Kaumagraph Corp.

National Labor Relations Board - Board Decisions

Mar 21, 1995

316 N.L.R.B. 793 (N.L.R.B. 1995)

793
316 NLRB No. 130
KAUMAGRAPH CORP.
1 The General Counsel and the Charging Party have excepted to
the judge’s failure to make an affirmative finding that the Respond-
ent’s recognition of the Union on July 25, 1991, was pursuant to a
settlement agreement approved by the Regional Director on Septem-
ber 30, 1991. The record supports this assertion and we so find.
2 In rejecting the Respondent’s 10(b) defense regarding the 8(a)(3)
allegations, the judge noted that the Respondent had failed to argue
that the 10(b) period should be measured from March 1991, when,
as the judge found, the Respondent had made a tentative decision
to relocate the plant to Michigan. The judge held that the Respond-
ent waived a 10(b) defense by failing to make this argument. We
agree that the allegations in this case were not barred by Sec. 10(b),
but we do not rely on this waiver finding.
Chairman Gould notes that the judge applied the test of Dubuque
Packing Co., 303 NLRB 386, 391 (1971), in finding that the Re-
spondent did not violate Sec. 8(a)(5) with respect to its plant reloca-
tion decision. Chairman Gould questions the validity of Dubuque,
but he finds no need to address that issue here. He concurs in the
judge’s decision to dismiss the complaint because the Union had a
sufficient opportunity to bargain about the relocation decision in ad-
vance of its implementation and was unable to present sufficient
concessions or alternatives to relocation. Consequently, the parties
had reached a good-faith impasse on the subject of relocation prior
to the Respondent’s lawful implementation of its decision.
1 The General Counsel’s motion to correct the record, with which
the other parties concur, is granted. The General Counsel’s motion
to strike portions of Respondent’s brief and Exhs. A and B attached
thereto is granted for the good and sufficient reasons set forth in the
General Counsel’s motion.
Kaumagraph Corporation and United Steelworkers
of America, AFL–CIO–CLC. Case 4–CA–20367
March 21, 1995
DECISION AND ORDER
BY CHAIRMAN GOULD AND MEMBERS STEPHENS
AND COHEN
On June 15, 1994, Administrative Law Judge
Claude R. Wolfe issued the attached decision. The
General Counsel and the Charging Party filed excep-
tions and supporting briefs, the Respondent filed an
answering brief, and the General Counsel filed a reply
brief. The Respondent also filed cross-exceptions to
the judge’s decision, and the General Counsel filed an
answering brief.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the decision and the
record in light of the exceptions1 and briefs and has
decided to affirm the judge’s rulings, findings,2 and
conclusions and to adopt the recommended Order.
ORDER
The recommended Order of the administrative law
judge is adopted and the complaint is dismissed.
Mark E. Arbesfeld, Esq., for the General Counsel.
Doreen S. Davis and Arlene J. Angelo, Esqs., for the Re-
spondent.
Daniel M. Kovalik, Esq., for the Charging Party.
DECISION
STATEMENT OF THE CASE
CLAUDE R. WOLFE, Administrative Law Judge. This pro-
ceeding was litigated before me in Philadelphia, Pennsyl-
vania, pursuant to charges filed and served on January 14
and amended on May 21, 1992, and complaint issued on Oc-
tober 30, 1992, alleging Kaumagraph Corporation (the Re-
spondent) has violated Section 8(a)(1), (3), and (5) of the
National Labor Relations Act (the Act) by closing its facility
in Wilmington, Delaware, and relocating work from there to
its facility in Michigan. Respondent denies it has violated the
Act.
On the entire record,1 including my observation of the de-
meanor of the witnesses as they testified, and after consider-
ing the able posttrial briefs of the parties, I make the follow-
ing
FINDINGS AND CONCLUSIONS
I. JURISDICTION
At all times material to this proceeding, Respondent has
been a Delaware corporation with offices and places of busi-
ness in Wilmington, Delaware, where it has been engaged in
hot-melt rotogravure printing. From 1991 until it closed its
Delaware facility in February 1992, Respondent, in conduct-
ing its business operations above described, sold and shipped
goods valued in excess of $50,000 from Wilmington, Dela-
ware, directly to points located outside that State. At all
times material to this proceeding, Respondent has been an
employer engaged in commerce within the meaning of Sec-
tion 2(2), (6), and (7) of the Act.
II. LABOR ORGANIZATION
At all material times, United Steelworkers of America,
AFL–CIO–CLC (the Union) has been a labor organization
within the meaning of Section 2(5) of the Act.
III. THE USE OF BACKGROUND EVIDENCE
On June 21, 1991, a consolidated complaint issued against
the Respondent in Case 4–CA–18961, et al., alleging, among
other things, that Respondent, acting through its vice presi-
dent and general manager, David Burke, threatened its em-
ployees with job loss, plant closure, a refusal to bargain with
the Union if the employees selected the Union to represent
them, and other retaliation. On September 30, 1991, the Re-
gional Director for Region 4 of the National Labor Relations
Board approved a settlement agreement covering these items
as well as others. That agreement has not been set aside.
In the instant case the General Counsel established,
through the uncontroverted and credible testimony of em-
ployees Dolores Petrucci, Emma Towles, Norma Smith, and
Ronald Smith, that: (1) David Burke told employees in early
1990, at a time the Union was attempting to organize Re-
spondent’s employees, that he would not deal with the
Union, would do anything he had to in order to keep the
Union out, did not care what it cost, and he would close the
794 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
2 Respondent’s reliance on the treatment of statements by Collichio
and Hamilton in American Packaging, 311 NLRB 482 (1993), for
the proposition Spearance’s report to Lambert was hearsay devoid of
evidentiary worth, is misplaced. The statement of Collichio, a depart-
ment manager, to the effect that Employer’s general manager had
stated employees would in no case receive a bonus was, unlike the
situation here, denied by the general manager. Moreover, Hamilton’s
statement to an employee that the bonus was less than usual because
of ‘‘you guys,’’ apparently a reference to union activity, had no
weight because there was no showing he was a supervisor or agent
of American Packaging Corporation.
3 Sec. 10(b) provides that no complaint shall issue based on any
unfair labor practice occurring more than 6 months prior to the filing
and service of the charge.
plant and move elsewhere and then would not have to deal
with the Union; (2) George Rosica, Respondent’s president,
said in 1990 he would shut the plant down before he would
allow the Union in, would and could move if he had to, and
the employees had to choose either the Union or the Com-
pany; and (3) Richard Spearance, a stipulated supervisor, told
employee Lambert about 3 weeks before his August 9, 1991
layoff that Rosica had told him the Wilmington plant would
be closed down if the Union got in. All of these statements
by David Burke, George Rosica, and Richard Spearance are
attributable to Respondent, 3E Co., 313 NLRB 12 fn. 1
(1993), and, inasmuch as neither Rosica nor Spearance testi-
fied, I conclude Spearance’s statement to Lambert was a
truthful account of Rosica’s statement which is consistent
with Rosica’s remarks to others as recited above. Compare
American Art Clay Co., 148 NLRB 1209, 1219 fn. 16
(1964).2 All the foregoing statements of Respondent’s agents
occurred prior to the approval of the settlement in the earlier
case and, with the possible exception of Spearance’s state-
ment, more than 6 months prior to the first charge filed and
served in this case. The General Counsel does not allege
them to be violations of the Act in this proceeding, but prof-
fers them as background evidence shedding light on Re-
spondent’s motivation in relocating bargaining unit work
from Wilmington, Delaware, to Flint, Michigan.
Respondent protests that threats which were the subject of
a settlement agreement, as here, cannot now be used as proof
of an unlawful motive in relocating the work and that this
case does not involve a situation where the subject of a set-
tlement agreement is used only as background evidence in
appraising Respondent’s motives and objectives. Respondent
proffers Barnes & Noble Bookstores, 237 NLRB 1246
(1978), as support for the proposition that the threats related
above cannot be relied on as proof of animus to establish the
alleged violation of Section 8(a)(3) of the Act. This is not
quite what the Board held in Barnes. What the Board there
said, at 1246 fn. 1, was, ‘‘While we do not rely solely on
[a prior finding of employer unfair labor practices] as proof
of [union] animus, Respondent’s prior unfair labor practices
can properly be noted as background.’’ Moreover, the Board
has recently held that presettlement conduct evidencing union
animus may be used to ‘‘shed considerable light’’ on the em-
ployer’s motivation in acting as it did after the settlement of
earlier charges, Special Mine Services, 308 NLRB 711
(1992); and, as Respondent recognizes in its posttrial brief,
it is well settled that the Board may use conduct beyond the
6 months’ period established in Section 10(b) of the Act,3
Machinists IAM Local 1424 (Bryan Mfg.) v. NLRB, 362 U.S.
411 (1960); and regarding presettlement conduct, Northern
California District Council of Hodcarriers (Joseph’s Land-
scaping), 154 NLRB 1384 (1965), as background evidence
in appraising Respondent’s motivation for its conduct alleged
to be unlawful in the case before me, so long as the General
Counsel’s case does not rely solely on the evidence proffered
as background evidence. Bearing the latter caution in mind,
yet recognizing the verity of the wise statement by Adminis-
trative Law Judge Maloney in Marcus Management, 292
NLRB 251, 262 (1989), that ‘‘there is such a thing as latent
hostility which bides its time and lies in wait, seeking the
appropriate occasion to work its will,’’ I conclude the evi-
dence of presettlement threats recited hereinabove is properly
admissible as background evidence to consider in evaluating
the motivation of Respondent for its conduct in the case be-
fore me in accord with the teachings of Bryan, supra, and
Joseph’s, supra.
IV. THE TIMELINESS OF THE AMENDED CHARGES
The original charge filed by the Union in this case on Jan-
uary 13, 1992, was served on Respondent on January 14,
1992. It alleged Respondent had violated Section 8(a)(5) and
(1) of the Act and stated the following as the basis for the
charge:
On or about October 2, 1991 the above named em-
ployer announced a relocation of its Wilmington, DE
operations to a sister facility in Flint, Michigan in vio-
lation of the Act.
The employer failed to bargain in good faith and in-
stead carried through on a previously documented threat
to relocate the plant if the employees selected the
United Steelworkers of America as their collective bar-
gaining representative.
The Union requests relief granted under Section 10(j)
of the Act in order to stop this illegal relocation.
The amended charge filed by the Union and served on May
21, 1992, is identical to the January 13 charge with the sin-
gle exception that it alleged the above-described conduct to
be violative of Section 8(a)(1), (3), and (5) of the Act.
Respondent contends the amended charge was filed more
than 6 months after the conduct alleged there and that the
subsequent inclusion of an allegation of a violation of Sec-
tion 8(a)(3) of the Act contravenes Section 10(b) of the Act.
I do not agree. The complaint alleges in relevant part:
6(a) In or about February 1992, a more precise date
presently being unknown to the General Counsel, Re-
spondent closed its Wilmington facility and relocated
the work of the Unit to the Flint facility.
(b) Respondent engaged in the conduct described
above in subparagraph (a), because Respondent’s em-
ployees selected the Union as their collective bargain-
ing representative and in order to avoid its collective
bargaining obligation of the Union.
(c) The subjects set forth above in subparagraph (a),
relate to wages, hours, and other terms and conditions
of employment of the Unit and are mandatory subjects
for the purposes of collective bargaining.
(d) Respondent engaged in the conduct described
above in subparagraph (a) without affording the Union
795KAUMAGRAPH CORP.
4 Visco advised there had been a $5 million decrease in sales at
the KFC facility and a sales decrease of $6 million at Wilmington
during the fiscal year ending June 1989. He particularly noted that
the $43–$44,000 monthly rent at Wilmington was far more than the
KFC monthly mortgage payment of about $5500, and Flint’s ulitities
cost was about half the $10–$15,000 monthly heat and electric bill
at Wilmington.
an opportunity to bargain with Respondent with respect
to this conduct.
7. By the conduct described above in paragraphs 6(a)
and 6(b), Respondent has been discriminating in regard
to the hire or tenure or terms or conditions of employ-
ment of its employees, thereby discouraging member-
ship in a labor organization in violation of Section
8(a)(1) and (3) of the Act.
8. By the conduct described above in paragraph 6,
Respondent has been failing and refusing to bargaining
collectively and in good faith with the exclusive collec-
tive bargaining representative of its employees within
the meaning of Section 8(d) of the Act in violation of
Section 8(a)(1) and (5) of the Act.
These allegations are consistent with the descriptive state-
ment which the Union typed on both the original and amend-
ed charges. The detailed allegations in the charges are not
only closely related, they are identical, allege unlawful moti-
vation, are based on the same facts, and express the same
legal theory of bad-faith bargaining and the perfecting of a
previous threat to relocate in retaliation for its employees’ se-
lection of the Union as their collective-bargaining representa-
tive. The amended charge places no additional burden of
proof on Respondent, is factually closely related to the origi-
nal charge, and is not time barred. Redd-I, Inc., 290 NLRB
1115 (1988); W. H. Froh, Inc., 310 NLRB 384 fn. 2, 386
fn. 6 (1993); Overnite Transportation Co., 296 NLRB 669
(1989). Accordingly, the 8(a)(1), (3), and (5) allegations are
appropriately before me for decision.
V. THE ALLEGED UNFAIR LABOR PRACTICES
A. Preliminary Stipulations
The parties stipulated that: (1) Kaumagraph Flint Corpora-
tion (KFC) is a separately incorporated business; (2) KFC
and Respondent have common ownership; and (3) Respond-
ent’s decision to close its Wilmington, Delaware plant and
transfer all the work performed by the unit of employees rep-
resented by the Union to one of the KFC plants in Flint,
Michigan, was a relocation of unit work unaccompanied by
any basic change in the nature of the transferred operations.
It is further stipulated that there is no allegation that Re-
spondent bargained unlawfully concerning the effects of its
decision to close the Wilmington, Delaware facility.
B. Facts Found
Respondent has recognized the Union as the designated
exclusive collective-bargaining representative of its employ-
ees in a unit appropriate for purposes of collective bargaining
since July 25, 1991, pursuant to a recognition agreement of
that date.
The appropriate unit is:
All regular full-time production and maintenance em-
ployees employed at Respondent’s 400 South Madison
Street, Wilmington, Delaware facility, excluding all
other employees, artists, professionals, laboratory tech-
nicians, office clericals, watchmen, guards and super-
visors as defined in the Act.
The Union and Respondent subsequently had bargaining
sessions on August 9, 16, 27, and 29; September 6, 11, and
18; and October 2, 1991. Although others, notably Burke,
Respondent’s vice president and plant manager at Wilming-
ton, were present at some of these meetings, the chief nego-
tiators always present for Respondent were its attorney, An-
thony F. Visco Jr., who was its primary spokesman, and
Thomas Cetola, its executive vice president. The Union’s
staff representative, Norman Hayman, was the Union’s chief
spokesman. Hayman and Cetola were the only negotiations
participants to testify in this case. All parties heavily rely on
the testimony of Hayman, a credible witness, in recounting
the content of the bargaining meetings. I find that reliance
well placed and credit Hayman’s account as well as the sup-
plementary testimony of Cetola, who did not testify in as
great a detail as did Hayman concerning negotiations.
Visco opened the first meeting with the announcement that
Respondent was considering moving its Wilmington oper-
ations to the KFC plant in Flint, Michigan. Visco announced
the move was being considered because there had been a
several million dollar decrease in sales at both locations, an-
ticipated new business had failed to materialize, the cost of
rent and utilities at Wilmington was far greater than that in
Michigan,4 and AC Delco (Delco), the sole customer of KFC
and Respondent at the time, wanted ‘‘next day delivery’’ to
its Michigan facility, which was much closer to the KFC
plant than Wilmington, which propinquity would favor a
move of the work to Michigan, and thus closer to the cus-
tomer. Hayman responded that the Union had some success
in other cases in getting a rent reduction. Either Visco or
Cetola remarked that if the Union could do that, the Com-
pany might be in business.
Hayman further recalls that during the meeting Visco gave
him specific information of approximately $10 million worth
of work scheduled for the Wilmington plant that had been
lost, told him Respondent had been hoping to retrieve work
previously lost to Kent Plastics, and that the Wilmington
plant here involved had been built in 1989 in anticipation of
work from European customers that did not come forth. At
the time of this meeting, all of the Wilmington facility’s pro-
duction was being shipped to the Flint plant rather than to
Delco, their common and sole customer. Kaumagraph Dry
Transfer Corporation (KDT), Kaumagraph Electrolumines-
cence Products, Inc. (KEL), and Kaumagraph Corp. U. K.
Limited were all corporations related to Respondent
Kaumagraph Corporation rather than Kaumagraph Flint Cor-
poration and had been terminated prior to these negotiations,
KEL and KDT due to losses, and the U. K. operation be-
cause expected business simply did not materialize.
By letter of August 14, 1991, the Union requested Re-
spondent to furnish financial records including income tax
returns to assist the Union in its assessment of Respondent’s
financial condition. These records were furnished and for-
warded by Hayman to the Union’s offices for review on Au-
gust 30. On September 6, Jerry Sokolow, a research associate
796 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
5 ‘‘Resorted’’ appears to be a synonym for ‘‘reinspected.’’
for the Union, after personal interviews with Cetola and an
examination of these records, sent Hayman an analysis indi-
cating among other things that the Respondent had an operat-
ing loss of $1,856,271 and a net loss of $3,394,921 in the
fiscal year ending June 30, 1991, while KFC had an operat-
ing profit of $2,597,205 and a net profit of $1,166,463 at its
Millington, Michigan plant, and that showed that the ratio of
current assets to current liabilities at Respondent’s Wilming-
ton plant was well below what would be an indication of a
sound short-term financial condition.
When the parties met on August 16, Burke had joined the
group. Hayman asked what Respondent would need to re-
main open in Wilmington. Visco replied he was not then
able to say, but would probably be able to do so at the next
meeting. Burke said the quality of the Wilmington produc-
tion was inferior to that at KFC’s Michigan facility, and spe-
cifically recalled an occasion when all the work produced in
Wilmington and forwarded to KFC had to be resorted5 in
Michigan because Delco had demanded it. He further relates
that the Delco assembly line had been idled because the Wil-
mington-produced parts were unacceptable and, further, that
Delco had advised KFC to move the production line to
Michigan ‘‘or else.’’ In this connection, Burke explained that
Delco required ‘‘just-in-time delivery,’’ which meant the
product had to be available within 4 hours of the time Delco
started its production line. As Hayman recalls, ‘‘next day de-
livery’’ had been mentioned at the previous negotiation ses-
sion as the standard required.
On August 27, Visco advised the negotiators that a deci-
sion on relocation of the work would be reached in mid-Sep-
tember, but it was just a matter of ‘‘how long you bleed.’’
He further stated an immediate infusion of $4 or $5 million
dollars’ worth of new business would be necessary to assure
Respondent would continue to operate in Wilmington and
that the cost of overhead was less important than the acquisi-
tion of new business and increased profits. Visco also said
Respondent needed relief on rent and utility costs, but that
labor costs were not an important factor in the relocation de-
cision to be made. Respondent consistently maintained that
position on labor costs. The Union, through Hayman, voiced
its suspicion that a decision to close Wilmington had already
been made because there had been no replacement for the re-
tired vice president of sales and marketing for Respondent,
and thus no one to develop the needed sales. Visco replied
those duties had devolved on George Rosica, Respondent’s
president. Visco also announced there were efforts underway
to secure a reduction in the rent paid for the Wilmington
premises.
Respondent’s efforts to secure a rent reduction had com-
menced long before the recognition of the Union as its em-
ployees’ collective-bargaining representative. The situation
vis-a-vis Respondent’s position as a tenant in its plant and
its rent situation is best understood by a brief excursion into
the plant’s history. On June 30, 1988, Respondent, Harbor
Associates (Harbor Assoc.) (in which Verino Pettinaro is a
partner), and Harbor PK Corporation (Harbor PK) and
Pettinaro Construction Company, Inc. (Pettinaro Construc-
tion), which are both headed by Verino Pettinaro as their
president, entered into an agreement. Harbor PK was incor-
porated by Harbor Assoc. to: (1) hold title to the land owned
by Harbor Assoc. on which the new Wilmington plant was
to be built by Harbor Assoc. and completed for Respondent’s
use by December 31, 1988; (2) sell 25 percent of Harbor
PK’s stock to Respondent’s owners for $112,500 cash; (3)
contract with Pettinaro Construction to build the plant and
receive $3,459,547 in exchange for the plant and the land on
which it sits; and (4) to lease the land to Respondent. The
building was delivered in March 1989. The monthly rent in-
stallment agreed on, amounting to about $40,000, was the
monthly mortgage and interest thereon, plus 14 percent of
that amount as a developer’s fee, plus taxes and insurance.
By letter of February 13, 1991, Respondent wrote Pettinaro
the following:
Dear Verino:
It is with great reluctance that we are submitting this
proposal outlining the terms under which Kaumaugraph
Corporation might be able to continue its occupancy of
400 S. Madison Street.
1. As of the end of this month the lease, between
Harbor PK Corp. and Kaumagraph Properties, Limited
Partnership will be terminated, and the 25% of stock of
Harbor PK Corp. held by tenant or its assigns will be
delivered and transferred to Landlord, thereby terminat-
ing the tenant’s further liability thereunder.
2. Commencing March 1, 1991 Kaumagraph Cor-
poration will lease the premises on a month to month
basis at the rate of $20,000.00 per month for a total pe-
riod not to exceed 18 months, and either party may ter-
minate such tenancy on 30 days written notice to the
other party.
3. Kaumagraph Corporation agrees during its occu-
pancy to be bound to all the other terms of the existing
lease, as tenant, particularly to the terms of the Indem-
nity provisions contained in the first Amendment of
Lease; and it acknowledges its obligation at the termi-
nation of its occupancy to pay the balance owed on the
improvements made at its special request.
4. Kaumagraph Corporation agrees that if it is able
to reconstitute its manufacturing business within the
above 18 month period, it will use its best efforts to ne-
gotiate a new, long term lease for the premises on
terms which are financially and commercially reason-
able for both parties.
If this meets with your approval you may make it ef-
fective by returning a signed copy.
The next letter Respondent sent Pettinaro was dated February
20, 1991, and states:
Dear Verino:
I understand from our conversation of February 15,
1991 that our effort to settle and compromise various
issues between us as embodied in our letter to you
dated February 13, 1991 is unsatisfactory. Therefore,
you may consider the offer as withdrawn.
We will continue to cooperate with you as our land-
lord in every possible way, including giving you as
much advance notice of changing circumstances as is
reasonable, but we continue to hope you will keep such
matters in the closest confidence.
797KAUMAGRAPH CORP.
Respondent was assessed late charges in July and September
1991 for not timely paying July, August, and September
1991 rent. Between the July and September assessments,
Robert Rosini, Respondent’s director of business develop-
ment, wrote the following letter to Pettinaro on August 16:
Dear Verino:
The following outlines Kaumaugraph’s proposal and
the terms under which it can remain as a tenant at 400
South Madison Street.
1. The old lease will be terminated and a new one
year lease beginning September 1, 1991 through August
31, 1992 will be entered into at a monthly rental of
$15,000,000/month triple net.
2. We will relinquish our 25% ownership in the
building.
3. Kaumagraph would like an option after the expira-
tion of the lease to renew under the terms and condi-
tions of the present lease.
4. Kaumagraph will agree to vacate on 60 days no-
tice if you find another tenant during the period of the
lease.
5. Kaumagraph will set up an appropriate payment
schedule for repayment of monies due with the nec-
essary guarantees.
Kaumagraph believes this proposal will benefit you
to the extent of having the following:
l. Income from the building.
2. Payment of the insurance, taxes and utilities by
Kaumagraph during the term of the lease.
3. Provide security for the building.
4. The distinct possibility that within the year the
auto industry will turn around allowing us to remain at
400 South Madison Street.
If an agreement cannot be reached we will be forced
to vacate the facilities in the very near future.
Pettinaro directed the following letter to Rosini on August
20:
Dear Bob:
The following are a few ideas that we discussed
today by telephone. The following ideas do not obligate
me in any way what so ever, they are to be used only
as a beginning point for discussions when I return from
vacation on Monday, August 26.
I understand that Kaumagraph has some immediate
cash flow problems at the present time and I would like
to propose the possibility of some type of the follow-
ing:
Verino Pettinaro could lend Kaumagraph approxi-
mately $30,000 per month. Kaumagraph could use
that $30,000 to pay their rent to Harbor PK Associ-
ates; or,
Verino Pettinaro could buy stock in Kaumagraph
at approximately $30,000 per month. Kaumagraph
could take this money and pay their rent to Harbor
PK Associates.
These above possible scenarios would enable Harbor
PK Associates to stay intact with the present owners
and their proportionate share of ownership.
These above possible scenarios would also allow
Kaumagraph to get through their immediate problems
until the economy gets better.
I would also like to resolve, at this time, the $50,000
that Kaumagraph still owes Pettinaro Construction
Company. This stems from problems with George
Rosica and differences of opinions on the HVAC. Also,
I would need some guarantees on the $250,000 that
Kaumagraph owes to Pettinaro Enterprises.
Bob, please give me a call on Monday, August 26,
when I am scheduled to return from vacation and let
me know your thoughts on whether or not the above
possible scenarios would help Kaumagraph.
The alternatives of becoming further indebted to Pettinaro
or permitting him to buy large chunks of Respondent’s stock,
with money 75 percent of which would flow to Pettinaro
through Harbor PK, posed no reasonable solution to Re-
spondent’s financial problems and either would have tended
to exacerbate rather than relieve Respondent’s money prob-
lems. Pettinaro is currently suing Respondent for more than
$5 million, and displayed implacable hostility toward Re-
spondent on the witness stand. He appeared revengeful and
his testimony did not impress me as being entirely candid.
I do not credit his testimony that he did not reduce Respond-
ent’s rent because the need to so do was not documented by
Respondent. This is no good Samaritan. As Pettinaro’s Au-
gust 20 letter to Respondent indicates, his interest was, prop-
erly I believe, directed at preserving and bettering his own
personal financial status and that of his various enterprises
involved here rather than to aid Respondent’s financial situa-
tion.
Returning to the negotiations, the parties met on August
29. They discussed financial and other information the Union
had received from Respondent. Union Staff Representative
Hayman briefly raised the issue of Respondent’s lack of a
sales and support group, but there was no extended discus-
sion on this topic.
On September 6, Burke was absent from the meeting be-
cause he had been transferred to the KFC operation in Michi-
gan, at the expense of KFC, in order to relieve Respondent
of his salary. The cost of saving was minimal in view of the
large amount of money Respondent said it needed to survive
at Wilmington. Hayman demonstrated that labor costs were
as much as 20-percent higher at Wilmington than they were
at Flint. Respondent did not then or ever advise the Union
or imply that labor costs were a factor in its consideration
to move work from its Wilmington, Delaware facility to the
KFC Flint, Michigan facility. The parties, working from pro-
posals presented by Respondent, agreed to several non-
economic items. Economics were not discussed.
On September 11, the Union proposed, as its initial offer,
a 1-year wage freeze, and 4-percent increases in the next 2
years if Wilmington showed a profit. Visco promised this
offer would be considered and he would respond. The parties
agreed to several remaining noneconomic issues. Respondent
provided the Union with additional information that the
Union had requested on employee hours worked. Burke was
not present at this meeting.
At the September 18 meeting, Respondent’s attorney,
Visco, again told the Union that labor costs were not a factor
used to calculate Respondent’s profitability and that reduc-
798 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
6 Cetola’s testimony and notes to this effect are credited.
tions of 15 percent in labor costs and 10 percent in employee
benefits would have no material effect on it.6 Visco also ad-
vised there would be a management meeting the following
week and that Respondent was considering the Union’s wage
proposal. The parties negotiated agreement on several other
contract proposals before adjourning.
Five days later on September 23, according to Business
Development Director Rosini and Executive Vice President
Cetola, the Respondent’s board of directors and Visco met
and decided to close the Wilmington facility. It seems un-
usual that, as Rosini and Cetola testify, no written minutes
were kept of this meeting, but their testimony is not inher-
ently incredible and mere suspicion raised by the absence of
written minutes does not warrant discrediting their testimony.
Rosini and Cetola deny that any decision to close had been
made prior to September 23. Both agree that the decision
was necessitated by continuing operating losses and the fail-
ure to secure new business. Both assert that labor costs were
not a material factor in the decision to close. Rosini points
out that the Wilmington facility in Delaware was closing
rather than the KFC plant in Michigan because the KFC
plant was always profitable, the customer (Delco) was in
Michigan and wanted the work done there for just-in-time
delivery, and all the work done for Delco was done in
Michigan, except for some overflow work diverted to Wil-
mington.
Visco met with the Union on October 2 and told Hayman
and the others present that the decision had been made to
close the Wilmington facility beginning December 9. He fur-
ther stated a reduction in employee wages would not change
that decision, there was no new business in the offing, and
Delco wanted the Company to operate in Michigan if there
was only going to be one location. Visco’s latter statement
regarding Delco’s wishes does not support the argument that
the customer did not want any work done in Wilmington. It
merely states the customer’s preference if the Respondent
closed one of its facilities does not constitute a request to re-
move work from the Wilmington facility, and does not imply
any dissatisfaction with work done in Wilmington. Similarly,
the customer’s letter to the Respondent on January 8, 1992,
after the Wilmington closure had been decided on, to the ef-
fect Delco preferred the work be done at the Michigan instal-
lation, is not evidence that, prior to Respondent’s decision on
September 23, 1991, to close the Wilmington facility, Delco
had adamantly insisted on having the manufacturing work
done for it at Wilmington moved from Wilmington to Michi-
gan. Absent some persuasive probative documentary evi-
dence predating that decision and/or testimony to that effect
from Delco representatives, I am not convinced Delco cared
where the work was produced so long as it was well done
and received on time. This conclusion gains considerable
support from the testimony of Respondent’s business devel-
opment director, Rosini, that deliveries to Delco had in fact
been on time since 1988, before the new Wilmington plant
had been built, and continued to be on time until 1992, after
Wilmington had been closed. Wilmington was producing
parts for Delco which were then shipped to KFC in Michigan
for delivery to Delco. This may have been a logistical prob-
lem for the Respondent, but not for the customer (Delco)
who was in fact, according to Rosini, receiving its goods on
time. In sum, there is no proof Wilmington’s production and
delivery time to KFC in Michigan prevented just-in-time de-
livery to Delco, and Rosini’s testimony indicates it did not
do so.
The Respondent is credited that there was no new business
on the horizon when it decided to shut down the Wilmington
facility. Moreover, the Respondent was in fact seeking rent
reduction from Pettinaro at the same time it was advising the
Union that rent reduction was the only thing, absent a sudden
large infusion of new business, that would permit it to main-
tain production in Wilmington. That it was unsuccessful in
those efforts does not mean it was not in good faith seeking
that reduction. It would be farfetched indeed to conclude that
the plea of need for rent reduction was but a ploy to mislead
the Union. There is no evidence warranting an inference that
the Respondent knew prior to its final decision to close Wil-
mington that Pettinaro would not make it some reasonable
accommodation regarding rent reduction, given his large
stake in keeping the plant, in which he and his companies
had a large present and future financial investment, occupied
and producing income and therefore payments, reducing the
size of his risk. The fact that the Respondent sought rent re-
lief and advised the Union such relief might enable it to re-
main in Wilmington is persuasive evidence it was acting in
good faith when it so told the Union, when it approached
Pettinaro on the matter 6 months prior to the contract nego-
tiations, and when it followed up on that approach until it
became apparent in August 1991 that Pettinaro was not in-
clined to provide the requested rent relief. The record pro-
vides no reason to believe that the Respondent’s efforts to
secure rent relief was a sham or that the Respondent knew
its efforts were certain to fail. It is obvious that Pettinaro ap-
parently knew Respondent was in a seriously negative finan-
cial situation from his August 20 letter to Respondent which
reveals knowledge of the Respondent’s money problems, and
also that Pettinaro’s proposal in that letter was designed to
protect his investments. Although Pettinaro’s proposal would
not likely have been of any benefit to the Respondent in
solving its financial problems and his proposal was reason-
ably calculated to do no more than resolve the situation fa-
vorably to his interests, it does show he was concerned about
the money owed to him and his companies by the Respond-
ent because of Respondent’s financial status. This lends some
support to Respondent’s contention that its situation in Wil-
mington was desperate.
After Visco’s announcement of Respondent’s decision to
close the Wilmington facility, the parties bargained a termi-
nation agreement covering the effects of the closing on Re-
spondent’s employees. This agreement was reached in De-
cember 1991, and there is no contention or evidence the re-
lated bargaining was in any way tainted by bad faith. As Re-
spondent’s posttrial brief correctly and concisely notes, the
termination agreement provided severance pay and other ben-
efits for employees electing to go to Michigan to work, in-
cluding the offer of jobs at KFC at the rate of pay in effect
at KFC, and moving expense and assistance, together with a
relocation allowance and 2 months’ free use of an apartment.
As a consequence of the Wilmington closing, the Re-
spondent forfeited its 25-percent interest in that facility and
by default became obliged to the city of Wilmington for the
$605,000 balance due on a loan from the Wilmington Urban
799KAUMAGRAPH CORP.
Development Action Grant Corporation (UDAG) for the
maintenance or creation of jobs in Wilmington.
The Respondent and the Union each called an expert wit-
ness to examine and explain Respondent’s financial condition
at the time of the closure. Both experts are certified public
accountants who, using different approaches (both acceptable
methods of examination) in analyzing the same data and with
different goals, came up with differing conclusions. James
Rossini, the Union’s expert witness, addressed himself to the
issue of viability, and asserts that when he gives an opinion
on finances he examines what he believes is a company’s
ability to survive and last. He defines viability as the ability
to generate sufficient income to pay bills when due, and fur-
ther states that a concern need not be profitable to be viable.
Paul Murray, the Respondent’s expert witness, who has for
several years audited the records of Respondent and all its
related companies named earlier in this decision, credibly re-
lates that he advised the Respondent to close the Wilmington
plant in October 1990 after determining there were insuffi-
cient sources for money to fund both plants (Wilmington and
Flint) because sales had declined significantly during the first
6 months of fiscal year 1990, KFC’s profits were down, Re-
spondent’s losses were increasing substantially, and KFC did
not have sufficient resources to fund Wilmington’s increasing
losses. Murray explains he recommended closing the Wil-
mington plant rather than the Flint plant because: Flint’s per-
formance was better; the Flint plant was devoted solely to
manufacturing for the automobile industry; practically all the
sales of Flint and Wilmington were automotive; and there
was a walkaway lease on the Wilmington premises as op-
posed to KFC’s ownership of its Flint facility.
The Respondent did not follow Murray’s advice and close
Wilmington in October 1990 because Raymond G. Burke,
Respondent’s chairman and chief executive officer, believed
the situation then was due to a temporary decline in the auto-
mobile industry which, as it recovered, would soon give rise
to much greater sales in that industry. Burke advised Murray
again in April 1991 that he was still anticipating more sales
and had no intention of closing the Wilmington facility.
The fiscal year audits of the Respondent, KFC, and other
properties under their common ownership have been pre-
pared in the same format from 1988, before the Union com-
menced its 1989 organizing drive culminating in the 1991
settlement and the subsequent bargaining I have earlier de-
scribed in this decision, to the present. Therefore no conclu-
sion can be made that the method of preparing the audits re-
lated to the time period in which the union activity and sub-
sequent events occurred and was employed with the design
of disguising an unlawful intent to deprive the Union of rep-
resentative status at Wilmington. Moreover, there is no rea-
son on the record before me to question the accuracy of the
audits. It is not surprising that Murray and Rossini, apprais-
ing the financial records of the Respondent and KFC from
different perspectives as they did with Rossini stressing via-
bility even absent a profit as he defines it and Murray look-
ing at profit as an indicator of viability, came to differing
conclusions.
The financial record in evidence show the Respondent had
net losses of $1,495,660 in fiscal year 1989, $990,311 in fis-
cal 1990 (this includes losses of a subsequently discontinued
subsidiary), and $3,812,738 in the fiscal year ending June 30,
1991. During the same fiscal years KFC had net incomes of
$2,472,693, $2,794,266, and $1,115,963, respectively. Al-
though the audit for fiscal year 1988 shows the Respondent
had a net income of $715,450, this is misleading because the
facility it inhabited prior to moving into the Wilmington fa-
cility with which this case is concerned was sold for
$1,472,000. If it were not for this one-time gain, the Re-
spondent’s audit would have shown a loss of approximately
$757,000. Thus, the Respondent has not shown a profit from
its operations since it entered the Wilmington plant. The dra-
matically increased losses of Respondent and decreased in-
come of KFC in fiscal 1991 were more than likely the result
of a downturn in the automotive industry which directly af-
fected both companies because their primary and sole cus-
tomer Delco, a subsidiary of General Motors, reduced its or-
ders by one-half in February 1991. During this time, Wil-
mington performed production work supplementing work of
the same type being done at KFC in Michigan and shipped
its production to KFC, which then delivered it to Delco.
Throughout its existence Respondent has had financial
problems, and became heavily dependent on KFC for finan-
cial support. Respondent’s ability to meet its obligations be-
came so severe that the Bank of Delaware, in March 1991,
agreed to refinance Respondent’s $3.8 million loan and grant
it a $1.5 million line of credit only on the condition that
KFC replace the Respondent as the primary obligor. In ex-
change for KFC’s assumption of its debt and securing its line
of credit, Respondent transferred certain of its assets, includ-
ing title to equipment at Wilmington, to the accounts of
KFC.
The picture of Respondent’s financial disarray requiring
adjustments agreed on at the September 23, 1991 meeting of
the Respondent’s board of directors, and later announced to
the Union, is plausible. On the other hand, there is evidence
that does not fit well with a conclusion the Respondent’s rep-
resentations in this regard are entirely accurate, notably the
following extract from Respondent’s accountant Murray’s
note B written in December 1991 and attached to Respond-
ent and KFC’s combined financial statements for the fiscal
years ending June 30, 1991, and June 30, 1992:
From inception KFC (which has operated a plant in
Michigan) has been profitable while K Corp (which has
operated a plant in Wilmington) and related entities
have incurred operating losses. From July to December,
1990 K Corp’s operations became increasingly unprofit-
able due to the substantial decline in sales as a result
of the US auto market decline. In response, from Jan.
through March, 1991, management of the Companies
developed a plan to:
1. Discontinue their electroluminescent lighting
business.
2. Consolidate their domestic operations by clos-
ing their Wilmington plant and reducing overhead.
3. Refinance their existing debt
4. Transfer their excess plant equipment to Europe
5. Continue plans to build and equip a plant in
Europe.
The accompanying income statement includes the
following charges related to the above restructuring:
800 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
7 I agree with the Union’s counsel that the reference to the ‘‘Wil-
mington plant’’ clearly means the facility whose closure is an issue
in the complaint here.
8 It was decided by March 1991 to close Wilmington in January
1992. The closure was in February 1992. Respondent did not accel-
erate the closure to avoid bargaining with the Union.
9 In referring to this claim regarding Delco’s demands or pref-
erence I specifically note Rosini’s concession that Delco deliveries
were on time from 1988 to 1992.
June 30
1991 1990
Other charges:
Writeoffs related to Wilmington
operations:
Program costs $373,885 - 0 -
Estimated costs of plant closing 400,000
Other 45,594
$819,479 - 0 -
Equity in loss of Kauma-
graph, Ltd. (See Note E.) 310,300 - 0 -
$1,129,779 - 0 -
Discontinued operations:
Electroluminescent lighting (KEL) $670,120 $651,087
Transfer business (KDT) 637,247
$670,120 $1,288,334
Management expects to terminate operations in Wil-
mington in January, 1992. Estimated shutdown and out
of pocket costs of closing the Wilmington plant of
$400,000 have been accrued as of June 30, 1991. Re-
curring operating losses of this plant have not been ac-
crued. The losses from discontinued operations include
KEL which was terminated June 30, 1991 and KDT
which was terminated Sept. 30, 1990. The loss on dis-
position of KDT ($250,000) was accrued for as of June
30, 1990.
Point 2 and the prefatory language flatly states that a plan
had been developed no later than March 1991 to close the
Wilmington plant. This runs counter to Respondent’s rep-
resentation no decision to shut down Wilmington7 was made
until September 23, 1991, but does not necessarily require a
finding the plan was then set in concrete and unchangeable.
Murray’s testimony that the word ‘‘plan’’ in the first para-
graph of the above-noted extract meant an investigation is
not convincing and is not credited. The failure of Burke
(whom Murray points to as the person who makes the deci-
sions for Respondent) to testify concerning the decision to
and reasons for the relocation of the work to KFC is unex-
plained. Consistent with the existence of a plan to consoli-
date domestic operations at Millington, which Murray’s audit
note sets forth, is KFC’s action of contracting for a 100-by-
75-foot addition to the Millington facility on May 30, 1991,
with completion date in September 1991. Similarly, the
beefing up of the Millington production force from 97 in
June 1991 to 120 in July, and thereafter in successive months
in 1991 to 131, 139, 150, 157, and 178 is or may be indic-
ative of the execution of a preordained consolidation plan.
This increase in employees may have been due to increased
work unrelated to such a plan, but there is no persuasive evi-
dence to that effect.
C. Conclusions
1. The 8(a)(3) allegation
The presettlement threats to close the Wilmington facility,
the evidence that Respondent had at least a tentative plan to
shut Wilmington down as early as March 19918 but advised
the Union in August no such decision had been made, the
purported failure to keep minutes of a meeting of its direc-
tors wherein a momentous decision to close a facility was
purportedly made, the failure of Attorney Visco or Chairman
and Chief Executive Officer Burke to testify in support of
Respondent’s defense even though they were principal par-
ticipants in the bargaining and decision to close Wilmington,
the expansion of Millington contracted for and begun prior
to the date that Respondent claims the closure decision was
made, the beefing up of the Millington work force prior to
the claimed decision date, the proffer of a claim, which I do
not credit, that Delco’s demand or request that all work done
for Delco be performed in Michigan,9 and the timing of the
closure announcement only 3 days after the Regional Direc-
tor approved the settlement agreement in the prior case are
sufficient to warrant an inference the Respondent’s hostility
toward union representation of its employees was a motivat-
ing factor in its decision to close the Wilmington facility.
That being the case, the burden now shifts to Respondent to
demonstrate that the closing of Wilmington and the related
work transfer would have taken place in the absence of union
representation. Wright Line, 251 NLRB 1083 (1980); NLRB
v. Transportation Management Corp., 462 U.S. 393 (1983).
The Respondent is not required to prove its defense beyond
a reasonable doubt, but only by a preponderance of the evi-
dence even though there is some evidence tending to negate
that defense. Merillat Industries, 307 NLRB 1301, 1303
(1992).
Although I have found the Respondent had a tentative plan
to close Wilmington prior to recognition of and negotiation
with the Union, the very fact that Respondent was consider-
ing closing Wilmington as early as January 1991 lends sup-
port to its contention that recognition and bargaining were
not the triggering events for the closure plan. Some weight
must be accorded the Respondent’s search for rent reduction.
It cannot fairly be concluded on the record before me that
Respondent knew these efforts were foredoomed or that if
the reduction sought was gained, the Respondent would still
close the plant. It seems to me that by announcing to the
Union it was seeking rent relief to enable it to continue oper-
ations in Wilmington, the Respondent bound itself to con-
tinue operating if the relief was obtained and was in no posi-
tion to renege on this position. I find that even though a pre-
liminary decision to close Wilmington was made in March
1991, the Respondent clearly conveyed to the Union that the
plant would be kept open if there were a sufficient increase
in sales or decrease in rent.
Most importantly in support of Respondent’s position is
the simple fact that although the Wilmington operation may
801KAUMAGRAPH CORP.
10 Sec. 10(b) of the Act provides that no complaint shall issue
based on conduct occurring more than 6 months prior to the filing
and service of a charge.
11 If Wilmington’s employees wages were cut by $2 an hour to
match those in Flint, each employee’s wages would be reduced by
about $350 per month per each employee who worked a 40-hour
week. This translates to about $16,800 a month total, far short of
what was needed.
have still been viable, i.e., could have been continued on a
no-profit basis, it had always been a losing operation, and
was kept afloat by the considerable financial assistance pro-
vided by KFC, which had always been profitable. Moreover,
the work being performed by the Wilmington facility, which
was the overflow work from KFC, makes the addition of
more space to the Millington plant (located only about 20
miles from Delco whose orders financed both KFC and the
Respondent) that is owned by KFC at a monthly mortgage
of about $5500, as opposed to the monthly rent at Wilming-
ton of about $40,000, an attractive and reasonable venture
from a financial standpoint. I also note there is no good rea-
son shown from a financial or other business-related point of
view for Respondent to keep a facility at Wilmington.
The evidence cuts both ways in several instances as the
foregoing discussion of the case for and against the finding
of a violation of the Act demonstrates. The issue is not
whether the Respondent could have continued its Wilmington
operation but whether it would have continued operating in
the absence of union representation of its employees. It is a
close question, but given its longterm financial condition,
which is shown by its records to have been abysmal, the fact
the Respondent was considering the closure and decided by
March 1991 to effect it in the absence of a financial wind-
fall, i.e., a large increase in sales or a large decrease in rent,
the fact Respondent was seeking rent relief before negotia-
tions began and continued to so do, and the fact the income
of the Wilmington facility depended on the success of KFC
in obtaining automotive work, I am persuaded the Respond-
ent would not have scuttled its plan to close Wilmington
even had the Union never appeared on the scene. The closure
and relocation therefore did not violate Section 8(a)(3) of the
Act.
For what it is worth, I also note that although the Re-
spondent argues a 10(b) defense10 with respect to some of
the evidence, it does not mention the fact that if, as I have
found, the preliminary decision to relocate was made in
March 1991, it was made more than 6 months prior to the
filing of the initial charge in the instant case in January
1992. I therefore find the Respondent has, by not raising this
defense, waived any defense this might afford it under Sec-
tion 10(b) of the Act. See, e.g., Petosky Geriatric Village,
295 NLRB 800, 802 fn. 2 (1989).
2. The 8(a)(5) allegation
The parties stipulated the closing of Wilmington and the
transfer of its work to Millington was a relocation of unit
work unaccompanied by a basic change in the nature of Re-
spondent’s operations. The decision to relocate is therefore
prima facie a mandatory subject of bargaining, Dubuque
Packing Co., 303 NLRB 386, 391 (1991), and cases cited
therein, which further provides an employer may show bar-
gaining over the decision is unnecessary by showing by a
preponderance of the evidence that direct or indirect labor
costs were not a factor in the decision or, even if they were,
the union could not have offered labor cost concessions suffi-
cient to change the decision to relocate.
From the beginning of negotiations, Visco advised the
union repesentatives that the closing of Wilmington was con-
templated and could only be forestalled by a very large mul-
timillion dollar and very quick increase in sales or, alter-
natively, a substantial decrease in its monthly rent. The sales
did not increase and the rent did not decrease. The monthly
relief sought from Pettinaro was approximately $25,000 in
February and $30,000 in August 1991. Although Hayman on
one occasion mentioned to Visco that the Union had had
some success in other instances in securing rent reduction,
and Visco responded that such action would be welcome and
if successful the Company ‘‘might be in business,’’ there is
no evidence the Union exerted any efforts in that direction.
Visco plainly advised the Union the Respondent’s financial
situation could not be sufficiently bettered by reduction of
labor costs to warrant keeping the Wilmington operation
going. This does not seem to be an unreasonable position
when one considers that in order to produce the $25,000 rent
relief sought in February, each of the Respondent’s 48 em-
ployees in August 1991 would have had to sacrifice $520 a
month in wages.11 It is unrealistic to assume that a wage sac-
rifice of that scope for the foreseeable future, which would
have been necessary, would have been possible to achieve.
Wages are but one component of labor costs, but there is no
showing of any other area of labor costs that significant cost
savings could have been made. The Union offered no real
help in this direction by proposing a 1-year wage freeze,
even though company records reflected that the labor cost
ratio had gone as high as 31.4 percent at Wilmington as op-
posed to 17.8 percent for KFC in fiscal 1989, and Wilming-
ton’s labor cost ratio was considerably higher than KFC’s in
fiscal years 1987 and 1988. The freeze would not have less-
ened this ratio. It merely would have preserved the unsound
status quo.
The General Counsel’s posttrial brief advances the follow-
ing proposition, among others:
[T]he probative evidence supports a finding that labor
costs were a factor. Thus, at the first bargaining ses-
sion, it is uncontroverted that the Respondent informed
Hayman that if the Union got Respondent relief on its
overhead in Wilmington, they might be in business. In
addition, Respondent virtually conceded that labor costs
were a factor in the decision to relocate, when Robert
Rosini admitted on cross examination that the Respond-
ent probably would have remained in Delaware had
Pettinaro provided the requested rent relief.
I do not agree that advice the Wilmington plant probably or
might remain operational if it received relief on its overhead
costs and/or rent relief translates into evidence that labor
costs were a factor in the relocation decision.
I have read the testimony, examined the relevant records,
and considered the arguments of counsel before arriving at
my conclusion, which is: (1) that the evidence preponderates
in favor of a conclusion the Union could not have offered
labor cost concessions sufficient to change the relocation de-
802 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
12 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
cision; and (2) that labor costs were not a significant factor
in the relocation decision. Accordingly, I find Respondent
did not violate Section 8(a)(5) of the Act. In making this de-
cision I have considered that Visco (Respondent’s attorney),
intentionally or otherwise, incorrectly advised the Union no
decision on relocation had been reached prior to September
1991. He did, however, from the beginning of negotiations
advise the Union that Respondent would relocate its work if
it could not obtain the relief he specified. The Union was
given full opportunity to bargain on the decision, but offered
little help in resolving Respondent’s problems. I believe Re-
spondent was bargaining in good faith with the Union, and
that the Wilmington work would not have been relocated if
the rent and/or sales figures had improved in the manner
Visco advised was necessary, but they did not improve.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended12
ORDER
The complaint is dismissed.