Jean PierDownload PDFNational Labor Relations Board - Board DecisionsApr 6, 1979241 N.L.R.B. 774 (N.L.R.B. 1979) Copy Citation DECISIONS OF NATIONAL LABOR RELATIONS BOARD Victor Patino and Nydia Patino; Victor Patino and Nydia Patino d/b/a Jean Pier; Richard Erquiaga d/b/a California Sewing' and Los Angeles Joint Board of the International Ladies' Garment Work- ers' Union, AFL-CIO. Cases 31-CA-6615, 31- CA-5612, 31-CA-5771, and 31-CA-5849 April 6, 1979 DECISION AND ORDER BY MEMBERS JENKINS, MURPHY, AND TRUESDALE On September 20, 1976, Administrative Law Judge Irving Rogosin issued the attached Decision in con- solidated Cases 31 CA-5612, 31 CA-5771, and 31- CA-5849, herein referred to as Case 31 CA-5612, et al. Thereafter, Respondent filed exceptions and a sup- porting brief, and the General Counsel filed excep- tions.2 Subsequently, while the Board was considering the Administrative Law Judge's original Decision, the General Counsel, on March 15, 1977, filed a motion with the Board requesting that the Board reopen the record in Case 31-CA-5612, et al., and consolidate that proceeding with Case 31-CA-6615, upon which the Regional Director had issued a complaint but which had not yet been heard by an Administrative Law Judge, and remand the entire proceeding for hearing before Administrative Law Judge Rogosin. On May 25, 1977, the Board issued an Order granting the motion and reopening the record in Case 31-CA- 5612, et al., for the purpose of either consolidating these cases with Case 31-CA-6615, or amending the complaint in Case 31-CA-5612, et al., to include the related allegations of Case 31-CA-6615. The Board also remanded the proceeding to the Regional Direc- tor for Region 31 for further hearing. Thereafter, the record was reopened, the cases were consolidated, the complaint in 31-CA-6615 was amended, and a further hearing was held before Ad- ministrative Law Judge Rogosin. On February 22, 1978, Administrative Law Judge Rogosin issued the attached Supplemental Decision in this proceeding, and on February 27, 1978, he issued an errata thereto. Subsequently, Respondent filed exceptions to the Supplemental Decision and the General Counsel filed limited cross-exceptions. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- I Hereinafter collectively called Respondent. 2 As discussed by the Administrative Law Judge in fn. 4 of his Supplemen- tal Decision. the General Counsel has moved to strike Respondent's excep- tions to the original Decision. In light of our decision herein, we find it unnecessary to rule upon the motion to strike. 3 The motion was titled "Motion to Amend Consolidated Complaint, Re- open Record and Remand for Further Hearing or, Alternatively, Motion to Reopen Record, Consolidate Cases and Remand for Further Heanng." tional Labor Relations Board has delegated its au- thority in this proceeding to a three-member panel. The Board has considered the record and the at- tached Decisions in light of the exceptions and brief and has decided to affirm the rulings, findings,4 and conclusions of the Administrative Law Judge only to the extent consistent herewith. The Administrative Law Judge found, and for the reasons set forth by him we agree, that Respondent violated Section 8(a)(1), (3), and (5) of the Act in var- ious respects during and after the Charging Party's successful organizing campaign among Respondent's employees. We do not agree, however, with his find- ing that Respondent Victor and Nydia Patino d/b/a Jean Pier violated Section 8(a)(5) of the Act on Sep- tember 12, 1975, by unilaterally offering the employ- ees an insurance plan. The offer occurred approxi- mately 6 weeks before the Board-conducted election which the Union won and therefore before Respon- dent was required to bargain with the Union. How- ever, we agree with the Administrative Law Judge's conclusion, for the reasons fully stated by him, that the offer constituted an independent violation of Sec- tion 8(a)(1). As discussed by the Administrative Law Judge, Re- spondent Victor Patino and Nydia Patino d/b/a Jean Pier shut down the Jean Pier operation in December 1975. In January 1976 the Patinos began operations again in a new location with new employees. Several months later the operation was continued under the name of Richard Erquiaga d/b/a California Sewing. As disclosed at the hearing and found by the Admin- istrative Law Judge, California Sewing was actually owned by the Patinos. The Administrative Law Judge found, among other violations, that the original closure by the Patinos d/ b/a Jean Pier was for the purpose of avoiding its bar- gaining obligation with the recently certified Union, and, therefore, was in violation of Section 8(a)(5). He also found that the employees who were terminated in December 1975 as a result of the plant closure, as well as four who were discharged in November 1975, were discharged in violation of Section 8(a)(3). We agree with these findings. The Administrative Law Judge neglected to find, however, that the failure to reinstate the employees when operations were there- after resumed in January 1976 also violated Section 8(a)(3). As we are in agreement with the Administra- tive Law Judge that the subsequent Patino and Cali- ' Respondent has excepted to certain credibility findings made by the Ad- ministrative 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 °(l950), enfd. 188 F.2d 362 (3d Cir. 1951). We have carefully examined the record and find no basis for reversing his findings. 241 NLRB No. 76 774 VICTOR PATINO AND NYDIA PATINO, ET AL. fornia Sewing operations were alter egos of the Pa- tinos d/b/a Jean Pier, we find that the failure to reinstate the discharged employees constituted a fur- ther violation of Section 8(a)(3). 5 ADDITIONAL REMEDY In fashioning a remedy for the various violations found, the Administrative Law Judge ordered that the four individuals discharged on November 14, 1975, be reinstated with backpay; that the individuals discharged in December 1975 be reinstated to the jobs formerly held by them (discharging, if necessary, present employees), but to the extent those dis- charged in December 1975 exceeded in number the jobs available, that they be placed on a preferential hiring list; and that backpay also be awarded to the individuals discharged in December 1975 until such time as they are placed on a preferential hiring list.6 We find that the proposed remedy is inadequate to cure Respondent's discriminatory conduct and to make the employees whole. As stated, it is clear that the actions taken in dicharging the employees on the above-mentioned dates and in refusing to offer them reinstatement when operations began anew, were all violations of Section 8(a)(3) of the Act. Violations of this nature are normally remedied by immediate of- fers of reinstatement and awards of backpay from the time of the discriminatory discharge until the offer of reinstatement 7 unless it is shown that such a remedy would endanger the continued viability of the opera- tion. 8 Such has not been shown at the present time. Accordingly, we shall order Respondent to offer all employees discriminatorily discharged on November 14, 1975, and all employees discriminatorily termi- nated on December 2 and 19, 1975, as a result of the closing of the Jean Pier plant, immediate and full re- instatement to their former jobs in its present operat- ing enterprise or, if those jobs no longer exist, to sub- stantially equivalent jobs, without prejudice to their seniority or other rights and privileges previously en- joyed, dismissing, if necessary, present employees of I The Administrative Law Judge found that Respondent Victor Patino and Nydia Patino, and Richard Erquiaga d/b/a California Sewing, were succes- sors to and alter egos of Respondent Victor Patino and Nydia Patino d/b/a Jean Pier. As we are in agreement with the finding of alter ego status we find it unnecessary to decide whether the Patinos and Richard Erquiaga d/b/a California Sewing were also successors to the Patinos d/b/a Jean Pier. 'The Administrative Law Judge inadvertently did not order that backpay be awarded to those individuals discharged in December 1975, who were to be reinstated under the terms of his recommended Order. While the General Counsel excepted to this oversight, we find it unnecessary to consider this error in view of our conclusions concerning the appropriateness of the rem- edy herein. 7 Mason City Dressed Beef Inc., er al., 231 NLRB 735 (1977); The Bell Company, Inc.. et a., 225 NLRB 474 (1976), enforcement denied 561 F.2d 1264 (7th Cir. 1977); Townhouse T. V. & Appliances, 213 NLRB 716 (1974), enforcement denied in pertinent part 531 F.2d 826 (7th Cir. 1976); R & H Masonry Supply, Inc., 238 NLRB 1044 (1978). I R d H Masonry Supply, Inc. supra. said Respondent, and make the aforesaid employees whole for any loss of earnings they may have suffered by reason of the discrimination against them in the manner set forth in F W. Woolworth Company, 90 NLRB 289 (1950), with interest thereon to be com- puted in the manner prescribed in Florida Steel Cor- poration, 231 NLRB 651 (1977). 9 ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Rela- tions Board hereby orders that the Respondent, Vic- tor Patino and Nydia Patino; Victor Patino and Nydia Patino d/b/a Jean Pier; Richard Erquiaga d/ b/a California Sewing, Los Angeles, California, its officers, agents, successors, and assigns, shall: I. Cease and desist from: (a) Discouraging membership in Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, or any other labor organization of its employees, by unilaterally changing the terms and conditions of employment of its employees; by dis- charging or terminating employees or otherwise dis- criminating in regard to the hire and tenure or terms and conditions of employment of its employees be- cause of their union affiliation or protected concerted activities, except to the extent authorized by the pro- viso to Section 8(a)(3) of the Act, as amended. (b) Unilaterally changing the terms and conditions of employment of its employees, threatening its em- ployees with plant closure, offering employees an in- surance plan or other benefits to induce them to with- draw from the Union, and promising employees wage increases if they withdraw from the Union. (c) Failing and refusing to bargain collectively, upon request, with the Union as the exclusive repre- sentative of the employees in the appropriate unit with respect to rates of pay, wages, hours of work, and other terms and conditions of employment, in- cluding the effects on the employees of the closing of the Jean Pier plant at 1405 West Pico Boulevard, Los Angeles, California, in which the employees were working on December 2, 1975, and, if an understand- ing is reached, embody such understanding in a signed agreement. (d) Failing and refusing to recall unlawfully termi- nated employees to avoid bargaining with, and to dis- courage membership in, Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO. (e) In any other manner interfering with, restrain- ing, or coercing its employees in the exercise of the right to self-organization, to form labor organizations, 9 See, generally. Isis Plumbing & Heating Co., 138 NLRB 716 (1962). 775 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to join or assist Los Angeles Joint Board of the Inter- national Ladies' Garment Workers' Union, AFL- CIO, or any other labor organization of their own choosing, and to engage in other protected concerted activities for the purpose of collective bargaining or other mutual aid or protection, as guaranteed in Sec- tion 7, or to refrain from any or all such activites, except to the extent that such rights may be affected by an agreement requiring membership in a labor or- ganization as a condition of employment, as autho- rized in the proviso to Section 8(a)(3) of the Act. 2. Take the following affirmative action which will effectuate the policies of the Act: (a) Offer Manuela Nunez, Wilfrido Dominguez, Paula Rios Lazaro, Lila de Castro, and any other em- ployees who were discriminatorily discharged on No- vember 14, 1975, and all employees who were dis- criminatorily terminated on December 2 and 19, 1975, as a result of the closing of the Jean Pier plant, immediate and full reinstatement to their former jobs in its present operating enterprise or, if those jobs no longer exist, to substantially equivalent jobs, without prejudice to their seniority or other rights and privi- leges previously enjoyed, dismissing, if necessary, pre- sent employees of said Respondent, and make the aforesaid named employees, as well as those dis- charged on December 2 and 19, 1975, whole for any loss of earnings they may have suffered by reason of the discrimination against them, in the manner set forth in the section of this decision entitled "Addi- tional Remedy." (b) Upon request, bargain collectively with the Union as the exclusive representative of all employees in the following appropriate unit with respect to rates of pay, wages, hours, and other terms and conditions of employment, including the effects upon the em- ployees of the termination of the Jean Pier operation, on December 2, 1975, and, if an understanding is reached, embody such understanding in a signed agreement: All production and maintenance employees em- ployed by Respondent at its facility located at 1405 West Pico Boulevard, Los Angeles, Califor- nia; 315 West 38th Street, Los Angeles, Califor- nia; or 3214 South Main St,'° Los Angeles, Cali- fornia; excluding office clerical employees, models, salesmen, professional employees, watchmen, guards and supervisors as defined in the Act. (c) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, I0The record reveals, and the Administrative Law Judge found, that in February 1977 Respondent moved its operation to 3214 South Main Street where it was still operating at the time of the hearing. timecards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms of this Order. (d) Post at the plant in Los Angeles, California, presently operated under the name of Richard Erqui- aga, doing business as California Sewing, and mail copies of the attached notice marked "Appendix"" to Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, in Spanish and English, to all employees previously employed by Jean Pier, including those who were discharged on November 14, 1975, as well as those who were termi- nated as of December 2 and 19, 1975, as a result of the closing of the plant. Copies of said notice, on forms provided by the Regional Director for Region 31, after being signed by Respondent's duly autho- rized representative, shall be mailed immediately upon receipt thereof as directed herein. The notice to be posted at the plant presently being operated by Victor Patino and Nydia Patino, under the name of Richard Erquiaga doing business as California Sew- ing, shall be posted immediately upon receipt thereof and shall be maintained 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 insure that said notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director for Region 31, in writing, within 20 days from the date of this Order, what steps Respondent has taken to comply herewith. "I In the event that this Order is enforced by a judgment of a United States court of appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National labor Relations Board." APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT discourage membership in Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, or any other labor organization of our employees by unilaterally changing the terms and conditions of employment of our employees; by discharging or terminating employees or otherwise discriminat- ing in regard to the hire and tenure or terms and conditions of employment of our employees be- cause of their union affiliation or protected con- certed activities, except to the extent authorized 776 VICTOR PATINO AND NYDIA PATINO, ET AL. by the proviso to Section 8(a)(3) of the Act, as amended. WE WILL NOT unilaterally change the terms and conditions of employment of our employees; threaten our employees with plant closure; offer them insurance plans or other benefits to induce them to withdraw from the Union; or promise employees wage increases if they withdraw from the Union. WE WILL NOT refuse to bargain collectively, upon request, with the Union as exclusive repre- sentative of all employees in the appropriate unit with respect to rates of pay, wages, hours of work and other terms and conditions of employ- ment, including the effects on the employees of the closing of the Jean Pier plant at 1405 West Pico Boulevard, Los Angeles, California, in which the employees were working on December 2, 1975, and, if an understanding is reached, em- body such understanding in a signed agreement. WE WILL NOT fail and refuse to recall unlaw- fully terminated employees to avoid bargaining with, and discourage membership in, Los Ange- les Joint Board of the International Ladies' Gar- ment Workers' Union, AFL-CIO. WE WILL NOT in any other manner interfere with, restrain, or coerce our employees in the ex- ercise of the right to self-organization, to form labor organizations, to join or assist Los Angeles Joint Board of the International Ladies' Gar- ment Workers' Union, AFL-CIO, or any other representative of their own choosing, and to en- gage in other protected concerted activities for the purpose of collective bargaining or other mu- tual aid or protection, as guaranteed in Section 7, or to refrain from engaging in any and all such activities, except to the extent that such rights may be effected by an agreement requiring mem- bership in a labor organization as a condition of employment, as authorized in the proviso to Sec- tion 8(a)(3) of the Act. WE WILL offer Manuela Nunez, Wilfrido Do- minguez, Paula Rios Lazaro, and Lila de Castro, and any other employees who may have been discriminatorily discharged on November 14, 1975, and all employees in the appropriate unit who were terminated on December 2, 1975 and December 19, 1975, as a result of the closing of the Jean Pier plant, immediate and full reinstate- ment to their former jobs, in our present operat- ing enterprise, or, if those jobs no longer exist, to substantially equivalent jobs, without prejudice to their seniority or other rights and privileges previously enjoyed, discharging, if necessary, present employees of said Respondent, and make said employees whole for any loss of earnings they may have suffered by reason of the discrimi- nation against them with interest. WE WILL, upon request, bargain collectively with Los Angeles Joint Board of the Interna- tional Ladies' Garment Worker's Union, AFL- CIO, as the exclusive representative of all em- ployees in the appropriate unit, with respect to rates of pay, wages, hours of employment and other terms and conditions of employment, and reduce to writing any agreement reached as a result of said bargaining. The appropriate unit is: All production and maintenance employees employed by Respondent at its facility located at 1405 West Pico Boulevard, Los Angeles, California; 315 West 38th Street, Los Angeles, California; or 3214 South Main Street, Los Angeles, California; excluding office clerical employees, models, salesmen, professional em- ployees, watchmen, guards and supervisors as defined in the Act. All our employees are free to become and remain or refrain from becoming or remaining members of the above-named labor organization, except to the ex- tent that such right may be affected by an agreement authorized by the proviso to Section 8(a)(3) of the Act. VICTOR PATINO AND NYDIA PATINO D/B/A JEAN PIER; VICTOR PATINO AND NYDIA PA- TINO; RICHARD ERQUIAGA D/B/A CALIFOR- NIA SEWING DECISION STATEMENT OF THE CASE IRvING ROGOSIN, Administrative Law Judge: The con- solidated complaint, hereinafter referred to as the com- plaint, issued January 30, 1976, alleges that Respondent has engaged in unfair labor practices within the meaning of Section 8(aX1), (3), and (5) and Section 2(6) and (7) of the National Labor Relations Act, as amended. Specifically, the complaint alleges that Respondent (i) on or about September 2, 1975, through Nydia Patino, threat- ened employees with plant closure if they continued their support of the Union; (2) in or about mid-September 1975, at a meeting of its employees, Respondent, through Victor Patino, submitted to them an insurance plan for the pur- pose of undermining their support of the Union; (3) in or about mid-October 1975, through Victor Patino, (a) prom- ised an employee a wage increase if the employees did not select the Union as their collective-bargaining representa- tive, and (b) threatened an employee with plant closure if the employees selected the Union as their collective-bar- gaining representative; (4) on or about October 24, 1975, through Nydia Patino, again threatened employees with plant closure if they selected the Union as their collective- 777 DECISIONS OF NATIONAL LABOR RELATIONS BOARD bargaining representative; and (5) since on or about No- vember 4, 1975, has refused to bargain collectively with the Union as the exclusive representative of employees in an appropriate unit by (a) on or about said date, without noti- fication to or bargaining with the Union, unilaterally im- posing new and more onerous conditions of employment on its employees; and (b) on or about December 2, 1975, with- out notification to or bargaining with the Union, unilater- ally closing part of its plant, resulting in the discharge of substantially all of its employees, and since said date failing and refusing to reinstate said employees to their former po- sitions; and (6) on or about November 14, 1975, discharged named employees,' and has since failed and refused to rein- state said employees to their former positions because they failed to meet the new and onerous conditions of employ- ment previously imposed by Respondent in retaliation for their union affiliation, and to undermine and destroy the Union's status as exclusive collective-bargaining represent- ative of all unit employees. Respondent's answer admits the procedural allegations of the complaint and the allegations as to the appropriate unit, the election procedure, and the issuance of the Re- gional Director's Report on Objections, recommending cer- tification of the Union; but it denies generally the remain- ing allegations of the complaint.' Hearing was held before the duly designated Administra- tive Law Judge on April 13 and 14, 1976, at Los Angeles, California. General Counsel and the Charging Party were represented by counsel. Respondent appeared in pro per, both partners participating in the hearing. All parties were afforded full opportunity to be heard, to examine and cross- examine witnesses, to introduce evidence relevant and ma- terial to the issues, to argue orally, and to file briefs and proposed findings of fact and conclusions of law. The par- ties waived oral argument; but, pursuant to an extension of time duly granted at Respondent's request, the General Counsel filed a brief on June 11, 1976, 3 No proposed find- ings of fact or conclusions of law have been filed by any of the parties. Upon the entire record in the case, the appearance and Manuela Nunez, Wilfrido Dominquez, Paula Rios Lazaro, and Lila de Castro. 2 Designations herein are as follows: General Counsel, unless otherwise stated or required by the context, his representative at the hearing; Victor Patino and Nydia Patino d/b/a Jean Pier, jointly, Respondent, the Em- ployer or the Company; Los Angeles Joint Board of the International La- dies' Garment Workers' Union, AFL-CIO, the Charging Party or the Union; the National Labor Relations Act, as amended (61 Statute 136, Pub- lic Law 86-257, 73 Statute 519, 29 U.S.C. 151, et seq.). the Act; the Na- tional Labor Relations Board, the Board. The original charge in Case 31- CA-5612 was filed on September 19 and served on September 26, 1975; the original charge in Case 31-CA-5771 was filed on December 5 and served on December 10, 1975, and the first amended charge was filed on January 2 and served on January 28, 1976; the charge in Case 31-CA-5849 was filed on January 26 and served on January 28, 1976. A settlement agreement entered into on November 4, 1975, in Case 31-CA-5612 was vacated and set aside by the Regional Director on about January 30, 1976. 'On May 7, 1976, subsequent to the closing of the hearing and without otherwise entering a formal appearance, Robert S. Michaels, Esq., of the law firm of Michaels and Sobel, notified the Administrative Law Judge that the firm had been retained to represent Respondent, and, for reasons stated. requested I month's extension of time in which to file briefs. The request was granted, and the time for filing briefs by all parties was extended to June I I, 1976. No briefs, however, have been received from Respondent or the Union. demeanor of the witnesses, and the General Counsel's brief which has been duly considered, I hereby make the follow- ing: FINDINGS OF FACT I. THE BUSINESS OF RESPONDENT It was stipulated at the hearing that, at all times material herein, Victor Patino and Nydia Patino, copartners doing business as Jean Pier, with an office and principal place of business located in Los Angeles, California, have been en- gaged in the manufacture of clothing. During the past cal- endar year, in the course of its business, Respondent sold services valued in excess of $50,000 to firms located in the State of California, each of which in turn sold goods and services valued in excess of $50,000 directly to customers located outside the State of California. Upon the basis of the foregoing and the entire record, including the stipulation of the parties, it is hereby found that at all times material herein, Respondent has been an employer engaged in commerce and in operations affecting commerce within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, is, and at all times material herein has been, a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. The Issues 1. Whether Respondent violated Section 8(a)(l) of the Act by (a) threatening employees with plant closure if they continued to support the Union; (b) submitting an insur- ance plan to its employees for the purpose of undermining their support of the Union; and (c) promising an employee a wage increase if the employees failed to designate the Union; and (c) promising an employee a wage increases if the employees failed to designate the Union as their collec- tive-bargaining representative, and threatening said em- ployee with plant closure if the employees selected the Union. 2. Whether Respondent violated Section 8(a)(l), (3), and (5) by unilaterally, and without prior notification to or bar- gaining with the Union, imposing new and more onerous conditions of employment because its employees had se- lected the Union as their collective-bargaining representa- tive. 3. Whether Respondent violated Section 8(a)(1) and (3) by discharging employees because they had failed to meet the new and more onerous conditions of employment. 4. Whether Respondent violated Section 8(a)( I), (3), and (5) of the Act by unilaterally and without prior notification to or bargaining with the Union, closing its plant, thereby resulting in the discharge of substantially all its employees because they had supported the Union or because of Re- spondent's determination to undermine the Union. 778 VICTOR PATINO AND NYDIA PATINO. ET AL. B. The Organizational Activitv Victor H. Patino and his wife, Nydia Patino. as equal partners, first engaged in business as sewing contractors for ladies' sportswear manufacturers in mid-May 1971. Mrs. Patino was in charge of production, while her husband was responsible for all the administrative and financial duties in connection with the operation of the Company. At its in- ception, the business was conducted at 2301 South Grand Avenue in Los Angeles but was later moved to larger quar- ters at 1405 West Pico Boulevard, Los Angeles. Respon- dent's complement of employees including production em- ployees declined from a high of about 189. in August or September 1975, to a low of 73 or 74 on December 2, 1975, when Respondent shut down its plant. Production employ- ees were paid at piecework rates. In May 1975, dissatisfaction with working conditions arose among the employees. During this period, a Spanish language pamphlet sponsored by "Comite Obrero Jean Piere" (sic) (workers, committee Jean Piere), not otherwise identified in the record, was circulated among the employ- ees. The pamphlet was extremely critical of management and protested working conditions at the plant.' Early in August the Union instituted an organizational campaign and distributed union leaflets and authorization cards. A number of employees, including Manuela Nunez, Esther Diaz, and Wilfrido Dominguez, alleged discriminatees. signed cards. In or about mid-August, Nydia Patino discovered a copy of the Spanish language leaflet on her desk and decided to call a meeting of the employees. On September 2, after the employees returned from lunch, Mrs. Patino held a meeting on working time in the vicinity of the timeclock. The meet- ing was attended by all the employees, as well as by Victor Patino, who was in the back of the room. Addressing the employees in Spanish, Mrs. Patino remarked that it had been some time since she had found it necessary to hold a meeting because the employees had been working in har- mony with their Employer. Since the union leaflets had be- gun to appear, she told them, she had been having prob- lems. She made it clear that she regarded statements in the leaflets disparaging of her husband, herself, and the firm, and that she intended to defend the reputation and integrity of the owners. She challenged the claim that employees would benefit from the Union and told them that they would be better off by remaining loyal to Respondent be- cause, by doing so, they would have good jobs. Finally, she told them that if they succeeded in bringing in the Union. she would shut down the factory, close out her banking account, and solve her problems by opening another fac- tory with new employees.5 On about September 12, while the employees were at 4 Aside from the name of the committee, there is no other indication of the sponsorship of this leaflet. Since the record indicates that the union organiza- tional activity did not commence until August, in the absence of any evi- dence linking this leaflet with the Union, it is presumed that the Union was not involved in the distribution of this leaflet. These findings are based upon a synthesis of the credible, and mutually corroborative testimony of Manuela Nunez, Esther Diaz, and Wilfrido Do- minguez. The testimony of the Patinos. who acted as their own counsel and were not too fluent in English, was generally rambling, discursive, and self- serving; their denials of the intimidatory statements attributed to them were unconvincing. lunch in the factory dining room, Mr. Patino called for at- tention and announced that the Company was making available an insurance program for employees who had been working more than 3 months. He explained the fea- tures of the program and distributed brochures describing the coverage. Mrs. Patino then spoke to each of the eligible employees at their machines. Although Mrs. Patino testified that Respondent had been considering an insurance plan for its employees for the past 2 years, it is evident that it took no action to implement such a program until after it had learned of the employees' organizational activities. According to her, Respondent submitted this proposal to the employees notwithstanding that Respondent was not then in "really good" financial condition. The insurance plan was not subsequently imple- mented, ostensibly because the premiums were too high in relation to the proposed benefits. In about mid-October, some 3 weeks before the election, Mr. Patino spoke to Hilario Gomez Guzman in the plant dining room. Patino arrived as Guzman was cleaning the floor and complimented him upon the appearance of the area. Guzman then asked Patino whether he could have a raise. Patino told him that he could not grant any wage increases because "the Union was coming in. but if the Union didn't come in," he would grant Guzman and an- other employee a raise. Patino then remarked that if the Union did come in everything "would go to hell," and he would shut down the factory and send all the employees home. 6 About I week before the election, while Guzman was performing his cleaning chores, Mrs. Patino told him, in the presence of Forelady Guadalupe and employee Mercedes, that the Union was attempting to come into the plant and that one of Respondent's customers who supplied the Com- pany with work had stated that if the Union came in, the customer would not give the Company any work because the garments would require a union label, and that the Company wanted nothing to do with the Union. Mrs. Pati- no added that if that occurred, she would shut the factory down and remove the machines, leaving the employees without work.' In October Victor and Nydia Patino started another gar- ment contracting business at the Company's former loca- tion at 2301 Grand Avenue, Los Angeles, under the trade name of "Puchy." This was done, according to Respondent, in an effort to reduce overhead at Jean Pier. The Patinos installed their 20-year-old daughter, Nidia, who had just graduated from designing school, as owner and operator, under a fictitious name business certificate. According to Mrs. Patino, their daughter used some of her own funds, which she had accumulated from her salary of $160 a week while working after school and part time for Jean Pier over a period of 5 years. Under an oral arrangement, Respon- dent stated that it sublet the premises to Puchy at a rental of $700 or $800 per month, which also covered the use of 25 sewing machines owned by Respondent and supplied to Puchy. Mrs. Patino also secured work for Puchy from var- ious manufacturers who had been supplying Jean Pier. The I Guzman's testimony regarding this incident is uncontroverted. Mrs. Patino did not deny the remarks attributed to her on this occasion. 779 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Puchy operation was basically the same as that of Jean Pier, except that Puchy did not press or finish garments, an operation which Jean Pier performed for Puchy. The Pa- tinos' minor son also worked at Puchy's operating a van to transport garments between the Puchy plant and the Jean Pier plant. The garments were pressed and finished at the Jean Pier plant, and then shipped to the manufacturer. The Puchy operation was eventually discontinued on De- cember 4, 2 days after Respondent closed its plant at West Pico Boulevard. Pursuant to a Stipulation for Certification Upon Consent Election, an election was held on November 3 among the employees in an appropriate unit.' Manuela Nunez and Wilfrido Dominguez, both alleged to have been discrimina- torily discharged herein, acted as union observers in the election. The following morning, November 4, at or about 8:15 a.m., Mrs. Patino called a meeting of all the employees in the plant dining room, and announced that since the Com- pany was now a "union company," it was establishing rules of its own. Thereafter, she stated, all employees would be required to be seated at their machines at 7:30 a.m. sharp, ready to begin work at the starting signal. She told the employees that they were not to engage in conversation while they were working at their machines, that they would not be permitted to use the machines to work on their per- sonal clothes, and that no one would be permitted to re- main at the machines during lunch periods. Finally, she notified the employees that they would have 2 weeks in which to demonstrate that they could earn the minimum wage based on their piecework production, and that all em- ployees failing to achieve such production within 2 weeks would be discharged. Two days later Ms. Patino showed Lazaro the latter's production record which indicated that Lazaro had not earned her minimum wage rate. Mrs. Patino told her that if she did not achieve the minimum rate in 2 days there would be nothing she could do for her. On Friday, the regular payday, Lazaro did not receive her paycheck but was sum- moned to the office. When she called there later that after- noon, Mr. Patino gave her her paycheck and said that there was no more work for her. He told her to return on Mon- day for her final paycheck. The following Monday Lazaro went to the plant and asked Mrs. Patino why she was being terminated. Mrs. Pa- tino told her that she had allowed her 2 weeks to demon- strate that she could earn her minimum wages, but that she (Lazaro) had failed to do so. Lazaro argued that she had been working for the company for I year, without earning the minimum wage scale, and wanted to know why she had not been discharged during that period. Mrs. Patino re- 'The description of the unit is as follows: Included: All production and maintenance employees employed by the Employer at its facility located at 1405 W. Pico Blvd., Los Angeles, California. Excluded: Office clerical employees, models, salesmen, professional em- ployees, watchmen, guards and supervisors as defined in the Act. According to the tally of ballots, 68 employees voted for and 15 voted against the Petitioner, there were 9 challenged ballots, an insufficient number to affect the results. On March 16, 1976, the Board issued its decision and Certification of Representative (Case 31-RC-3297), adopting the Regional Director's report, and certifying the Union as the exclusive representative of the employees in the appropriate unit. plied, according to Lazaro, that since the employees had voted for the Union, it was up to the Union to find work for her. On about November 14 Respondent discharged Nunez, Dominguez, Lazaro, Castro, and other employees, allegedly because they had failed to earn the minimum wage during the newly established 2-week probationary period. On November 28 Mrs. Patino notified the employees that she was unable to meet the payroll that day. On December I Respondent shipped work to some of its manufacturers for which it expected payment the following day. Conse- quently, Mrs. Patino notified the employees that they would receive their paychecks on Tuesday. The next morning, December 2, representatives of the Department of Labor for the State of California appeared at the plant and notified Mrs. Patino that her employees had reported that the Company had failed to pay their wages for the preceding week. Asked when the employees could expect to be paid, Mrs. Patino told the officials that she was expecting funds with which to pay her employees that same afternoon. According to her, she had discussed the closing of the plant with her husband the previous Fri- day, when they found they could not meet the payroll, but they had reached no decision. After the visit from the De- partment of Labor representatives, it was decided to close the plant that day, and she notified the employees of the Company's intention. Mrs. Patino conceded that she as- sumed that the employees had reported to the Union that they had not received their paychecks on November 28, and that in turn the Union had relayed this information to the Department of Labor. Later the same day, Victor Pati- no obtained funds from the manufacturer in payment of the shipment delivered the day before. On December 1, 1975, Respondent was served by its landlord with a notice to quit for nonpayment of rent for the months of November and December 1975, in the amount of $1,800 a month, or a total of $3,600. On December 2 about 4:30 in the afternoon, Mrs. Patino distributed the paychecks and announced that the Com- pany was closing down completely as of that date. Mrs. Patino chided the employees for having brought down what had been a family, and she stated that the employees had wanted to see her "defeated" and that they could now see her predicament. Finally, she told them that the Company was closing down completely and would not open the next day. She closed by sarcastically wishing the employees a merry Christmas. The Company continued operations until December 19, with some seven employees, who had volunteered to help finish the uncompleted work on hand. Although Respon- dent contends that these employees agreed to work without compensation, at the direction of the Department of Labor Respondent paid each of them at an hourly rate. In addi- tion, Respondent subcontracted a portion of the work that remained on hand on December 2 to other garment con- tractors. By letter dated December 3, 1975, Respondent's labor consultant notified the Union for the first time that the Company was permanently discontinuing all business op- erations as of that date. The letter advised, "The manage- ment has determined that it is no longer economically feasi- 780 VICTOR PATINO AND NYDIA PATINO, ET AL. ble to remain open. The shutdown of operations will be complete." At the time of the hearing, Mr. and Mrs. Patino were employed by a firm known as Budget Fashion; he, as fac- tory manager at a salary of $300 per week, his wife, as forelady at $250 per week, plus a commission of 3 percent on gross sales payable to them jointly. Their son was em- ployed as driver of a van, at $110 per week. As part of the consideration for the compensation paid to Mr. and Mrs. Patino, they have leased the equipment formerly used by them at Jean Pier consisting of 151 sewing machines; a number of pressing machines, with I boiler attached; and the van.9 According to Victor Patino, Budget Fashion is owned by an outsider, Eddie Radow, and no member of Patino's family has a financial interest in that business. Pa- tino admitted that in his capacity as factory manager he had hired some of the employees who had previously worked for Jean Pier. C. Concluding Findings 1. The 8(a)(1) allegations The record establishes that at the meeting of employees on September 2, Nydia Patino threatened to close the plant, remove the machinery and equipment, and install the same at a different location; the threat was, in fact, later carried out through the subterfuge of setting up their daughter in business at the Puchy establishment. Contrary to Victor Pa- tino's testimony that the September 2 meeting was called solely for the purpose of discussing production and Mrs. Patino's initial denial that she was aware of any previous organizational activity. she left no doubt that she called the meeting in order to reply to the criticism complaints, and what she regarded as disparaging references to her and to her husband in the leaflet disseminated by the workers' committee of employees.' 0 It is undisputed that in or about mid-September, after the organizational activity was well under way, Respondent, through Victor Patino, for the first time proposed an insur- ance plan to the employees despite the fact that Respon- dent claimed that business conditions were "not really good." On the basis of Respondent's opposition to the or- ganizational activities of its employees, and the timing of Respondent's offer of the insurance program, it is found that the proposal was made to the employees in order to persuade them to renounce the Union as their bargaining agent. It is further found that in about mid-October Victor Pati- no told employee Guzman, in response to a request for a wage increase, that the Company could not grant any wage increases because the Union was coming into the plant, but if the employees did not select the Union, he and another employee would receive a wage increase. It is further found According to Respondent, approximately 50 of these sewing machines had previously been sold. Some of the remaining sewing machines were still not for, and others had been pledged as security for the unpaid balance. 1' Mrs. Patino apparently made no distinction between this pamphlet and literature distributed by the Union, although it is evident from the context of her remarks that she was probably referring to the leaflet distributed by the committee. that during this conversation Patino threatened that if the Union came in he would shut down the factory. On October 24, Nydia Patino stated to employees that if they selected the Union as their bargaining agent, the plant would be closed, and that a manufacturer which supplied the Company with work would cease doing business with it. Even if this were true (Respondent offered no corroboration in support of Mrs. Patino's statement), this would furnish no justification for denying the employees the right to self- organization guaranteed by the Act. In view of Respon- dent's overt threats on September 2, in mid-October, and on the occasion in question to close the plant if the employees selected the Union as their representative and Mrs. Patino's statement that one of the Company's accounts had indi- cated that it would refuse to supply the Company with work if the employees designated the Union, cannot be re- garded as a prediction of the effects of unionization on the Company." Moreover, Mrs. Patino did not assert that the possible loss of business from the manufacturer would re- sult in the closing of the plant but merely injected this as a make-weight argument to dissuade the employees from se- lecting the Union as their bargaining agent. Therefore, it is found that by threatening employees with plant closure because they had engaged in union or con- certed activities; by promising employee Guzman a wage increase if the Union were not selected as bargaining agent; and by offering employees an insurance plan as an induce- ment to renounce the Union, Respondent has interfered with, restrained, and coerced employees in the exercise of rights guaranteed in Section 7, thereby engaging in unfair labor practices within the meaning of Section 8(aX I). 2. The 8(a)(3) Violations a. The rule changes It is undisputed that on November 4, the day after the Board-conducted election, Respondent changed working conditions of its production employees by requiring them to achieve a new standard of production. Mrs. Patino notified the employees that they would thereafter be required to produce a sufficient number of units on a piecework basis to earn the minimum hourly wage rate. There was no showing that Respondent had established any production standards prior to the election, and employee's compensation was ap- parently based on the number of units produced at the piecework rate without regard to whether the employee ac- tually earned the equivalent of the minimum hourly wage. Understandably, the earnings of employees depended not only upon their own efficiency but also upon such factors as the type of unit on which they were working and the piece- work rate for the operation involved. The volume of pro- duction and consequent earnings varied among employees, and from week to week with given employees. Although Respondent maintained that employees who did not suc- ceed in earning their minimum wage by their piecework '' "In such a case, however, the prediction must be carefully phrased on the basis of objective fact to convey an employer's belief as to demonstrably probable consequences beyond his control or to convey a management deci- sion already arrived at to close the plant in case of unionization." N.LR.B. v. Gissel Packing Co, Inc. 395 U.S. 575. 618 (1969). 781 DECISIONS OF NATIONAL LABOR RELATIONS BOARD production had been discharged prior to the election, the record discloses that there was no such policy before the election, and, in any event, that no such policy was uni- formly enforced. Thus, at least three employees 2 who were subsequently discharged, allegedly for failure to earn their minimum hourly wage, testified that prior to the advent of the Union, they consistently failed to produce sufficient quantities at piecework rates to earn the equivalent of the minimum hourly wage. Yet they were not criticized, much less discharged. Moreover, there was no showing that these three employees had ever been previously warned that if they did not produce enough piecework to earn the mini- mum wage they would be discharged. The record as a whole warrants the conclusion that a substantial number of employees did not produce enough piecework to satisfy the production requirement announced on November 4. Dominguez' testimony to this effect is par- tially corroborated by Respondent's payroll records. Ac- cording to the record for the payroll period ending Novem- ber 22, of 81 production employees 54 earned less than $84 a week, the minimum wages for a 40-hour week, at the minimum hourly rate of $2.10. Although these records do not disclose the number of hours actually worked by these employees, Mrs. Patino's only explanation was that the em- ployees who received paychecks of less than $84 a week must have worked less than 40 hours. Elsewhere, however, she testified that with few exceptions, all of the production employees worked a 40-hour week in the latter part of No- vember. Nevertheless, despite Mrs. Patino's contention that employees were paid the minimum wage regardless of whether they produced at that level, the record establishes that their compensation was based wholly on their actual production. In fact, the record discloses that a majority of the employees consistently failed to earn the minimum hourly wage based on their rates of production. Neverthe- less, Respondent was content either to pay them the mini- mum wage, irrespective of whether their production war- ranted it, or to pay them wages based upon their actual production on a piecework basis until the employees mani- fested their determination to select a bargaining agent to represent them. Based upon the foregoing, and the timing of the change in policy the day after the election, it is found that Respon- dent adopted new production standards as a means of re- taliating against the employees because of their selection of the Union. b. The change in starting time and rules prohibiting talking Respondent contends that it has always maintained rules requiring production employees to be seated at their ma- chines at precisely 7:30 a.m. and prohibiting them from engaging in conversation with fellow employees during working time. If these rules were actually in effect, it is obvious that either the employees were unaware of the rules, or that the rules had never been strictly enforced. In any case, it is clear that Mrs. Patino notified the employees that they would thereafter be required to adhere strictly to the rules. 2 Lazaro, Nunez, and Dominguez. Prior to the election the regular working hours were 7:30 a.m. to 4 p.m. Employees were permitted, however, to start earlier and work later, if they so desired, thereby enhancing their earnings. Mrs. Patino conceded that prior to the elec- tion this policy had been flexible. Some employees, like Lazaro, for example, were permitted to start work as early as 6:30 or 6:45 a.m. or to work as late as 5:30 or 6 p.m. Whatever may have been Respondent's purpose in making this announcement, it is obvious that it constituted a unilat- eral change in working conditions prompted by the employ- ees' selection of the Union as bargaining agent. The record further establishes that prior to the election employees were permitted to use the sewing machines to work on their personal clothing during nonworking time. Mrs. Patino's announcement the day after the election that this privilege was being discontinued, in the absence of any reasonable justification for the change in policy, warrants a finding that the change was made in retaliation for the se- lection of the Union as bargaining agent. It is undisputed that the changes in working conditions were made without prior notification to the Union, and prior to an opportunity to negotiate concerning the changes, despite the fact that the Union had won the election the day before. Therefore, it is, found that by unilaterally changing the terms and conditions of employment of its employees fol- lowing the Board election, without prior notification to or opportunity to negotiate with the Union'" which was later certified as exclusive bargaining agent, Respondent has failed and refused to bargain collectively with the Union, thereby engaging in unfair labor practices within the mean- ing of Section 8(a)(5); Respondent has interfered with, re- strained, and coerced employees in the exercise of rights guaranteed in Section 7, thereby engaging in unfair labor practices within the meaning of Section 8(aXl) of the Act. It is further found that by said conduct, Respondent has discriminated in regard to the hire and tenure of employ- ment of its employees to discourage membership in the Union, thereby engaging in unfair labor practices within the meaning of Section 8(a)(3) of the Act. c. The November 14 discharges Respondent contends that it discharged the four employ- ees'4 because they had failed to produce their quota of piecework units to earn the minimum wage. It may be noted in passing that when Mrs. Patino notified the employ- ees of the production requirement, she told them that they would have 2 weeks in which to demonstrate they could achieve this quota. Instead of allowing them the 2 weeks as she had stated, she decided to terminate them before the expiration of the probationary period. In any event, these employees were discharged because they had failed to sat- isfy a newly imposed condition of employment which, it has been found, violated Section 8(a)(l), (3), and (5) of the Act. Two of these employees, Nunez and Dominguez, had acted as union observers at the election. In Lazaro's case, Mrs. Patino told her at the time of her discharge that since she had supported the Union, the Union could find work for 13 M S. P Industries, Inc., d/b/a The Larirner Press, 222 NLRB 220 (1976). '1 Nunez. Dominguez. Lazaro, and de Castro. 782 VICTOR PATINO AND NYDIA PATINO, ET AL. her. The record further establishes that, as shown by the payroll for the week ending November 22 (the week after these terminations), a substantial number of employees who had failed to produce sufficient piecework to earn the mini- mum wage were retained in Respondent's employ. Therefore, it is found that by discharging Nunez, Domin- guez, Lazaro, de Castro, and other employees on November 14, ostensibly because of their failure to produce enough piecework to earn the minimum wage but in reality because of their union membership and adherence, Respondent has discriminated in regard to hire and tenure of employment to discourage membership in the Union, thereby engaging in unfair labor practices within the meaning of Section 8(a)(3) of the Act. d. The plant closure and consequent termination of employees Respondent contends that its plant closure on December 2 was dictated by its financial condition which culminated in its inability to meet the payroll on November 28. Re- spondent's decision to close the plant, however, was not actually made until after it was notified by the Department of Labor that the employees had complained that Respon- dent had failed to pay their wages the previous Friday. Obviously, Mrs. Patino held the employees and the Union responsible for the complaint to the Department of Labor. Obviously, Respondent's inability to meet its payroll amounted to only a temporary exigency, inasmuch as it succeeded in obtaining the necessary funds from its custom- ers within a matter of a day. It was not shown whether Respondent had ever failed to meet its payroll in the past, but it seems wholly improbable that it would have based a decision to close its business on its inability to meet its pay- roll on this occasion, particularly since the Employer was fully aware that it would receive sufficient funds within 24 hours to meet its payroll. The fact that Respondent had been served in the meantime with a notice to quit for non- payment of 2 months' rent does not establish that its finan- cial condition did not warrant that it continue in business. If Respondent had decided to close its plant in order to frustrate its employees' desire for self-organization, it would have suited its purpose to default in payment of rent. Re- spondent offered no profit and loss statements, income tax statements, or other financial data which would have shed light on its financial condition as of the time it decided to close down its operation. Evidence subpenaed by the Gen- eral Counsel, showing Respondent's gross revenues for the period June to October 1975,1' compared favorably with 15 Gross Revenues According to Respondent's Ledger.' 1975 1974 December 1-19 $14,000 December $33,000 November 45,000 November 48,000 October 77.000 October 61,000 September 70,000 September 54,000 August 68,000 August 65,000 July 65,000 July 56,000 June 52,000 June 41.000 May 45.000 May 71,000 April 48,000 April 46.000 March 38,000 March 41,000 February 44,000 February 31,000 Januar 34,000 January 37,000 600.000 584,000 'All figures have been rounded off to the nearest $1,.000. Judging b) those for the corresponding period of the preceding year. Gross revenues for the month of October 1975 were, in fact, higher than for any other month in either year. Moreover, it is significant that the Puchy operation, in which Mr. and Mrs. Patino were obviously financially involved (if, indeed, they were not the actual owners), which had commenced in October 1975, involved work which would otherwise have been performed by Jean Pier and was diverted at Mrs. Pa- tino's request to the Puchy operation. Thus, any contention that Respondent's decision to close the Jean Pier operation resulted from a decline in business is wholly unconvincing. Rather the evidence tends to show that, in a determination to avoid dealing with the Union as the exclusive represent- ative of its employees, Respondent closed its business and terminated all its employees. It is noted that, notwithstand- ing that Respondent shut down its operation on December 2, it nevertheless continued (albeit with a skeleton crew in- cluding the Patinos, their son, and their daughter), until December 19, retaining only such employees as it desired, and subcontracting work to other garment subcontractors in order to complete the unfinished work on hand. It is well established that an employer may shut down his entire business, even if prompted by a desire to avoid unionism, without committing an unfair labor practice.6 The General Counsel contends, however, that Respondent did not actually shut down operations on December 2, that its action on that date merely constituted a partial shut- down, and that it actually continued operations until De- cember 19, employing a skeleton crew of what it regarded as loyal employees and subcontracting the remaining work. This is not the type of partial closure which the Court envis- aged when it concluded that a partial closing "motivated by a purpose to chill unionism in . . . remaining plants of the single employer may constitute an unfair labor practice un- der Section 8(a)(3).1' The record here fairly establishes that for all practical purposes the business of Respondent was shut down on December 2, remaining in operation solely for the purpose of completing work on hand. In retaining the small group of employees, however, who according to Respondent volunteered to assist in the completion of the work on hand without compensation, it is evident that the selection of these employees was based upon their pre- sumed loyalty to their Employer. To this extent, at least, it appears that the Employer selected for termination union supporters while retaining those who were presumptively loyal to their employer. Thus, it is apparent that Respon- dent's selection of the employees whom it retained to com- plete the work was based on union considerations. More- over, it is clear from the timing of Respondent's decision to shut down its operations and terminate the employees that it did, in whole or material part not only because they had supported the Union but also because of their concerted these figures, Respondent grossed more in 1975 than in 1974. Obviously. the financial condition of Respondent's business could not be deter- mined on the basis of gross revenues alone, but Respondent furmshed no profit and loss statements or other financial data which could aid in determining its financial condition as of December 2, 1975. 16 Textile Workers Union of .merica . Darlington Manufacturing Co., 380 .S 263. 273 1965). 1" Id at 27 5 783 DECISIONS OF NATIONAL LABOR RELATIONS BOARD activity in reporting to the Department of Labor Respon- dent's failure to make timely payment of their wages. Un- der all the circumstances, the termination of the vast major- ity of its employees on December 2, even though a consequence of Respondent's shutdown, constituted dis- crimination in regard to hire and tenure of employment to discourage membership in the Union in violation of Section 8(a)(3) of the Act. It is axiomatic that an employer is required to notify the collective-bargaining representative of its employees of a decision to shut down its operations in order that the Union may bargain about the effects of the closing upon the em- ployees. It is undisputed that Respondent did not notify the Union until December 3, 1975, the day after it shut down its operation, of its decision to close the plant and did not afford the Union an opportunity to bargain about the effect of the closing upon its employees. By failing to afford the Union an opportunity to bargain about the selection of em- ployees for termination and other aspects of its decision, Respondent deprived unit employees of an opportunity to be considered for the work performed by the few employees who were retained, as well as the subcontractors, between December 2 and December 19, the date Respondent actu- ally ceased operation of the plant. Respondent was under a duty to bargain concerning such matters as "severance pay, vacation pay, seniority and pensions, among others, which are necessarily of particular importance to the employ- ees."'8 Therefore, it is found that by failing to notify the Union of its decision to shut down its operations and to afford the Union an opportunity to bargain about the effects of the shutdown upon the employees, Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(5) of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent set forth in section III, above, occurring in connection with its operations de- scribed in section I, above, have a close, intimate, and sub- stantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that Respondent has engaged in unfair la- bor practices within the meaning of Section 8(a)(l), (3), and (5) of the Act, it will be recommended that it cease and desist therefrom and take certain affirmative action de- signed to effectuate the policies of the Act. It has been found that Respondent discriminatorily dis- charged Manuela Nunez, Wilfrido Dominguez, Paula Rios Lazaro, Lila de Castro, and other employees, on November 14, 1975, because of their union or concerted activity to discourage membership in the Union, in violation of section 8(a)(3) of the Act. Since Respondent has permanently shut down its operations, it will not be recommended that Re- I Interstate Tool Co., Inc., 177 NLRB 686 (1969). spondent offer these employees immediate and full rein- statement to their former positions. It will, however, be rec- ommended that Respondent make said employees whole for any loss of pay they may have suffered as a result of the discrimination against them for the period from November 14, 1975, to December 19, 1975, when Respondent ceased doing business. In consequence of Respondent's unlawful failure to bar- gain with the Union about the effects of its shutdown, the displaced employees have been denied an opportunity to bargain through their collective-bargaining representative at a time when Respondent was still in need of their services and a measure of balanced bargaining power existed. A mere bargaining order would not furnish an adequate rem- edy for the unfair labor practices which Respondent has committed. In order to effectuate the policies of the Act, it will be recommended that Respondent bargain collectively with the Union concerning the effects of the shutdown on its employees, accompanied by a limited backpay order de- signed both to make whole the employees for losses suffered as the result of the violation and to recreate in some practi- cal manner a situation in which the parties' bargaining po- sition may be restored. It will, therefore, be recommended that Respondent make Manuela Nunez, Wilfrido Dominguez, Paula Rios Lazaro, and Lila de Castro whole for any loss of pay they may have suffered as a result of the discrimination against them from the date of such discrimination until the date of the unconditional offer of reinstatement to said employees, less their net earnings during such period, with backpay computed in accordance with the Board's customary for- mula, plus interest at 6 percent per annum. It will, therefore, be recommended that Respondent pay the terminated employees, including those who were unlaw- fully terminated on November 14, 1975, backpay at the rate of their normal wages while they were last in Respondent's employ from 5 days after the date of this Decision and recommended Order until the occurrence of the earliest of the following conditions: (1) The date Respondent bargains to agreement with the Union on those subjects pertaining to the effects of the plant shutdown on its employees; (2) a bona fide impasse in bargaining; (3) the failure of the Union to request bargaining within 5 days of this Decision or to commence negotiations within 5 days of Respondent's notice of its desire to bargain with the Union; or (4) the subsequent failure of the Union to bargain in good faith. In no event shall the sum paid to any of these employees ex- ceed the amount such employee would have earned as wages from December 2, 1975, the date on which Respon- dent terminated its operations, to the date such employee has secured substantially equivalent employment elsewhere or the date on which Respondent shall have offered to bar- gain, whichever occurs sooner. However, in no event shall this sum be less than these employees would have earned for a 2-week period at the rate of their normal wages when last in Respondent's employ.' It will further be recommended that Respondent place all terminated employees, including those who were discrimi- natorily discharged on November 14, 1975, on a preferen- '1 Interstate Tool Co., Inc., supra; Transmarine Navigation Corporation and its Subsidiary, International Terminals, Inc., 170 NLRB 389 (1968). 784 VICTOR PATINO AND NYDIA PATINO, ET AL. tial hiring list in the event Respondent resumes operations and at that time offer reinstatement to those employees, and mail copies of the notice attached hereto, in Spanish and in English, to said employees. Upon the basis of the foregoing findings of fact and upon the entire record in the case, make the following: CONCLUSIONS OF LAW 1. Victor Patino and Nydia Patino, copartners doing business as Jean Pier, were, at all times material herein, an employer engaged in commerce and in a business affecting commerce within the meaning of Section 2(6) and (7) of the Act. 2. Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, is, and at all times material herein has been, a labor organization within the meaning of Section 2(5) of the Act. 3. All production and maintenance employees employed by the Employer at its facility located at 1405 West Pico Boulevard, Los Angeles, California, excluding office clerical employees, models, salesmen, professional employees, watchmen, guards, and supervisors as defined in the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. At all times material, since November 3, 1975, the Union has been, and now is, the certified and exclusive representative of all employees in the aforesaid appropriate unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 5. By discharging Manuela Nunez, Wilfrido Dominguez. Paula Rios Lazaro, Lila de Castro, and other employees on November 14, 1975, because of their union or other pro- tected concerted activities, to discourage membership in the Union, Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(3) of the Act. 6. By refusing, on or about November 4. and at all times thereafter, to bargain collectively with the above-named Union as the exclusive representative of all the employees of Respondent in the appropriate unit, more particularly by refusing to bargain with the Union concerning the changes in working conditions; by unilaterally offering employees an insurance plan without first notifying the Union and affording it an opportunity to bargain: and by failing and refusing to bargain with the Union concerning the effects of the plant closing, Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(l) and (5) of the Act. 7. By the aforesaid refusal to bargain, by threatening employees with plant closure, by promising employees a wage increase to renounce the Union, and by unilaterally offering employees an insurance plan for the purpose of undermining their union support, Respondent has inter- fered with. restrained, and coerced employees in the exer- cise of the rights guaranteed in Section 7. thereby engaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 8. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. [Recommended Order omitted from publication.] SUPPLEMENTAL DECISION STATEMENT OF THE CASE IRVING ROGOSIN, Administrative Law Judge: On Sep- tember 20, 1976, the Decision of this Administrative Law Judge was issued in consolidated Cases 31-CA-5612, 31- CA-5771, and 31-CA-5849, finding that Respondents Vic- tor Patino and Nydia Patino d/b/a Jean Pier had engaged in unfair labor practices within the meaning of Section 8(a)(1), (3), and (5) and Section 2(6) and (7) of the National Labor Relations Act, as amended, and recommending an order to remedy said unfair labor practices. On March 1I, 1977, while these consolidated cases were pending before the Board, the Regional Director issued a new complaint against Victor Patino and Nydia Patino d/b/a Jean Pier, Budget Fashions, and Richard Erquiaga d/b/a California Sewing, alleging that Respondent Budget Fashions and Re- spondent California Sewing were both alter egos of Respon- dent Jean Pier, and as such had violated Section 8(aX)(1), (3), and (5) and Section 2(6) and (7) of the Act (Case 31-CA- 6615, formerly 21-CA-15104).' On May 25, 1977, the Board granted the General Coun- sel's motion to reopen the record in the previous consoli- dated cases, to consolidate said cases with Case 31-CA- 6615, and to arrange for further hearing. The consolidated cases previously heard were remanded to the Regional Di- rector for further action. On June 23, 1977, the Regional Director reopened the record in the former cases; consoli- dated said cases with Case 31-CA-6615 for purposes of hearing, ruling, and decision before this Administrative Law Judge; and noticed the cases for hearing. The amended complaint, issued August 26, 1977,2 alleges, in substance, that (1) from about February 1, 1976, until about May 12, 1976, Respondent Victor Patino, as a sole proprietor, assumed and continued the operations of Re- spondent Jean Pier,3 using substantially the same equip- ment, employing some of the same employees and supervi- sors, and producing the same products and services previously performed by Respondent Jean Pier at a differ- ent location; (2) since on about May 12, 1976, Respondent Richard Erquiaga, doing business as California Sewing, as- sumed and continued the operations of Respondent Jean Pier, jointly with Respondent Victor Patino, for the benefit of Respondent Jean Pier: (3) at all times material, Respon- dents have been affiliated business enterprises with common ownership and control, operating as a single integrated en- terprise, thereby constituting a single employer; (4) since February 1976, Respondents Victor Patino and Respondent California Sewing have each been alter egos of Respondent Jean Pier; (5) since on about November 4, 1975, Respon- I The onginal charge in the instant case, filed on October 5, 1976, and duly served, named as the Employer only Victor Patino and Nydia Patino. The first amended charge, filed on March 10, 1977. also duly served, added as Respondents Eddie Radow, d/b/a Budget Fashions, and Richard Erquiaga, d/b/a California Sewing. The second amended charge, filed on August 26. 1977. and duly served, added Victor Patino and Nydia Patino d/b/a Jean Pier as Respondents. 2 Budget Fashions was dropped as a Respondent in this amended com- plaint. References to Jean Pier herein signify the copartnership of Victor Patino and Nydia Patino, d hba Jean Pier. 785 DECISIONS OF NATIONAL LABOR RELATIONS BOARD dents have refused to bargain with the Union as exclusive representative of Respondents' employees in an appropriate unit; (6) in about December 1975 and in about February 1976 Respondent Jean Pier unilaterally decided to move without notifying the Union or offering it an opportunity to bargain, removed said Respondent's business from 1405 West Pico Boulevard to a location at 315 West 38th Street, Los Angeles, California; (7) and since about February 1, 1976, Respondents have failed and refused to reinstate the former employees of Jean Pier to the positions previously occupied by them while in the employ of Jean Pier at its location at 1405 West Pico Boulevard, Los Angeles, Cali- fornia. Respondents Victor Patino, Nydia Patino, Richard Erquiaga, and California Sewing filed answers through their attorney; Respondent Budget Fashions, Inc., filed an answer signed by Edward Radow (its secretary-treasurer), but was later dropped from these proceedings. All Respon- dents denied generally the substantive allegations of the complaint. Pursuant to the Board's Order, issued May 25, 1977, hearing was held before me on August 29 and 30, 1977, at Los Angeles, California. General Counsel and Respondents were represented by counsel. All parties were afforded full opportunity to be heard, to examine and cross-examine wit- nesses, to introduce evidence relevant and material to the issues, to argue orally, and to file briefs and proposed find- ings of fact and conclusions of law. The parties waived oral argument but filed briefs on October 1, 1977.4 No proposed findings of fact or conclusions of law have been filed by any of the parties. Upon the entire record in the case and based upon the appearance and demeanor of the witnesses and the briefs of the parties in the instant proceeding, I make the following: FINDINGS OF FACT I. THE BUSINESS OF RESPONDENTS The amended consolidated complaint alleges that at all times material herein, Respondent Jean Pier, a partnership. either per se or through alter egos, has been engaged in the manufacturing of clothing, with an office and principal place of business located in Los Angeles, California. In the ' On November 9, 1977, counsel for the General Counsel moved to strike from Respondents' brief exhibits A and B, annexed to the brief. Exhibit A, purporting to be a brief on behalf of Respondents Victor Patino and Nydia Patino in the previous consolidated cases, was never actually filed or served on the other parties, despite a 30-day extension granted for the purpose. Likewise, exhibit B, consisting of the purported financial statements of Jean Pier for the year ended December 31, 1975, attached to the previous brief allegedly filed, was never introduced in evidence in those cases or in the instant proceedings. Nor has any claim been made that the financial state- ments constituted newly discovered evidence or that they were otherwise admissible in these proceedings. In any event, Respondents made no attempt to introduce this evidence at either hearing. General Counsel's motion to strike is hereby granted, and both exhibits attached to Respondents' brief are hereby stricken. With regard to the motion to strike the exceptions, including the financial statements attached thereto, the General Counsel represents that no exceptions were ever served on the other parties, and no proof of such service has been shown. However, since the previous cases have already been transferred to the Board, the motion to strike the exceptions and the financial statements attached thereto in this case are reserved for disposition by the Board. course of its business, said Respondent sells services valued in excess of $50,000 annually to firms located in the State of California, each of which firms in turn sells goods and ser- vices valued in excess of $50,000 annually directly to cus- tomers located outside the State of California. Although Respondents deny these allegations proforma, Respondents Victor Patino and Nydia Patino, as copartners doing busi- ness as Jean Pier, stipulated at the instant hearing that Jean Pier and Richard Erquiaga, doing business as California Sewing, have, at all times material, been engaged in com- merce within the meaning of the Act. Moreover, the Board has asserted jurisdiction over Respondent Jean Pier, and has certified the Union as exclusive representative of em- ployees in the appropriate unit on March 16, 1976. It is therefore found on the basis of the foregoing and the entire record that, at all times material herein, Respondents Victor Patino and Nydia Patino, copartners doing business as Jean Pier, and their alter egos, have constituted a single employer engaged in commerce and in operations affecting commerce within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, is, and at all times material has been, a labor organization within the meaning of Section 2(5) of the Act. III. THE NFAIR LABOR PRACTICES A. The Issues 1. Whether Respondents Victor Patino and Nydia Pati- no and Richard Erquiaga, doing business as California Sewing, as alter egos of Jean Pier, have engaged in unfair labor practices within the meaning of Section 8(a)(1), (3) and (5) of the Act by various acts of interference, restraint, or coercion: by unilaterally, without notice to or opportuni- ty for negotiation with the Union, shutting down and re- moving the Jean Pier operation to a new location, and by discharging and thereafter failing and refusing to reinstate the employees of Jean Pier who had unlawfully been termi- nated in December 1975 when it closed down its operation. B. Preliminary Statement The instant proceeding represents the aftermath of events which gave rise to the unfair labor practices in which Victor Patino and Nydia Patino, copartners doing business as Jean fPier, were found to have engaged in in the earlier proceed- ings. The findings and conclusions in those cases as detailed in the Decision issued on September 20, 1976, are now pending before the Board. Except as modified herein, the findings and conclusions are hereby reaffirmed and incorpo- rated herein by reference. C. Subsequent Events As found in the earlier Decision, the Patinos shut down the Jean Pier operation for all practical purposes, on about 786 VICTOR PATINO AND NYDIA PATINO, ET AL. December 2, 1975, retaining a skeleton crew until Decem- ber 19 and utilizing other contractors to complete unfin- ished work on hand. The Patinos had been engaged, under the firm name of Jean Pier, in the business of sewing and finishing ladies garments for sportswear manufacturers. Among their cus- tomers or manufacturers was Budget Fashions, Inc., herein Budget. Under the current practice in the Los Angeles area, the manufacturer selects the textiles or fabrics, designs the style of the garment to be produced, cuts the material, and delivers the goods to the "contractor." The contractor sews, presses, finishes, and delivers the finished garments to the manufacturer. During this period, Budget used other con- tractors as well as Jean Pier to perform this work. Sometime in December 1975,5 Edward Radow, managing officer and sole stockholder of Budget, telephoned Victor Patino at Jean Pier's place of business to ask him whether he could handle some work for Budget.6 Patino told Radow that he was going out of business. Radow asked Patino what he planned to do, and Patino told him that he was going to look for other work. Radow, who had acquired some property consisting of two separate, neighboring buildings only one of which he intended to occupy, asked Patino whether he would be interested in moving into the other building and working for Budget as an "inside con- tractor."7 Patino was receptive to this proposition, and told Radow that he had all the necessary equipment and could provide experienced help for the operation. After closing the Jean Pier operation in December 1975 (probably late in January 1976), the Patinos moved the ma- chines and equipment which had been used in the Jean Pier operation from the location at 1405 West Pico Boulevard, Los Angeles, to the site at 226 West 37th Place, one of the two buildings owned by Radow. About 2 weeks later, Bud- get moved its own machines and equipment from Radow's other building, located at 315 West 38th Street, to the 226 West 37th Place location, while the Patinos moved their machines and equipment into 315 West 38th Street, where they continued their operation. Later, Radow in an individual capacity executed a lease with the Patinos, as individuals dated February 1, 1976, covering the building located at 315 West 38th Street, Los Angeles, for a term of 3 years at a monthly rental of $900.' s Although Radow testified that it was in the latter part of the year, and later said that it could have been anywhere from August to November, it is evident from the context of his testimony that the telephone conversation occurred in the month of December, since Jean Pier ostensibly went out of business no later than December 19. 1975. 6 Budget conducted a manufacturing business similar to Jean Pier's but on a smaller scale, chiefly for making samples of ladies sportswear garments for its customers. 7 Radow testified that an inside contractor usually works on or near the premises of the manufacturer, performing services for that manufacturer ex- clusively as long as the manufacturer can provide the contractor with work. When the manufacturer has no work for the contractor, the latter may per- form work for other manufacturers. I Although Patino claimed that the lease was not actually executed until April 1976, Budget's records for the Patino operation disclose that $900 was deducted from income from the operation for the month of February. Ac- cording to Radow, the lease was executed at about the time the Patinos began this operation. Payroll records indicate that the first payroll period ended January 31, 1976. I is probable that Patino occupied the premises without a lease before the arrangement with Radow was reduced to writing. In an) event, as will later appear, the arrangement was terminated about the end of April the same year. Under the arrangement between Radow and the Patinos, covered by an Addendum to the lease, Radow was entitled to the Patinos' services, as an "independent contractor," in the sewing and finishing of good furnished by Radow, the lessor.' The Addendum called for the Patinos' ° to provide the machines, equipment, furniture, and personnel essential to the operation. Patino was to hire the employees needed for the venture, with the sole right to hire, direct, supervise, and control the employees. Radow agreed to advance necessary funds for the operation, including costs of alteration and installation of Patino's machines and equipment, and to fi- nance Patino's payroll on a weekly basis. Radow also agreed to compensate Patino for the work furnished Budget at a price fixed between them, with a periodic accounting at least monthly. Radow further undertook to advance Patino any addi- tional sums necessary, furnishing him with an accounting of such sums, for which Patino agreed to reimburse Radow upon presentation of statements or billings. Radow established a separate payroll account at the bank in Budget's name, apart from its own regular account. Patino furnished the bank with the wage and hour data, and the bank ssued the paychecks, deducting the custom- ary withholdings. The original payroll printout covering this account was sent to Patino and a copy to Radow. Bud- get maintained a separate ledger for its transactions with Patino, including the payroll advances and other expenses incurred, crediting Patino with the income derived from the operation. Patino was free, however, to do work for other manufac- turers and to establish prices for the work, provided only that Budget had "first call" on Patino's services. Patino ac- tually performed such work for other manufacturers, who remitted payment to Budget which credited Patino's ac- count with such payment. Radow recommended another manufacturer to Patino as his first "outside" customer. Radow received no commission for this order, but on subse- quent business which Radow procured for Patino he was paid a commission. Later, Patino solicited his own custom- ers directly, made his own arrangements, and paid Radow no commission. As has previously been noted, Patino decided on the size of his work force, hired the operators, fixed their wages, rates of pay, hours of work, and other terms and conditions of employment. As of February 20, 1976, Patino had hired 23 employees. Of this number, only four, presumably key employees, had been employees of Jean Pier." Patino also placed help wanted ads for operators in La Opinion, a 9 Although the lease and Addendum make no mention of Budget, it is evident that as sole stockholder and managing official, Radow made no dis- tinction between himself, as an individual and the corporation as a separate entity. It is clear, however, that any services to be performed by the Patinos under the lease arrangement were to be rendered to Budget. For the purpose of this proceeding. references to Radow are intended to appl equall to Budget, as the context may require. 10 For convenience. all references to Patino hereinafter are intended to apply to Victor Patino and to his wife Ndia unless the context otherwise requires. Until March 1976, Mrs. Patino was employed by a different manu- facturer. Thereafter, she joined her husband in active management. " Yolanda Vasquez. Teresa Cervantes. Virginia Calderon, and Julia Rod- nguez. 787 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Spanish language newspaper in the Los Angeles area. By March 31, 1976, Patino had hired 68 employees, none of whom except as noted, had previously been employed by Jean Pier. Although Patino was not entitled to a salary under his arrangement, Radow discovered in March 1976, after ex- amining the bank's payroll printout for the Patino opera- tion, that Patino, his wife, and son had been drawing sala- ries aggregating $660 a week. Radow protested to Patino that that was not their arrangement, reminding him that the Patinos were not entitled to a salary and were to be com- pensated only by any profits derived from the operation. Patino told Radow that he needed a salary to live on. Fi- nally, Patino prevailed on Radow to let him continue draw- ing a salary, on Patino's assurance that he would be able to work off any indebtedness to Radow. In April 1976, Radow told Patino that he wanted to dis- continue their arrangement, and notified Patino that he would not be doing any of Budget's work and would be operating "on his own." Patino pleaded that he needed time to make arrangements to meet his payroll, to "register a name," and procure the necessary licenses.' Radow gave him until the end of June. Radow cancelled Patino's lease but permitted him to re- main as a tenant at will on a month-to-month basis. An unlawful detainer action brought by Radow against Patino to recover rent, for the months of April, May, and June, was settled by the issuance of postdated checks to cover the arrears of rent. Other differences were apparently resolved in an accounting between the parties. On April 30, 1976, the last day of the pay period under Patino's arrangement with Budget, Patino notified the em- ployees who had been working under this arrangement that a new company, California Sewing, was being formed to continue the business previously conducted by him. On May 1, California Sewing took over the operation, using the same machines, equipment, and personnel, at the same lo- cation and performing the same work for the same custom- ers. Meanwhile, Patino had approached Richard Erquiaga regarding the formation of California Sewing to operate the business which had previously been conducted by Patino. Erquiaga, a friend of Patino's son and frequent visitor at the Patino home, consented. On May 12, 1976, Erquiaga signed and filed a fictitious business name statement with the county clerk, in the name of California Sewing. According to Erquiaga, he became the actual, as well as the titular, owner of the business, but he delegated all authority for the operation of the business to Patino as his manager. The same day, Patino opened a bank account with a $4,000 deposit in the name of Califor- nia Sewing.' Erquiaga, aged 22 and living at home with his parents, was a full-time college student, and part-time clerk em- ployed by Alpha Beta, a retail grocery company. He had known the Patinos about 7 years, primarily through their 2 "Fictitious Business Name Statement." i Although Patino testified that he was "broke" when Radow terminated his arrangement with him, he claimed that this sum represented payment by Budget for work completed during the final weeks of his arrangement with Radow. Patino also testified that he may have met his payrolls for California Sewing with advances from manufacturers for whom he did work. son. He admittedly had no familiarity with the garment contracting business either as owner or employee. He in- vested no money in the operation, but according to him, he was to receive 10 percent of any profits. Patino, his wife, and his son drew salaries aggregating about $600 weekly, substantially the same amount the Patinos had drawn as inside contractor while at Budget. After it became apparent at the hearing that Erquiaga was nothing more than a strawman for Patino, the parties stipulated that Erquiaga was not the real owner of California Sewing and that the business was actually owned and operated by Victor H. Patino and Nydia Patino. California Sewing continued its contracting operation until February 1977, when it moved its machines and equipment to a new location at 3214 South Main Street, Los Angeles, California, where it was still operating at the time of the hearing. California Sewing employed a comple- ment of 49 persons, including the Patinos, all of whom had been employed in the previous operation. These employees continued to work for California Sewing without a hiatus during the transition from the Patino-Budget opration to California Sewing. At the previous hearing, Respondent Patino testified that after he closed down the Jean Pier operation, he, his wife, and his son became employed by Budget Fashions as fac- tory manager, forelady, and driver, at salaries of $300, $250, and $110 per week, respectively, plus a 3 percent commission on gross sales to Patino and his wife. Patino arranged for moving and installing at the new location the sewing and pressing machines and all other equipment pre- viously used in the Jean Pier operation. The evidence developed at the instant hearing, however, fairly establishes that the Patinos were lessees of Radow and independent contractors rather than employees of Bud- get. If anything, the relationship was more nearly that of landlord and tenant. They occupied the premises owned by Radow under a lease at a rental of $900 per month. They used their own machines and equipment, hired their own employees, fixed wages and conditions of employment, per- formed the same type of services for other manufacturers, and independently established, the prices to be charged other manufacturers for the work performed. The fact that Radow collected his rent out of the gross receipts from the Patino operation, financed the weekly payroll, and ad- vanced the expenses of installation of the machinery and equipment does not affect these conclusions. In fact, under the initial arrangement, the Patinos were to receive no weekly salary or compensation other than the net profits realized from the operation after Budget had recouped the amounts advanced for payroll and other expenses. Subse- quently, when Radow discovered that Patino was including in his weekly payroll salaries for himself, his wife, and his son, Radow protested that that was not their arrangement. That Radow eventually capitulated, and consented to al- lowing the Patinos to draw these sums as salary, did not result in an employer-employee relationship. The fact that the Patinos performed contract services for other manufac- turers, while occupying premises owned by Radow, indi- cates that the parties regarded the Patinos as an indepen- dent contractor. It is clear from the record that Patino performed the same type of services for manufacturers other than Budget, and that by mid-March the amount of 788 VICTOR PATINO AND NYDIA PATINO, ET AL. work performed for Budget had drastically declined in comparison with work done for outside manufacturers. It is found on the basis of the foregoing and upon the entire record, that the lease arrangement between Radow and the Patinos, under which the Patinos rendered services to Budget, did not create an employment relationship but rather that of an independent contractor continuing the same business previously conducted under the name of Jean Pier. Budget continued its own business, utilizing other contractors in addition to Patino, maintaining sepa- rate bookkeeping records for its own operation. There was no interchange of employees between Budget and Patino. The record fully establishes that neither Budget nor Radow possessed or exercised any control over the manner or means by which the garments on which Patino's employees worked was to be performed. It is evident from the forego- ing findings that the operation conducted by Patino, while acting as contractor for Budget, amounted to a continu- ation of the Jean Pier operation, with the same ownership, management, and substantially the same customers. It is therefore found that the Patinos were successors or alter egos of the business operated as Jean Pier. The fact that the Patinos were able to reestablish their business, al- beit at a different location, within less than I month after they had ostensibly shut down their operation as Jean Pier. lends further support to the conclusion that Respondent Patinos closed down their operation as Jean Pier and dis- charged their entire complement of employees at their for- mer location to avoid recognizing and negotiating with the Union. The Patinos' flagrant attempt to conceal their actual ownership of California Sewing by putting the business in Erquiaga's name, which the Patinos reluctantly conceded, if only for the purpose of this hearing, completely impugns their motive for closing down the Jean Pier operation. It further supports the conclusion that both the Patino-Budget arrangement and the California Sewing business were mere disguised continuances of Jean Pier. It is hereby found that the Patino-Budget operation, and Richard Erquiaga, doing business as California Sewing, at all times material herein have been, and that California Sewing is now successor to and alter ego of Victor Patino and Nydia Patino, individually, and as copartners doing business as Jean Pier. It is therefore found that all Respondents are, jointly and severally, responsible for remedying the unfair labor prac- tices committed, as found in the previous unfair labor prac- tice proceedings.'4 Since the evidence adduced in the instant proceeding es- tablishes that the Patinos, as copartners doing business as Jean Pier, did not, as there found, permanently shut down their operations on or about December 19, 1975, but in- stead, entered into the lease arrangement with Radow soon afterward under which they continued substantially the same business as Jean Pier at a different address, using the same machines, equipment, some of its former employees. and producing the same product for many of the same la- dies' sportswear manufacturers (including Budget), it will 14 N.L R.B. v. Flite Chief, Inc.; Richard Miller and Karen Miller et al., PAR 85 LC 11.200 (?th Cir. 1977); James K. Sterritt, Inc.. and Concrete Haulers, Inc., 215 NLRB 769 (1974); Marquis Printing Corporation and Mutual Litho- graph Company, 213 NLRB 394 (1974); Rushton Mercier Wood'orking Co., Inc., and Rand & Co., Inc., 203 NLRB 123 (1973). be necessary to modify "The Remedy" in the previous pro- ceedings. D. The Refusal To Bargain 1. The appropriate unit The consolidated complaint in these proceedings alleges, and Respondent's answers deny, that the following consti- tutes an appropriate unit for the purposes of collective bar- gaining within the meaning of Section 9(b) of the Act: All production and maintenance employees employed by respondents at their facility located at 1405 West Pico Boulevard, Los Angeles, California or 315 West 38th Street, Los Angeles, California, excluding office clerical employees, models, salesmen, professional em- ployees, watchmen, guards and supervisors as defined in the Act. On November 3, 1975, in accordance with a Stipulation for Certification Upon Consent Election, an election was held among the employees in the appropriate unit alleged. On March 16, 1976, the Board issued its decision and certi- fication of Representative, adopting the Regional Director's report (Case 31-RC-3297)."' As found in the previous Deci- sion in these proceedings, Jean Pier purportedly closed down its operation at its Pico Boulevard location, as Victor Patino and Nydia Patino had threatened to do. In about mid-January 1976. the Patinos entered into the lease ar- rangement with Radow, previously detailed. As of February 20, 1976, Patino had hired 23 employees, only four of whom had previously worked for Jean Pier. By March 31, 1976, Patino had hired 68 production employees. There was no change in the job classifications or duties of these employees. At the time of the election, on November 3, 1975, there were at least 92 production and maintenance employees in the unit which had been found to be appropri- ate.' 6 The subsequent reduction in the size of the work force did not, of course, affect the appropriateness of the unit. 2. Majority status The Union's majority status having been established by the Board certification, there is a presumption of continuing majority in favor of the Union. There can be no doubt that except for the brief hiatus of less than I month, following the purported closing down of the Jean Pier operation, Pa- tino resumed the same business enterprise, first under his lease arrangement with Radow, and later (upon the cancel- lation of the lease), without any interruption in the opera- tion, employing the same employees, under the alter ego of California Sewing. While the evidence discloses that Patino hired only four of Jean Pier's former employees, at the time he began operating under the Budget auspices it is obvious that he did not hire a majority of Jean Pier's former em- ployees because of his determination to avoid dealing with I' The appropnate unit described in the certification did not, of course, refer to the 315 West 38th Street location. At the time of the election Jean Pier was still operating the business at 1405 West Pico Boulevard. " The tally of ballots established 68 ballots cast for and 15 against the Union. with 9 challenged ballots, and insufficient number to affect the results of the election. 789 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the Union. Moreover, Patino or his alter egos at no time raised the issue of lack of majority (or appropriateness of the unit) as a ground for refusal to bargain. Even if Patino had done so it would have been to no avail, since he met the Union's initial demand for bargaining by shutting down the Jean Pier operation and terminating his employees.' 7 In any event, even under successorship principles, unless the successor can demonstrate that the Union has lost its majority or can establish a good-faith doubt based upon objective considerations that the Union no longer repre- sents a majority of the unit employees, the successor is ob- ligated to recognize and bargain with the Union. Any al- leged loss of majority, under the circumstances of these cases, must be attributed to Respondents Patino, in view of the mass discharges of their employees for the obvious pur- pose of circumventing the Union's status as certified repre- sentative. The presumption of continuing majority status is at least as applicable in the case of alter egos as in the case of successors, and the Union may not be required to rees- tablish its majority status.' "Where such a presumption ex- ists and has not been overcome by the requisite kind and degree of proof. the incumbent union need not reestablish its majority status through an election" or by other means. This is especially so where the owners of Jean Pier had manifested their union animus through plant closure and were determined not to bargain with the Union under any circumstances. Whether Respondents are deemed to be suc- cessors or alter egos, the end result would be the same. 3. Demand for recognition; refusal to bargain It is not disputed that the Union made a demand on Jean Pier for recognition and bargaining, at least as early as No- vember 4, 1975, the day after the Board-conducted election, and that Jean Pier failed or refused to bargain with the Union. Respondents' contention that the Union failed to make a demand on California Sewing is no defense to its failure or refusal to bargain. Since the existing certification itself constitutes a continuing demand for recognition, the incumbent Union need not renew its demand. Moreover, the evidence in both the prior as well as the present pro- ceedings makes it abundantly clear, in view of Respon- dents' unalterable opposition to the Union, that any further demand by the Union would have been futile. In such case, the Union is excused from making such a demand. In view of the continuity of the business enterprise, the Union's status as continuing bargaining representative of the employees in the appropriate unit covered by the Board certification and Respondents' failure to overcome the pre- sumption of continuing majority status, it is hereby found that at all times material herein since November 4, 1975, and especially since March 15, 1976, the Union has been, and now is, the exclusive bargaining representative of the employees in the appropriate unit. It is further found that '7 Cf. N.L.R.B. v. Bausch & Lomb, Inc., 526 F.2d 817 (2d Cir. 1975), enfg. in material part 214 NLRB 338 (1974), and cases cited therein. See also Virginia Sportswear, Incorporated, 226 NLRB 1296 (1976). In view of Pa- tino's union animus, his assertion that he did not offer employment to other former employees of Jean Pier because he had no addresses for them is patently specious, especially as there was no showing that he made any effort to locate them. H1 Virginia Sportswear, Incorporated, supra at 1300. the Union made or was legally excused from making a proper demand for bargaining with Jean Pier and its suc- cessors or alter egos; that Respondents failed and refused to bargain with the Union; and that they are jointly and sever- ally obligated to bargain with the Union as exclusive repre- sentative of Respondents' employees in the appropriate unit. In view of these findings, The Remedy, conclusions of law, and recommended Order and notice to employees in the prior proceedings are hereby vacated and the following substituted therefor: IV. THE REMEDY Having found that Respondents Victor Patino and Nydia Patino, doing business as Jean Pier, and their alter egos, Victor Patino, Nydia Patino, and Richard Erquiaga, doing business as California Sewing, have engaged, jointly and severally, in unfair labor practices within the meaning of Section 8(a)(1), (3), and (5) of the Act, it will be recom- mended that they cease and desist therefrom and take cer- tain affirmative action designed to effectuate the policies of the Act. It has been found that Respondents Victor Patino and Nydia Patino, doing business as Jean Pier, discriminatorily discharged Manuela Nunez, Wilfrido Dominguez, Paula Rios Lazaro, and Lila de Castro on November 14, 1975, because of their union or other protected concerted activi- ties to discourage membership in the Union, in violation of Section 8(a)(3) and (1) of the Act. Since it has been found that Respondents Patinos did not permanently shut down the Jean Pier operation but continued the same business at another location, at least since about January 24, 1976, and subsequently, under the guise of Richard Erquiaga, doing business as California Sewing, it will be recommended that Respondents be ordered to offer the employees discharged on November 14, 1975, as well as those terminated on De- cember 2, 1975, as a consequence of the shutdown on that date, immediate and full reinstatement to the jobs held by them on said dates, respectively, as employees of Respon- dents Victor Patino and Nydia Patino, individually or in their capacity as copartners doing business as Jean Pier, and to as many of their former employees in the unit repre- sented by the Union, who were terminated on December 2, 1975, as said Respondents may require in the conduct of their operations or those of any successor or alter ego of said Respondents, discharging, if necessary, any employees presently employed in their current operation. All remain- ing employees in the unit represented by the Union, who were terminated on December 2, 1975, as a result of the shutdown of the Jean Pier operation, shall be placed on a preferential hiring list. The identity of such employees is left for determination at the compliance stage of these proceed- ings. It will further be recommended that Respondents shall make whole those employees discharged on November 14, 1975, as well as those discharged on December 2, 1975, for any loss of earnings they may have sustained by reason of the discrimination against them, by payment to the employ- ees discharged on November 14, 1975, of the sums of money they would normally have earned but for the dis- crimination against them from the date of said discrimina- 790 VICTOR PATINO AND NYDIA PATINO, ET AL. tion to the date of Respondents' unconditional offer of rein- statement; and, as to those employees who were terminated as a result of the shutdown of the Jean Pier plant on De- cember 2, 1975, for any sums of money they would have earned but for such discrimination, from December 2, 1975., to the date on which Respondents place the names of such employees on a preferential hiring list, less their net earn- ings during such periods, with backpay computed on a quarterly basis, plus interest, as provided in F. W. Wool- worth Company, 90 NLRB 289 (1950), and Florida Steel Corporation, 231 NLRB 651 (1977),'9 to be determined at the compliance stage of these proceedings, if necessary. It will further be recommended that Respondents, jointly and severally, be required to recognize and bargain collec- tively with the Union as the exclusive representative of all the employees in the appropriate unit for a period of I year from the date Respondents commence bargaining with the Union in good faith.'0 Upon the basis of the foregoing findings of fact, and upon the entire record in the case, I make the following: CONCLUSIONS OF LAW 1. Victor Patino and Nydia Patino, copartners, doing business as Jean Pier, and Victor Patino and Nydia Patino, individually, and Richard Erquiaga, doing business as Cali- fornia Sewing, alter egos of said Victor Patino and Nydia Patino, as individuals, or as copartners doing business as Jean Pier, were, and at all times material herein have been, employers engaged in commerce and in a business affecting commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. Los Angeles Joint Board of the International Ladies' Garment Workers' Union, AFL-CIO, is, and at all times material herein has been, a labor organization within the meaning of Section 2(5) of the Act. 3. All production and maintenance employees employed by Respondents Victor Patino and Nydia Patino, doing business as Jean Pier, at their former facility located at 1405 West Pico Boulevard, Los Angeles, California, or at 315 West 38th Street, Los Angeles, California, excluding office clerical employees, models, salesmen, professional employ- ' 9 See, generally. Isis Plumbing Heating Co., 138 NLRB 716 (1962). 20As the Board's certification of the Union was entered on March 17, 1976, and tile employees have been deprived of their right to be represented by their chosen bargaining representative for more than a year, it has been recommended that Respondents be required to bargain with the Union in good faith for I year from the date Respondents commence bargaining in good faith. Bartlett-Collins Cornpany, 230 NLRB 194 (1977); Daniel Con- struction Company, a Division of Daniel International. 229 NLRB 93 (1977). ees, watchmen, guards, and supervisors as defined in the Act, constitute a unit appropriate for the purposes of collec- tive bargaining within the meaning of Section 9(b) of the Act. 4. At all times material since November 3, 1975, and especially since March 16, 1976, when it was certified as exclusive bargaining agent and at all times since, the Union has been, and is now, the exclusive representative of all the employees in the aforesaid appropriate unit for the pur- poses of collective bargaining within the meaning of Section 9(a) of the Act. 5. By changing the terms and conditions of employment of their employees on November 4, 1975, and by discharg- ing Manuela Nunez, Wilfrido Dominguez, Paula Rios Lazaro, and Lila de Castro on November 14. 1975, and, by terminating all other employees in the appropriate unit or December 2, 1975, ostensibly because of the shutdown of Respondent Jean Pier's business, but in actuality, because of their union or other concerted activities, to discourage membership in the Union, Respondent has engaged in un- fair labor practices within the meaning of Section 8(a)(3) and (I) of the Act. 6. By refusing, on or about November 4, 1975, and at all times thereafter, and especially since March 16. 1976, the date of the Union's certification, to bargain collectively with the Union as the exclusive representative of all Re- spondents' employees in an appropriate unit: and, particu- larly, by refusing to bargain with the Union concerning changes in working conditions; by unilaterally offering em- ployees an insurance plan, without first notifying the Union and affording it an opportunity to bargain regarding such plan; and by failing and refusing to bargain with the Union concerning the effects of the plant closing, Respondents have engaged in unfair labor practices within the meaning of Section 8(a)(5), thereby interfering with, restraining, and coercing its employees in the exercise of the rights guaran- teed in Section 7, thereby engaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 7. By changing the terms and conditions of employment of their employees: by threatening them with plant closure: by promising an employee a wage increase to renounce the Union; and by unilaterally offering employees an insurance plan for the purpose of undermining their support of the Union, Respondents have interfered with, restrained, and coerced employees in the exercise of the rights guaranteed in Section 7, thereby engaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 8. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. [Recommended Order omitted from publication.] 791 Copy with citationCopy as parenthetical citation