Jays Foods, Inc.

National Labor Relations Board - Board Decisions

Feb 24, 1977

228 N.L.R.B. 423 (N.L.R.B. 1977)

JAYS FOODS, INC. 423
Jays Foods, Inc. and Robert Lull and Retail Clerks
Union Local 1550, affiliated with Retail Clerks
International Association , AFL-CIO
Nielsen Brothers Cartage Co ., Inc. and Robert Lull.
Cases 13-CA-14889, 13-CA-14955, and 13-CA-
14890
February 24, 1977
DECISION AND ORDER
BY CHAIRMAN MURPHY AND MEMBERS
FANNING AND JENKINS
On September 3, 1976, Administrative Law Judge
Sidney J. Barban issued the attached Decision in this
proceeding. Thereafter, Respondents, Jays Foods,
Inc., and Nielsen Brothers Cartage Co., Inc., filed
exceptions and a brief, and the General Counsel filed
exceptions and a brief. The Respondents and the
General Counsel filed answering briefs to the respec-
tive exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and briefs
and has decided to affirm the rulings, findings,' and
conclusions of the Administrative Law Judge and to
adopt his recommended Order as modified herein.
We agree with the findings of the Administrative
Law Judge that when Respondent Jays Foods
contracted out its delivery operation on November
14, 1975, to Nielsen Brothers Cartage Co., Inc., and
discharged its truckdrivers, it did so for discriminato-
ry reasons in violation of Section 8(a)(1) and (3) of
the Act. However, we do not agree with the Adminis-
trative Law Judge's recommended remedy for such
conduct, which does not require Respondent Jays
Foods to resume its delivery operations and to offer
reinstatement to the 26 discriminatees.
As the Administrative Law Judge correctly points
out, the remedy of resumption of operations is the
normal remedy in the factual situation here, particu-
larly since the record shows that such a resumption of
operations would not create any undue hardship.
Respondent Jays Foods is a successful and finan-
cially sound operation and had conducted its own
delivery operations for over 30 years. Although Jays
Foods has contracted out this work to Nielsen, the
1 Respondent Jays Foods has excepted to certain credibility findings
made by the Administrative Law Judge It is the Board's established policy
not to overrule an Administrative Law Judge 's resolutions with respect to
credibility unless the clear preponderance of all of the relevant evidence
convinces us that the resolutions are incorrect Standard Dry Wall Products,
Inc, 91 NLRB 544 (1950 ), enfd 188 F 2d 362 (C A 3, 1951 ) We have
delivery trucks and other equipment continue to be
housed on Jays Foods' property and, in fact, the
trucks still have Jays Foods' name on them. The
truckdrivers, now employed by Nielsen, report to
Jays Foods' premises, the same as before the con-
tracting out. There they are dispatched daily by a
dispatcher employed by Nielsen from an office in
Jays Foods' plant.
Under the provisions of the contract between Jays
Foods and Nielsen, the agreement can be canceled
upon 30 days' notice in writing by either party, and
Jays Foods has the right to repurchase the vehicles at
a certain time period in accordance with the condi-
tions set forth in the contract. Thus, the physical and
legal ties of the delivery service operations have not
been completely severed, and Jays Foods' resumption
of the delivery operation at any time could be easily
effected.
Apparently, the reason the Administrative Law
Judge did not consider it necessary to order Jays
Foods to resume the delivery operations is that he
considered the status quo as providing a substantially
adequate affirmative remedy for the unfair labor
practices. He indicated he was strongly influenced by
the fact that Nielsen had eventually voluntarily hired
23 of the 26 discharged employees to perform Jays
Foods' delivery operation in apparently the same
manner as before. He also was persuaded by the fact
that the wages and other benefits of the drivers may
be better than those enjoyed before Jays Foods
contracted out the operation. We find the rationale of
the Administrative Law Judge unconvincing and
legally unsupportable under the facts of this case.2
Admittedly, the discriminatees are paid a higher
hourly rate working for Nielsen. However, part of the
higher wage scale can oe attributed to normal raises
which were periodically given, and it is pure specula-
tion to assume, as does the Administrative Law
Judge, that the truckdrivers would not have received
similar raises, or that they would receive pay cuts if
they returned to work for Jays Foods. Moreover, the
record shows that the discriminatees received mone-
tary benefits at Jays Foods which they do not enjoy at
Nielsen, such as substantial yearly bonuses and free
meals and coffee. Furthermore, as the Administrative
Law Judge specifically noted, the seniority and job
security at Nielsen, where they are now employees
with low seniority, may not compare with that
enjoyed at Jays Foods.
Our concern also is that the remedy recommended
by the Administrative Law Judge permits Respon-
carefully examined the record and find no basis for reversing his findings.
2 Cf, e g, Walker Company, 183 NLRB 1322 (1970), Bruce E Kronen.
bergh and Herbert Schoenbrod d/b/a American Needle & Novelty Company,
206 NLRB 534 (1973); Akron Novelty Manufacturing Company, 224 NLRB
998 (1976), Serv-U-Stores, Inc, 225 NLRB 37 (1976), Sunflower Novelty
Bags, Inc, 225 NLRB 1331 (1976).
228 NLRB No. 54
424 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
dent Jays Foods to be rewarded for its illegal activity.
The organizational efforts of its employees have been
effectively frustrated and Jays Foods has succeeded
in avoiding union organization. We find that the
payment of the modest amount of backpay required
and the posting of the notices recommended by the
Administrative Law Judge are insufficient remedies
to effectuate the policies of the Act.
In brief, the remedy recommended by the Adminis-
trative Law Judge falls short of making the discrimi-
natees whole. The record shows that three truckdri-
vers who had been discriminatorily discharged have
not been hired by Nielsen. In accepting a job with
Nielsen the other discriminatees are required under
the union security of the collective-bargaining con-
tract to join a union not of their own choosing.
Indeed, they must join a union which the majority of
the employees in the Jays Foods' unit had earlier
rejected.
For the above reasons we shall require Respondent
Jays Foods to resume its former operations and
reestablish the status quo ante, to the extent necessary
to provide jobs for those who desire reinstatement in
Jays Foods' employment as provided below.
ADDITIONAL REMEDY
Having found that Respondent Jays Foods has
engaged in certain unfair labor practices, we shall
order it to cease and desist therefrom and take certain
affirmative action necessary to effectuate the policies
of the Act as recommended by the Administrative
Law Judge in the Remedy provided for in his
Decision.
For the reasons discussed above, however, we have
found that the Administrative Law Judge's refusal to
require Respondent Jays Foods to resume its delivery
operations would not effectuate the policies of the
Act. Accordingly, we shall order that Respondent
Jays Foods reestablish that operation and reinstate
the employees discriminatorily discharged when the
delivery work was contracted out. We shall also
award the employees involved backpay based on the
earnings they normally would have received from the
date of their discharge to the date of Respondent Jays
Foods' offer of reinstatement, less any net interim
earnings, which shall be computed on a quarterly
basis, in the manner set forth in F. W. Woolworth
Company, 90 NLRB 289 (1950), with interest at the
rate of 6 percent per annum as set forth in Isis
Plumbing & Heating Co., 138 NLRB 716 (1962).
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge as
modified herein and hereby orders that the Respon-
dent, Jays Foods, Inc., Chicago, Illinois, its officers,
agents, successors, and assigns, shall take the action
set forth in said recommended Order as so modified:
1. Substitute the following for paragraph 2(b):
"(b) Reestablish its delivery operations and offer to
the following employees immediate and full reinstate-
ment to their former jobs or, if those jobs no longer
exist, to substantially equivalent positions, without
prejudice to their seniority or other rights and
privileges, and make each of them whole for any loss
of earnings they may have suffered in the manner
provided in the section of the Board's Decision and
Order entitled `Additional Remedy':
"Siebert Kuiken Gerald Dildine
Richard McCormick Charles Merrick
Jack Whelan Raymond Prince
Paul Knott James Chapman
Albert Philp Dennis Altgilbers
Robert Lull Edward Sallay
Henry Goodman Craig Mullins
Thomas Richards Lawrence Rossi
Charles Dietz David Butkus
James Paluch Raymond Hansen
Robert Vitner Lauren Hodson
Gary Redelsperger Ronald Davis
Charles Vogel John Short"
2. Delete paragraph 2(c) and reletter the following
paragraphs accordingly.
3. Substitute the attached notice for that of the
Administrative Law Judge.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Act gives all
employees these rights:
To form, join, or assist labor organizations
To bargain collectively through represen-
tatives of their own choosing
To engage in other concerted activities for
the purpose of collective bargaining or other
mutual aid or protection
To refrain from any or all such activities,
except as may be required by a legal agree-
ment between an employer and the represen-
tative of the employees.
WE WILL NOT discharge or discriminate against
our employees because they join or help Retail
JAYS FOODS, INC. 425
Clerks Union Local 1550, affiliated with Retail
Clerks International Association, AFL-CIO, or
Local 705 , International Brotherhood of Team-
sters , Chauffeurs, Warehousemen and Helpers of
America, or any other labor organization.
WE WILL NOT grant or promise to grant increas-
es in wages or other benefits in order to induce our
employees not to engage in union activities.
WE WILL NOT threaten to withhold wage in-
creases or other benefits because our employees
engage in activities on behalf of a union.
WE WILL NOT threaten to close our operations,
or any part of our operations, or contract out our
operations, or sell our equipment because our
employees have engaged in activities on behalf of
a union.
WE WILL NOT coercively interrogate our em-
ployees concerning membership in or activities on
behalf of a union.
WE WILL NOT in any other manner interfere
with, restrain , or coerce our employees in the
exercise of rights guaranteed by law.
WE WILL offer Edward Olson immediate and
full reinstatement to his former job or, if that job
no longer exists , to a substantially equivalent job,
without prejudice to his seniority, or other rights
and privileges, or working conditions, and, WE
WILL make Edward Olson whole for any loss of
pay or other benefits suffered by him as a result of
the discrimination against him.
WE WILL resume our delivery operations and
take the delivery operations away from Nielsen
Cartage. We shall offer the employees named
below immediate and full reinstatement to their
former jobs or, if those jobs no longer exist, to
substantially equivalent jobs, without prejudice to
their seniority, or other rights, privileges, or other
working conditions:
Siebert Kuiken
Richard McCormick
Jack Whelan
Paul Knott
Albert Philp
Robert Lull
Henry Goodman
Gerald Dildine
Charles Merrick
Raymond Prince
James Chapman
Dennis Altgilbers
Edward Sallay
Thomas Richards
Charles Dietz
James Palach
Robert Vitner
Gary Redelsperger
Charles Vogel
John Short
Lawrence Rossi
David Butkus
Raymond Hansen
Lauren Hodson
Ronald Davis
Craig Mullins
WE WILL make the employees named above
whole for any loss of earnings or benefits they
may have lost by reason of their discharge on
November 14, 1975.
JAYS FOODS, INC.
DECISION
STATEMENT OF THE CASE
SIDNEY J. BARBAN, Administrative Law Judge: This
matter was heard at Chicago, Illinois, on April 26, 27, 28,
29, and 30 and May 4, 5, and 6, 1976, upon complaints
issued in the above cases consolidated by an order issued
on January 27, 1976.1 The consolidated complaints allege
that (a) Respondent Jays Foods, Inc. (herein sometimes
Jays) interrogated employees concerning union activities;
granted a wage increase to induce employees to refrain
from union activities ; threatened to withhold a wage
increase from employees engaging in union activities;
advised employees that management of Jays was angry and
would sell its trucks and contract out its delivery operations
because employees had engaged in union activities; and
stated that employees would lose benefits if a union were
selected as their representative , all in violation of Section
8(a)(1) of the Act; (b) Respondent Jays, on or about
November 14, 1975, ceased its delivery operations, sold its
trucks, and contracted its delivery operations to Respon-
dent Nielsen Brothers Cartage Co ., Inc. (herein sometimes
Nielsen Cartage), and discharged 26 named employees,
because its employees had engaged in union activities, all in
violation of Section 8(a)(1) and (3) of the Act; (c)
Respondent Nielsen Cartage refused to hire 5 named
employees (who had been discharged by Jays) because they
had engaged in union activities, in violation of Section
8(a)(1) and (3) of the Act; (d) Nielsen Cartage is and has
been a successor employer with respect to the delivery
operations of Jays, and at all material times had knowledge
of Jays' alleged unfair labor practices in ceasing its delivery
operations, selling its trucks , and contracting its delivery
operations to Nielsen Cartage and discharging its employ-
ees; and (e) Jays, on or about December 1, 1975, discharged
Edward Olsen because of his union or other protected
concerted activities in violation of Section 8(a)(1) and (3) of
the Act.
The answers of Jays and Nielsen Cartage ( sometimes
jointly referred to as the Respondents) deny the commis-
sion of the alleged unfair labor practices , but admit
allegations in the complaints sufficient to justify the
assertion of jurisdiction over Respondents under current
standards of the Board. (Jays produced and distributed
snack foods in a recent annual period of a value in excess of
$50,000 which it shipped in interstate commerce ; Nielsen,
engaged in the trucking and delivery business , an essential
link in the chain of interstate commerce , in a recent annual
period performed services valued in excess of $50 ,000 for
enterprises which shipped goods valued in excess of $50,000
I Charges in Cases 13-CA-14889 and 13-CA-14890 were filed on
November 19, 1975, and charges in Case 13-CA- 14995 on December 9,
1975. A consolidated complaint in Cases 13-CA-14889 and 13-CA-14890
issued on January 22, 1976. Complaint in Case 13-CA-14955 issued on
January 26, 1976.
426 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
directly in interstate commerce.) Respondents' answers
admit that Chicago Truck Drivers, Helpers and Warehouse
Workers Union (Independent) (herein the Independent
Union) 2 and Local 705, International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers of
America (herein the Teamsters), and Retail Clerks Union
Local 1550, affiliated with Retail Clerks International
Association, AFL-CIO (herein the Retail Clerks), are labor
organizations within the meaning of the Act.
Upon the entire record in this case,3 from observation of
the witnesses and their demeanor, and after due consider-
ation of the briefs filed by General Counsel, Jays, and
Nielsen, I make the following:
FINDINGS AND CONCLUSIONS
A. Jays' Operations
1. Description: Jays asserts that it is the largest indepen-
dent snack food producer and distributor in the United
States with annual gross sales in excess of $30 million
(Resp. Exh. 10). This operation which began, apparently in
a small way, in 1938, acquired its first tractor-trailer in 1942
or 1943. At times material to this proceeding in 1975 (all
dates herein are in 1975 unless otherwise noted), Jays
operated a manufacturing plant in Chicago, Illinois, at
which it produced or processed certain snack foods. These
products are distributed to certain distribution points in
Chicago (and perhaps elsewhere) operated by Jays, which
are referred to herein as "branches," and to independent
distributors located in four States . To make deliveries from
its plant to its branches and distributors, and among
branches and distributors (referred to herein as delivery
operations), Jays had acquired and owned 27 tractors and
35 trailers and leased 2 additional tractors. These were
located at Jays' plant out of which the truckdrivers
employed by Jays in its delivery operations were dis-
patched.4 At the time Jays sold this equipment and
contracted out its delivery operations, it also had three
additional trailers on order which had not then been
delivered. Immediately prior to November 17, when Jays
contracted out its delivery operations, it employed 26
truckdrivers in this operation.
Jays also employs driver-salesmen at various branches
who take Jays' products from the branches and deliver
them to various grocery stores and other retail outlets on
the routes assigned to each individual driver. As is
customary in this type of industry, the driver-salesmen are
expected to be on the lookout for new accounts in their area
and to aggressively push their employer's products.
Other operations of Jays not directly involved in this
proceeding are not detailed in the record.
2. Managerial and supervisory personnel: Principally
involved in this proceeding are the following:
Leonard Japp, Sr., is president of Jays and clearly
controls its day-to-day operations.
2 Sometimes referred to as Fenner's Union in the transcript in reference
to the executive director of the Independent Union.
3 General Counsel's motion to correct the record by deleting the word
"liar" at p 1262, 1. 18, and inserting the word "lawyer" in its place , which is
unopposed, is hereby granted.
* The term "truckdnvers" or "drivers" will be used to refer to employees
engaged in Jays' delivery operations to drive tractor-trader equipment, in
Silas Martilla is executive vice president for marketing of
Jays and is in charge of Jays' sales activities, and, prior to
November 17, had responsibility for the delivery operations
described above.
John Staton, whose status is at issue in this proceeding, is
either the shipping supervisor, as he described himself in his
prehearing affidavit to the General Counsel, or the assistant
shipping supervisor, as he insisted in his testimony. The title
is not important here. In his affidavit, Staton states that he
has authority to hire and fire dock employees who work at
Jays' plant, which employees apparently, as normal in the
industry, load and unload trucks and handle merchandise
on the docks at Jays' plant. At the hearing, Staton testified
that he has authority to fire dock employees, but only
makes recommendations as to their hire, some of which are
not followed.5 I am satisfied from observation of the
witnesses and from the record as a whole (e.g., Staton's
presence with management at meetings concerned with
truckdrivers' working conditions) that Staton's authority is
greater than Jays' witnesses admit. In any event, since he
exercises one authority-the right to fire-set forth in the
statutory definition, he is clearly a supervisor within the
meaning of the Act, and I so find.
Arthur L. Timmons, Sr., whose status is also in dispute,
carries the title of assistant to the sales manager, special
projects. It is stated that Timmons is assistant to Martilla
and Leonard Japp, Jr., but the record indicates that he
principally reports to the former. Timmons is a son-in-law
of Japp, Sr., and though he does not himself own stock in
Jays, nor is he an officer of the corporation, his wife owns a
substantial amount of such stock and is a member of the
board of directors of Jays. One of Timmons' functions is to
visit consumers who have purchased Jays' products and
have made a complaint. He discusses customers' com-
plaints and attempts to explain the situations and appease
the complainants. He may, offer the customer fresh product
for the product complained of. Timmons' reports of
products complained of are brought to production supervi-
sors for corrective action. Timmons represents Jays at
openings of new stores of chain grocery firms, arranging for
the display of Jays' products. When Jays contemplates
expanding into a new territory, Timmons would investigate
the area and may talk to grocery managers in that area on
behalf of Jays. He makes a report on this investigation to
Martilla. He has some responsibility with respect to
overdue accounts of some chain stores supplied by Jays,
although his testimony concerning this function tended to
be somewhat evasive to the point of being facetious. In the
absence of either the manager or the assistant manager of
one of Jays' branches, Timmons will fill in for the absent
manager, sometimes for several weeks, but it is denied that
he exercises the supervisory authority which admittedly the
manager and the assistant manager possess. On occasion,
Timmons has been assigned to ride with Jays' truckdrivers
and do a timestudy of their work. In this function,
contradistinction to Jays' "driver-salesmen ," who deliver its products to
retail outlets
S At one point Staton testified that he did not have authority to
recommend discharge. To the extent that this is inconsistent with his poor
testimony that he has the right to discharge employees, Staton's denial is not
credited.
JAYS FOODS, INC. 427
Timmons has given truckdrivers road tests and written
examinations required by Government regulations and
certified to these facts as an authorized representative of
Jays. Timmons testified that he also has gone out on a route
to substitute for an absent driver-salesman. Timmons is
paid on a salary basis, and receives in addition a commis-
sion based on Jays' gross volume of sales. Martilla and
Japp, Jr., are the only other individuals receiving such
commission. Based on his income during a recent period, it
would seem that Timmons' income from Jays will substan-
tially exceed $30,000 annually.
The facts set forth and the record herein demonstrates
that Timmons is identified with and is part of the manage-
ment of Jays. In the circumstances of this case, the
employees would reasonably understand that Timmons
spoke for Jays in matters affecting their employment.
Considering all of the factors involved-particularly Tim-
mons' close relationship to the owners of the business, his
authority to represent Jays in dealings with the public, his
frequent substitution for admitted supervisors (it was not
shown that employees were informed that he had, as
claimed, less authority than the absent manager) and his
testing, examining and certification of Jays' truckdrivers as
qualified to be employed-in light of the provisions of
Sections 2(13) and (2) of the Act, I find that Arthur L.
Timmons, Sr., is an agent of Jays within the meaning of the
Act, and that Timmons' conduct, as set forth hereinafter, is
attributable to Respondent for the purposes of the Act. See
Aircraft Plating Company, Inc., 213 NLRB 664 (1974).
As noted above, it is admitted that the managers and
assistant managers of Jays' various branches are supervi-
sors within the meaning of the Act. At times material to this
proceeding, William Brand was manager and Donald C.
Skafgaard, Jr., was assistant manager of Jays' West Branch
where Edward Olson was employed at the time of his
discharge.
B. Background and Summary of Facts
There have been several attempts to organize different
parts of Jays' operations, some of which resulted in
proceedings before the Board. The earliest of these brought
to my attention is reported in 129 NLRB 690 (1960). In that
instance, in June 1959, a local of the International Associa-
tion of Machinists sought to represent the maintenance
workers employed by Jays to maintain approximately 115
vehicles used in the delivery of its products. Jays opposed
the organization attempt, but, in an election on July 21,
1959, the employees voted for the IAM by an overwhelming
majority. Prior to certification, the IAM presented Jays
with a contract which it had with another area employer.
Determining that the rates in the IAM contract were higher
than those it was then paying its maintenance employees,
Jays' maintenance supervisor, Judkins (apparently the same
maintenance supervisor described in the present record),
was instructed to contract out the maintenance operations.
A final decision was made to close the maintenance
department on July 30, 9 days after the election and the
maintenance employees were discharged on July 31. The
Board found that the maintenance employees were dis-
charged because they had sought to exercise their right to
collective bargaining guaranteed by the Act and that Jays
had thereby violated Section 8(a)(1) and (3).6 The Court of
Appeals for the Seventh Circuit set aside the Board's
Decision and Order , 291 F.2d 317 (1961).
For some time Jays also seems to have had considerable
dispute and litigation with Local 1 of the Bakery Workers.
See 148 NLRB 310 (1964) (sustaining union objections to
election); Jays Foods, Inc. v. Local Union #1, American
Bakery and Confectionery Workers ' International Union,
AFL-CIO, 57 LRRM 2495, 50 LC 1 19,324 (C.A. 1, 1964)
(dismissing Jays' petition for review of Board's Order
directing an election), cert. denied 379 U.S. 969 (1965); 255
F.Supp . 822 (1966) (involving a state court suit against the
bakers union).
In 1973, the Independent Union (also called Fenner's
Union) won an election conducted by the Board and was
certified as the bargaining representative of Jays 'truckdriv-
ers. Jays' vice president , Martilla, testified that Jays and
the Independent Union came to an agreement on the terms
of a bargaining contract . It appears that the Independent
Union then advised the drivers that if they did not accept
this agreement that Union would no longer represent them.
When the drivers rejected the contract proposal , the Union
on February 13, 1974, advised the employees that the
Union would no longer negotiate for them and withdrew as
the employees' collective-bargaining representative. Jays
then requested the Regional Office of the Board to revoke
the certification of the Independent Union and on March
IF, 1974, the certification was revoked . Jays, however,
assured the drivers that it would pay the various raises
which had been agreed to with the Independent Union.
In 1975 , Jays' employees became involved in two union
organizational attempts. In July, the Retail Clerks filed a
petition to represent the Company 's driver-salesmen. The
Retail Clerks lost the election on October 2, 1975. Mean-
while, a group of Jays' truckdrivers, on September 26, upset
at the results of the Company's request that they forgo the
wage raise promised for July 1, sought the assistance of the
Teamsters. A further meeting between the Teamsters and
the truckdrivers was set for October 4. However, on
October 3 , Jays suddenly announced to the truckdrivers
that the wage raise they had been asked previously to forgo
until the first of the year would be granted immediately.
Moreover, as discussed in more detail hereinafter, just 2
days before granting this raise to the truckdrivers (and 1
day before the Retail Clerks election), Jays asserts that it
informed Adolph J. Nielsen, president of Nielsen Cartage,
that Jays would contract out to Nielsen the delivery
operations in which the truckdrivers were then employed.
The truckdrivers were notified of this on November 14 and
Nielsen Cartage took over Jays' delivery operations on
November 17, employing some , but not all, of Jays'
truckdrivers.
6 In coming to this conclusion the Board and the Trial Examiner
discredited Jays' contention that it had long considered contracting out its
maintenance operations. It is also noted (as discussed further hereinafter)
that the Trial Examiner in that case placed some emphasis on the fact that,
prior to contracting out its maintenance work, Jays did not make a
comparative cost study and offered no proof that the contracting out had
actually been economically motivated.
428 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Edward Olsen , who had been one of the observers for the
Retail Clerks at the election on October 2, was disch'rged
on December 1.
Case 13-CA-14889
Case 13-CA- 14889 essentially involves the charge that
Jays discontinued its delivery operations , sold its trucks,
contracted out its delivery operations , and discharged its
truckdrivers engaged in those operations because of the
drivers' activities in respect to the Teamsters and that Jays
engaged in certain independent violations of the Act.
1. Union activity
About the last of June 1975, Jays called a meeting of its
truckdrivers in the late afternoon at the plant . Martina,
Staton , Joe Whalen (vice president in charge of advertising
and a son-in-law of Japp , Sr.), and Judkins were present for
management . Martina advised the employees that, because
of certain economic strictures which the Company was
experiencing , Jays was trying to cut back on expenditures.
He referred to the 32-cent-per-hour raise that would be due
the truckdrivers on July 1 under the commitment made to
them after the Independent Union withdrew as their
representative , and requested their cooperation in agreeing
to forgo the increase until the first of the following year.
After the management personnel had left the room, the
truckdrivers, led by Robert Lull, voted to agree with the
Company's request and Lull advised Martilla that the
truckdrivers would cooperate and the wage increase could
be deferred as Martina had requested.
The truckdrivers, or some of them, thereafter became
disillusioned with this decision, based mainly on their
discovery that the Company had thereafter employed a new
production supervisor who they thought was being paid in
part with their deferred pay raise. For some time they
discussed contacting the Teamsters. Six truckdrivers (Lull,
Kuiken, McCormick, Goodman, Paluch, and Hodson)
finally met with agents of the Teamsters, on September 26,
at the Teamsters hall. All of them signed authorization
cards for the Teamsters. At this meeting the Teamsters
agents told the employees that the Teamsters would not be
interested in becoming involved unless assured that a
majority of the truckdrivers desired representation by the
Teamsters. It was agreed that the six employees would
attempt to have as many of the truckdrivers as possible
attend a meeting with Teamsters agents on Saturday,
October 4. During the succeeding week, this was much
talked about among the truckdrivers with the result that
almost all the truckdrivers employed by Jays attended the
meeting at a local motel . However, for reasons not shown
by the record, the Teamsters agents did not appear as
promised, and did not contact the truckdrivers to explain
that they would not come to the meeting.
Knowledge of this activity to secure representation by the
Teamsters was soon known to Jays. Thus, when Staton
r This clearly referred to Martilla's promise to abide by the wage
provisions of the proposed agreement with the Independent Union
8 At the hearing , General Counsel offered Chapman's prehearing affida-
vit assertedly to rebut an implied charge of recently fabricated testimony
inherent in the cross-examination of Chapman. I rejected this offer. General
returned from vacation in September, he was told that the
truckdrivers were contacting the Union . (Staton states that
he does not recall who told him this and denies that he
knew what union was involved .) Staton thereupon ques-
tioned several truckdrivers as to whether the employees had
contacted the Union, and asked why they would want a
union, stating his understanding that the employees had an
agreement with Martilla .7 Staton received only negative
responses from the employees to his questions. Staton's
conduct is alleged as interrogation violative of the Act. This
will be dealt with hereinafter.
2. Alleged interference with, and restraint and
coercion of employees
a. The October 3 meeting
After the close of the representation election on October
2, which was lost by the Retail Clerks, Martilla advised
Japp, Sr., that Martilla was going to hold a meeting with the
truckdrivers the next evening and intended to advise them
that Jays would restore the wage increase which had been
deferred since July 1. At the meeting on October 3,
attended by Martina, Staton, Whalen, and Judkins on
behalf of Jays, Martilla told the truckdrivers that he had
intended to have a meeting with them for some time but
that he had been too busy. After a few queries on
operational matters, according to the credited testimony of
truckdriver Robert Lull, Martilla told the employees that
the Company's financial condition, as shown by an
auditor's report, had so improved that Jays could give the
truckdrivers their deferred raise immediately "rather than
wait until the first of the year." Lull testified that then
Martilla asserted that he had heard that "a few of you
fellows have contacted a union," that if he knew who the
employees were who were involved in this, he would not
give them the raise, but since he did not know, he would
have to give the raise to all. Martina further stated, "I don't
know what the hell you fellows want, but if you want a
union, why don't you go back to Fenners' union because he
got you this [holding up the proposed agreement with the
Independent Union]," and "you fellows aren't loyal to
anyone but yourselves."
This version of the October 3 meeting was substantially
supported by the testimony of General Counsel's witnesses
James Chapman,8 Gary Redelsperger, James Paluch, and
Richard McCormick. In addition, Ronald Davis, a truck-
driver who came in at the very end of the meeting, recalled,
on cross-examination, that he had heard Martina "say
something about why don't you guys try to get Fenner's
union back in here."
Martilla's version of this meeting differs from Lull's
principally in his denial that he knew about the truckdriv-
ers' union activity at the time and, therefore, did not
indicate at the meeting that he knew about their union
activity; in his denial that he said that if he knew who was
involved in the union activity those employees would not
Counsel complains of this in his brief. I have since reconsidered my ruling in
light of the discussion of Rule 801(d)(l) in Redden and Saltzburg , Federal
Rules ofEvidence Manual (Michie 1975), and have some question whether my
ruling was correct. However, since I credit Chapman the issue is not
important.
JAYS FOODS, INC. 429
receive the raise ; and in his denial that he advised the
truckdrivers to go to Fenner's Union if they wanted a
union . Martilla states he did advise the employees "that it
was my opinion that not all of them really deserved [the
raise ] in view of things that had happened since the first of
July but because of the fact that I didn't specifically know
who these people were . . . I would give everyone the 32
cent an hour pay raise," and that this "was living up to the
commitment that we had had with them after Fenner's
union walked away ."9 Martilla's denials were substantially
corroborated by Whalen and Staton . Whalen also recalled
that Martilla "said something like, `I 'm not sure that
everyone deserves a blanket raise , but that's according to
the agreement and we are going to live up to it., "
I have credited Lull's version of this meeting because he
impressed me as an honest straightforward witness whose
testimony was corroborated by other witnesses . Davis'
testimony as to the single remark he heard at the end of the
meeting, in particular, impressed me as having the ring of
truth and accuracy in support of Lull's version . I do not
credit Martilla's denial that he was aware of truckdriver
union activity . The record as a whole , as discussed herein,
convinces me that Respondent was well aware of this
activity . Staton's admissions have been referred to previ-
ously.
Respondent gives no convincing reason for announcing
this raise on the day before the men were scheduled to meet
with the Teamsters . The men understood that the raises had
been deferred to January . The timing of this action,
Martilla's antiunion comments at the meeting, and remarks
made by Japp , Sr., after the meeting, as discussed below, in
light of the entire record, are convincing and I fmd that the
grant of the wage raise was to counteract the truckdrivers'
union activities . I further fmd that Martilla's statement that
he would not give the raise to those active in union
activities , if he knew them, contained an implied threat of
reprisal for those who continued in such union activity. By
such conduct Respondent interfered with , restrained, and
coerced its employees in violation of Section 8(a)(1) of the
Act.
b. Aftermath of the October 3 meeting
(1) Immediately after the meeting and on their way out,
truckdrivers Ronald Davis and Charles Dietz went into the
dispatch office. Davis states that while they were there,
Japp, Sr., came into the office and spoke to them.
According to Davis, Japp said he hoped that the men were
happy with the 32-cent raise which they had received. Japp
further said that he heard that the men were "going to have
a meeting tomorrow," and, in answer to Davis' affirmative
reply, then asked if Davis and Dietz were going to the
meeting . Davis indicated that this depended on his wife's
plans for him, and that Dietz replied that he did not think
he could attend. Japp expressed his disapproval of their
attending the meeting and stated that he knew who the
troublemakers were who were trying to get the Union in-
Lull, Goodman, and Vitner-and said that if the employees
signed cards to bring the Union in, he would "close the
9 At another point, Martilla testified that he told the men, more
specifically, that some did not deserve the raise "because of the kind of work
they had been performing" since July 1. He asserted that this comment was
doors." Davis asserted that Japp also questioned the
employees as to their opinion of the Union. Davis replied
that his wife thought that Jays' benefits were equal to what
the Union might secure, but, since he held a union
withdrawal card, "it would help me to carry my card,
because I wasn't getting any younger."
Japp, who states that he does not know Davis or Dietz,
denied that he had a conversation with any employee of the
character related by Davis. Japp, in particular, testified that
he left the plant about 3 or 3:30 in the afternoon and was
not present on the premises at the time of the meeting with
the men or thereafter. Japp could give no reason for
recalling what time he left the plant on that day, except that
as "a general thing, if the plant wasn't running, I left early."
He could not remember, on cross-examination, what time
he left the plant on the next following Friday, and stated
that he was able to recall his movements on October 3 after
counsel jogged his memory on the subject, though he could
not recall what counsel said.
Dietz did not testify. Neither counsel called him, nor was
there any showing that he was available to testify. No other
witness recalled seeing Japp, Sr., about the plant after the
meeting.
Counsel for Jays, in his brief, places particular stress on
the time element involved as impeaching Davis. Thus,
Davis, who came in at the very end of Martilla's meeting
with the men, asserted that the conversation with Japp
occurred "shortly after the meeting," at "approximately
6:15 p.m." Counsel points out that the meeting began about
5 p.m., was of short duration, and was over no later than
5:30 p.m.
My impression of Davis at the hearing was that of a
rather intent witness trying to give accurate testimony. I do
not believe that he fabricated this incident out of whole
cloth. After giving careful consideration to the factors set
forth above and the entire record, I credit Davis' account
set forth.
I find that by the threat made by Japp, Sr., to "close the
doors" if the employees brought the Teamsters in, Jays
violated Section 8(a)(1) of the Act. I do not believe that in
the circumstances of this case, Japp's remarks conveyed an
impression of surveillance, as General Counsel alleges. The
record shows that the drivers' activities were much dis-
cussed by the drivers and by supervisors, and were known
to Jays' management. Without some clearer indication that
Japp was referring to a surreptitious source, I find that this
allegation has not been proved. The allegation of illegal
interrogation of Davis by Japp will be considered hereinaf-
ter. General Counsel agrees that no proof was adduced in
support of allegation VI(h) of the complaint that Japp, Sr.,
threatened to withdraw certain benefits if the Union came
in. It will be recommended that this allegation be dismissed.
(2) After the meeting, truckdriver Lull, together with
some other truckdrivers, and Supervisor Staton went to a
nearby tavern. During the course of a conversation in
which Lull was asserting that he hoped there would be a
good turnout of drivers at the meeting the next day, for he
felt that "Jays is sure afraid of the Teamsters," Staton called
based upon a rather vague, unspecific, and undocumented statement made
by Shipping Supervisor Neal that some of the truckdnvers were "dogging it."
430 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Lull aside, apart from the other men, and told him, "Bob,
you know the old man is talking about selling the fleet."
Lull replied that he had heard this for a long time, to which
Staton answered, "Well, this time the old man is serious."
Staton admitted in his testimony that, in this conversa-
tion, he told Lull "if the fellows keep fooling around like
this, the old man is liable to sell the semi-truck operations."
The record makes it quite clear that Staton was referring to
the drivers' union activities.10
Staton gave two reasons for his statement to Lull on this
occasion. He first said that this statement expressed his
opinion "that management was going to get fed up with the
harassment they were getting. . . . All these meetings we
had, so forth, and discontent."" He further stated that he
was prompted to say this to Lull by seeing a stranger
wandering around the plant who someone told him was
Nielsen of Nielsen Cartage 12 Staton denied that anyone in
management told him, prior to November, about the "sale
of the cartage operation." Based upon my assessment of
Staton's testimony, and the whole record, I am not inclined
to credit his denial.
I fmd that by Staton's threat that the trucking operation
would be sold if the employees continued in their union
activities, Jays violated Section 8(axl) of the Act.
c. Other alleged violations of Section 8(a)(1)
(1) Driver James Paluch testified that in the month of
October, sometime after the October 3 meeting, when he
was at Jays' North Branch operation, Art Timmons, who
frequently substituted for branch managers, engaged him in
conversation. After an initial greeting, Timmons said, "I
hear you guys are starting this union stuff again," to which
Paluch answered that he did not know anything about it
and did not want to know. (Paluch, in fact, had been one of
the group that originally visited the Teamsters hall and had
signed an authorization card.) Timmons then stated, "Well,
I'll tell you one thing, you are getting the old man pretty
mad and he is going to sell the trucks."
Timmons recalled being at the North Branch in October,
but denied substituting for the branch management at the
time. He did not recall having any conversation with
Paluch during this period, but denied having the conversa-
tion attributed to him by Paluch. Timmons further admit-
ted that during this period in October, he heard "scuttle-
butt" and hearsay of union activities on the part of the
tractor-trailer drivers, stating that the "scuttlebutt .. .
flowed throughout." 13 Timmons, like Staton, testified that
he was not informed of or consulted about the impending
"deal" with Nielsen prior to November 14.
'o Staton's attempt to deny that he "knew" of the men 's union activities,
but only "assumed" they had contacted the Union was not persuasive.
Indeed , the conversation at the tavern from which he withdrew with Lull
necessarily informed him that there was to be a union meeting with the
Teamsters . Staton in his prehearmg affidavit stated that "by this time," he
"knew" the drivers had contacted the Union . I do not credit Staton's denial
that he was aware at that time of "any union activities by the drivers," or that
he did not know the drivers had contacted the Union.
11 Later , Staton stated that by "harassment" he did not "necessarily mean
Union harassment ," and then said, "I didn't mean union." In the absence of
any better explanation, and on the record as a whole , I find, as has been
noted , that Staton was indeed speaking of the drivers ' union activities.
12 Nielsen's testimony, however, was that when Nielsen first came to the
I find that Timmons made the statements testified to by
Paluch as set forth above.
(2) Driver Siebert Kuiken testified that on or about
November 5 Supervisor Staton said to him, "I heard that
you fellows are going to join the Union or talking about
joining the union, and ... if you do ... the Old Man is
going to sell the fleet." When Kuiken protested that he had
heard this before, Staton replied that "this time he means
it." Staton, in substance, admits this conversation.
I find that by Staton's threat to Kuiken and Timmons'
threat to Paluch that if the drivers persisted in their union
activity Jays would sell its trucks, which the drivers were
employed to drive, Jays violated Section 8(axl) of the Act.
As has been noted hereinabove, Jays' management and
supervisors engaged in considerable interrogation of em-
ployees concerning their union desires and activities. Much
of this questioning occurred in a context of coercion and
restraint, and several of the employees refused to answer
candidly. Respondent offers no valid reason to justify this
course of conduct. On this record, I fmd that Staton's
admitted interrogation of several employees, Japp's ques-
tioning of Davis and Dietz, and Timmons' questioning of
Paluch had a natural tendency, in the circumstances, to
interfere with, restrain, and coerce the employees in the
exercise of their rights under the Act and, therefore, by such
conduct, Respondent Jays violated Section 8(a)(1) of the
Act.
3. The decision to contract Jays' delivery
operations
a. The negotiations
For a long time prior to 1975 several cartage companies
in the Chicago area, including Nielsen Cartage, had sought
to have Jays contract out Jay's delivery operations. These
advances had uniformly been resisted by Jays on the basis
that it was performing a highly successful operation in an
efficient manner. According to the testimony of Martilla
and Adolph Nielsen, it would appear that Nielsen was
specifically well regarded by Jays' management because of
personal friendship between the Nielsen and Japp families.
Nielsen and Martilla were members of the same country
club and met there at regular intervals . Nevertheless,
Nielsen's requests that his company be considered to take
over Jays' delivery operations had been rejected over a
period of 5 years prior to 1975.
Martilla and Nielsen recall that the latter again broached
the subject of Nielsen Cartage taking over Jays' delivery
operations at a meeting at the country club in May 1975.
Martilla states that Nielsen said he could perform the
plant Staton was instructed by Jays' management to give Nielsen the drivers'
logbooks. Staton admits that Martilla told him to give the logs to Nielsen and
that he did so. At this point , I am convinced Staton was informed of
Nielsen's purpose in the plant.
13 Beyond this admission , on direct examination, Timmons tended to be
rather vague , and seemingly evasive , about this "scuttlebutt." He agreed he
"knew something was going on," but not "the nature of what was discussed."
Though he denied that he "knew the semi-truckdrivers were trying to get a
union," he also agreed that was the nature of the "scuttlebutt" which he
heard from branch managers and assistant branch managers (who are, as
noted previously , supervisory personnel). Timmons was uncertain as to the
particular persons who relayed this information to him , but he was certain
that he had not heard it from Japp, Sr.
JAYS FOODS, INC.
operation more economically than Jays and that he
(Martilla) replied that "it is still our opinion that we are
doing a pretty darn nice job with it." Martilla states, rather
summarily, that he spoke to some management people
about this inquiry, but clearly aroused no immediate
interest.
Martilla states, and Nielsen confirms, that Nielsen again
brought up the subject at the country club on August 24.
Martilla asserts he remained skeptical that Nielsen knew
enough about Jays' operations to be able to say he could do
a better job, and that, in any event, in order to contract out
the operation Jays would have to dispose of its tractors,
trailers, and equipment. Nielsen replied that he was sure he
could purchase the equipment. Martilla states that he
invited Nielsen to visit Jays' operations to see if he could
come up with some concrete figures upon which to make a
proposal.
The two witnesses assert that Nielsen visited Jays' plant
during the first week in September, observed the operation,
and was given certain drivers' "logs" which he took away
with him. According to Martilla and Nielsen about a week
later, possibly on or about September 8 or 9, Nielsen
presented Martilla with a written proposal based upon a
"representative week" in Jays' operations, July 22-August
2. Martilla, on this occasion, states he introduced Nielsen to
Thomas Stanislawski, Jays' executive vice president and
treasurer, for discussion of the value of Jays' delivery
equipment. It is stated that they agreed to accept the book
value of the equipment. Martilla and Nielsen next met, as
they testified, at the country club on September 17, when
Martilla suggested that Nielsen present another proposal
based upon a more recent week in the delivery operations.
Nielsen agreed to visit the plant again. Martilla says that
the two men discussed the number of drivers Nielsen would
employ if he obtained the contract and that Nielsen said he
could do the job with 23 drivers. Jays was then employing
26 drivers.14 In addition, Martilla, who was aware that
Nielsen Cartage had a bargaining agreement with the
Independent Union, expressed concern that Jay's opera-
tions might be shut down because of a strike by Nielsen
Cartage employees, which Martilla said had never occurred
with Jays' employees.15 Nielsen assured Martilla that he
need have no worry on that score, that Nielsen would take
appropriate action to prevent it.
On September 30, Nielsen gave Martilla a second written
proposal based upon Jays' operations for the week of
September 21-27. On October 1, Martilla called Nielsen
and told him "it looked like we had a deal," and that
Nielsen should prepare a formal contract for Jays' consid-
eration. Nevertheless, Martilla said that Jays wished to go
over Nielsen's computations with him in detail because
"[we] didn't necessarily agree with his computations."
Nielsen delivered a written contract proposal the next day.
As discussed below, the parties came to a final agreement,
on October 9, subject to certain authorities which Nielsen
Cartage was required to secure from the Interstate Com-
merce Commission (ICC).
14 In fact, however, the first proposal assertedly presented on September 8
or 9 and the next proposal on September 30 were based on employing 22
drivers. The discrepancy is not explained, nor is there any explanation of
how Nielsen determined he could accomplish the work with four fewer
drivers.
431
In contrast to the above version of these events, which
tends to place much of the negotiations prior to the latter
part of September, when the truckdrivers became particu-
larly active in seeking help from the Teamsters, Nielsen in
his prehearing affidavit, made December 9, refers to only
one meeting with Martina at the country club, in the third
week of September; says that he was invited to and visited
Jays' operations after that, "in late September;" that
Martilla asked for Nielsen's prices "at the end of Septem-
ber," which Nielsen furnished, whereupon Martilla "a day
or two later" called "and said it looked as if we had a deal."
At the hearing, Nielsen asserted that his affidavit was in
error. It is noted, however, that one part of Nielsen's cost
computations, which Martilla asserts (with some doubt)
was presented to him by Nielsen on or about September 8
or 9, is inexplicably dated October 1, 1975. From my
observation of the witnesses and consideration of the facts,
I am persuaded that such contacts and discussion as may
have occurred before September 17 were more casual and
less definite than the witnesses indicated in their testimony,
and that some later events may have been transposed to a
slightly earlier time.
On October 9, Nielsen met with Martilla, Stanislawski,
and Japp, Sr., with some other management personnel
present part of the time . After Nielsen agreed to slightly
reduce the price he was asking to perform Jays' delivery
operation, Jays agreed to contract the operation to Nielsen.
In an effort to expedite the process of securing operating
authority from the ICC, Nielsen Cartage requested emer-
gency operating rights to haul Jays products in interstate
commerce. When Nielsen, who had continued telephone
contact with Martilla in the interim, advised the latter on
November 7 that the ICC had granted the necessary
authority, Martilla pressed Nielsen to take over immediate-
ly. Nielsen advised Martilla that this could not be done
before November 17.
On Friday evening, November 14, Jays' truckdrivers were
assembled at the plant where they were advised by Martilla
that Jays' delivery operation was being taken over by
Nielsen on Mcnday and that their employment with Jays
was terminated. Martilla introduced Nielsen who told them
that he intended to hire as many of them as he could.
Nielsen stated that he would require 22 or 23 drivers for the
operation, but that, under Nielsen Cartage's contract with
the Independent Union, certain employees of Nielsen
Cartage had the right to bid on this new work, and he would
not know until the next day the full number who would
desire to transfer. Nielsen made arrangements with the men
to come to his office the next day to make application for
employment.
The contract between Jays and Nielsen Cartage for the
performance of Jays delivery operation became effective
November 17.
15 Jays' management apparently had a constant concern that umomza-
tion of its employees would lead to interruption of its operations and
opposed union organizing efforts on that ground, as set forth in literature
distributed to the driver-salesmen . (G.C. Exh. 16)
432 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
b. Jay's reasons for contracting out its delivery
operation
According to Martilla and other management witnesses,
Jays decided to contract out its delivery operation for three
reasons : (1) Nielsen's figures indicated that Jays might save
considerable money ; (2) sale of Jays' equipment would
release a considerable amount of capital invested in
equipment ; and (3) Martilla would be relieved of responsi-
bility ofoverseeing the delivery operation.
(1) Projected savings. At one point, as has been noted,
Nielsen prepared an estimate of his price for performing
Jays' delivery operation for the week of July 27-August 2.
Based on using 22 drivers, Nielsen estimated he would have
charged Jays $21,232.01 for that week. Jays' records
showed a cost of $23,203.32 for that week. A worksheet
drawn up by Stanislawski also showed that, for the first 35
weeks of 1975, Jays' cost for the delivery operation
averaged $22,552.22 per week. A second estimate made by
Nielsen for the week of September 21 to 27 was that Nielsen
Cartago could have performed the operation for that week
for $18,492.80, based on a payroll of 22 drivers. No
evidence was presented as to Jays' costs for this latter week,
as was done for the prior week, so no comparison can be
made. Assuming there was a typical week in Jays' delivery
operation, the week of September 21-27 would not seem to
be one of them . It is noted from Stanislawski 's 35-week
analysis (Resp. Exh. 13) that weekly delivery costs tended
to vary widely. Martilla testified that he and Stanislawski
were sure that Nielsen could not save Jays as much as
indicated , but said that the figures indicated that there
would be a saving.
At the hearing General Counsel objected to Respondent's
offer to prove that Jays had actually enjoyed a saving in its
delivery operation since Nielsen Cartage took over, The
objection was sustained on the ground that Respondent's
motive must be determined as of the time the operation was
contracted out, not by its subsequent experience. Jays'
counsel agreed that, even if the evidence showed that Jays
had made a mistake and had not saved any money, this fact
would not have probative value in assessing Jays' motive.
Since the hearing, however, I have had access to Jays
Foods, Inc., supra, which was not cited to me at the hearing.
As noted in that case, the Trial Examiner based his
decision , in part, on the fact that Jays made no comparison
of costs either before or after contracting out its mainte-
nance operation . While I am not persuaded that my ruling
at the hearing was wrong , I have given careful consider-
ation to the facts Respondent states it would have proved if
it had been permitted . According to this offer, Stanislawski
compared Jays' experience from January through March
1975 with payments made to Nielsen Cartage for delivery
services for the same period in 1976. Stanislawski further
adjusted Jays' costs by taking into account the 32-cent raise
given in October and a second 32-cent raise which it is
16 The union scale referred to was not identified . Manifestly it was not
that of the Independent Union for that union was not seeking to organize
Jays at the time.
it Stanislawski at a later point denied that the word "union" came up in
his discussions with Martilla in reference to these matters and asserted that
he was sure that he "never discussed the union scale in any of [his]
computations " On direct examination , Stanislawski admitted such a
alleged would have been given the drivers by Jays in
January 1976. It is stated that the figures show an average
saving of roughly $1,000 a week on such a basis. (General
Counsel, of course, had no opportunity to cross-examine
this material.)
Notably, moreover, Stanislawski went further in his
comparative cost analysis: he felt impelled, or was request-
ed by Martilla, to make an analysis of how much more Jays'
delivery operation would have cost (and consequently how
much more it saved by farming it out) if Jays had been
paying the union scale during this period.16 This, obviously
seems to indicate, contrary to Jays' insistence, the employ-
ees' abortive attempt to secure representation by the
Teamsters was a factor in the decision to contract out the
delivery operation. Two instances of testimony by Jays'
management bear significantly upon this issue.
In the midst of testifying about his discussion with
Martilla concerning the figures in Respondent's Exhibit 13,
and the possible savings which it indicated, Stanislawski
stated, "Well, we discussed about the 32 cent an hour,
which would be additional savings and then plus another
additional that was promised to the drivers at the time and
we also discussed that should we get involved in paying the men
more, say union scale at the time, which I don't know what it
was, I think about $7 and some cents there, the savings
would be greater." (Emphasis supplied.) This conversation
clearly took place before September 30, for Stanislawski
specifically places his next following conversation with
Martilla at "the latter part of September. I'd say about
September 30." 17
Also bearing on this issue is the testimony of Japp, Sr.,
with respect to his conference with Martilla and Stanislaw-
ski, in early October, when Japp apparently gave his
consent to contracting out the delivery operation to Nielsen
Cartage. In the course of testifying about the discussions
that day, Japp testified, "I can't remember anything that
was said, but I know that we did say that if we could get out
of the trucking business and give it to somebody who knew
how to do it, we could then get back to selling our
merchandise which we knew something about, because
going through all these litigations, why it was taking up a lot of
our time and costing a lot of money that we didn't have.... "
(Emphasis supplied.) Japp later stated that he was "refer-
ring to the litigation that we had with the driver- salesmen
an d the union, and stuff like this that we went through
before, and it costs a lot of money ." 18 In the circumstances,
and upon the record, I fmd that this statement referred to
concern over union activities of the truckdrivers. I do not
credit Japp's testimony to the contrary.
c. The contract; present operations
There is no evidence of ownership or control by Nielsen
Cartage or its management in Jays, or by Jays or its
management in Nielsen Cartage , other than the terms of the
discussion of the "union scale" in connection with his most recent
computations made at Martilla 's request in preparation for hearing of this
matter
18 Japp denied that this statement indicated concern about possible
litigation involving the truckdrivers, but admitted that the litigation concern-
ing the driver-salesmen had been completed at this time.
JAYS FOODS, INC.
contract which they executed on November 17. The record
does show that the close personal r('. itionship between the
parties permeated their contractual dealings. Thus, after
Jays' management succeeded in getting Nielsen to slightly
lower his price, Japp, Sr., admonished Nielsen to be sure of
his figures, saying that because of their personal relation-
ship he did not want Nielsen to be hurt by their deal.
As part of the contract, Nielsen Cartage paid Jays
$62,632 for the tractors purchased from Jays; $22,569.06 for
parts, supplies, and equipment; and agreed to pay Jays
$76,448 for Jays' trailers, payable at the rate of $1,830.66
per month over a 4-year period. The record shows that
these sums had been paid as agreed up to the time of the
hearing. It appears that Nielsen has acquired the two diesel
tractors which had formerly been leased by Jays, and has
purchased the three trailers which Jays had previously
ordered.
Since November 17, the equipment used in transporting
Jays' products has been kept on Jays' premises, as was the
case before the contract was made. The truckdrivers, now
employed by Nielsen Cartage, report to Jays' plant, as
before, where they are daily dispatched by a dispatcher
employed by Nielsen Cartage from an office on Jays'
premises. (There is no indication of any charge to Nielsen
for use of Jays' premises.) The employees are covered by
Nielsen Cartage's contract with the Independent Union,
have been required to join that union by the terms of the
agreement, and appear to receive better wages and benefits
under that contract than they received from Jays. However,
it may be that their seniority rights are less.
Under the provisions of paragraph 1(c) of the contract
between Jays and Nielsen Cartage, the agreement can be
cancelled upon 30 days' notice in writing by either party.
Nielsen Cartage agrees to give Jays exclusive use of certain
listed vehicles from November 17, 1975, to November 17,
1980, with the right of Jays to repurchase the vehicles at
certain annual periods in accordance with stated condi-
tions. The contract sets forth the rate which Nielsen will
charge for each vehicle per week, with provisions for
increased or decreased charges according to the conditions
set forth.
4. Analysis and conclusions
The facts in this case are convincing that Jays subcon-
tracted its delivery operation and discharged its drivers
because of their union activities.
For a considerable number of years, Jays had resisted
efforts of outside cartage firms to take over Jays' delivery
operation notwithstanding arguments to the effect that such
firms could do the work more economically and efficiently.
It is plain that Jays considered it important to retain in its
own hands the flexibility of immediate control and supervi-
sion of the daily operation carrying its fragile products to
i9 For reasons previously noted, I have found that the discussions
between Nielsen and Jays with respect to the former taking over Jays'
delivery operation did not become serious until the late part of September,
when the employees began contacting the Teamsters, leading to a tentative
decision on October 1, and a firm decision on October 9, to contract out the
operation
20 In the only other successful organization of Jays' employees by a union
not favored by Jays, the Company also contracted out the maintenance
operation involved there. Though the Independent Union once briefly
433
the various distribution points. As Martilla put it, Jays
considered that "we are doing a pretty darn nice job with
[the delivery operation]." Jays' business success indicates
this was an understatement.
Why then did Jays in the fall of 1975 suddenly sell its
trucks and subcontract out its delivery operations? 19 The
answer is clearly indicated in Jays' hostility to the employ-
ees' activities on behalf of the Teamsters, by the threats by
various supervisors and management that the delivery
operation would, indeed, be contracted out and the trucks
sold (or that the doors would be closed) because of the
employees' union activities, and by the testimony of Japp,
Sr., and Stanislawski, as found above, to the effect that the
possibility of the Teamsters coming in was a substantial
factor in the decision to subcontract the operation.20
In defense of its action in subcontracting out the work,
Jays contends that when it did so it was unaware of the
drivers' union activities, and, in any event, was motivated
by the financial savings and operational benefits to be
secured. The overwhelming evidence is that the drivers'
union activities were well known to Jays' management and
supervisors, and I so find. While I find the cost comparisons
relied upon by Jays to be something less than accurate
presentations of probable savings by contracting to Niel-
sen,21 I have no doubt that some dollar savings may have
been realized by Japp. I do not believe, however, that Jays
would have departed from 35 years of highly successful
business practices, abandoning its complete control over a
complex delivery system, involving speedy dependable
delivery of fragile perishable products which require special
handling by experienced personnel, but for the advent of
the drivers' effort to bring the Teamsters into the operation.
In addition to the factors which have been previously set
forth, I note that although Jays claims negotiations were
initiated in May with Nielsen concerning contracting out
this operation, and though Jays assertedly found it neces-
sary to cut back on expenses between May and July
because of adverse market conditions, no effort was made
during that period to act on Nielsen's contention that he
could perform the deliveries more economically than Jays.
However, after the drivers began their union activity, the
negotiations became accelerated and the decision made.
The applicable legal principles have recently been set
forth in N.LR.B. v. Townhouse T. V. & Appliances, Inc., 531
F.2d 826 (1976), as follows:
It is well settled that an employer violates Section
8(a)(3) and (1) of the Act by subcontracting part of an
integrated business and dismissing the persons em-
ployed therein if the action is motivated at least in part
by antiunion considerations. N.L.R.B. v. National Food
Stores, Inc., 332 F.2d 249 (7th Cir. 1964); N.LRB. v.
George Roberts & Sons, Inc., d/b/a The Roberts Press,
451 F.2d 941, 945-946 (2d Cir. 1971). Of course, as
represented Jays' truckdrivers, when the drivers rejected the deal made by
the Company and the Independent Union, the latter withdrew. The
employees were told by Martilla that Jays still favored the Independent
Union.
21 In each case estimates of yearly savings were made by extrapolating
Nielsen's estimate based on a single week's activity. The asserted experience
after contracting to Nielsen is based on noncomparable periods which is also
probably affected by changes in Jays' business activities
434 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Townhouse argues, the converse is true, i.e., an employ-
er does not violate Section 8(a)(3) and (1) if he makes a
decision to subcontract solely for sound business
reasons . Jays Foods Inc. v. N.L.RB., 292 F.2d 317 (7th
Cir. 1961); N.L.R.B. v. Rapid Bindery, Inc., 293 F.2d
170, (2d Cir. 1961).
Based upon the above, and the entire record in this case, I
find that Jays, by contracting out its delivery operations to
Nielsen and by discharging its truckdriver employees, 22 on
or about November 14, because of their union activities,
violated Section 8(a)(1) and (3) of the Act.
D. Case 13-CA-14890
The allegations of the complaint in Case 13-CA-14890
assert that Respondent Nielsen Cartage refused, on or
about November 15, to hire Siebert Kuiken, Robert Lull,
James Paluch, Henry Goodman, and Richard McCormick
(who were among the drivers discharged by Jays the day
before) because of their union activities.
Nielsen, on November 14, requested that all of Jays'
drivers who wished to work for Nielsen Cartage appear for
interviews at his office the next morning. As the men
arrived, they were requested to fill out employment
applications and were then interviewed in groups. Later
that afternoon, Nielsen or another agent called the appli-
cants to inform them as to who had been rejected and who
would be employed. At that time , eight Nielsen Cartage
employees had bid to transfer to the work at Jays. Nielsen
hired 15 of the applicants from Jays. Among those not hired
were the five named in the complaint. These were among
the oldest, and presumably the most experienced, employ-
ees in Jays' delivery operations.23 These five were also in
the front rank of the employees seeking Teamsters repre-
sentation.
Nielsen's asserted reasons for deciding which of the
applicants he would hire leave much to be desired. At the
hearing, and in his prehearing affidavit, Neilsen asserted
that he relied upon ( 1) his examination of the drivers' logs,
(2) records from the State of Illinois showing the drivers'
moving violations (MVR's), and (3) his interviews with the
drivers. However, General Counsel proved, and counsel for
Nielsen Cartage concedes, that Nielsen had not received
the MVR's on November 15 when the men were informed
as to who would be hired and who would not. Nielsen never
explained how the drivers' logs (involving hundreds of
pieces of paper), which he last examined on September 30
for the purpose of making a cost proposal to Jays (and not
for the purpose of determining who should be hired), aided
him in making his selections. Nor did he point out the
factors in the interviews which influenced his decision.24
22 These employees are. Siebert Kuiken, Richard McCormick, Jack
Whalen, Paul Knott, Albert Philp, Robert Lull, Henry Goodman, Thomas
Richards , Charles Dietz, James Paluch , Robert Vitner, Gary Redelsperger,
Charles Vogel, John Short, Gerald Dildine, Charles Merrick , Raymond
Prince, James Chapman, Dennis Altgilbers, Edward Sallay, Craig Mullins,
Lawrence Rossi, David Butkus , Raymond Hansen , Lauren Hodson, Ronald
Davis.
23 Kuiken was Ist in seniority, McCormick 2d, Lull 7th,Goodman 8th,
and Paluch 1 I th, among 26 employees.
24 Counsel for Nielsen Cartage indicates that Nielsen relied also on
General Counsel contends that Nielsen was informed by
Jays of the identity of the five union adherents and acceded
to Jays' request that these five not be employed. This is
denied by Nielsen. The key to General Counsel's conten-
tion is the testimony of Lull, which I credit, that on
November 15 Supervisor Staton told Lull that during the
week previous Nielsen had come to him with a list of drivers
he was going to employ; that Staton told Nielsen that there
were drivers on the list who Staton would not employ; and
that Nielsen replied that was "the way Si[Martilla] wanted
it." 25 General Counsel contends that this may be accepted
as an admission against interest binding on both Jays and
Nielsen Cartage.
There is no showing in this record of any connection
between the two Respondents other than long-term and
apparently deep friendship of their managements and the
contractual relationship between them which is the subject
of this case. There is no common ownership, nor interlock-
ing directors or officers. Nor is there any showing of a
common labor relations policy or joint control over
employees of either of them, except as may inhere in their
contractual relationship. Staton is shown to be a supervisor
of Jays, but not of Nielsen. In the circumstances I find that
Staton's statement to Lull cannot be held an admission
binding on Nielsen. Though General Counsel's evidence
raises strong suspicions that Nielsen failed and refused to
hire the five named drivers on November 15 because of
their union activities, it does not prove the allegation of the
complaint and I shall recommend that it be dismissed.26
E. Case 13-CA-14955
The complaint in Case 13-CA-14955 alleges that Jays
discharged Edward Olson on December 1, 1975, because of
his union or other concerted activities protected by the Act.
1. Olson's union activities
Edward Olson had been employed by Jays as a driver-
salesman at Jays' West Branch for over 20 years. In 1975,
Olson contacted the Retail Clerks Union in an effort to
have that union organize Jays' driver-salesmen , persuaded
a number of his fellow workers to meet with representatives
of the Retail Clerks, and secured signed authorization cards
from a majority of his fellow workers at the West Branch.
These activities were open and carried on largely around
the West Branch. The employees' activities on behalf of the
Retail Clerks, as had the truckdrivers' activities on behalf of
the Teamsters, came readily to the attention of Jays'
supervisors. Thus, the branch manager, Brand, quickly
found out about the employees' meeting with the union. I
find that Jays' management was aware of Olson's orga-
nizing activities on behalf of the Retail Clerks.
information in the drivers' applications . Nielsen asserts that after the
interviews , he "sat in my office with the applications and determined which
15 drivers I was going to hire ." This was not mentioned in his preheanng
affidavit. I am persuaded that this was an afterthought at the hearing.
25 Staton admitted speaking to Lull on this occasion , but denies saying
that he had spoken with Nielsen about the selection of drivers. Both Staton
and Nielsen deny that they had a conversation such as that related in Lull's
testimony.
26 The record shows that the five men have since been hired by Nielsen in
January 1976.
JAYS FOODS, INC.
At the election conducted by the Board on October 2,
1975, Olson was the union observer at the West Branch. As
previously noted, the Retail Clerks lost the election. After
the election was concluded, according to Olson's credited
testimony, Japp, Sr., approached him and extended his
hand in a handshake, and in an unfriendly insincere tone
said, "Thanks a lot, Ed."27
2. Events leading to Olson's discharge
The incidents which allegedly triggered Olson's discharge
concerned the manner in which he served two customers on
his route-a Jewel store and a National store-on Friday,
November 28, the day after Thanksgiving, and his failure to
come in to work on Saturday, November 29, to serve these
two customers.
Jays' branches are not normally open on Saturday, for
the driver-salesmen normally work a 5-day week. The rule
with respect to a week in which a holiday falls is somewhat
different. Although Jays' witnesses were not altogether
consistent with respect to whether the rule had been
changed in 1975, they were agreed in general that driver-
salesmen were permitted to work a 4-day week in a week in
which a holiday fell on a working day, provided the driver-
salesman had provided for his customers' needs, that is,
took care of his 5-day schedule in 4 days. 28 Branches are
normally open on Saturday in a week in which a holiday
falls on a working day and salesmen may service their
customers on that day.
On Friday, November 28, Olson arrived at the Jewel store
on Mannheim Road on his route at 2:10 p.m.29 The
receiving clerk at the store refused to accept delivery of
Jays' products on the ground that receiving hours at the
store ended at 2 p.m. Olson sought permission from the
store manager to make the delivery and was refused. Earlier
in the day, at the National store on his route, Olson
examined the Jays' products on the shelves, determined
that there was a sufficient amount for the weekend, and did
not deliver any additional products.30
After returning to the West Branch that afternoon, Olson
performed his normal end-of-week paperwork, ordered his
products for the following Monday delivery, loaded his
truck, and was checked out by Branch Manager Brand.
Brand noticed that no sale was listed for the Jewel store
(stated to be the largest account on Olson's route), and
asked Olson about it. After Olson explained, Brand gave a
noncommittal reply, indicating that he was satisfied with
the explanation.31 Olson signed out, telling Brand, "Good
night. See you on Monday." Brand, however, denies that he
knew that Olson had made out his weekend inventory, or
made his Monday order (but none for Saturday), or that he
heard Olson say he would see Brand on Monday, thus, in
effect, contending he had no reason to know, on Friday
27 In making this finding, I have considered Japp's apparent denial of this
testimony
28 Each driver is scheduled to visit each customer on his route on a
designated day of the week. In a holiday week, the dnver-salesman had to fit
into his schedule the customers missed on the day of the holiday.
29 Jays claims it was told by the store manager that Olson arrived at 220
p.m. The p
I
oint is not important . Olson 's is the only direct testimony on the
point and credit it. As will be noted hereinafter, I am persuaded that Jays'
witnesses tended to overstate or exaggerate Olson 's shortcomings.
30 Again, Jays claims that it was told Olson had not been seen at the
National store. Olson's direct testimony is credited.
435
afternoon, that Olson was not coming in on Saturday
morning. Brand admitted, however, that Olson's records,
which he had before him, did not contain certain markings
which were customary to indicate that Olson intended to
visit the Jewel store the next day.
On Saturday, November 29, 7 of the 24 driver-salesmen
at the West Branch came to work. Brand checked the
records of the remaining salesmen , and made notes of seven
customers for whom no sales were shown for Friday. Brand
asked Donald C. Skafgaard, the assistant branch manager,
to investigate three of the stores listed, including the Jewel
and National stores on Olson's route, Brand stating that he
would take the remaining four. Skafgaard later reported
that the Jewel store was almost completely out of Jays
products, and the manager would not accept a later
delivery that day. He reported that the National store was
"out of product," and that he would replenish the stock at
that store. Skafgaard also returned to the West Branch to
pick up more product to be delivered to the third store on
his list, which also had not been served on Friday by
another driver-salesman .32 Brand states that the four stores
on his list were adequately supplied.
Brand spoke with Olson when the latter came to work on
Monday, December 1, and advised him that he was
suspended until further notice. Brand states that he then
spoke with Skafgaard, who told him that this was an
"[i]mpossible situation . . . he just doesn't do the job,
hasn't done the job for this week, and this Jewel, we have
never had a situation like this. We not only lose the business
for the entire weekend, but we might even lose the
account." Skafgaard went even further in his testimony,
asserting that he told Brand that Jays might lose the entire
Jewel account and the entire National account because of
Olson's failure to serve these customers on Saturday.
I doubt that these things were said as reported. In the first
instance, Skafgaard had actually worked at the West
Branch for only a very few weeks as assistant branch
manager , previously having been a salesman at another
branch, and would hardly have been quite so assertive
about past experience at the West Branch. Further, as
shown by Brand's testimony of his conversation with
Martilla set forth hereinafter, Brand seems addicted to the
use of "impossible" to score the point he is trying to make.
Lastly, I do not believe that the two men were concerned
about losing these accounts as stated. The National store
was served on Saturday, and no difficulty was experienced
in supplying the Jewel store on Monday, December 1.
After suspending Olson, Brand then called Martilla,
advising him of the situation involving the Jewel and
National stores on Olson's route. Brand states that he told
Martilla that Olson was "not trying," and was working
"with the least momentum possible. The results the same,
the least. It's an impossible situation." According to Brand,
3i Olson says Brand merely replied , "Oh," indicating that he was
satisfied . Brand asserts that he said, "Okay, well take care of it "
32 This driver-salesman was not criticized or disciplined for failing to
serve this customer or for not coming in on Saturday Skafgaard carefully
explained that the delivery to this third store was not really necessary, in
contrast to the situation at Olson's customers . The explanation was less than
persuasive . Thus, if the third store needed additional stock, as seems to have
been the case , since Skafgaard made a special trip for this purpose, I would
have expected that the other salesman would have at least been criticized.
436 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Martilla agreed that it was "an impossible situation," and
asked what Brand wanted to do . When Brand insisted upon
Olson's immediate termination , Martilla stated , he suggest-
ed a lighter penalty, pointing out that Olson had to be
employed 4 more weeks to get his yearly bonus, which he
would lose if discharged before the end of the year. Martilla
finally told Brand to write up Brand 's recommendation for
Olson 's termination and to transmit it to Martilla.
Olson was discharged by Brand in a telephone call later
in the day, on December 1.
3. The asserted reasons for Olson's discharge
Brand testified that the reasons for Olson's discharge
were set forth in the termination of employment memo
which he submitted to Martilla on December 1. This stated:
Very poor sales, lowest in West Branch. Caused by least
amount of on job sales time, 4 days only week of
11 /29/75. He allowed two accounts, one Jewel and one
National, to be out of stock on Jays items for the week-
end 11/29 & 11/30 due to no-sale by him 11/28/75.
s s s s s
No arrangements made by E. Olson for delivery of
product on Saturday 11/29/75. He knowingly permit-
ted and approved out of stock for Customers &
resultant loss of sales to Customers & Jays when he
checked out for the week 11/29/75 disregarding oppor-
tunity available for completing his Route Sales on
11 /29/75, increasing his sales commissions and satisfy-
ing Jays Customers.
The memo further stated that Olson was not recommend-
ed for reemployment.
Brand further testified that Olson was the first or among
the first, to check in every day; that he "was continually
twenty-four" among the driver-salesmen at the West
Branch in dollar volume of sales; that Olson brought in
very little new business; and that Brand frequently spoke to
Olson about these matters , to which, Brand stated, Olson
would reply that he was doing the best he could, and that he
had all the retail outlets on his route. Martilla testified that
Brand had also told him that "some years prior," when
some routes opened up, "Olson had not bid for routes on
which he could have made considerably more money."
Respondent Jays further asserts that a comparison of
Olson's production for the period from July until he was
terminated with his replacement's production for the period
from December until mid-April 1976 shows that the
replacement produced a higher dollar volume of sales 33
Upon analysis, however, most of these criticisms do not
appear to stand up well. While Olson's dollar volume of
sales, with the exception of I or 2 weeks, was consistently in
the lower half of the group at the West Branch, he was not,
33 In a memo apparently prepared by Brand and signed by Skafgaard,
which was given General Counsel during his investigation of the case as a
basis for Olson's discharge , it was additionally claimed that Olson "Dawdled
around - A M reload - coffee - mens room - and would be among last
to leave for route " No testimony was adduced in support of these
contentions
34 Thus, while Olson was ranked 24th in 22 weeks during the 2-year
as Brand testified, "continually twenty-fourth" (indeed,
during much of the time referred to by Brand there were
only 23 regular routes at the West Branch).34 While Brand
did not seem too certain on cross-examination about the
new accounts which Olson had brought in, he did agree that
just before Olson was discharged, Olson had solicited and
secured a good new account which was thereafter served by
his replacement.
While ranking salesmen by dollar volume may be a useful
technique to incite sales competition among the salesmen, it
is not a very accurate way to compare actual effort. Thus,
the record indicates that the various routes are different in
size and sales potential. This is borne out by Brand's
comment that Olson could have bid on other routes on
which he could have made considerably more money. It is
further noted, as set forth below, that Olson's replacement
continued to have low rankings among the West Branch
salesmen after Olson's discharge.
The contention that Olson 's replacement performed more
satisfactorily than Olson seems highly questionable. The
periods and the conditions compared are very different.
Among other items, the replacement is credited with
income from the good new account secured by Olson just
before his discharge. Moreover, it is noted that, for the first
21 weeks after Olson's discharge, the replacement was
ranked 24th among West Branch salesmen on 8 occasions,
and on 9 occasions was ranked between 20th and 23d.
Olson's failure some years ago to bid on a more lucrative
route may (or may not) indicate a lack of sales aggressive-
ness on his part, but he was obviously privileged to use his
seniority in this way so long as he properly covered the
route that he did bid on.
Respondent argues in its brief that Olson's production
was affected by the fact that he ate lunch at home about
three times a week (Olson stated that his home was
convenient to his route), instead of eating in a restaurant
along the way, and by Olson's admission that he sometimes
rested for short periods at home. However, it is not shown
that this prevented Olson from adequately covering his
route. There is no evidence of any occasion prior to
November 28-29 that Olson may not have properly served
any customer on his route. Nor is there any showing that
Jays was aware that Olson stopped by his home during the
day, except for a conversation between Skafgaard and Lull
at a New Year's Eve party in 1975, after Olson was
discharged.35
Lull testified that he had a conversation with Skafgaard
at a New Year's Eve party in 1975, at the home of another
former truckdriver for Jays, in which, in response to query
from Lull, Skafgaard told him (Lull) that Martilla had
instructed Skafgaard to follow Olson because he was
prounion and because his sales were down; that Skafgaard
had caught Olson at home at 11 o'clock in the morning
when he should have been on his route; that Skafgaard had
checked a few of Olson's big stores and found they were out
period referred to by Brand, and was 23d in 25 weeks, he was ranked 22d
during 16 weeks, 21st during 15 weeks, 20th during 11 weeks, 19th during 4
weeks, 15th during 3 weeks, and in I week each was ranked 3d, I Ith, 12th,
16th, 17th, and 18th among the diver-salesmen at the West Branch.
35 Counsel for Jays asserted that there was common talk at the West
Branch that Olson went home during the day to care for his pigeons. There
was no proof of such gossip. Olson denied that he did so.
JAYS FOODS, INC.
of merchandise ; and that Olson 's replacement with 3
months' experience with Jays had higher sales than Olson;
and that Jays "was going to court" on January 7 with
respect to Olson3e
Skafgaard denied Lull 's testimony, except that he stated
he had "no recollection" of telling Lull about meeting
Board agents about the Olson matter . Skafgaard further
denied that anyone had discussed Olson's union activities
with him, or that anyone had told him to follow Olson, or
that he had done so. I credit Lull. He not only seemed to be
an honest witness, as has been noted, but his testimony is
consistent in detail with the record as a whole.
4. Analysis and conclusions
Respondent Jays' motive for discharging Olson presents
a very disturbing problem . Olson clearly failed to serve a
Jewel store, the largest customer on his route , on November
28 (perhaps without his fault), and also failed to come in on
November 29 to serve that customer .37 I have no doubt that
this would be upsetting to the management of Jays, though,
as I have noted , I believe the testimony on this score was
somewhat exaggerated . In such circumstances , the dis-
charge of a new employee might not be noteworthy,
although the record indicates that the discharge of driver-
salesmen by Jays is not frequent. However, the discharge of
a salesman with over 20 years' seniority who apparently
had never done anything like this before requires closer
consideration .38 Indeed , the record shows that Branch
Manager Brand had developed such an hostility toward
Olson that he was unwilling to permit Olson to continue at
work for the 4 more weeks necessary that he might get his
yearly bonus . Jays seeks to account for that hostility by
showing that Olson's dollar volume was usually near the
bottom of those driver-salesmen employed at Jays' West
Branch, which Jays attributes to a lackadaisical attitude on
Olson's part. On the other hand, the record shows that Jays'
management was aware that Olson's route as such was a
low-producing route 39 Notwithstanding Brand's testimony
that he constantly spoke to Olson about his production-
which is fairly normal procedure in respect to salesmen in
this type of industry-there is no evidence that Olson was
in any danger of losing his job prior to his activities on
behalf of the Union and his serving as one of the observers
at the election on October 2.
As has been found, Jays is clearly hostile to unionization
of its operations. The record further shows that Japp, Sr.,
Jays' chief executive officer, was concerned over the margin
of the Company's victory over the Retail Clerks in the
election, and indicated his personal displeasure at Olson's
role, immediately after the election. The fact that Branch
Manager Brand was actively seeking to secure a reason to
discharge Olson is shown by Skafgaard's admission to Lull
after Olson was terminated.
36 In fact, Jays had an appointment to meet with representatives of the
Regional Office on January 7 to present Jays' defense to the charge that
Olson had been discriminated against.
37 1 am not so sure , notwithstanding Assistant Manager Skafgaard's
testimony , that Olson failed to serve a National store on that occasion.
38 The record shows that in one other case a driver -salesman was given
one or more warnings before discharge.
437
Respondent Jays manifestly had the right to discharge
Olson because he was a poor salesman , or for failing to
serve his customers , or for not being aggressive enough, if
such was the case. However, on the basis of the above
analysis and the record as a whole , I am convinced that
Olson was discharged for his union activities and the
reasons advanced by Jays are pretexts . It is therefore found
that Respondent Jays, by the discharge of Edward Olson,
violated Section 8(a)(1) and (3) of the Act 40
CONCLUSIONS OF LAW
1. Respondent Jays Foods, Inc., and Respondent Niel-
sen Brothers Cartage Co., Inc., are each an employer
engaged in commerce within the meaning of Section 2(6)
and (7) of the Act.
2. Chicago Truck Drivers, Helpers and Warehousemen
Workers Union (Independent); Local 705, International
Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America; and Retail Clerks Union Local
1550, affiliated with Retail Clerks International Associa-
tion, AFL-CIO, are each a labor organization within the
meaning of Section 2(5) of the Act.
3. By ceasing its delivery operations , selling its trucks,
and contracting out its delivery operation to Respondent
Nielsen Cartage because of the union activities of Jays
Foods' employees , Respondent Jays Foods engaged in and
is engaging in unfair labor practices in violation of Section
8(a)(1) and (3) of the Act.
4. By discharging the following named employees on
November 14, 1975, because of the union activities of its
employees, Respondent Jays' Foods engaged in and is
engaging in unfair labor practices in violation of Section
8(a)(l) and (3) of the Act: Siebert Kuiken, Richard
McCormick, Jack Whalen, Paul Knott, Albert Philp,
Robert Lull, Henry Goodman, Thomas Richards, Charles
Dietz, James Paluch, Robert Vitner, Gary Redelsperger,
Charles Vogel, John Short, Gerald Dildine, Charles Mer-
rick, Raymond Prince, James Chapman, Dennis Altgilbers,
Edward Sallay, Craig Mullins , Lawrence Rossi, David
Butkus, Raymond Hansen, Lauren Hodson, Ronald Davis.
5. By discharging Edward Olson on December 1, 1975,
because of his union activities, Respondent Jays Foods
engaged in and is engaging in unfair labor practices in
violation of Section 8(axl) and (3) of the Act.
6. By threatening to sell its trucks and contract out its
delivery operation by threatening to close its doors because
of the union activities of its employees; by granting benefits
to its employees to discourage union activities; by threaten-
ing to withhold benefits because of employee union
activities; and by coercively interrogating its employees
concerning union activities, Respondent Jays Foods en-
gaged in and is engaging in unfair labor practices in
violation of Section 8(a)(1) of the Act.
39 Notwithstanding the somewhat higher dollar volume produced by
Olson's successor on the route, the successor continued to rank low among
the salesmen at the West Branch.
90 In coming to this conclusion, I have noted and considered Jays'
argument that no other election observer for the Retail Clerks was
discharged . It is not necessary that Respondent discharge every union
adherent to effectively chill union activities among the employees.
438 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
7. The aforesaid unfair labor practices affect commerce
within the meaning of Section 2(6) and (7) of the Act.
8. Except as found hereinabove , Respondent Jays
Foods did not engage in unfair labor practices as alleged in
the complaints in this matter.
9. Respondent Nielsen Cartage did not engage in unfair
labor practices as alleged in the complaints in this matter.
THE REMEDY
It having been found that Respondent Jays Foods, Inc.,
has engaged in certain unfair labor practices in violation of
Section 8(a)(1) and (3) of the Act, I shall recommend that it
cease and desist therefrom and take certain affirmative
action to effectuate the policies of the Act.
It having been found that Respondent Jays Foods, Inc.,
unlawfully discharged Edward Olson, it will be recom-
mended that Respondent Jays Foods , Inc., offer Olson
immediate and full reinstatement to his former job, or, if
such job no longer exists, to a substantially equivalent job,
without prejudice to his seniority and other rights, privileg-
es, or other working conditions , and make him whole for
any loss of earnings or benefits suffered by reason of such
discrimination, by payment to him of a sum of money equal
to the amount he would have earned from the date of his
termination as found herein to the date of Respondent Jays
Foods' offer to reinstate him as aforesaid , less his net
earnings during that period, in accordance with the Board's
formula set forth in F. W. Woolworth Company, 90 NLRB
289 (1950), with interest thereon at the rate of 6 percent per
annum , as set forth in Isis Plumbing & Heating Co., 138
NLRB 716 (1962).
Respondent Jays Foods having unlawfully terminated
and contracted out its delivery operation to Respondent
Nielsen Cartage, and having unlawfully discharged the 26
employees who were employed in that operation, General
Counsel contends that in order to restore the situation as it
was before Respondent Jays engaged in these unfair labor
practices, Jays should be required to resume its delivery
operation and reinstate the discharged employees with
whatever backpay and benefits lost by reason of their
unlawful discharge . This is, indeed, the Board's normal
remedy in cases such as this where ordering such resump-
tion of operations would not create any undue hardship.
See Townhouse T. V. & Appliances, 213 NLRB 716 (1974),
and cases cited therein. There is no showing that such a
remedy would create any undue hardship here. Jays
appears to be a financially sound company; it had
conducted this delivery operation successfully for over 30
years; the trucks continue to be housed on its property and
used exclusively in its delivery operation as before; and the
contract between Jays and Nielsen Cartage makes clear
that the parties contemplated that Jays might well wish to
buy the trucks back and resume these operations.
However, it does not seem to me that it is necessary to
order Respondent Jays Foods to resume the delivery
operation (if it does not desire to do so) in order to provide
41 1 am to some extent concerned as to whether their seniority and job
security may not compare with that enjoyed with Jays.
a substantially adequate affirmative remedy for these unfair
labor practices. In coming to this conclusion, I am strongly
influenced by the fact that Respondent Nielsen Cartage has
voluntarily hired 23 of the 26 discharged employees to
perform Jays' delivery operations, apparently as before.
The evidence is that their wages and benefits may be better
than those they enjoyed before Jays contracted out the
operation.41
Under the circumstances, I believe that an order requir-
ing Respondent Jays Foods (1) to reimburse the 26 named
employees for any loss of pay and benefits because of their
discharge (in accordance with the Board's policies set forth
above) until such time as those employees obtain, or have
obtained, substantially equivalent employment,42 and (2),
in the event that Respondent Jays Foods resumes the
delivery operation contracted to Nielsen Cartage, or
otherwise withdraws such delivery operation from Nielsen
Cartage, to offer those employees reinstatement to their
former jobs, or, if those jobs no longer exist, to substantially
equivalent jobs, without prejudice to the employees' senior-
ity and other rights and privileges, or other working
conditions, would constitute an appropriate affirmative
remedy. See, e.g., Savoy Laundry, Inc., 148 NLRB 38 (1964).
I shall so recommend.
The complaint against Respondent Nielsen Cartage
alleges, and General Counsel argues, that Respondent
Nielsen Cartage is a successor to Respondent Jays Foods
with respect to the delivery operations involved here, and as
such is responsible for remedying those unfair labor
practices which relate to the contracting out of those
operations. It is, of course, well settled that a purchaser who
"acquires and operates a business of an employer found
guilty of unfair labor practices in basically unchanged form
under circumstances which charge him with notice of unfair
labor practice charges against his predecessor " may be held
responsible for remedying his predecessor's unlawful con-
duct. See Golden State Bottling Co., Inc. v. N.L,R.B., 414
U.S. 168 (1973). Where the purchaser cannot be charged
with knowledge of the predecessor's unfair labor practices;
however, the purchaser may not be held responsible for
remedying those practices. Ramada Inns, Inc., 171 NLRB
1060 (1968). The circumstances of this case arouse great
suspicion that Nielsen knew that Jays was seeking to
forestall its employees' attempts to bring the Teamsters in
by contracting out the operation, but the circumstances are
not strong enough to support a finding that Nielsen knew or
should be charged with knowledge of Jays Foods' unfair
labor practices. It is therefore found that Respondent
Nielsen Cartage is not responsible for remedying Respon-
dent Jays Foods' unfair labor practices.
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, I issue the following recommended:
42 Whether employment by Nielsen Brothers Cartage, Inc., or by any
other employer, constitutes substantially equivalent employment, if in
dispute , can be determined in a compliance hearing.
JAYS FOODS, INC. 439
ORDER43
The Respondent, Jays Foods, Inc., Chicago, Illinois, its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Discouraging membership in or activities on behalf of
Local 705, International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America, or
Retail Clerks Union Local 1550, affiliated with Retail
Clerks International Association, AFL-CIO, or any other
labor organization, by discharging its employees or in any
other manner discriminating in regard to their hire or
tenure of employment, or any term of condition of their
employment.
(b) Granting or promising to grant wage increases or
other benefits in order to induce its employees to refrain
from union activities.
(c) Threatening to withhold wage increases or other
benefits to induce its employees to refrain from union
activities.
(d) Threatening to terminate its operations or any part of
its operations or to sell its equipment because its employees
have become members of a union or have engaged in
activities on behalf of a union.
(e) Coercively interrogating its employees concerning
membership in or activities on behalf of a union.
(f) In any other manner interfering with, restraining, or
coercing employees in the exercise of rights guaranteed
under Section 7 of the National Labor Relations Act.
2. Take the following affirmative action which is
necessary to effectuate the policies of the Act:
(a) Offer Edward Olson immediate and full reinstatement
to his former job, or, if that job no longer exists, to a
substantially equivalent job, and make him whole for any
loss of earnings he may have suffered by reasons of his
discharge, in accordance with the provisions of the section
herein entitled "The Remedy."
(b) In the event Respondent Jays Foods, Inc., resumes its
delivery operations which were contracted to Nielsen
Brothers Cartage, Inc., on or about November 17, 1975, or
withdraws such delivery operations from Nielsen Cartage,
offer the employees named below immediate and full
reinstatement to their former jobs, or, if those jobs no
longer exist, to substantially equivalent jobs, in accordance
with the provisions of the section herein entitled "The
Remedy."
(c) Make the employees named below whole for any loss
of earnings or benefits they may have lost by reason of their
discharge on November 14, 1975, to the date Respondent
Jays Foods, Inc., offers them reinstatement, or until such
earlier time as each secures , or did secure, substantially
equivalent employment, in accordance with the provisions
of the section herein entitled "The Remedy":
Siebert Kuiken
Richard McCormick
Jack Whelan
Paul Knott
Albert Philp
Robert Lull
Henry Goodman
Thomas Richards
Charles Dietz
James Paluch
Robert Vitner
Gary Redelsperger
Charles Vogel
Dennis Altgilbers
Edward Sallay
Craig Mullins
Lawrence Rossi
David Butkus
Raymond Hansen
Lauren Hodson
Ronald Davis
John Short
Gerald Dildine
Charles Merrick
Raymond Prince
James Chapman
(d) Preserve and, upon request, make available to the
Board and its agents, for examination and copying, all
payroll records, social security payment records, timecards,
personnel records and reports, and all other records
necessary to facilitate the effectuation of the Order herein.
(e) Post at its plant and branch operations in and about
Chicago, Illinois, copies of the attached notice marked
"Appendix." 44 Copies of said notice, on forms provided by
the Regional Director for Region 13, after being duly
signed by an authorized representative of Respondent, shall
be posted by it 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. Reasonable steps shall
be taken by Respondent to ensure that said notices are not
altered, defaced, or covered by any other material.
(f) Notify the Regional Director for Region 13, in writing,
within 20 days from the date of this Order, what steps
Respondent has taken to comply herewith.
IT IS FURTHER ORDERED that the complaint be, and it
hereby is, dismissed as to alleged violations of the Act not
found in this Decision.
43 In the event no exceptions are filed as as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board , the findings,
conclusions, and recommended Order herein shall, as provided in Sec. 102.48
of the Rules and Regulations , be adopted by the Board and become its
findings, conclusions, and Order , and all objections thereto shall be deemed
waived for all purposes.
44 In the event the Board 's Order is enforced by a Judgment of the 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 "