IFG-Stockton Management

National Labor Relations Board - Administrative Judge Opinions

Aug 19, 2010

32-CA-024926 (N.L.R.B. Aug. 19, 2010)

JD(SF)–35–10
Stockton, CA
UNITED STATES OF AMERICA
BEFORE THE NATIONAL LABOR RELATIONS BOARD
DIVISION OF JUDGES
SAN FRANCISCO BRANCH OFFICE
IFG-STOCKTON MANAGEMENT, L.P.
and Case 32-CA-24926
INTERNATIONAL UNION OF
OPERATING ENGINEERS, STATIONARY
ENGINEERS LOCAL 39, AFL-CIO
Gary M. Connaughton, Esq., Oakland, CA,
for the General Counsel.
Scott Malm, Esq. (Cassel, Malm, Fagundes)
Stockton, CA, for the Respondent.
Stuart Weinberg, Esq., (Weinberg, Roger & Rosenfeld)
Alameda, CA, for the Union.
DECISION
Statement of the Case
Jay R. Pollack, Administrative Law Judge. I heard this case in trial at Oakland,
California, on June 21, 2010. On January 28, 2010, the International Union of Operating
Engineers, Stationary Engineers Local 39, AFL-CIO, (the Union) filed the charge in Case 32-
CA-24926 alleging that IFG-Stockton Management LP1 (Respondent) committed certain
violations of Section 8(a)(5), (3) and (1) of the National Labor Relations Act (the Act). On
March 31, 2010, the Union filed the first amended charge. On March 31, 2010, the Regional
Director for Region 32 of the National Labor Relations Board (the Board) issued a complaint and
notice of hearing against Respondent, alleging that Respondent violated Section 8(a)(5), (3) and
(1) of the Act. Respondent filed a timely answer to the complaint, denying all wrongdoing.
The parties have been afforded full opportunity to appear, to introduce relevant
evidence, to examine and cross-examine witnesses, and to file briefs. Upon the entire record,

1 The name of the Respondent appears as corrected at the hearing.
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from my observation of the demeanor of the witnesses2, and having considered the posthearing
briefs of the parties, I make the following.
Findings of Fact
I. Jurisdiction
The Respondent is a limited partnership, with an office and principal place of business in
Stockton, California, where it has been engaged in the business of managing and maintaining
buildings and facilities In the twelve months prior to issuance of the complaint, Respondent, in
conducting its business operations, derived gross revenues in excess of $50,000 from the City
of Stockton, California. Further, Respondent purchased and received goods and services
valued in excess of $50,000 directly from points outside the State of California. Accordingly, the
Respondent admits and I find that Respondent is an employer engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act.
The Respondent admits and I find that the Union is a labor organization within the
meaning of Section 2(5) of the Act.
II. Alleged Unfair Labor Practices
Respondent is engaged in the management and maintenance of commercial buildings
and facilities, including the Stockton Arena in Stockton, California. The Union represented a
bargaining unit of Respondent’s employees at the Stockton Arena The collective bargaining
agreement between the parties was effective by its terms from January 1, 2007 through
December 31, 2009. Although the size of the bargaining unit varied during the term of the
bargaining agreement, there were two bargaining unit employees for an extended period of time
prior to January 31, 2010.
In early October 2009, the Union sent Respondent a letter reopening the bargaining
agreement for purposes of bargaining for a successor bargaining agreement. In that same
month, Charles Kemp, Respondent’s general manager, decided to replace Respondent’s
bargaining unit employees with outside contractors because of issues he had with the work
competence of employees supplied by the Union. In late October, Respondent’s counsel sent
the Union a letter notifying the Union that Respondent intended to “terminate” the bargaining
agreement upon its expiration. Counsel’s letter noted that Respondent ‘s “intent to terminate
the contract is a subject of bargaining and offers to meet and confer with [the Union] for the
purpose of negotiating a new or modified contract and that contract is to be observed during the
bargaining up to the last day of the contract.” The Union, by Steven Thomas, business
representative, responded that the Union intended to bargain a successor agreement. Because
the parties were unable to meet prior to December 31, 2009, the parties agreed to extend the
bargaining agreement until midnight January 31, 2010.

2 The credibility resolutions herein have been derived from a review of the entire testimonial
record and exhibits, with due regard for the logic of probability, the demeanor of the witnesses, and
the teachings of NLRB v. Walton Manufacturing Company, 369 U.S. 404, 408 (1962). As to those
witnesses testifying in contradiction to the findings herein, their testimony has been discredited,
either as having been in conflict with credited documentary or testimonial evidence or because it
was in and of itself incredible and unworthy of belief.
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On January 22, 2010, the parties met in the presence of a Federal Mediator, for their first
and only bargaining session for a successor bargaining agreement. The Union stated that it
was there to bargain for a successor agreement. Respondent stated that it did not want a
contract; that the bargaining agreement was not working for Respondent because the Union
had not provided Respondent with properly trained employees. Thomas answered
Respondent’s claims that the Union had failed to provide properly trained employees by stating
that the Union only had the right to refer applicants and, that it was Respondent’s responsibility
to make sure it hired qualified employees.
Thomas distributed copies of the Union’s 16 bargaining proposals. The parties
discussed the Union’s proposals. Respondent stated that it had no counter proposals because
it did not see a need to move forward with negotiations. After Respondent insisted that it did not
want a contract, the mediator called for a break in the session so that he could meet with
Respondent separately.
In its meeting with the mediator, Respondent again stated its intent to walk away from
the contract. The mediator stated that Respondent could: (1) accept the Union’s proposals;
(2) attempt to change to change job descriptions and titles (the mediator suggested the Union
would never agree to this); or (3) proceed without a contract and await the Union’s reaction.
Respondent stated that it would walk away from the contract and the mediator agreed to inform
the Union.
After meeting with the mediator, Respondent’s representatives discussed how to
implement its decision to terminate its relationship with the Union. Respondent decided that it
would notify its two unit employees that they would be let go because Respondent no longer
had an agreement with the Union. Respondent decided to place employee Michael Valverde on
paid administrative leave. Valverde was put on administrative leave because Respondent
feared that Valverde might get upset once he learned that Respondent was walking away from
the Union. Respondent admitted that it knew Valverde was a strong Union supporter.
Valverde was notified by telephone and letter that he was placed on administrative leave
until January 31, 2010 and that Respondent had “opted” not to renew the contract which expired
on January 31, 2010. In addition Valverde was told “You are asked to refrain from making any
contact with any other IFG employees.”
On February 1, 2010, Respondent terminated its two bargaining unit employees,
Valverde and Brion Leri. Respondent subcontracted out the bargaining unit work and later
rehired Leri to supervise the employees of the subcontractors. Respondent did not give notice
to or bargain with the Union over these terminations. On February 3, Thomas sent Respondent
a letter demanding that Respondent return to the bargaining table. Respondent did not respond
and no further bargaining took place.
Respondent presented evidence from Brion Leri. After being terminated on
February 1, Leri was rehired by Respondent to supervise the employees of subcontractors used
by Respondent. Leri testified that he expressed dissatisfaction with the employees on several
occasions. After being informed that Respondent was no longer affiliated with the Union, Leri
expressed concern over the Union and his job status. However, Leri did not testify that he ever
stated that he did not want the Union to represent him.
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III. Analysis and conclusions
A. The Respondent Was Obligated to Bargain
The general rule is that when parties are engaged in negotiations for a new agreement,
an employer’s obligation to refrain from unilateral changes encompasses a duty to refrain from
implementation unless and until an overall impasse has been reached on bargaining for the
agreement as a whole. Pleasantview Nursing Home, 335 NLRB 96 (2001); citing Bottom Line
Enterprises, 302 NLRB 373 (1991). In Bottom Line Enterprise, the Board recognized only two
exceptions to that general rule: when a union engages in bargaining delay tactics and “when
economic exigencies compel prompt action, 335 NLRB at 374
The Board has limited the economic considerations which would trigger the Bottom Line
exception to “extraordinary events which are an unforeseen occurrence, having a major
economic effect [requiring] the company to take immediate action.” Hankins Lumber Co.,
316 NLRB 837, 838 (1995). In RBE Electronics, 320 NLRB 80, 81 (1995) the Board made it
clear that “[a]bsent a dire financial emergency, economic events such as . . . operation at a
competitive disadvantage . . . do not justify unilateral action.” citing Triple A Fire Protection, 315
NLRB 409, 414 (1994).
However, in RBE Electronics, the Board also found that there may be other economic
exigencies that, although not sufficiently compelling to excuse bargaining altogether, should be
encompassed within the exigency exception. In those cases, the employer will “satisfy its
statutory obligation by providing [the union] with adequate notice and an opportunity to bargain
over the changes it proposes to respond to the exigency and by bargaining to impasse over the
particular matter. In such time sensitive circumstances, however, bargaining, to be in good
faith, need not be protracted.” Pleasantview Nursing Home, supra, citing RBE Electronics and
Naperville Ready Mix, Inc., 329 NLRB 174, 182–184 (1999).
In Pleasantview Nursing Home the Board reiterated that the exception will be limited
only to those exigencies in which time is of the essence and which demand prompt action.
Thus, the Board will require an employer to show a need that the particular action proposed be
implemented promptly. Consistent with the requirement that an employer prove that its
proposed changes were “compelled,” the employer must also show that the exigency was
caused by external events, was beyond its control, or was not reasonably foreseeable. Id.
Applying these principles here, it is clear that the Respondent’s claim of inadequately
trained employees is not the type of “extraordinary event” that justifies unilateral action without
bargaining. Although Respondent could decide to subcontract the unit work, it first had to offer
the Union the opportunity to bargain over the decision and the effects of the decision.
There was no reason why Respondent could not give the Union notice and an
opportunity to bargain over its decision to subcontract the work and the effects of such a
decision.
In the instant case the parties met on only one occasion. Respondent indicated its
desire to end the relationship. It offered no proposals or counter proposals. There was no
discussion concerning a plan for subcontracting or the effects of Respondent’s decision to
subcontract the work.
Respondent argues that the Union did not have majority support. It is axiomatic that an
employer’s obligation to bargain with the Section 9(a) representative of its’ bargaining unit
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employees continues after the expiration of a collective bargaining agreement unless or until it is
shown that the union has lost majority support. Levitz Furniture Co., 333 NLRB 717 (2001).
Absent a showing that the union lost majority support, an employer violates Section 8(a)(5) of
the Act if it refuses to recognize and bargain in good faith with an incumbent union once a
collective bargaining agreement expires.
The Board has held that the burden is on the employer to prove by a preponderance of
objective evidence that the union had in fact lost majority support at the time the employer
withdrew recognition. Levitz, supra,at 725. The evidence presented by Leri does not establish
that the Union had lost majority support at the time of Respondent’s refusal to bargain.
Further, Respondent argues that there is a bargaining unit of only one employee.
However, the evidence establishes that the appointment of Leri to supervise subcontractors was
part-and-parcel of the decision to subcontract the bargaining unit work. Therefore, to allow this
defense would be to permit Respondent to profit from its own wrongdoing. As stated earlier,
Respondent could subcontract the work, but it first was obligated to bargain with the Union over
the decision and the effects of that decision.
As I have found that on January 22, 2020, no lawful impasse existed, Respondent’s
implementation of its decision to subcontract the bargaining unit work, without the agreement of
the Union, was violative of Section 8(a)(1) and (5) of the Act.
B. Paid Leave for Valverde
In cases involving dual motivation, the Board employs the test set forth in Wright Line, A
Division of Wright Line, Inc., 251 NLRB 1083, 1089 (1980), enfd. 662 F.2d 899 (1st Cir. 1981),
cert. denied, 455 U.S. 989 (1982), approved in NLRB v. Transportation Management Corp., 462
U.S. 393, 399-403 (1983). Initially, the General Counsel must establish by a preponderance of
the credible evidence that anti-union sentiment was a “motivating factor” for the discipline or
discharge. This means that General Counsel must prove that the employee was engaged in
protected activity, that the employer knew the employee was engaged in protected activity, and
that the protected activity was a motivating reason for the employer’s action. Wright Line, supra,
251 NLRB at 1090. Unlawful motivation may be found based upon direct evidence of employer
animus toward the protected activity. Robert Orr/Sysco Food Services, 343 NLRB 1183 (2004).
Alternatively, proof of discriminatory motivation may be based on circumstantial evidence, as
described in Robert Orr/Sysco Food Services, supra:
To support an inference of unlawful motivation, the Board looks to such factors
as inconsistencies between the proffered reasons for the discipline and other
actions of the employer, disparate treatment of certain employees compared to
other employees with similar work records or offenses, deviations from past
practice, and proximity in time of the discipline to the union activity. Embassy
Vacation Resorts, 340 NLRB No. 94, slip op. at 3 (2003).
If the General Counsel has satisfied the initial burden, the burden of persuasion shifts to
Respondent to show by a preponderance of the credible evidence that it would have taken the
same action even in the absence of the employee’s protected activity. If Respondent advances
reasons which are found to be false, an inference that the true motive is an unlawful one may be
warranted. Shattuck Denn Mining Corp. v. NLRB, 362 F.2d 466, 470 (9th Cir. 1966); Limestone
Apparel Corp., 255 NLRB 722 (1981), enfd. 705 F.2d 799 (6th Cir. 1982). However,
Respondent’s defense does not fail simply because not all the evidence supports its defense or
because some evidence tends to refute it. Merrilat Industries, 307 NLRB 1301, 1303 (1992).
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Ultimately, the General Counsel retains the burden of proving discrimination. Wright Line, supra,
251 NLRB at 1088, n. 11.
In the instant case, Respondent placed Valverde on paid administrative leave due to its
belief that Valverde would be upset by Respondent’s withdrawal of recognition of the Union.
Respondent admitted that Valverde was a strong Union supporter. Further, Respondent
requested Valverde not to make any contact with any employees of Respondent. Under the
circumstances, I find that General Counsel has established that Valverde was placed on paid
leave because he was a strong Union supporter and because Respondent did not want him to
have contact with other employees.
I find Respondent’s evidence that Valverde was “volatile at times”, without objective
support, insufficient to establish that it would have taken this action in the absence of Valverde’s
Union support. Accordingly, I find that Respondent violated Section 8(a)(3) and (1) of the Act in
placing Valverde on paid leave.
Conclusions of Law
1. Respondent is an employer engaged in commerce and in a business affecting
commerce within the meaning of Section 2(6) and (7) of the Act.
2. The Union is a labor organization within the meaning of Section 2(5) of the Act.
3. Respondent violated Section 8(a)(5) and (1) of the Act by unilaterally subcontracting
bargaining unit work on February1, 2010.
4. Respondent violated Section 8(a)(3) and (1) by placing employee Michael Valverde
on administrative leave on January 22, 2010.
5. Respondent’s conduct above are unfair labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act.
Remedy
Having found Respondent engaged in certain unfair labor practices, I shall recommend
that it be ordered to cease and desist therefrom and take certain affirmative action to effectuate
the purposes and policies of the Act.
Respondent having unlawfully laid off employees Valverde and Leri, must offer them
reinstatement and make them whole for any loss of earnings and other benefits, computed on a
quarterly basis from date of discharge to date of proper offer of reinstatement, 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).
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On these findings of fact and conclusions of law and on the entire record, I issue the
following recommended:3
ORDER
The Respondent, IFG-Stockton Management, LP, its officers, agents, successors, and
assigns shall
1. Cease and desist from
(a) Refusing to bargain collectively by unilaterally subcontracting the bargaining unit
work.
(b) Placing employees on paid administrative leave because of their union
sympathies.
(c) Laying off employees, without bargaining in good faith with the Union or in order
to discourage union activities and union membership.
(d) Withdrawing recognition from the Union as the exclusive collective-bargaining
representative of Respondent’s employees in the unit described below.
(e) Refusing to meet and bargain with the Union as the exclusive collective-
bargaining representative of Respondent’s employees in the appropriate bargaining unit with
respect to rates of pay, hours of employment, and other terms and conditions of employment.
(f) 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) Upon request, meet and bargain with the Union as the exclusive collective-
bargaining representative of its employees in the appropriate bargaining unit described below
with respect to rates of pay, hours of employment, and other terms and conditions, and if an
understanding is reached, embody such understanding in a signed agreement. The appropriate
bargaining unit is:
All employees performing work described in and covered by “Section1. Union
Recognition” of the January 1, 2007 through December 31, 2009 collective bargaining
agreement between Respondent and the Union, excluding all other employees,
guards and supervisors as defined in the Act.
(b) Within 14 days from the date of this Order, offer Michael Valverde and Brion Leri
full reinstatement to their former jobs or, if those jobs no longer exists, to substantially

3 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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equivalent positions, without prejudice to their seniority or any other rights or privileges
previously enjoyed but for their unlawful discharges.
(c) Make Valverde and Leri 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.
(d) Preserve and, on request, make available to the Board or its agents for
examination and copying, all payroll records, social security payment records, timecards,
personnel records and reports, and all other records necessary to analyze the amount of
backpay due under the terms of this Order.
(e) Within 14 days after service by the Region, post at its facility in Stockton,
California copies of the attached notice marked “Appendix.”4 Copies of the notice, on forms
provided by the Regional Director for Region 32, 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 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 January 23, 2010.
(f) Within 21 days after service by the Region, file with the Regional Director for
Region 32, a sworn certification of a responsible official on a form provided by Region 32
attesting to the steps the Respondent has taken to comply herewith.
Dated, Washington, D.C., August 19, 2010.
____________________
Jay R. Pollack
Administrative Law Judge

4 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)–35–10
Stockton, CA
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 refuse to bargain collectively by unilaterally subcontracting the bargaining unit
work.
WE WILL NOT place employees on paid administrative leave because of their union
sympathies.
WE WILL NOT lay off employees, without bargaining in good faith with the Union or in order to
discourage union activities and union membership.
WE WILL NOT withdraw recognition from the Union as the exclusive collective bargaining
representative of Respondent’s employees in the unit described below.
WE WILL NOT refuse to meet and bargain with the Union as the exclusive collective bargaining
representative of Respondent’s employees in the appropriate bargaining unit with respect to
rates of pay, hours of employment, and other terms and conditions of employment.
WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the
exercise of the rights guaranteed them by Section 7 of the Act.
WE WILL upon request, meet and bargain with the Union as the exclusive collective bargaining
representative of our employees in the appropriate bargaining unit described below with respect
to rates of pay, hours of employment, and other terms and conditions, and if an understanding is
reached, embody such understanding in a signed agreement. The appropriate bargaining unit
is:
All employees performing work described in and covered by “Section 1. Union
Recognition” of the January 1, 2007 through December 31, 2009 collective
bargaining agreement between Respondent and the Union, excluding all other
employees, guards and supervisors as defined in the Act.
JD(SF)–35–10
Stockton, CA
WE WILL offer Michael Valverde and Brion Leri full reinstatement to their former jobs or, if those
jobs no longer exist, to substantially equivalent positions, without prejudice to their seniority or
any other rights or privileges previously enjoyed but for their unlawful discharges.
WE WILL Make Valverde and Brion Leri whole for any loss of earnings and other benefits
suffered as a result of the discrimination against them, with interest.
IFG-Stockton Management, LP
(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.
1301 Clay Street, Federal Building, Room 300N, Oakland, CA 94612-5211
(510) 637-3300, Hours: 8:30 a.m. to 5 p.m.
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, (510) 637-3270.
THIS NOTICE AND THE DECISION IN THIS MATTER ARE PUBLIC DOCUMENTS
Any interested individual who wishes to request a copy of this Notice or a complete copy of the
Decision of which this Notice is a part may do so by contacting the Board's Offices at the
address and telephone number appearing immediately above.