Johnson's Industrial Caterers, Inc.

National Labor Relations Board - Board Decisions

Jun 9, 1972

197 N.L.R.B. 352 (N.L.R.B. 1972)

352 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Johnson 's Industrial Caterers, Inc. and Sales Drivers,
Sales and Service Local 176, affiliated with the
International Brotherhood of Teamsters , Chauf-
feurs, Warehousemen and Helpers of America.
Case 9-CA-6365
June 9, 1972
DECISION AND ORDER
BY MEMBERS FANNING, KENNEDY, AND
PENELLO
On February 23, 1972, Trial Examiner Henry L.
Jalette issued the attached Decision in this proceed-
ing. Thereafter, Respondent filed exceptions and a
supporting brief, and the General Counsel filed
limited exceptions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel:
The Board has considered the record and the Trial
Examiner's Decision in light of the exceptions and
briefs and has decided to affirm the Trial Examiner's
rulings, findings, and conclusions and to adopt his
recommended Order, except as modified herein.'
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Trial Examiner and hereby orders
that Respondent Johnson's Industrial Caterers, Inc.,
Dayton, Ohio, its officers, agents, successors, and
assigns, shall take the action set forth in the Trial
Examiner's recommended Order, as herein modified.
1. Delete in paragraph 1(d) the words "In any like
or related manner" and substitute the words "In any
other manner."
2. Substitute the attached notice for the Trial
Examiner's notice.
1 We find no merit in the Respondent's exceptions , including the
contention that its abrupt change in the working conditions of its drivers
was motivated solely by economic considerations and , its contentions
concerning the remedy The only exceptions filed by the General Counsel
have to do with remedy At fn 8 of his Decision, the Trial Examiner stated
that his recommendation as to remedy accorded with the General Counsel's
request We note , however, that in his brief to the Trial Examiner the
General Counsel asked not only for a remedy whereby the Union would
have an opportunity to determine a course of action which would reflect the
wishes of the bargaining unit employees but also for a make-whole order
"for any loss of wages of fringe benefits suffered as a result of the
unilateral changes illegally instituted by the Respondent " As to this
request , we agree with the Trial Examiner that the employees should be
made whole for any losses suffered by reason of the changes only if they
express desire for restoration of their earlier employment status However,
we find merit in the General Counsel's contention that a broad order is
appropriate when the facts support both an 8(a)(3) violation and an 8(a)(5)
violation in the institution of unilateral changes
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WILL bargain, upon request, with Sales
Drivers, Sales and Service Local 176, affiliated
with International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of
America, as the exclusive representative of all our
employees in the bargaining unit defined below
with respect to rates of pay, wages, hours of
employment, and other terms and conditions of
employment and, if an understanding is reached,
embody such understanding in a signed agree-
ment.
The bargaining unit is:
All route drivers, checkers, and order
fillers at our Dayton operation, but exclud-
ing all office clerical employees, professional
employees, guards and supervisors as de-
fined in the Act.
WE WILL NOT make changes in the wages and
other conditions of employment of our employees
in the appropriate unit above without consulting
and negotiating with Sales Drivers, Sales and
Service Local 176, affiliated with International
Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America.
WE WILL, if requested by Sales Drivers, Sales
and Service Local 176, affiliated with Internation-
al Brotherhood of Teamsters, Chauffeurs, Ware-
housemen and Helpers of America, revoke the
changes in wages and working conditions institut-
ed by us on July 9, 1971, affecting employees in
the appropriate unit and restore the wages and
working conditions in effect prior thereto, and
make employees whole for any losses they may
have suffered by reason of the changes instituted
on July 9, 1971.
WE WILL NOT make changes in the wages and
other conditions of employment of our employees
because you have selected a labor organization as
your exclusive representative for purposes of
collective bargaining and to avoid fulfilling our
obligation to bargain with your representative.
WE WILL NOT in any other manner interfere
with, restrain, or coerce employees in the exercise
of their right to self-organization, to form, join, or
assist Sales Drivers, Sales and Service Local 176,
affiliated with International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Help-
ers of America, or any other labor organization,
to bargain collectively through representatives of
197 NLRB No. 60
JOHNSON'S INDUSTRIAL CATERERS, INC. 353
their own choosing, to engage in other concerted
activities for the purpose of collective bargaining
or other mutual aid or protection, or to refrain
from any or all such activities.
You are free to become and remain members of
Sales Drivers, Sales and Service Local 176, affiliated
with International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America, or
any other labor organization.
JOHNSON'S INDUSTRIAL
CATERERS, INC.
(Employer)
Dated By
(Representative) (Title)
This is an official notice and must not be defaced
by anyone.
This notice must remain posted for 60 consecutive
days from the date of posting and must not be
altered, defaced, or covered by any other material.
Any questions concerning this notice or compli-
ance with its provisions may be directed to the
Board's Office, 550 Main Street, Federal Office
Building, Room 2407, Cincinnati, Ohio 45202,
Telephone 513-684-3686.
TRIAL EXAMINER'S DECISION
STATEMENT OF THE CASE
HENRY L . JALETTE, Trial Examiner: This case presents
questions of whether Respondent violated Section 8(a)(1),
(3), and (5) of the Act by bargaining in bad faith,
unilaterally changing conditions of employment, and
dealing directly with employees , and whether it violated
Section 8(a) (3) and ( 1) when its unilateral changes caused
two employees to quit. The charge was filed by the Union
on July 7, 1971,1 and was amended on July 19. Pursuant
thereto, complaint issued on August 26. On November 3, a
hearing was held in Dayton, Ohio.
Upon consideration of the entire record, including my
observation of the witnesses and the beefs filed by General
Counsel , the charging party, and Respondent , I make the
following:
FINDINGS OF FACT
1. THE FACTS
Respondent is an Ohio corporation engaged in food
service delivery and sale from vending trucks, with
facilities in Dayton, Columbus, and Newark, Ohio.2 The
Dayton, Ohio, facility is the only facility involved in this
proceeding. On March 2, the Union was certified as
bargaining representative of Respondent's employees at
the Dayton facility in the following unit: All route drivers,
checkers, and order fillers employed by the Employer at its
Dayton, Ohio, operation, but excluding all office clerical
employees, professional employees, guards, and supervi-
sors as defined in the Act.
On or about March 18, the parties commenced bargain-
ing and held between 10 to 15 meetings during the period
from March 18 to July 12. Throughout the negotiations,
the Union was represented by Business Representative
Dick Loy and employees Larry Sprout and Betty Stanfill.
Respondent was represented by its vice president, Robert
Johnson, and an individual named Galbraith.
The testimony of all the witnesses was rather general
about their discussions at all the meetings. The meeting of
March 18 was described as informal with the Union stating
it would submit written proposals at the next meeting. The
next meeting was on March 25 and the Union submitted a
standard form of contract and explained to Respondent
the meaning of its provisions.
The next meeting was on April 8 and at this meeting the
Union submitted a contract proposal, using provisions
culled from the standard form it had presented on March
25. The proposal contained no provisions on wages. The
parties went through the proposal without reaching
agreement on any provisions. Johnson told the Union he
wanted his attorney to check the proposals.
At the next meeting on April 12, the Union submitted its
economic demands covering matters such as wages,
holidays, vacations, and a guaranteed wage. The Respon-
dent stated it would have to cost-out the proposal, because
it had no idea then of the impact on its operations.
There were two other meetings in April, but all that the
record discloses as having been discussed were the term of
the contract and an absentee problem.
At a meeting in early May, Johnson advised the Union
that he was considering a change in method of operations
and was going on a trip to check on the operations of other
mobile caterers, one in California, another in St. Louis.
There were other meetings in May, but the record does
not indicate what was discussed. Respondent tentatively
agreed to some of the Union's proposals, but it did not
submit any counterproposals. According to Loy, Johnson
spoke in generalities about changing his method of
operation and said he would submit a proposal when his
ideas had jelled. He was to have proposals to submit after
his trip.
During May, Johnson asked drivers Stanfill and Sprout
to keep a record of the supplies they used for a period of 30
days to see what would happen if they were operating
under a difference between the wholesale and retail price.
Stanfill and Sprout did as they were requested, but, except
for asking them about gasoline usage, Johnson never asked
to see the results of their recordkeeping.
The parties had a meeting in June after Johnson's return
from his trip. Johnson told the Union he was going to
computerize his pricing situation and had ordered a
computer. He provided the Union, at Loy's request, with a
copy of a lease agreement he had obtained from Nick's
Catering Service, Inc., in St. Louis. At some point, the
I Unless otherwise indicated, all dates appearing hereinafter refer to and I find, that Respondent meets the Board 's $500 ,000 retail and $50,000
1971 direct inflow standards for the assertion of junsdiction
8 Commerce is not in issue . The complaint alleges, the answer admits,
354 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
record is not clear as to the date, but before July 9, Loy
and Johnson discussed Nick's lease agreement. Loy asked
Johnson whether Nick's operators were employees or
independent contractors. Either in this conversation, or
another on the same subject, Loy indicated that the Union
would insist on negotiating about any changes.
A week or so before July 9, Johnson told Stanfill and
Sprout, the employee representatives on the Union's
bargaining committee, that they would have to tell Loy
that it would be another 6 weeks before he could give him
any facts and figures on the new system, because it would
be 6 weeks before he got the computer. Stanfill and Sprout
asked him if they couldn't discuss the language part of the
contract and get that settled and discuss economics later.
Johnson refused
About July 6, Loy called Johnson to tell him of a rumor
he had heard of the possibility of a work stoppage by the
employees because of a fear they were about to be charged
with shortages. Loy also told him of the unfair labor
practice charge being filed accusing Respondent of a
refusal to bargain. (The charge, dated July 6, was filed on
July 7.) A meeting was scheduled for July 8, but it was
canceled because Johnson couldn't make it and resched-
uled for July 9. It never took place, but the record does
not indicate why.
Prior to July 9, the working conditions of the route
drivers were as follows: Respondent provided the canteen-
type trucks, including gasoline, the products to be sold
(except for cigars) and all supplies (cups, spoons, towels,
condiments, etc.). The workweek was from Monday
through Friday and the drivers reported to the plant to
load their trucks about 2:30 a in., and returned from their
rounds about 2.30 p.m. They were paid on a commission
basis, receiving a 20 percent commission on food items
sold, 10 percent on milk, and 4.5 percent on cigarettes.
They received credit for returns. They were required to
wear uri.,orms and Respondent paid one half the cost.
On July 9, about 3 p.m., Johnson called a meeting of
employees. He told them he had heard of the possibility of
a strike, that he didn't want to scare them, but he was
instituting a new system effective Monday, July 12, under
which the drivers would be independent drivers. He then
explained the changes that were being made. He told them
that they would buy the merchandise from Respondent at
a wholesale price and sell it at a retail price. They would
buy food items, including milk, at a 36 percent discount,
and would pay for their supplies according to a puce list
Respondent would prepare. They would pay a truck rental
charge of 10 percent of gross sales. Returns would no
longer be accepted for credit.
Questions were asked about insurance, vacations, and
holidays, and Johnson told the drivers he did not know
what would be done about insurance (for which employees
were then charged a nominal premium), but coverage
would be continued in effect until he did know.3 Vacations
and holidays would be discontinued. (Johnson disputed
saying this, but it is clear from his testimony that this is
3 Whether a change in insurance was ever made is in some doubt
According to Sprout, about October, an insurance representative spoke to
the employees and told them that since they were in business for themselves,
they would have to carry their own insurance This meant that coverage
what was in fact done and Johnson's denial that these
benefits were discontinued is a rationalization resulting
from his assurances to the employees that they would make
more money under the new system and this would'
substitute for the loss of vacation and holiday benefits.)
Uniforms would still be required but employees would
bear the full cost. (It is not clear whether employees were
so advised on July 9, but Sprout testified, without
contradiction, that he has been so advised by a supervisor
since July 9.)
Johnson said that he did not know how much a driver
would be charged when he was absent, whether it would be
a flat rate or a commission rate. (Later, the rate was fixed
by Respondent at $30 a day.)
Johnson indicated that the change would be for a trial
period of 30, 60, or 90 days, and he assured the drivers that
during that period he would be able to show them they
would make more money under the new system. He told
the drivers he would guarantee their normal salary during
the test period.
The employees were instructed. to report to work on
Saturday to inventory their trucks. On Friday evening, the
employees had a union meeting in which they debated
calling a strike. Loy advised them not to strike, but to
inventory their trucks on Saturday as instructed and to
wait to see what was going to happen. Monday morning
the drivers reported to work and started their rounds with
the new inventory.
On Monday afternoon, Loy met with Johnson to discuss
the changes the status of the drivers. He asked
Johnson to r;. . to the old system and to negotiate from
that point. Johnson refused. He said he had to make the
change because of an absentee problem and he thought the
change was economically sound. He said if the change did
not work he would close down the Dayton business.
When Johnson announced the new system on Friday, he
told the drivers that at the end of each day they would
make a deposit (varying in amount depending on the
route) in Respondent's account as part payment for the
sale items they had purchased and he explained that the
following day each driver would settle up by paying the
remainder of his bill. This procedure would be repeated
each day. There was a misunderstanding about this and it
appears no deposits were made Monday afternoon. On
Tuesday, after servicing their routes, the drivers discovered
that bills for Monday's purchases were not ready and they
could not settle up. Moreover, they were required to make
deposits for both Monday's and Tuesday's purchases. (In
the case of Stanfill, she had to make two $100 deposits.) On
reporting to the plant on Wednesday, the drivers refused to
load their trucks until they were given bills for their sales
on Monday.
Betty Stanfill received a bill for $190.26 for Monday. Her
total receipts for that day were $213 and some cents.
Stanfill owed an additional $96 for supplies in her
inventory, part of which she had used and she felt the bill
could not be right. She spoke to Johnson about it and he
which had cost the employees 75 cents per week would cost them over $11
per month Johnson testified not only that insurance has been continued,
but even more that Respondent now pays the 75 cents per week Any doubt
about the matter can be resolved in the compliance stage
JOHNSON'S INDUSTRIAL CATERERS, INC.
told her to load her truck and to start out on her route, that
he would straighten the matter out later. Stanfill told him
she couldn't afford to run the route under those circum-
stances and she quit. Under essentially similar circum-
stances, Karen Holloway also quit.4
II. ANALYSIS AND CONCLUSIONS
A. The Refusal To Bargain
The alleged refusal to bargain has three parts: (1) The
changes in method of operation are alleged to have been
undertaken unilaterally and are consequently alleged to be
unlawful; (2) the discussion of the changes with the
employees on July 9 is alleged to have constituted direct
dealing with employees in derogation of the Union's status
as exclusive representative of the employees; and (3) the
Respondent's conduct during the course of negotiations is
alleged to evidence bad faith and a purpose on the part of
Respondent to avoid entering into a collective-bargaining
agreement.
1. The unilateral changes in method of operations
issue 5
The facts recited above are essentially undisputed. The
Union admits, as Respondent contends, that during the
negotiations in May, Johnson advised it that it was
considering changing its method of operations, and
Johnson even gave Union Agent Loy a copy of a lease
agreement used by Nick's Catering Service, Inc., of St.
Louis for its route drivers. But, beyond telling the Union
that it was considering a change and was investigating
other operations and that a computer had been ordered,
Respondent did not notify the Union, nor consult with it,
about any of the changes announced on July 9.
It is undisputed that at no time during the negotiations
did the parties ever discuss economic issues. Yet, Respon-
dent's changes in method of operations really involved
economic matters only, such as rate of commission, cost of
supplies to the driver, cost of truck rental, and the like. In
addition, the changes in method of operations involved
such mandatory subjects of bargaining as insurance,
vacation, and holidays. None of these subjects had been
discussed in negotiations. But if the issue of the unilateral
nature of Respondent's conduct were in doubt, the doubt
would be eliminated by Johnson's admission that when he
mentioned to the Union the possibility of a change in the
method of operation, Business Representative Loy told
him any change in working conditions would have to be
negotiated. Despite this, Johnson never mentioned the
changes to Loy thereafter and instituted them on July 9.
Such unilateral conduct clearly violated Section 8(a)(5) of
the Act. N.L.R.B. v. Katz, 369 U.S. 736 (1962).
Respondent makes other contentions in defense of its
conduct, which are so clearly lacking in merit that, with
one exception, they do not warrant discussion. The
exception is the contention that Respondent has been and
4 Two other drivers also quit who, like Stanfill and Holloway, were
alleged to have been constructively discharged At the hearing, General
Counsel moved to dismiss the complaint as to those other two drivers I
granted the motion
355
is still willing to discuss with the Union the effects of the
change. As I understand Respondent, it is contending that
its decision to change method of operation was not a
mandatory subject of bargaining and that it was only
obligated to bargain about the effects of its decision. In
support of this position, Respondent cites N.L.R.B. v.
Adams Dairy, Inc., 350 F.2d 108 (C.A. 8), cert. denied 382
U.S. 1011, and General Motors Corp., 191 NLRB No. 149.
In Adams Dairy, the Court held that an employer is not
required to bargain about a decision to terminate a phase
of its business and that a decision to convert from a system
of distribution by employees to distribution by independ-
ent contractors was a basic operational change which was
the equivalent of a decision to closeout part of its business.
In General Motors, using the same rationale as used by the
Court in Adams Dairy, the Board held that the decision to
sell a dealership was not a mandatory subject of bargain-
ing.
These decisions are significant, but Respondent has not
articulated how they are applicable to this case. Their
applicability is evident, if Respondent were contending
that it terminated its distribution of canteen foods at
Dayton and changed to a system of sales by independent
contractors. But Respondent asserts in its brief that "The
question of whether the changed operation resulted in an
independent contractor relationship with the drivers is not
an issue in this case." If such were the case, Adams Dairy
and General Motors would be inapplicable. As can be seen
from the foregoing, there is an ambivalent quality about
Respondent's position. Whatever arguments Respondent
may now make, however, it appears to me the status of the
drivers is an issue that cannot be avoided, and while there
is some doubt in my mind whether the court's view in
Adams Dairy accords with the view of the Board, by whose
decisions I am bound (General Motors suggests that the
Board may give hospitable reception to the court's view in
the future), I will assume, arguendo, that an employer is not
required to bargain about a decision to change from an
employee distribution system to a system of distribution by
independent contractors. The question is were Respon-
dent's drivers converted from employees to independent
contractors.
In determining the status of persons alleged to be
independent contractors, the Board normally applies the
"right to control" test. If the company retains the right to
control not only the result to be achieved, but also the
manner and means of achieving it, the relationship is an
employer-employee relationship. , The i evidence that ^ Re-
spondent retained ; the right to control the manner and
means of selling canteen foods is overwhelming.
No written contracts were entered into; the arrangement
was oral and terminable at will. (See Borden, Inc., 192
NLRB No. 7). The trucks continued to be the property of
Respondent and drivers were charged a truck rental fee
unilaterally determined by Respondent. As to the food
items sold, Respondent fixed both the wholesale and retail
prices. Respondent also fixed the prices of supplies.
S The changes are also alleged to have been motivated by antiunion
considerations in violation of Sec . 8(a)(3), and this aspect of the changes will
also be treated under this heading.
356 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Supplies (except gasoline) and the items for sale (except
cigars) had to be purchased from Respondent. As to the
routes, they continued to be the property of Respondent.
Respondent kept a record of the customers of each route
and drivers were required to report any new customers.
Respondent retained the right to take customers from one
route and assign it to another and the right to determine
who would be assigned to any particular route. If a route
became available, drivers could bid on it on the basis of
seniority. Drivers could not drop a customer or change any
customer stops without approval by Respondent. The
drivers were required to wear uniforms and their hours of
work were the same as before the change and could not be
vaned because of the closing hours of the stockroom. If
desirous of a day off, or if they were to be absent, drivers
had to consult a supervisor. When absent, Respondent
provided a driver and charged the regular driver $30 for
each day. The drivers could not hire their own replace-
ments nor could they use helpers without Respondent's
approval.
It seems supererogatory to discuss any additional details
about the status of the drivers after July 9. It is abundantly
clear that they possess none of the indicia of independent
contractors. In Dan Dee West Virginia Corp., 180 NLRB
534, more significant changes in the working conditions of
route salesmen were deemed insufficient to qualify them as
independent contractors. Actually, Respondent did not
make a change in its method of operations . ". . . there was
[no] change in the capital structure of [Respondent] which
resulted in a partial liquidation and a recoup of capital
investment." Adams Dairy, supra, at 111. Rather, the only
change was in the method of computing the earnings of the
drivers. This change was hardly basic, nor did it change the
employee status of the drivers.
As Respondent's drivers continued to be employees, and
as Respondent 's changes related to their wages and other
terms and conditions of employment, it was required to
bargain with the Union before putting any of the changes
into effect. As indicated above, this was an obligation it
failed to fulfill. _
Up to this point, I have adverted to Respondent's
assertion that its changes in method of operation was
economically motivated without deciding whether or not it
was in fact so. In my judgment , the evidence is substantial
that the change in method of operations was motivated by
a desire to avoid bargaining with the Union. Respondent
had three facilities, the Dayton facility involved herein,
and facilities in Newark and Columbus, Ohio. The Newark
and Columbus facilities are not unionized . No changes
were made in the method of operation there. Johnson
testified that the reason for this was that the changes were
experimental and the employee complement at Newark
was too small and at Columbus too large to select either of
those two locations to test the workability of the changes. I
do not credit his explanation. According to him, the idea
for this change dated back more than 2 years before the
advent of the Union and at that time he had investigated
the matter to the extent of making a trip to St. Louis and to
California. However, only after the Union was certified
was the idea brought to fruition. For 2 years, it rested in
limbo. Nothing was being done to pursue the idea further.
After the Union was certified , the decision was made and a
computer was ordered . But although this occurred in May,
all that the Union was told was that a computer had been
ordered . Moreover , the fact that a computer had been
ordered did not necessarily mean that the working
conditions of the employees had to be changed. Nothing
was said to Loy about that. On July 6, only 3 days before
the changes were announced to the employees , Loy spoke
to Johnson about rumors of a strike and the filing of a
charge and Johnson gave no intimation of the pending
change . Three days later , he announced the changes to the
employees . In my judgment , these circumstances, consid-
ered with Respondent 's inaction during a period of 2 years
when it was allegedly investigating the possibility of a
change , compel a finding that the changes in working
conditions were instituted because the employees had
selected the Union as their representative for purposes of
collective bargaining and in order to avoid fulfilling
Respondent's obligation to bargain with it. The changes
were therefore not only violative of Section 8(a)(5), but
also Section 8(a)(3).
2. The direct dealing with employees
The unilateral changes announced on July 9, which I
have found violative of Section 8(a)(5) because they were
instituted without notice to or consultation with the
majority representative , are also alleged, by amendment to
the complaint at the hearing, to be violative of Section
8(a)(5) on the ground that when Respondent met with the
employees on July 9 and announced the changes in method
of operations , and when thereafter it discussed with
employees problems that arose under the new system, it
was engaged in direct dealing with the employees in
derogation of the status of the Union as majority
representative . Of course , the unilateral conduct derogated
from the Union 's status as majority representative and
little is added either to the remedy in this case or the body
of law on the subject to find a violation on the theory of
direct dealing . In my judgment , the conduct of Respondent
did not constitute direct dealing with employees in the
sense in which the term is normally used . Respondent was
not making offers to employees seeking acceptances, nor
was it seeking to induce employees to repudiate the Union.
While the effect of its unilateral change in working
conditions was to undermine the Union , I cannot see how
the implementation and announcement of what was clearly
a predetermined course of action constituted direct
dealing. Huttig Sash and Door Company, Incorporatet 154
NLRB 811, 817. Compare Dan Dee West Virginia Corp.,
supra, at 539.
3. Bad-faith bargaining
As indicated earlier, Respondent land the Union met 12
to 15 times . As a result of these meetings , certain contract
proposals of the Union were tentatively agreed upon. The
Union submitted a wage proposal , but it was never
discussed . Respondent never made a counterproposal.
Johnson had promised to do so upon return from his trip
to investigate lease arrangements of other food distribu-
tors, but he never did so. Instead , he unilaterally changed
JOHNSON'S INDUSTRIAL CATERERS, INC.
working conditions with the obvious intention of destroy-
ing the unit in which certification had issued. Moreover, at
the very time he was meeting with the Union in
negotiations, he had a written counterproposal in his
possession, which he did not produce and submit to the
Union until September. (Significantly, the complaint
herein had issued on August 26, charging Respondent with
a failure to bargain in good faith.) That counterproposal
reflected the tentative agreement reached on several issues,
made specific counterproposals on matters such as man-
agement rights, seniority, leave of absence, and grievance
and arbitration provisions, but was silent on all economic
issues, including wages, holidays, vacations, and uniforms,
despite the fact the Union had submitted a proposal on
those issues and despite the fact Respondent as far back as
July 9 had adopted new commission rates, instituted truck
rental charges, abolished vacations and holidays, and
required employees to pay for their uniforms. In my
judgement, such conduct clearly reflects that Respondent
had no intention of negotiating a collective-bargaining
agreement. In N L.R B. v. Katz, supra, the Supreme Court
indicated that unilateral action ". . . will often disclose an
unwillingness to agree with the union." In this case, the
unilateral conduct was intended to destroy the bargaining
unit, and when the unilateral action is considered with
Respondent's inertia at the bargaining table, including the
belated submission of a somewhat meaningless counterpro-
posal, it is clear that, from the inception of bargaining,
Respondent was engaged in bargaining in bad faith and
with no intention to enter into a collective-bargaining
agreement.
B. The Constructive Discharge of Betty Stanfill and
Karen Holloway
As noted earlier, both Betty Stanfill and Karen Hollo-
way quit their employment on July 14 rather than work
under the new system. General Counsel and the Union
contend that they were constructively discharged. I have
carefully considered the cases cited by the Union in
support of this contention and I consider them factually
distinguishable. In the first place, the changes did not
impose onerous working conditions on the employees. The
hours of work, the routes, everything, continued un-
changed. Moreover, although the changes appear to have
been an abortive attempt at creating independent contrac-
tors, the drivers were not required to assume any financial
obligations.
Secondly, to the extent that their earnings were affected,
the drivers suffered no substantial reduction in earnings.
This is evident from the testimony of Larry Sprout. True,
at first blush, it appeared to Stanfill and Holloway that
they would suffer substantial reductions under the new
system. However, it is undisputed they were assured that
the matter would be straightened out and I find their
6 The purpose of this remedy is to insure that the employees in the
appropriate unit will be accorded the services of their selected bargaining
agent for the period provided by law See Mar-Jac Poultry Company, Inc,
136 NLRB 785, Commerce Company d/b/a Lamar Hotel, 140 NLRB 226,
229, enfd. 328 F 2d 600 (C A 5), cert. denied 379 U S 817, Burnett
Construction Company, 149 NLRB 1419, 1421, enfd 350 F 2d 57 (C.A 10),
Waycross Sportswear, Inc, 166 NLRB 101, enfd 403 F.2d 832 (CA. 5)
357
reasons for not believing the assurances unconvincing.
Moreover, on July 9, Johnson had guaranteed the drivers
they would not receive less under the new system than they
did under the old. Significantly, all but four of the drivers
continued to operate their routes. Under these circum-
stances, I conclude that Stanfill and Holloway were not
justified in quitting and were not constructively discharged.
Accordingly, I shall recommend dismissal of the allega-
tions of the complaint relating to them.
III. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
The activities of the Respondent set forth in section II,
above, occurring in connection with its operations de-
scribed in section I, above, have a close, intimate, and
substantial relationship 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.
IV. THE REMEDY
Having found that Respondent has engaged in unfair
labor practices in violation of Section 8(a)(I), (3), and (5)
of the Act, I shall recommend that it be ordered to cease
and desist therefrom and to take certain affirmative action
designed to effectuate the policies of the Act.
As to Respondent's refusal to bargain in good faith, I
shall recommend that Respondent be ordered to bargain
with the Union in the appropriate unit for which it was
certified. As the evidence shows that such refusal to
bargain in good faith existed at the inception of negotia-
tions, I shall recommend that the normal certification year
be extended for a period of 1 year from the date when
Respondent begins to bargain in good faith with the Union
as the recognized representative of the employees in the
appropriate unit .6
As to the unlawful changes in working conditions, it is
customary in circumstances such as are here presented
where the employer's unilateral conduct has not been
motivated by good faith, nor occasioned by compelling
business considerations, to order the Respondent to revoke
the changes and to restore the conditions in existence prior
thereto.? However, as it cannot be predicted with certainty
whether the employees desire such revocation, I shall
recommend that restoration be conditioned upon the
affirmative desire of the affected employees for such, as
expressed through their collective-bargaining representa-
tives.8 I shall further recommend that Respondent make
available to the Union, upon request, all records necessary
and relevant to decide whether it desires restoration of the
working conditions in effect prior to July 9.
Since I have found that Respondent was discriminatorily
motivated within the meaning of Section 8(a)(3) of the Act
in making changes in working conditions on July 9 and
r Great Western Broadcasting Corporation d/b/a KXTV,139 NLRB 93,
96.
9 This recommendation accords with the General Counsel's request.
Although the Union has requested an order restoring the status quo ante, I
do not understand it to be opposed to a conditional order such as I am
recommending above.
1
358 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
that such changes were also violative of Section 8(a)(5) of
the Act by reason of Respondent's failure to bargain with
the Union with respect thereto, I would normally recom-
mend that all employees affected by the changes be made
whole for any losses they may have suffered by reason of
the changes, whether arising from the pricing system
adopted or the elimination of fringe benefits such as
insurance, holidays, vacations, and uniforms. However, if
the employees, acting through their collective-bargaining
representative, express the desire to retain the new system
in preference to restoration of the old, it appears to me that
a make-whole remedy would be unnecessary and inappro-
priate. Accordingly, I shall recommend that the employees
be made whole for any losses suffered by reason of the
changes, only if the employees express the desire for
restoration as provided above. In such event, all losses to
be reimbursed shall be computed in accordance with the
formula set forth in F. W. Woolworth Company, 90 NLRB
289, to which shall be added interest at the rate of 6
percent per annum in accordance with Isis Plumbing Jr
Heating Co, 138 NLRB 716.
Finally, despite Respondent's unlawful motivation in
making changes, the essential ingredient of its unfair labor
practices has been its refusal to bargain for which I deem a
narrow order appropriate.
CONCLUSIONS OF LAW
1. Johnson's Industrial Caterers, Inc., is an employer
engaged in commerce within the meaning of Section 2(6)
and (7) of the Act.
2. Sales Drivers, Sales and Service Local 176, affiliated
with the International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America, is a labor
organization within the meaning of Section 2(5) of the Act.
3. All route drivers, checkers, and order fillers em-
ployed by Respondent at its Dayton, Ohio, operation, but
excluding all office clerical employees, professional em-
ployees, 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. Sales Drivers, Sales and Service Local 176, affiliated
with the International Brotherhood of Teamsters, Chauf-
feurs, Warehousemen and Helpers of America is the
exclusive representative of the employees of Respondent in
the above-described unit within the meaning of Section
9(a) of the Act.
5. By changing the working conditions of its employees
without notice to and consultation with the Union certified
as the exclusive representative of its employees in an
appropriate unit and by negotiating in bad faith with no
intention to enter into a collective-bargaining agreement,
Respondent engaged in, and is engaging in, unfair labor
practices within the meaning of Sections 8(a)(5) and (1)
and 2(6) and (7) of the Act.
6. By changing the working conditions of its employees
because they selected the Union as their exclusive
representative for purposes of collective bargaining and in
order to avoid fulfilling its obligation to bargain with the
9 In the event no exceptions are filed as provided by Sec 102 46 of the
Rules and Regulations of the National Labor Relations Board , the findings,
conclusions, recommendations, and recommended Order herein shall, as
Union, Respondent has engaged in, and is engaging in,
unfair labor practices within the meaning of Sections
8(a)(3) and (1) and 2(6) and (7) of the Act.
7. General Counsel has failed to establish by a
preponderance of evidence that Betty Stanfill and Karen
Holloway were constructively discharged in violation of
Section 8(a)(3) and (1) of the Act.
Upon the foregoing findings of fact, conclusions of law,
and the entire record, and pursuant to Section 10(c) of the
Act, I hereby issue the following recommended: 9
ORDER
Respondent, Johnson's Industrial Caterers, Inc., its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Refusing to bargain with Sales Drivers, Sales and
Service Local 176, affiliated with the International Brother-
hood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, as the exclusive representative of its
employees at Dayton, Ohio, in a unit of all route drivers,
checkers, and order fillers, but excluding all office clerical
employees, professional employees, guards, and supervi-
sors as defined in the Act.
(b) Changing the working conditions of employees in the
appropriate unit without consulting and negotiating with
Sales Drivers, Sales and Service Local 176, affiliated with
International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America.
(c) Making changes in working conditions of its
employees with a purpose of undermining the exclusive
representative of its employees and to avoid fulfilling its
obligation to bargain with such exclusive representative.
(d) In any like or related manner interfering with,
restraining, or coercing its employees in the exercise of
their rights to self-organization, to form, join, or assist the
above-named labor organization, or any other labor
organization, to bargain collectively through representa-
tives of their own choosing, and to engage in concerted
activities for the purpose of collective bargaining or other
mutual aid or protection as guaranteed by Section 7 of the
Act, or to refrain from any or all activities.
2. Take the following affirmative action designed to
effectuate the policies of the Act.
(a) Upon request, bargain collectively with Sales Drivers,
Sales and Service Local 176, affiliated with International
Brotherhood of Teamsters, Chauffeurs, Warehousemen
and Helpers of America as the exclusive representative of
all employees in the unit described above and, if an
understanding is reached, embody such understanding in a
signed agreement.
(b) Upon request, furnish the above-named labor
organization all records necessary and relevant to decide'
whether it desires restoration of the working conditions in
effect prior to July 9.
(c) Revoke the unilateral changes instituted on July 9,
1971, in the wages and other terms and conditions of
employment of employees in the appropriate unit and
restore those wages and other terms and conditions of
provided in Sec 102 48 of the Rules and Regulations , be adopted by the
Board and become its findings , conclusions, and Order, and all objections
thereto shall be deemed waived for all purposes.
JOHNSON'S INDUSTRIAL CATERERS, INC.
employment in effect prior thereto and make employees
whole for any losses they may have suffered by reason of
the unlawful changes, if Sales Drivers, Sales and Service
Local 176, affiliated with International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers of
America, the exclusive representative of these employees,
so desires.
(d) Preserve and upon request, make available to the
Board and its agents for examination and copying all
records relevant and necessary to a determination of the
amounts due employees under the terms of this recom-
mended Order.
(e) Post at its Dayton, Ohio, facility, copies of the
attached notice marked "Appendix." io Copies of said
notice, on forms provided by the Regional Director for
10 In the event that the Board's 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 "
359
Region 9, after being duly signed by Respondent's
authorized representative, shall be posted by it immediate-
ly upon receipt thereof, and be maintained by it for 60
consecutive days thereafter, in conspicuous places, includ-
ing 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.
(f) Notify the Regional Director for Region 9, in writing,
within 20 days from the receipt of this Decision, what steps
it has taken to comply herewith.ii
It is further recommended that the allegation of
paragraphs found not to have been sustained by a
preponderance of the evidence be dismissed.
11 In the event that this Recommended Order is adopted by the Board
after exceptions have been filed, this provision shall be modified to read
"Notify the Regional Director for Region 9, in writing , within 20 days from
the date of this Order, what steps the Respondent has taken to comply
herewith "