J F Morris Co.

National Labor Relations Board - Board Decisions

Feb 8, 1989

292 N.L.R.B. 869 (N.L.R.B. 1989)

J F MORRIS CO
J F Moms Company and Francis W Schantz, a
Single Employer and Local 124, International
Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America , AFL-CIO
Case 7-CA-27865
February 8, 1989
DECISION AND ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
JOHANSEN AND HIGGINS
Upon a charge filed by the Union on March 15,
1988, as amended on April 18, 1988, the General
Counsel of the National Labor Relations Board
issued a complaint against J F Morns Company
and Francis W Schantz, a Single Employer, the
Respondent, alleging that it has violated Section
8(a)(1) and (5) of the National Labor Relations
Act Although properly served copies of the
charge, amended charge, and complaint, the Re-
spondent has failed to file an answer
On June 20, 1988, the General Counsel filed a
Motion for Summary Judgment On June 23, 1988,
the Board issued an order transferring the proceed-
ing to the Board and a Notice to Show Cause why
the motion should not be granted The Respondent
filed no response The allegations in the motion are
therefore undisputed
The National Labor Relations Board had dele-
gated 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 Regula-
tions provides that the allegations in the complaint
shall be deemed admitted if an answer is not filed
within 14 days from service of the complaint,
unless good cause is shown The complaint states
that unless an answer is filed within 14 days of
service, "all the allegations in the complaint shall
be deemed to be admitted to be true and shall be so
found by the Board " Further, the undisputed alle-
gations in the Motion for Summary Judgment dis-
close that the Regional Attorney for Region 7, by
letter dated May 13, 1988, notified the Respondent
that unless an answer was received by May 27,
1988, a Motion for Summary Judgment would be
filed In the absence of a good cause being shown
for the failure to file a timely answer, we grant the
General Counsel's Motion for Summary Judgment
On the entire record, the Board makes the fol-
lowing
FINDINGS OF FACT
I JURISDICTION
869
The Respondent, J F Morris Company, a
Michigan corporation, had been engaged in operat
Ing a cartage company at its Ecorse, Michigan
place of business until February 1, 1988, at which
time it moved to Melvindale, Michigan During the
year ending December 31, 1987, a representative
period, the Respondent in the course and conduct
of its business operations provided services valued
in excess of $50,000 for National Steel Corporation,
Great Lakes Steel Division, located in Ecorse,
Michigan During the same calendar year, Great
Lakes Steel sold and shipped from its Ecorse,
Michigan facility products, goods, and materials
valued in excess of $50,000 directly to points out-
side the State of Michigan We find that the Re-
spondent is an employer engaged in commerce
within the meaning of Section 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
At all material times , Respondents J F Morris
Company and Francis W Schantz have been alter
egos and a single employer within the meaning of
the Act i
Since about August 28, 1985, the Union has been
the designated and recognized exclusive collective-
bargaining representative of the employees in the
following appropriate unit
All full-time and regular part-time truck driv-
ers and employee owner-operators employed
by Respondents at Respondent-Morris' Ecorse,
Michigan, place of business, but excluding all
guards and supervisors as defined in the Act
Recognition has been embodied in a collective bar-
gaining agreement effective until March 31, 1988
The Union continues to be the exclusive represent-
ative under Section 9(a) of the Act
Since about September 15, 1985, without provid-
ing the Union the notice required by Section 8(d)
of the Act, the Respondent has failed to pay wage
rates and make fringe benefit fund contributions as
required by the collective-bargaining agreement
and has retained employees' paycheck deductions
intended as contributions to the fringe benefit
1 Respondent Schantz is president and chairman of Respondent J F
Morns Company s board of directors Schantz possessed or exercised sole
control over the business functions and labor relations of Respondent
J F Morns Company solely determined to subcontract the Respond
ent s payroll functions and to reimburse and sell its operating license In
addition Schantz was personally and individually involved in the unfair
labor practices herein found
292 NLRB No 94
870 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
funds 2 Further, in December 1987, without pro-
viding the Union prior notice and an opportunity
to bargain, the Respondent engaged Atlantic West-
ern Personnel Leasing Company as a payroll agent
of its unit employees in order to evade its obliga
tions under the collective-bargaining agreement,
and, in March 1988 , sold its Michigan operating li-
cense to Able Cartage of Michigan , Inc, and trans-
ferred its unit employees to that company
Based on the above, we find that the Respondent
has refused to bargain collectively with the Union
as the exclusive representative of the unit employ
ees by, without prior notice to the Union, unilater-
ally changing terms and conditions of employment
and by refusing to bargain over the effects of its
decision to terminate its operations by selling its
operating license , all in violation of Section 8(a)(5)
and (1) of the Act
CONCLUSIONS OF LAW
I By failing since September 15, 1985, without
providing the Union notice required by Section
8(d) of the Act, to pay wage rates and make fringe
benefit fund contributions required by the collec
tive-bargaining agreement and by retaining employ-
ees' paycheck deductions intended as contributions
to the fringe benefit funds, the Respondent has en-
gaged in unfair labor practices affecting commerce
within the meaning of Section 8 (a)(1) and (5) and
Section 2(6) and (7) of the Act
2 By engaging another company as the payroll
agent of its unit employees and by selling its oper-
ating license to another company and transferring
its unit employees to that company, without giving
the Union prior notice and an opportunity to bar
gain over the effects of its decision to terminate its
operations , the Respondent has engaged in unfair
labor practices affecting commerce within the
meaning of Section 8(a)(1) and (5) and Section 2(6)
and (7) of the Act
2 Despite the language of Sec 10(b) of the Act which provides in rel
evant part that no complaint shall issue based on any unfair labor prac
tice occurring more than six months prior to the filing of the charge with
the Board the Board has held that the limitation period is tolled
until the adversely affected party receives actual or constructive notice of
the alleged unlawful conduct Drukker Communications 258 NLRB 734
(1981) and Wisconsin River Valley Council (Skippy Enterprises) 211
NLRB 222 226-227 ( 1974) enfd 532 F 2d 47 (7th Cir 1976) Because
the Respondent failed to file any answer to the complaint specifically
one pleading the affirmative defense of Sec 10 (b) it obviously cannot
meet what would have been its burden-to show that the Union had
knowledge of the alleged unfair labor practices more than 6 months
before it filed the charge Accordingly the violations and remedy shall
be found to have commenced with the Respondents failure to abide by
the contract See Burgess Construction 227 NLRB 765 766 ( 1977) enfd
596 F 2d 378 (9th Cir 1979)
REMEDY
Having found that the Respondent has engaged
in certain 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 3
We shall order the Respondent to make the re-
quired contributions to the union fringe benefit
funds and to transmit to the funds the contributions
it has failed to make since September 15, 1985 4
We shall also order the Respondent to make whole
unit employees for any loss of benefits caused by
its failure to make these required fund contributions
and to reimburse employees for any expenses ensu-
ing from the Respondent's unlawful failure to make
such contributions, as set forth in Kraft Plumbing &
Heating, 252 NLRB 891 fn 2 (1980), enfd 661 F 2d
940 (9th Cir 1981) We shall further order the Re
spondent to make all affected unit employees
whole for losses they incurred by virtue of its fail-
ure to pay the proper wage rates since September
15, 1985 Such backpay shall be computed in ac
cordance with Ogle Protection Service, 183 NLRB
682, 683 (1970), enfd 444 F 2d 502 (6th Cir 1971)
Interest on reimbursements and backpay shall be
computed in the manner prescribed in New Hori-
zons for the Retarded 5
We shall order the Respondent to bargain with
the Union over the effects of the cessation of its
operations on the Respondent's employees repre-
sented by the Union With respect to this require-
ment, and in order to create circumstances under
which the obligation to bargain will be accompa-
nied by economic consequences, we shall order the
Respondent to pay its employees, in addition to the
backpay owed from September 15, 1985, until the
date the Respondent's operations ceased, amounts
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 the occurrence of the
earliest of the following conditions (1) the date the
Respondent bargains to agreement with the Union
on those subjects pertaining to the effects of the
Respondent's cessation of operations, (2) a bona
fide impasse in bargaining, (3) the failure of the
3 Because it is apparent from the General Counsel s motion that the
Respondent closed its operations in March 1988 we find it appropriate to
require the Respondent to mail copies of the notice to all unit employees
employed at the time of the closure See e g Print Quic 262 NLRB 857
862 fn 19 (1982)
4 Any interest or other additional amounts owed with respect to these
fund contributions shall be calculated in the manner set forth in
Merryweather Optical Co 240 NLRB 1213 (1979)
5 283 NLRB 1173 (1987) Interest will be computed at the short term
Federal rate for the underpayment of taxes as set out in the 1986 amend
ment to 26 U S C § 6621 Interest on amounts accrued before January 1
1987 shall be computed under Florida Steel Corp 231 NLRB 651 (1977)
J F MORRIS CO
Union to commence negotiations within 5 days of
the Respondent's notice of its desire to bargain
with the Union, or (4) the subsequent failure of the
Union to bargain in good faith, but in no event
shall this additional sum paid to any of these em-
ployees exceed the amount each would have
earned as wages from the time the Respondent dis-
continued its operations to the time each secured
equivalent employment elsewhere, or the date on
which the Respondent offers to bargain, whichever
occurs first, provided, however, in no event will
this sum be less than the employees would have
earned for a 2-week period at the rate of their
normal wages when last in the Respondent's
employ Backpay shall be based on earnings that
the employees would normally have received
during the applicable period, less any net interim
earnings, and shall be computed on a quarterly
basis 'n the manner set forth in F W Woolworth
Co, 90 NLRB 289 (1950), with interest thereon
computed in the manner prescribed in New Hori-
zons for the Retarded, supra
ORDER
The National Labor Relations Board orders that
the Respondent, J F Morris Company and Fran-
cis W Schantz, Melvindale, Michigan, its officers,
agents , successors , and assigns, shall
1 Cease and desist from
(a) Failing to bargain with the Union by failing
to make required contributions on behalf of its unit
employees to union fringe benefit funds, by retain-
ing deductions from employees' paychecks intend-
ed as contributions to the union fringe benefit
funds, and by failing to pay unit employees the
contractually required wage rates
(b) Failing and refusing to bargain with the
Union by engaging another company as the payroll
agent of its unit employees and by selling its oper-
ating license to another company and transferring
its unit employees to that company, without giving
the Union prior notice and an opportunity to bar-
gain over the effects of terminating its operations
(c) In any like or related manner interfering
with, restraining, or coercing employees in the ex
ercise of the rights guaranteed them by Section 7
of the Act
2 Take the following affirmative action neces-
sary to effectuate the policies of the Act
(a) Pay into the funds, on behalf of its unit em-
ployees, those contributions it failed to make as a
result of its unlawful discontinuance of fund pay-
ments, in the manner set forth in the remedy sec-
tion of this Decision and Order
(b) Make whole unit employees for any losses in
wages and expenses they may have suffered as a
871
result of the failure to adhere to the collective-bar-
gaining agreement, in the manner set forth in the
remedy section of this Decision and Order
(c) On request, bargain collectively with the
Union with respect to the effects on its unit em-
ployees of its decision to terminate its operations,
and reduce to writing any agreement reached as a
result of such bargaining The appropriate unit is
All full-time and regular part-time truck driv-
ers and employee owner operators employed
by Respondents at Respondent Morris' Ecorse,
Michigan, place of business, but excluding all
guards and supervisors as defined in the Act
(d) Make whole its unit employees by paying
those employees employed when the Respondent
terminated its operations normal wages plus inter-
est and in the manner set forth in the remedy sec
tion of this Decision and Order
(e) Preserve and, on request, make available to
the Board or its agents for examination and copy-
ing, all payroll records, social security payment
records, timecards, personnel records and reports,
and all other records necessary to analyze the
amount of backpay and other money due under the
terms of this Order
(f) Mail signed and dated copies of the attached
notice marked "Appendix" to the last known ad-
dresses of all unit employees as of the sale of the
Respondent's business Copies of the notice, on
forms provided by the Regional Director for
Region 7, after being signed by the Respondent's
authorized representative, shall be mailed by the
Respondent immediately upon receipt
(g) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondent has taken to comply
B 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 Nation
al Labor Relations Board shall read Posted Pursuant to a Judgment of
the United States Court of Appeals Enforcing an Order of the National
Labor R-lations Board
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 the National Labor Relations Act
and has ordered us to post and abide by this notice
WE WILL NOT fail to make required contribu
tions on behalf of our unit employees to the union
fringe benefit funds
872 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
WE WILL NOT retain deductions from employee
paychecks , which were intended as contributions
to the union fringe benefit funds
WE WILL NOT fail to pay unit employees the
contractually required wage rates
WE WILL NOT engage another company as the
payroll agent of our employees or sell our operat-
ing license to another company without giving the
Union prior notice and an opportunity to bargain
in good faith over the effect on our employees of
our decision to close our operations
WE WILL NOT in any like or related manner
interfere with , restrain, or coerce you in the exer-
cise of the rights guaranteed you by Section 7 of
the Act
WE WILL pay into the union fringe benefit funds
those contributions we failed to make as a result of
our unlawful discontinuance of fund payments
WE WILL make unit employees whole for any
losses or expenses they may have suffered as a
result of our unilateral discontinuance of fund con-
tributions and our failure to pay contractually re-
quired wage rates , with interest
WE WILL make unit employees whole by paying
those terminated when we closed our operations
normal wages for the period specified by the Na-
tional Labor Relations Board , with interest
WE WILL, on request , bargain collectively with
the Union with respect to the effects on our unit
employees of our decision to close our operations,
and reduce to writing any agreement reached as a
result of such bargaining
All full time and regular part-time truck driv-
ers and employee owner-operators employed
by Respondents at Respondent Morris ' Ecorse,
Michigan , place of business , but excluding all
guards and supervisors as defined in the Act
J F MORRIS COMPANY AND FRAN-
CIS W SCHANTZ, A SINGLE EMPLOY
ER