Having also found that Respondents discriminated with regard to the hire and
tenure of employment of Leonard Bieganski, Leonard Calcaterra, Anthony Licausi,
Joseph Gondek, Walter Wilson, and Edna Wilson, the Trial Examiner recommends
that the Respondents, jointly and severally, offer each of them immediate and full
reinstatement to his former or substantially equivalent position without prejudice to
his seniority or other rights and privileges and, jointly and severally, make him whole
for any loss of pay suffered as a result of the discrimination against him, by pay-
ment to him of a sum of money equal to the amount he would have earned from
the date of the discrimination to the date of the offer of reinstatement, less net
earnings to be computed on a quarterly basis in the manner established by the
Board in F. W. Woolworth Co., 90 NLRB 289; N.L.R.B. v. Seven-Up Bottling
Company, 344 U.S. 344.
As the unfair labor practices committed by Respondents are of a character strik-
ing at the root of employee rights safeguarded by the Act, it will be recommended
that Respondents cease and desist from infringing in any manner upon the rights
guaranteed in Section 7 of the Act
Upon the basis of the above findings of fact, and upon the entire record in the
case, I make the following:
I By interrogating employees concerning their union membership or activities,
and by threatening them with reprisals if Local 283 should be designated as their
collective-bargaining representative, Respondents Pet Supply and Julius violated
Section 8 (a)( 1) of the Act.
HERMAN BROTHERS PET SUPPLY, INC., ETC. 1097
CONCLUSIONS OF LAW
2. By discharging, and discriminating in regard to the hire and tenure of employ-
ment of Leonard Bieganski, Leonard Calcaterra, Anthony Licausi, Joseph Gondek,
Walter Wilson, and Edna Wilson, all the Respondents have engaged in unfair labor
practices within the meaning of Section 8(a) (3) and (1) of the Act.
3. The aforesaid unfair labor practices are unfair labor practices within the mean-
ing of Section 2(6) and (7) of the Act.
RECOMMENDED ORDER
Upon the basis of the foregoing findings of fact and conclusions of law, and upon
the entire record in the case, the Trial Examiner recommends, in order to effectuate
the policies of the Act, that Respondents Herman Brothers Pet Supply, Inc., Francis
Herman, Leon Herman, and Julius Herman, jointly and severally, and their officers,
agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Discouraging membership in Cylinder Gas, Petroleum and Accessory Drivers
and Inside Employees, Local Union No. 283, an affiliate of International Brother-
hood of Teamsters, Chauffers, Warehousemen and Helpers of America, or any other
labor organization of their employees, by engaging in discrimination in regard to
their hire or tenure or any term or condition of employment, except as authorized
by Section 8(a) (3) of the Act.
(b) Interfering with, restraining, or coercing their employees in the exercise of
rights guaranteed in Section 7 of the Act.
(c) In any other manner interfering with, restraining, or coercing their employees
in the exercise of their right to self-organization, to form labor organizations, to
join or assist the above-named Union or any other labor organization, to bargain
collectively through representatives of their own choosing, and to engage in other
concerted activities for the purpose of collective bargaining or other mutual aid
or protection, or to refrain from any or all of such activities.
2. Take the following affirmative action which I find will effectuate the policies
of the Act:
(a) Offer Leonard Bieganski , Leonard Calcaterra, Anthony Licausi, Joseph
Gondek, Walter Wilson, and Edna Wilson immediate and full reinstatement to their
former or substantially equivalent positions, without prejudice, to their seniority and
other rights and privileges, and make them whole for any loss of pay they may have
suffered by reason of the discrimination against them, in the manner set forth in
the section of this Report entitled "The Remedy."
(b) Preserve and, upon request, make available to the Board, or its agents. for
examination and copying, all payroll records, social security payment records, time-
cards, personnel records and reports, and all other records necessary to analyze the
amount of backpay due under the terms of this recommended order.
(c) Post at their respective offices and stores in Detroit, Michigan, copies of the
notice attached hereto marked "Appendix." 11 Copies of said notice to be furnished
by the Regional Director for the Seventh Region shall, after being duly signed by
each Respondent, be posted immediately upon receipt thereof and be maintained by it
for 60 consecutive days thereafter in conspicuous places, including all places where
notices to employees are customarily posted. All the Respondents shall take reason-
able steps that such notices are not altered, defaced, or covered by any other
material.
(d) Notify the Regional Director for the Seventh Region, in writing, within 20
days from the date of receipt of this Intermediate Report, what steps they have
taken to comply herewith.12
It is further recommended that, unless Respondents shall, within 20 days from
the date of receipt of this Intermediate Report, notify said Regional Director, in
writing, that they will comply with the foregoing recommendations, the National
Labor Relations Board issue an order requiring Respondents to take the action
aforesaid
u In the event that these Recommendations be adopted by the Board, the words "A De-
cision and Order" shall be substituted for the words "The Recommendations of a Trial.
Examiner" in the notice. In the further event that the Board's Order be enforced by a
decree of a United States Court of Appeals, the words "A Decree of the United States
Court of Appeals, Enforcing an Order" shall be substituted for the words "A Decision,
and Order "
12 In the event that these Recommendations be adopted by the Board, this provision
shall be modified to read: "Notify said Regional Director, in writing, within 10 days
from the date of this Order, what steps the Respondent has taken to comply herewith."
1098 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
APPENDIX
NOTICE TO ALL EMPLOYEES
Pursuant to the Recommendations of a Trial Examiner of the National Labor
Relations Board, and in order to effectuate the policies of the National Labor Rela-
tions Act, as amended, we hereby notify you that:
WE WILL NOT discourage membership in Cylinder Gas, Petroleum and
Accessory Drivers and Inside Employees, Local Union No. 283, an affiliate
of International Brotherhood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, or any other labor organization of our employees, by
discharging, refusing to reinstate, or in any other manner discriminating against
them in regard to their hire or tenure of employment or any term or condition
of employment.
WE WILL offer Leonard Bieganski, Leonard Calcaterra, Anthony Licausi,
Joseph Gondek, Walter Wilson, and Edna Wilson immediate and full rein-
statement to their former or substantially equivalent positions without prejudice
to their seniority or other rights and privileges previously enjoyed, and make
them whole for any loss of pay suffered by them as the result of the discrimina-
tion against them.
WE WILL NOT interrogate our employees concerning their union membership
or activities, or threaten them with reprisals for engaging in such activities.
WE WILL NOT in any other manner interfere with, restrain, or coerce our
employees in the exercise of their right to self-organization, to form labor
organizations , to join or assist the above-named union or any other labor
organization, to bargain collectively through representatives of their own
choosing, and to engage in other concerted activities for the purpose of col-
lective bargaining or other mutual aid or protection, and to refrain from any
or all such activities.
All our employees are free to become or remain, and to refrain from becoming
or remaining, members of the above-named or any other labor organization.
HERMAN BROTHERS PET SUPPLY, INC.,
Employer.
Dated------------------- By-------------------------------------------
(Representative) (Title)
-------------------------------------------
(FRANCIS HERMAN)
-------------------------------------------
(LEON HERMAN)
-------------------------------------------
(JULIUS J. HERMAN)
This notice must remain posted for 60 days from the date hereof, and must not be
altered, defaced, or covered by any other material
Employees may communicate directly with the Board's Regional Office, Industrial
Building, 232 W. Grand River, Detroit 26, Michigan, Telephone Number, Woodward
2-3830, if they have any question concerning this notice or compliance with its
provisions.
Emmadine Farms , Inc. and Ernest G. Ostling
Milkdrivers and Dairy Employees Union, Local 338, Inter-
national Brotherhood of Teamsters, Chauffeurs, Warehouse-
men and Helpers of America and Ernest G. Ostling. Cases
Nos. 2-CA-8099 and 2-CB-32893. September 27, 1962
DECISION AND ORDER
On April 11, 1962, Trial Examiner Fannie M. Boyls issued her
Intermediate Report in the above-entitled proceeding, finding that the
138 NLRB No. 127.