Kraft Plumbing and Heating, Inc.

National Labor Relations Board - Board Decisions

Sep 30, 1980

252 N.L.R.B. 891 (N.L.R.B. 1980)

KRAF I'PI.LIMBIN(i ANI) HEA'IN(. INC
Kraft Plumbing and Heating Inc. and Local Union
No. 469 of the United Association of Journey-
men and Apprentices of the Plumbing and Pipe
Fitting Industry of the United States and
Canada. Case 28-CA-5335
September 30, 1980
DECISION AND ORDER
BY CHAIRMAN FANNING ANI) MEMBIRS
JENKINS ANI) PENE I. O
On May 14, 1980, Administrative Law Judge
Roger B. Holmes issued the attached Decision in
this proceeding. Thereafter, Respondent filed ex-
ceptions and a supporting brief, and the General
Counsel filed an answering brief to Respondent's
exceptions.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
The Board has considered the record and the at-
tached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, find-
ings,' and conclusions of the Administrative Law
Judge and to adopt his recommended Order, as
modified herein.2
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor Re-
lations Board adopts as its Order the recommended
' Respondent has excepted to certain credibility findings made by the
Administrative Law Judge It is the Board's estahlished policy not to
overrule an administrative law judge's resolutions with respect to credi-
hbility unless the clear preponderance of all of the relevant evidence cotn-
vinces us that the resolutions are incorrect Standard Dry Wall Productrs.
Inc.. 91 NLRB 544 (195()). enfd 188 F2d 362 (3d Cir 1951). We have
carefully examined the record and find no basis for reversing his findings.
= As part of his remedy, the Administrative Law Judge recommended
that Respondent he ordered to reimburse the trust funds provided for in
the collective-bargaining agreement for those contributions Respondent
has failed to make o behalf of unit employees. noting, however, that the
Hoard does not provide for the addition of interest at a fixed rate on un-
lawfully withheld fund payments. See Merrywrauther Optical Company. 240
NLRB 1213 (1979). In addition, we shall order Respondent to make em-
ployees whole by reimbursing them for any medical, dental. r other ex-
penses ensuing from Respondent's unlawful failure to make such required
contributions This shall include reimbursing employees for any medical
or dental hills they have paid directly to health care providers that the
contractual policies would have covered, as well as any premiums they
may have paid to third-party insurance compaines to coninue medical
and dental coverage in the absence of Respondent's required conlribu-
tions to the appropriate funds. Further, we shall order Respondent to re-
imburse employees for any contrihutionls they themselves may have made
for the maiitenance of the coniractual health and welfare pensioln. indus-
try and apprenticeship funds after Respondent unlawfully discontinued
contributions to those funds birrmo Mechanical Corp.. 249 NLRB 669
(1190(); 4ngeluv Block C.. Inc .4nari. Inc.. 250 NLRB 8h8 19(80). Inlter-
est on all such umn shall be paid i the manner prescribed in Ilorida
Steel Corporalton. 231 NI RB 651 (1977) Sec. generally, Ioi Pllrmhing &
HIeating Co(. 138 NI RiB 716 (1962) Member Jenkins would compute in-
lerest in accordance ith his dissenl i Onmpia Medical (orp . 250
NI R 14h (19S()
Order of the Administrative Law Judge, as modi-
fied below, and hereby orders that the Respondent.
Kraft Plumbing and Heating, Inc., Tempe, Arizo-
na, its officers, agents, successors, and assigns, shall
take the action set forth in the said recommended
Order, as so modified:
1. Substitute the following for paragraph 2(d):
"(d) Make whole the employees in the appropri-
ate unit by transmitting the contributions owed to
the Union's health and welfare, pension, industry
and apprenticeship funds pursuant to the terms of
its collective-bargaining agreement with the Union.
and by reimbursing unit employees for any medi-
cal, dental, or any other expenses ensuing from Re-
spondent's unlawful failure to make such required
contributions. This shall include reimbursing em-
ployees for any contributions they themselves may
have made for the maintenance of the Union's
health and welfare, pension, industry and appren-
ticeship funds after Respondent unlawfully discon-
tinued contributions to those funds; for any premi-
ums they may have paid to third-party insurance
companies to continue medical and dental coverage
in the absence of Respondent's required contribu-
tions to such funds; and for any medical or dental
bills they have paid directly to health care provid-
ers that the contractual policies would have cov-
ered. All payments to employees shall be made
with interest."
2. Insert the following as paragraph 2(e) and re-
letter subsequent paragraphs accordingly:
"(e) Reimburse the Union for losses due to Re-
spondent's failure to honor the dues-deduction au-
thorizations of its employees in the appropriate
unit."
3. Substitute the attached notice for that of the
Administrative Law Judge.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
WE WIIL NOT fail and refuse to furnish cer-
tain payroll records to Local Union No. 469 of
the United Association of Journeymen and
Apprentices of the Plumbing and Pipe Fitting
Industry of the United States and Canada
when those records are requested by the
Union and are necessary to the performance
by the Union of its collective-bargaining func-
tions.
WE WILL NOT refuse to recognize and bar-
gain collectively with the Union as the exclu-
sive collective-bargaining representative in the
252 NLRB No. 126
DIECISIONS ()F NATIONA. I.ABO()R RELATIONS B()ARI)
unit of our employees described below. The
appropriate collective-bargaining unit is:
All employees of Kraft Plumbing and Heat-
ing, Inc., engaged in plumbing work as de-
fined in the collective-bargaining agreement
between the Plumbing and Air Conditioning
Contractors of Arizona and the Union, ex-
cluding all other employees, guards and su-
pervisors as defined in the National Labor
Relations Act.
Wt WI.L NOT repudiate and fail to honor,
abide by, and apply the terms of the collec-
tive-bargaining agreement between the Associ-
ation and the Union referred to above.
WtL WIl.L NOT unilaterally discontinue com-
pliance with the hiring hall provisions of the
applicable collective-bargaining agreement re-
ferred to above.
WL: WILL NOT unilaterally discontinue
monthly contributions to the health and wel-
fare, pension, industry and apprenticeship
funds provided for in the applicable collective-
bargaining agreement referred to above.
Wl WI.l. NOT fail to honor the dues-deduc-
tion authorizations of unit employees and fail
to disburse such dues to the Union in accord-
ance with the terms of the applicable collec-
tive-bargaining agreement referred to above.
WE WILL NOT unilaterally institute a new
health and welfare plan covering unit employ-
ees.
WE WILL NOT unilaterally increase the wage
rates of unit employees.
WI Wit. NOT in any like or related manner
interfere with, restrain, or coerce our employ-
ees in the exercise of the rights guaranteed to
them by the National Labor Relations Act.
WE WlL.t. forthwith furnish to the Union the
payroll records previously requested by the
Union.
WIE wit.l. recognize and, upon request, bar-
gain collectively with the Union as the exclu-
sive collective-bargaining representative of the
employees of our Company in the bargaining
unit described above, and WE wIl.. embody in
a signed agreement any understanding which
may be reached.
WE Wt.l. reimburse the Union for the losses
due to our failure to honor the union dues-de-
duction authorizations of unit employees.
WI wllt. honor, abide by, and apply the
terms of the existing collective-bargaining
agreement referred to above.
WE Wi.l. make whole our unit employees
for their loss of wages and benefits resulting
from our failure to apply the terms of the col-
lective-bargaining agreement referred to
above, and resulting from our unilateral ac-
tions.
Wt wil. make whole our unit employees
by transmitting the contributions owed to the
Union's health and welfare, pension, industry
and apprenticeship funds pursuant to the terms
of its collective-bargaining agreement with the
Union, and by reimbursing unit employees for
any medical, dental, or any other expenses en-
suing from our unlawful failure to make such
required contributions. This shall include reim-
bursing employees for any contributions they
themselves may have made for the mainte-
nance of the Union's health and welfare, pen-
sion, industry, and apprenticeship funds after
we unlawfully discontinued contributions to
those funds; for any premiums they may have
paid to third-party insurance companies to
continue medical and dental coverage in the
absence of our required contributions to such
funds; and for any medical or dental bills they
have paid directly to health care providers
that the contractual policies would have cov-
ered.
WE Wii.. pay to our employees appropriate
interest on such moneys.
KRAFr PLUMBING AND HEATING,
INC.
DECISION
ROGER B. HOI.ME., Administrative Law Judge: The
original unfair labor practice charge in this case was filed
on May 10, 1979, by Local Union No. 469 of the United
Association of Journeymen and Apprentices of the
Plumbing and Pipe Fitting Industry of the United States
and Canada, herein called the Union. (See G.C. Exh.
l(a).) The first amended unfair labor practice charge in
this case was filed on June 8, 1979, by the Union. (See
G.C. Exh. l(c).) The second amended unfair labor prac-
tice charge in this case was filed on June 11, 1979, by the
Union. (See G.C. Exh. I(e).)
The Regional Director of Region 28 of the National
Labor Relations Board, herein called the Board, who
was acting on behalf of the General Counsel of the
Board, issued on June 22, 1979, a complaint and notice
of hearing against Kraft Plumbing and Heating, Inc.,
herein called the Respondent. (See G.C. Exh. I(g).) At
the beginning of the hearing in this proceeding, counsel
for the General Counsel moved to amend his complaint.
I granted the General Counsel's motion.
The General Counsel alleges that the Respondent has
engaged in unfair labor practices within the meaning of
Section 8(a)(1) and (5) of the National Labor Relations
Act, as amended, herein called the Act. In summary, the
General Counsel alleges that the Respondent violated
Section 8(a)( ) and (5) of the Act by:
X892
KRAFT PLUMBING AND HEATING, INC.
(I) Failing and refusing to furnish to the Union certain
payroll records which had been requested by the Union.
(2) Refusing to recognize and bargain with the Union
as the collective-bargaining representative in a unit of the
Respondent's employees.
(3) Repudiating and refusing to honor and abide by the
terms of a collective-bargaining agreement between the
Respondent and the Union.
(4) Discontinuing compliance with the hiring hall pro-
visions of the contract.
(5) Discontinuing monthly contributions to the health
and welfare, pension, industry and apprenticeship funds
provided for in the contract.
(6) Refusing to honor the dues-deduction authoriza-
tions of unit employees and failing to transmit such dues
to the Union.
(7) Instituting a new health and welfare plan covering
unit employees.
(8) Increasing the wage rates of unit employees.
The Respondent filed an answer to the General Coun-
sel's complaint and, inter alia, denied the commission of
the alleged unfair labor practices. (See G.C. Exh. l(i).)
At the hearing, the Respondent's answer was amended to
deny the additional allegations which were amended into
the General Counsel's complaint, and to add to the Re-
spondent's answer a defense under Section 10(b) of the
Act.
A pretrial motion to strike was filed on August 24,
1979, by counsel for the General Counsel. The General
Counsel sought to have stricken paragraphs 1, 3, and 6 in
the Respondent's answer. (See G.C. Exh. l(j).) The
Deputy Chief Administrative Law Judge, James T.
Barker, granted the General Counsel's motion, in part,
with regard to paragraphs I and 6 of the Respondent's
answer. He referred the portion of the General Counsel's
motion relating to paragraph 3 to the Administrative
Law Judge to be designated to conduct the hearing. (See
G.C. Exh. I(q).) At the outset of the hearing, I denied
the General Counsel's pretrial motion to strike the Re-
spondent's denial of the allegations set forth in paragraph
3 of the General Counsel's complaint.
The hearing was held before me on November 6, 7,
and 8, 1979, at Phoenix, Arizona. The time for filing
briefs was set for December 13, 1979. Both counsel for
the General Counsel and the attorneys for the Respond-
ent made closing arguments on the record after the pres-
entation of the evidence, and they both filed briefs,
which have been considered.
FINI)INGS 01 FACT
A. The witnesses
In alphabetical order by their last names, the following
17 persons appeared as witnesses at the hearing in this
proceeding:
Dorothy Allen is the credit manager and the accounts
payable supervisor of Phoenix Pipe & Supply, which is
located in Phoenix, Arizona.
Jerry Baker is the president of Mesa N. O. Nelson
Company, Incorporated, which is located in Mesa, Ari-
zona.
Bruce Biehler is the branch manager and also a sales-
man for Larsen Supply Company, Incorporated, which is
located in Tempe, Arizona.
KAennelh Ray Brooks is the business manager of the
Union, which is the Charging Party in this case.
Steve Buterhaugh is an employee of the Burner Com-
pany located in Phoenix.
Dell Campbell is the credit manager of Smith Pipe &
Steel Company, which has offices in Phoenix and
Tucson, Arizona.
Jerry R. Corley is the business agent of the Union.
.Neil Folkmaln is the owner of Arizona Water Works
Supply located in Tempe.
John Douglas lfehnt is an attorney with law offices lo-
cated in Tempe.
Carl Kraft is the president of the Respondent.
Howard Kraft is the president of Climate Control In-
corporated, which is located in Phoenix.
M.ike KraJi is the sole owner of Mike Kraft Plumbing
Company. He is the father of Carl Kraft.
Henry Pierce is the vice president in charge of purchas-
ing and collections of Sunny Pipe & Supply Company,
Incorporated. which is located in Phoenix.
Ray Scare is the office manager of the Hajoca Corpo-
ration of Phoenix.
Ken Steele is the branch manager of Pioneer Plumbing
Supply, an AMFAC Company, which is located in
I'hoenix.
Joseph Stertz is the executive director of the Plumbing
& Air Conditioning Contractors of Arizona, which is a
multiemployer bargaining association, and which for
convenience has been referred to simply as the Associ-
ation.
Edward SzaJfroniec is the manager of Keenan Pipe and
Supply of Mesa.
B. Credibility resolutions
In addition to observing the demeanor of the witnesses
while they were giving their testimony in this proceed-
ing, I have also given consideration to other factors,
such as the positions held by the various witnesses and
their interest in the outcome of the litigation. Viewed in
the context of certain facts, which were established or
admitted, I have also given consideration to the inherent
probability of certain testimony, and whether such testi-
mony is consistent or inconsistent with other established
facts.
The findings of fact to be made herein will rest upon
portions of the testimony given by Brooks, Corley,
Helm, Carl Kraft, Mike Kraft, and Stertz. Particularly
with regard to the testimony offered by Carl Kraft, the
parties have different viewpoints as to his credibility.
Carl Kraft gave an affidavit, which was sworn to on
June 27, 1979, and in which he relates, among other
things, events concerning a verbal contract between the
Respondent and a general contractor to perform work at
the Western Electric facility on December 26, 1978.
Counsel for the General Counsel introduced a copy of
that affidavit as General Counsel's Exhibit 22. In that
statement, Carl Kraft stated, inter alia, the following:
"Since Respondent had his regular employees working at
IDECISIONS OF NATIONAL LABOR RELATIONS BO()ARD
capacity, it contacted the Union Hall to request two (2)
men for the job in question." The Attorneys for the Re-
spondent argued in their brief:
At trial the government suggested that Respond-
ent did call the hiring hall for workers and based
upon that suggestion, argued that such action some-
how showed Respondent to be a signatory to the
Agreement and bound thereby. The evidence does
not show such action by Respondent and, therefore,
no sequence of events based upon the alleged call to
the hiring hall may be used to imply signatory
status in Respondent.
Carl Kraft was quite clear with regard to the call
to the hiring hall. Carl Kraft testified that the gen-
eral contractor for a particular job "took the liberty
of calling the hall for two men" in Respondent's
name (ORP 420). Respondent did not request any-
thing of the union.
Union representative Kenneth Brooks testified lie
did not know who called the hiring hall (ORP 304).
Therefore, the only evidence is that a third party
contacted the hiring hall. The government's conten-
tion fails.
On the other hand, counsel for the General Counsel
argue in their brief the following:
However at the hearing Carl Kraft directly con-
tradicted the statement he had made in his affidavit
at a point in time closer to the incident in question.
Carl Kraft testified that it was not the Respondent
who had made the call to the Union for the referral
but rather the general contractor. This is totally in-
consistent with the Respondent's prior statement
and clearly impeaches the witness. Kraft's denial
that his prior statement is accurate regarding such a
crucial item is particularly outrageous in view of
the fact that the Respondent's prior statement was
prepared by its own counsel!
In connection with the foregoing, see also pages 393-
401 of the transcript of the proceedings. Another matter
to be considered regarding the reliability of the testimo-
ny given by Carl Kraft at the hearing was his response
to questions concerning his signing of a surety bond re-
quired under the Union's collective-bargaining agree-
ment. In this connection, see General Counsel's Exhibit
13 and see also transcript pages 431-434. Particularly un-
convincing was Carl Kraft's assertion that he had signed
the surety bond "accidentally, I suppose."
Still another matter to be considered regarding the
credibility of the testimony by Carl Kraft was his testi-
mony regarding the corporate checks which had been
paid to the Association for membership dues. In this con-
nection, see transcript pages 422-423. According to Carl
Kraft's version, the amounts of the corporate checks paid
to the Association were credited to debts which were
owed by Carl Kraft and the corporation to his father,
Mike Kraft.
Finally, the testimony by Carl Kraft conflicts with the
testimony of Corley regarding conversations between the
two persons. After considering all of the foregoing mat-
ters, I credit Corley's version of his conversations. I do
not credit the testimony of Carl Kraft regarding the re-
quest for the referral of employees to the Western Elec-
tric facility; that the signing of the surety bond was
merely an accident, and that the corporate checks for
dues to the Association were made in partial payment of
loans previously obtained by Carl Kraft and the corpora-
tion from Mike Kraft.
I found the testimony of the various suppliers of mate-
rials to the Respondent to be credible, but it is not neces-
sary to set forth their accounts in view of the conclusion
that the Respondent has been a member of the Associ-
ation at all times material herein, and that the Board may
exercise its jurisdiction based on the commerce facts per-
taining to members of that multiemployer bargaining as-
sociation.
C. he business operations of Mike Krafi Plumbing
Company
Mike Kraft has been the sole owner of Mike Kraft
Plumbing Company for the past 33 to 34 years. He has
primarily performed repair work. He described his cus-
tomers as being "hundreds of them," and such customers
had included Rosarita Foods and Safeway Stores. At one
time Mike Kraft had employed as many as 10 or 12 em-
ployees, but by December 1974 Mike Kraft had only two
employees. They were Ernest Burgos and Arthur Scott
Brown. Both of those persons were longtime employees
of Mike Kraft Plumbing, and by December 1974 both
had been referred through the Union's hiring hall to
work for Mike Kraft Plumbing Company.
Since 1974 Mike Kraft has been what he described as
"semi-retired." He unsuccessfully tried to sell his business
to a third party prior to its incorporation.
In November or December 1974 Mike Kraft contacted
Attorney Helm, whose practice of law includes estate
planning and tax planning. Mike Kraft expressed to At-
torney Helm his concern about the amount of the estate
taxes which would have to be paid after his death. Attor-
ney Helm explained: "Mr. Kraft, in his lifetime had accu-
mulated enough money so that under the old tax code
that we had, he was going to be subject to reasonably
substantial taxes and he came to me for advice on what
to do about it." Mike Kraft was advised that he could
reduce his estate by making a gift of assets valued at
$30,000 to his son, Carl Kraft, who desired to go into
business. Mike Kraft could thereby take advantage of a
lifetime exemption from gift taxation of $30,000 under
the Internal Revenue Code. Attorney Helm explained:
"At the time, as I recall it, I suggested that the easiest
way to do it was to be in the form of a corporation so
that we could just transfer a share of stock to Carl. As I
recall, that's what we did."
The parties entered into the following stipulation re-
garding this matter:
It is hereby stipulated by and between the parties
that on or about December 20, 1974 Kraft Plumbing
& Heating, Inc. was incorporated. The incorpora-
tors of said corporation were Carl Kraft and Mi-
chael Kraft, Jr. Subsequently, at the organizational
894
KRAFT PLUMBING AND EATIN(iG, INC.
meeting of Kraft Plumbing & Heating, Inc. held on
or about December 20, 1974, Michael Kraft, Jr. of-
fered to convey most equipment and inventory of
the plumbing and heating business that he had oper-
ated as a sole proprietorship prior to incorporation
to the corporation for the sum of $25,500 to be paid
by the corporation issuing to Michael Kraft, Jr. and
Mae Lenore Kraft, 25,500 shares of its common
stock.
The meeting accepted Michael Kraft's offer and
on December 24, 1974 issued to Michael Kraft, Jr.
and Mae Lenore Kraft Stock Certificate No. I evi-
denced by a copy of said certificate which will be
included at this point in the record. This certificate
represents 27,700 shares. The difference between
25,500 shares and the 27,700 shares indicated on the
stock certificate is equal to 2,000 additional shares
given by the corporation to Mr. & Mrs. Kraft so
that the corporation could assume and use the trade
name Kraft Plumbing & Heating if it so desired,
said name representing good will.
On the same date, Mr. & Mrs. Kraft then gifted
all said shares of stock to Carl Kraft. Mr. & Mrs.
Kraft retaining no shares in the corporation.
A copy of the minutes of the organizational
meeting of the corporation which includes a list in-
dicating the assets transferred is also attached
herein.
The documents referred to in the stipulation were re-
ceived into evidence as Joint Exhibits I and 2.
Included in the property transferred were inventory
merchandise valued at $12,150; tools and equipment
valued at $3,050; office equipment valued at $500; autos
and trucks valued at $9,800, and goodwill valued at
$2,000. With regard to the goodwill and use of the pro-
prietorship's name, the minutes of the organizational
meeting reveal the following:
Michael Kraft, Jr. then offered to permit the Cor-
poration to assume and to use the trade name Kraft
Plumbing & Heating with the necessary addition of
Inc. for the additional consideration of Two Thou-
sand Dollars ($2,000.00). Mr. Kraft stated that by
accepting this offer, the Corporation would also be
entitled to whatever good will was attached to the
use of that name in the community and that the
Corporation would not have to disclaim any rela-
tionship to the preexisting proprietorship nor would
the Corporation have to distinguish between itself
and the prior proprietorship in any literature, letter-
head, advertisement or contractual arrangement.
After discussion, it was moved, seconded and unani-
mously.
RESOLVED, that the Corporation accepts Mr.
Kraft's offer to transfer the name and good will
and that the Corporation issue Two Thousand
(2,000) shares of its common stock at a par value
of One Dollar a share in return for the good will.
Mike Kraft said that he kept one truck for himself, and
also that he retained his personal tools. He said that he
did not keep any office equipment. His son, Carl Kraft,
assumed the lease on the building at 215 West First
Street in Tempe.
Since that time in 1974, Mike Kraft has had no em-
ployees. He described the types of jobs which he had
performed since December 1974 as follows:
Q. (By Mr. Janofsky) Tell me, Mr. Kraft, what
kinds of jobs have you done since the transfer of
assets to your son in 1974?
A. I've done the plumbing in a house-we have a
summer home in the mountains. I've done a house
up on the golf course in Pine Tops Lake Country
Club; done a house up there last summer.
I've certain people, mainly elderly people-
there's a minister I have in mind, and so on, that
just wait for me. They'll call the shop and have my
son contact me. Sometimes I'm home and some-
times "I'm not. They try to call me at home.
Since that time, Mike Kraft has maintained a summer
home about 180 miles from Phoenix in the mountains
near Show Low, Arizona. During the summer months he
spends a couple of weeks at a time at his summer home.
As Mike Kraft testified at the hearing regarding his busi-
ness, I'm not looking for it. When it comes in, I'll do it.
I'm not encouraging business."
Regarding the physical condition of Mike Kraft by the
time of the hearing, see the representations made by the
attorneys for the Respondent at transcript pages 336 and
337.
D. The Business Operations of Kraft Plumbing &
Hearing, Inc.
There are three officers of the Respondent corpora-
tion. Carl M. Kraft is the president of the corporation.
His mother, Leonore Kraft, is the secretary of the corpo-
ration. His father, Mike Kraft, is the treasurer of the cor-
poration.
Since transfer of the stock in the corporation from his
father on December 20, 1974, Carl Kraft has been the
sole owner of the Respondent. According to Carl Kraft,
the Respondent performs repair and remodel plumbing
work, which he said was similar to that which was per-
formed by Mike Kraft Plumbing Company. The corpora-
tion has its office at the same location as previously had
been occupied by Mike Kraft Plumbing Company.
In the issue of the telephone directory which was cur-
rent at the time of the hearing, the corporation did not
use its corporate name in its yellow pages advertisement,
but instead it listed itself as "Kraft Plumbing & Heating
Company."
At the time of the transfer of the assets to the corpora-
tion, the Respondent employed both of the employees
who had previously performed plumbing and service
work for Mike Kraft Plumbing Company. They were
Scott Brown and Ernest Burgos. No new employment
applications were filled out by those two persons at that
time. The Respondent employed only those two persons
to perform plumbing and service work until October 1,
1977, when the Respondent hired another employee.
Brown continued his employment with the Respondent
895
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
until the summer of 1978, and Burgos was still employed
by the Respondent at the time of the hearing.
Carl Kraft stated that the Respondent paid Brown and
Burgos the wage rates which were set forth in the
Union's contract, and that the Respondent had submitted
fringe benefit contributions on behalf of those employees
until the Respondent ceased to do so on January 1, 1979.
The Respondent also had transmitted union dues deduc-
tions until the Respondent ceased doing so concerning
Burgos on January 1, 1979.
The Respondent has hired other employees since Oc-
tober 1, 1977, without resort to the Union's hiring hall.
The Respondent gave no notice to the Union that it was
not utilizing the union hiring hall. As will be described
later, the Respondent did request the Union to refer two
employees in December 1978. Carl Kraft acknowledged
that he paid those two employees money for appearing
for work and made fringe benefit contributions to the
trust funds on their behalf.
Carl Kraft acknowledged that the Respondent had ac-
quired some of the customers of Mike Kraft Plumbing
Company, but he said that he did not know how many
of them were acquired by the Respondent. He did give
Rosarita Foods as the name of one of the larger custom-
ers of Mike Kraft Plumbing Company, and one which
the Respondent had acquired. Carl Kraft had worked at
times in the past for his father before the corporation
was formed. Carl Kraft said that he was familiar with
some of the customers who had been serviced by his fa-
ther's company. Carl Kraft acknowledged at the hearing
that the Respondent had submitted checks drawn on the
corporate account and signed by him to the Plumbing &
Air Conditioning Contractors of Arizona.
In January 1979 and again in October 1979, the Re-
spondent gave wage increases in varying amounts to its
employees. On or about February 1, 1979, the Respond-
ent began a new health and welfare plan for its employ-
ees. The Respondent did not consult with the Union
prior to the taking of such actions.
E. Matters Pertaining to the Plumbing and Air
Conditioning Contractors of Arizona
The Plumbing and Air Conditioning Contractors of
Arizona has been in existence for about 29 years. That
entity was usually referred to at the hearing as the Asso-
ciation, and for convenience it will be referred to by that
name herein. Among other things, the Association en-
gages in collective bargaining with unions on behalf of
the employer members of the Association, unless the
member notifies the Association to the contrary.
Climate Control is one of the members of Plumbing
and Air Conditioning Contractors of Arizona. Climate
Control had been a member of that Association for sev-
eral years at the time of the hearing in November 1979.
During the previous year, Climate Control had pur-
chased goods and materials valued in excess of $50,000
from outside the State of Arizona, and Climate Control
had brought those goods into Arizona directly from out-
side the State. Those facts were true not only for the
previous year, but also for the prior calendar year.
One of the unions which has negotiated agreements
with the Association is the Union involved in this pro-
ceeding. Among the purposes of the Union is the negoti-
ation with employers and employer associations for
agreements pertaining to employees' wages, fringe bene-
fits, working rules, working conditions, grievance proce-
dures, and hiring halls. Employees are members and par-
ticipate in the Union.
Introduced into evidence as General Counsel's Exhibit
2 was a copy of a collective-bargaining agreement be-
tween the Association and Local Union 469 and Local
Union 741 of the United Association of Journeymen and
Apprentices of the Plumbing and Pipe Fitting Industry
of the United States and Canada. The effective dates of
that agreement were June 1, 1972, through May 31,
1975.
A copy of another collective-bargaining agreement be-
tween the same parties was introduced into evidence as
General Counsel's Exhibit 3. The effective dates for that
contract were June 14, 1975, through June 30, 1978.
Introduced into evidence as General Counsel's Exhibit
4 was a copy of still another collective-bargaining agree-
ment between the same parties. The effective dates of
that agreement are from July 1, 1978, through June 30,
1981. General Counsel's Exhibit 4A and General Coun-
sel's Exhibit 4B are supplemental agreements to General
Counsel's Exhibit 4, which were entered into by the par-
ties to those contracts.
According to Executive Director Stertz, the members
of the Association are businesses or companies. The re-
cords of the Association show that Mike Kraft Plumbing
& Heating became a member of the Association in 1952.
The Association prepares lists or rosters of its mem-
bers. Copies of such rosters were introduced into evi-
dence as General Counsel's Exhibit 8, A through D.
Those documents show the company's name, address,
telephone number, and the name of the person consid-
ered by the Association to be the principal representative
of that Company.
The 1974 roster of the members of the Association
was introduced as General Counsel's Exhibit 8. On that
roster there appears "Kraft Plbg. & Htg. Co." Mike
Kraft's name appears underneath the company's name.
The 1975 roster of members of the Association was in-
troduced into evidence as General Counsel's Exhibit 8A.
On that roster there appears "Kraft Plumbing & Heating
Co." Once again, Mike Kraft's name appears underneath
the company's name. The 1976 roster of members of the
Association was introduced into evidence as General
Counsel's Exhibit 8B. On that document there appears
"Kraft Plumbing & Heating Co." Carl Kraft's name ap-
pears underneath the company's name on the 1976 roster.
The 1978 roster was introduced into evidence as General
Counsel's Exhibit 8C, and the 1979 roster was introduced
into evidence as General Counsel's Exhibit 8D. On both
of those rosters the company's name appears the same as
in General Counsel's Exhibit 8B, and Carl Kraft's name
appears underneath the company's name on both rosters.
F. The Conversation Between Stertz and Mike Kraft
In 1974 or early 1975 there was a telephone conversa-
tion between Stertz and Mike Kraft. During that conver-
sation Mike Kraft informed Stertz that "he was turning
896
KRAFT PLUMBING AND HEATING, INC
the business over to his son, Carl. and he was going to
become less active in the Association work."
Stertz explained at the hearing that Mike Kraft had
held various offices in the Association, and at one time
Mike Kraft was the state president. Stertz said that he
was never advised that Mike Kraft was going to resign
from the Association, and he said that he had never re-
ceived a written resignation from him. Stertz acknowl-
edged that Carl Kraft had never submitted an application
for membership with the Association, nor had Kraft
Plumbing & Heating, Inc. Since 1975 Carl Kraft has not
attended any Association meetings, but Mike Kraft has
continued to attend Association functions.
According to Stertz, he was not notified prior to Janu-
ary 1979 that Kraft Plumbing & Heating was withdraw-
ing its membership from the Association, nor was he no-
tified that it was revoking the Association's authority to
bargain on its behalf and to enter into collective-bargain-
ing agreements. Similarly, the Union's Business Manager,
Brooks, said that he had not been advised that the com-
pany was withdrawing from the Association or that it
was revoking the Association's authority to bargain on
its behalf. Brooks was not aware of the corporate name
of the Respondent, and Stertz did not believe that the
change in the company's name was ever discussed with
him.
G. Membership Dues Paid by the Respondent to the
Association
Members of the Association are sent bills by the Asso-
ciation for their membership dues.
Stertz explained that Mike Kraft Plumbing & Heating
had been billed for dues by the Association since 1952.
He said that the Association continued to bill the compa-
ny for its membership dues after the telephone conversa-
tion between Stertz and Mike Kraft in 1974 or early
1975. He said that the membership dues continued to be
paid to the Association by check.
Copies of bills sent by the Association to the company
were introduced into evidence as General Counsel's Ex-
hibits 7A through 7KK. The Association received pay-
ment for membership dues by check until January 1979.
The earliest bill for Association membership dues was in-
troduced as General Counsel's Exhibit 7KK, which is
dated November 7, 1975. That document shows that the
bill for membership dues was addressed to: Kraft Plumb-
ing & Heating Co, 215 W. First St., Tempe, AZ 85281.
The last bill in chronological order is General Counsel's
Exhibit 7F, which is dated April 3, 1979. That bill was
for membership dues in the Association for January,
February, March, and April 1979.
Stertz explained at the hearing that there were some
differences in spelling of the company's name due to the
typing of the bills by different secretaries. For example,
on some of the Association bills there appears "Co." and
on other bills there appears "Company." (See, for exam-
ple, G.C. Exh. 7.) Sometimes the name was abbreviated
on some bills. For example, there appears "Kraft Plbg. &
Htg. Co." (See, for example, G.C. Exh. 7.)
On September 11, 1978, Stertz wrote a letter on the
Association's letterhead stationery to Carl Kraft regard-
ing a delinquency in the firm's dues. A copy of that
letter was introduced into evidence as General Counsel's
Exhibit 11. In pertinent part, it states:
Carl Kraft
Kraft Plumbing & Heating Co.
215 West First Street
Tempe, AZ 85281
Carl:
In keeping with the By-laws, I must write you and
advise that your firm is delinquent in dues in the
amount of $60,000. This covers the months of June,
July, August and September.
Please give this your personal attention, as when
delinquent dues exceed the regulations of the By-
laws, it is my duty to report same at a meeting of
the Association.
The membership dues requested in the foregoing letter
were subsequently paid by the Respondent to the Associ-
ation.
H. The Checks Sent by the Association to the
Respondent
Introduced into evidence as General Counsel's Exhibit
10A was a copy of a letter dated July 8, 1977, from the
Association to the Respondent. In pertinent part, it
states:
Kraft Plumbing & Heating, Inc.
215 West First Street
Tempe, AZ 85281
Carl:
It is with pleasure that we enclose herewith a check
made payable to Kraft Plumbing & Heating, Inc. in
the amount of $92.00, which is a dividend due you
via our State Compensation Fund Insurance Plan.
Introduced into evidence as General Counsel's Exhibit
10B was a copy of a letter dated August 6, 1976, from
the Association to the Respondent. In pertinent part, it
states:
Mr. Carl Kraft
Kraft Plumbing & Heating, Inc.
215 W. First St.
Tempe, AZ 85281
Carl:
It is our pleasure to enclose a Dividend Check from
the Arizona State Compensation Fund in the
amount of $133. Had you not been a member and
participated on an individual basis, you would have
received $59. By being a member you received an
additional benefit of $74.
Carl, I hope that the next dividend year gives you a
larger return. We can all work together in accom-
plishing this by stressing "safety." Please give my
regards to Mike.
According to Stertz, the Respondent had to be a
member of the Association in order to be entitled to the
897
DECISIONS OF NATIONAL LABOR RELATIONS BO)ARD
refund through the Association's plan. Stertz stated that
Carl Kraft never returned either check referred to
above, nor did Carl Kraft claim at that time that the Re-
spondent was not a member of the Association and thus
not entitled to the money he received.
I. Bulletins Distributed to Members of the Association
Members of the Association were sent bulletins regard-
ing the status of negotiations.
Copies of such bulletins during a timespan from May
7, 1974, to September 25, 1978, were introduced into evi-
dence as General Counsel's Exhibits 9 through 9Q.
Copies of those bulletins had been distributed to Kraft
Plumbing & Heating Co.
Other examples of communications from the Associ-
ation to its members regarding negotiations were intro-
duced into evidence as General Counsel's Exhibits 5 and
6. Those documents are dated March 19, 1976, and Feb-
ruary 10, 1978, respectively.
At the hearing an envelope from the Association was
identified as being addressed to: "Carl Kraft, Mike Kraft
Plumbing & Heating." The envelope was postmarked
December 22, 1978. An addressograph plate had been
used to address that communication.
The Association also supplies a copy of its roster of
members to the Union. The Union then sends out notices
to those members listed on the Association roster. (For
example, see G.C. Exh. 12A, which is dated February
28, 1975, and G.C. Exh. 12B, which is dated April 24,
1978.)
J. Payments to the Trust Funds and Transmittal of
Union Dues
Trust funds are established under the terms of the col-
lective-bargaining agreement which was introduced into
evidence as General Counsel's Exhibit 4. According to
Brooks, Kraft Plumbing & Heating had made contribu-
tions to such funds for "a good number of years," and as
late as December 1978 for two employees, Alan Johnson
and Richard Wilson.
Brooks identified General Counsel's Exhibit 16 as
being a standard form used by contractors who are sig-
natory to the collective-bargaining agreement, and who
report the fringe benefit payments for employees who
have worked for the contractor. General Counsel's Ex-
hibit 16 shows payments made for 4 hours worked each
by Johnson and by Wilson. The payments are to the
health and welfare fund, the pension fund and the indus-
try program fund. In addition, the document reveals that
union dues were transmitted by the Company for those
employees. There is still another employee's name on the
form, but it is illegible on that photostat. However, an-
other photostat of the same document was subsequently
introduced into evidence as General Counsel's Exhibit
17D, and that photostat shows that the employee's name
was Burgos. The document shows that he worked 152
hours as a metal tradesman, and that contributions were
made by the employer to a separate health and welfare
fund and separate industry program fund. The employ-
er's name is shown as "Kraft Plumbing & Heating Co."
Beside the signature line on the document appears "Carl
M. Kraft by L. K." Besides the title line appears
"owner."
General Counsel's Exhibit 17A through 17NNN are
copies of similar forms, all of which were submitted
under the employer's name of "Kraft Plumbing & Heat-
ing Co." during the period from January 1, 1974,
through May 1979. Some forms list no employees and no
contributions. (For example, see G.C. Exh. 17A for May
1979.)
The form for February 1974 shows "Michael Kraft"
by the signature line and "owner" by the title line. (See
G.C. Exh. 17MMM.) The form for March 1974 shows
the same information. (See G.C. Exh. 17LLL.) In addi-
tion, the form for April 1974 also discloses the same in-
formation. (See G.C. Exh. 17KKK.)
For May 1974 "Carl Kraft" appears beside the signa-
ture line with the title space left blank. (See G.C. Exh.
17JJJ.) For July 1974 what appears to be "M. Rledu" is
written by the signature line and "bkker" by the title
space. (See G.C. Exh. 17HHH.) For August 1974 what
appears to be "Carl Kraft by A. Arner" is written beside
the signature line and "Bkkter" by the title line. (See
G.C. Exh. 17GGG.)
What appears to be "Ed Harrington" is written beside
the signature line and "Acctg" is written by the title line
on the reports submitted between October 1974 and July
1976 with one exception which is blank in both of those
spaces. (See G.C. Exhs. 17GG through 17JJ; 17LL
through 17XX; and 17AAA through 17EEE.) General
Counsel's Exhibit 17KK is the exception to the above.
The report for August 1976 shows "C.M. Kraft" by
the signature line and "owner (L. K.)" by the title line.
(See G.C. Exh. 17FF.)
On the reports submitted during the period of time
from September 1976 through April 1978 what appears
to be "Ed Harrington" and "Acctg" are shown by signa-
ture lines and title lines respectively. (See G.C. Exhs.
17L through 17Z; and 17AA through 17EE.)
Thereafter, except for the report previously described
for December 1978, the spaces were left blank beside the
signature line and the title line. (See G.C. Exhs. 17A;
17B; 17C; and 17E through 17K.) General Counsel's Ex-
hibit 17D is the exception to the foregoing.
As noted above, "Kraft Plumbing & Heating Co." is
listed as the employer on all of the foregoing reports
from January 1974 through May 1979.
Payments to the funds were unilaterally discontinued
by the Respondent after its payments in January 1979 for
the hours worked by its employees during the previous
month.
Transmission of union dues, which had been deducted
from the employee's wages, also was unilaterally discon-
tinued after the payments for December 1978. Brooks
pointed out at the hearing that Burgos was still em-
ployed by the Respondent at the time of the hearing and
that the Union had not received any revocation of
Burgos' previously executed union dues-checkoff author-
ization.
898
KRAFT PLl'MHIN(i AND) HEATINU, INC.
K. The Suretv Bond
A surety bond executed by an employer is a require-
ment of the collective-bargaining agreements with the
Union. The Union's practice is not to dispatch workers
to an employer unless the employer has signed a surety
bond for the workers' wages and fringe benefits.
A copy of a surety bond dated July 16, 1976, by
"Kraft Plumbing & Heating, Inc." and signed by Carl M.
Kraft was introduced into evidence as General Counsel's
Exhibit 13. In pertinent part, it states:
KNOW ALL MEN BY THESE PRESENTS:
That we, KRAFT PLUMBING & HEATING,
INC., as principal, and FIDELITY & DEPOSIT
COMPANY OF MARYLAND as surety, a corpo-
ration duly qualified to act as surety in the State of
Arizona, are held and firmly bound unto Local
Unions 469 of the United Association of Journey-
men and Apprentices of the Plumbing and Pipefit-
ting Industry of the United States and Canada, for
the use and benefit of the employees of the principal
and any other parties to whom wages or benefits
are to be paid under the terms of the Arizona Pipe
Trades Agreement of June 14, 1975, together with
any modification, renewal, extension or supplemen-
tal thereof, and the terms of any subsequent Arizona
Pipe Trades Agreement which may be entered into
between the parties, as obligee, in the sum of TWO
THOUSAND & 00/100 - Dollars ($2,000.00) for
the payment of which, said principal binds itself and
its successors, and surety binds itself and its succes-
sors, jointly and severally, firmly by these presents.
The condition of the above obligation is such,
that whereas said principal, as a contractor has en-
tered into a collective bargaining agreement dated
June 14, 1975 (generally known as the Arizona Pipe
Trades Agreement), with obligee providing among
other things for the payment of wages to and bene-
fits for his employees.
Now, if the said principal shall pay such wages
and any other benefits, to the employees or to any
other party named in said Arizona Pipe Trades
Agreement to whom they are to be paid in the
manner and at the time when such sums are to be
paid, then this obligation is to be void, otherwise, to
remain in full force and effect.
It is expressly understood that so far as wages are
concerned the liability of the surety hereunder shall
be limited to ten days' wages each for employees of
the principal.
It is further understood that the obligee shall
notify the surety of any default of the principal's
obligations under this bond, such notice to be made
by registered or certified mail within thirty days
after any wage default, or ninety days after any
other default occurs.
It is also expressly provided that as a further con-
dition hereof this bond shall be construed to cover
all reasonable expenses incurred by any party in the
collection of any of the sums due under the terms
and provisions of said Arizona Pipe Trades Agree-
ment.
It is further expressly agreed that the surety may
cancel its liability hereunder at any time upon mail-
ing thirty days' written notice, in advance, to the
principal and the obligee Union herein named, and
that the liability of the surety hereunder shall cease
upon the expiration of the thirty days after the de-
livery of said notice.
It is further expressly agreed by and between all
parties named in this bond that the total aggregate
liability of the surety for all claims shall be limited
to the face amount of this bond, irrespective of the
number of years this bond is in force.
L. The Use of the Union's Hiring Hall
Both Arthur Brown and Ernest Burgos were referred
by the Union to work for "Kraft Plumbing."
A copy of a union referral slip dated in December
1974 for Burgos was introduced into evidence as General
Counsel's Exhibit 18. Another referral slip dated Septem-
her 20, 1978, for Burgos was introduced into evidence as
General Counsel's Exhibit 20.
Both Brown and Burgos paid dues to the Union.
Brown had paid such dues from 1952 to the time of the
hearing, and Burgos had paid such dues from 1974 to
January 1979. (In this connection, see also G.C. Exhs.
19A and 19B.)
A copy of a union referral slip for Alan R. Johnson to
work for "Kraft Plumbing" at Western Electric was in-
troduced into evidence as General Counsel's Exhibit 14.
That document is dated December 26, 1978. A similar
referral slip for Richard R. Wilson to work for "Kraft
Plumbing" at Western Electric was introduced into evi-
dence as General Counsel's Exhibit 14B. That document
is also dated December 26, 1978.
M. The Events in December 1978
As a result of a conversation sometime in early De-
cember 1978 between Corley and a union member,
Arthur Scott Brown, Corley and another union Business
Agent, Ron Harvill, went to the Respondent's premises
on December 27, 1978.
Around 7:20 a.m. on that date, Corley observed two
people arrive at the Respondent's premises in a truck.
The two persons unlocked the gate and went inside.
They put some things in the truck, and then they locked
the gate and left the Respondent's premises about 7:40
a.m.
Corley and Harvill followed the two persons to 70th
Street and Camelback. Corley and Harvill then went on
the premises at that location.
Corley observed that the persons were performing
plumbing work. Corley questioned one of the workers as
to whether he was working for "Kraft Plumbing Compa-
ny." The worker replied, "Yes." Corley then asked him
if he had gone through the dispatch hall. The worker re-
plied, "No." Corley inquired as to the worker's name,
and the worker referred Corley to the shop. Corley left.
About 9 a.m. on that day Corley returned to the Re-
spondent's premises, and he spoke with a lady, who
899
DECISIONS OF NATIONAL LABOR REI.ATIONS BOARD
Corley identified at the hearing as being Carl Kraft's
mother. Corley asked to talk with Kraft. During his
direct examination by Counsel for the General Counsel,
Corley testified:
And she said Carl Kraft is not here but I can
beep him. So she did and within a few minutes Carl
Kraft called.
I said Carl I've been out to the job at 70th Street
& Camelback. I guess you know what I found. He
said, yes I do, what do we do now.
I asked him if he would come in so we could go
through his books. He said, well, I'm way out on
the Black Canyon and I'll be in in about an hour.
Approximately 10:00 o'clock Carl came in, drove
through the gate, got out of his truck. I walked up
to him. We introduced ourselves, and he had told
me that he had terminated the two new hires out of
the Western Electric plant.
I told him, geez, I wish you hadn't done that.
Q. Can you tell us the names of those men?
A. It was Alan Johnson and Richard Wilson.
Q. How did they come to work for Kraft?
A. They had picked up a work order the day
before and was to report that morning to the West-
ern Electric job.
Q. They were referred out of the hall?
A. Yes, they were referred out of the hiring hall.
Q. Okay.
A. Like I said, I mentioned to him that I wished
he hadn't done this. I had full intentions of getting
things straightened out.
Then Carl said how do I become non-signatory. I
told him, Carl it's out of the question at this time. It
takes 60 days prior to the expiration date of the
contract which is in '81.
I again asked Carl if I could look into his books.
He told me that his attorney advised him not to at
this time.
I then left and went into my office.
Q. Was anyone else present when this conversa-
tion took place?
A. No, it was just Carl and I.
Q. For what purpose did you request to see his
payroll records?
A. Number one, I wanted to see who he did have
employed. I wanted to make sure that the fringes
were being reported, turned in, this and that.
The Union filed a protest regarding this matter under
the grievance procedure of the collective-bargaining
agreement. The case was scheduled for hearing, but the
Respondent did not appear. Thereafter, the Union filed
the unfair labor practice charge which is involved in this
proceeding.
Introduced into evidence as General Counsel's Exhibit
15 was a copy of a "Notice of Termination" for Richard
R. Wilson. The document is on a form which is supplied
by the Union to contractors. The form indicates that
Wilson was hired and terminated on the same date, i.e.,
December 27, 1978. The firm's name shown on the form
is "Kraft Plbg & Htg Inc." The document is dated De-
cember 27, 1978, and it shows "Carl M. Kraft owner by
LK."
N. Conclusions
In its decision in Saks & Company d/b/a Saks Fifth
Avenue, 247 NLRB No. 128 (1980), the Board stated the
following:
The Board has held that, in determining succes-
sorship, the keystone is whether there is substantial
continuity of the employing industry.6 Continuity
of the employing industry requires consideration of
the work done . . as well as consideration of the
work force ....
Miami Industrial rucks, Inc., 221 NLRB 1223 (1975), where
the Hoard recognized a successorship to a portion of the pred-
ecessor's operation to wit, one product line with the successor con-
tinuing to service it for the same customers employing four service
employees, three of whom were employees of the predecessor See
also Mondovi Foods Corporalion, 235 NLRB 1080, fn 8 (1978).
Without repeating here all of the findings of fact
which have previously been set forth herein, I conclude
that there was a "substantial continuity of the employing
industry" in this case. The Respondent corporation con-
tinued the same type of plumbing repair and remodeling
work which Mike Kraft Plumbing had performed. The
Respondent operated its business out of the same loca-
tion as Mike Kraft Plumbing had previously occupied.
The corporation immediately employed both of the em-
ployees of Mike Kraft Plumbing who had been perform-
ing plumbing and service work for that company. The
Respondent applied the existing collective-bargaining
agreement with the Union regarding the payment of
wage rates to those employees and the payment of fringe
benefits for those employees. There were no new em-
ployees hired by the Respondent for that type of work
until October 1, 1977.
The sole owner of Mike Kraft Plumbing was instru-
mental in the formation of the Respondent corporation,
and Mike Kraft transferred certain assets to the corpora-
tion in exchange for shares of stock in the corporation.
Then Mike Kraft immediately made a gift of those shares
of stock to his son, Carl Kraft, who thereafter has been
the sole owner of the Respondent corporation. Signifi-
cantly, Mike Kraft continued to be one of the three offi-
cers of the Respondent corporation at the time of the
hearing. The other two officers of the corporation were
Mike Kraft's wife and Mike Kraft's son. By virtue of the
transfer of certain assets to the corporation, a substantial
amount of the equipment previously operated by Mike
Kraft Plumbing became the equipment utilized by the
Respondent. Mike Kraft retained only his own tools and
one truck. While Mike Kraft has continued to perform
some plumbing work, he candidly stated at the hearing
that he was semiretired. He has had no employees since
the formation of the Respondent corporation. Consider-
ing his semiretirement, his physical condition, the trans-
fer of the substantial amount of his equipment to the Re-
spondent corporation, and the fact that he has had no
employees it cannot be fairly said that the Respondent is
900
KRAFT PLUMBING AND HEATING, INC.
not a successor employer to the business formerly oper-
ated by Mike Kraft Plumbing.
At least some of the former customers of Mike Kraft
Plumbing were acquired by the Respondent. However,
that factor seems to be of less significance under the par-
ticular circumstances of this case when one considers the
nature of the plumbing repair and remodeling work
being done, and the types of customers for whom the
work has been performed.
As noted above, the Respondent corporation applied
initially the terms of the collective-bargaining agreement
with regard to paying the wages and fringe benefits to
the two employees who had previously worked for Mike
Kraft Plumbing. The Respondent subsequently did not
utilize the Union's hiring hall provided for in the collec-
tive-bargaining agreement until December 26, 1978,
when the Respondent did request the Union to refer two
employees to work for the Respondent at the Western
Electric facility.
The Respondent paid membership dues to the Associ-
ation by checks drawn on the corporate bank account. I
conclude that the Respondent therefore, in effect, contin-
ued the membership of Mike Kraft Plumbing in the As-
sociation. As indicated previously herein in Section B, I
have not credited the version given by Carl Kraft that
the amounts of the corporate checks paid to the Associ-
ation for membership dues were in partial payment for
loans made to Carl Kraft and the corporation by Mike
Kraft.
It is significant that the Respondent never gave notice
to the Association, nor to the Union, that the Association
did not have authority to bargain collectively on behalf
of the Respondent. Instead, the Respondent paid mem-
bership dues by means of corporate checks, as indicated
above, and also the Respondent received moneys from
the Association as a member. In this connection see Gen-
eral Counsel's Exhibits 10A and 10B. The Respondent
has never returned those checks, or those amounts of
money to the Association, nor did the Respondent claim
at the time that it received the moneys that the Respond-
ent was not a member of the Association.
As noted previously in the findings of fact, the Re-
spondent did execute a surety bond in accordance with
the terms of the collective-bargaining agreement. For the
reasons previously stated in Section B herein, I have not
accepted Carl Kraft's account that his signing of that
surety bond was an accident.
After considering all of the foregoing, I conclude that
the Respondent corporation is a successor employer to
Mike Kraft Plumbing. First Food Ventures, Inc., 229
NLRB 1228 (1977). I further conclude that the Respond-
ent has been a member of the Association since the in-
ception of the Respondent and that the Respondent has
been bound to the collective-bargaining agreement nego-
tiated on its behalf by the Association.
Consistent with the foregoing, I find that the Board
should properly assert its jurisdiction over the business
operations of the Respondent. Insulation Contractors of
Southern California, Inc., 110 NLRB 638 (1954).
At the request of the counsel for the General Counsel,
I have taken judicial notice of the Board's decision in
Local Union 469 of the United Association of Journeymen
and Apprentices of the Plumbing and Pipe Fitting Industry
of the United States and Canada (Mackey Plumbing Co.),
228 NLRB 298 (1977). In that decision, the Board found,
inter alia, the following: "Mackey is a member of Plumb-
ing and Air Conditioning Contractors of Arizona, an as-
sociation of employers engaged in the plumbing industry
which exists for the purpose, inter alia, of negotiating
collective-bargaining agreements with the Respondent
Union." Note also the findings regarding jurisdiction
over the members of that Association as set forth at page
301 of the decision by Administrative Law Judge Russell
L. Stevens. The testimony of Howard Kraft, the presi-
dent of Climate Control Incorporated, as set forth in the
findings of fact herein, establishes the currency of the
Board's jurisdiction over a member of that same Associ-
ation. In this connection, note the Board's holding re-
garding the applicability of various time periods in con-
sidering the assertion of the Board's jurisdiction, Reliable
Roofing Company, Inc., 246 NLRB No. 118, fn. 1 (1979).
In view of the foregoing, I conclude that the Board may
exercise its jurisdiction over the Respondent based upon
the commerce facts pertaining to members of that mul-
tiemployer bargaining association.
Based upon the testimony given by Brooks, Corley,
and Stertz, as well as the documentary evidence referred
to in the findings of fact, I conclude that the Union
meets the definition of a labor organization as set forth in
Section 2(5) of the Act.
In its decision in Don Burgess Construction Corporation
d/b/a Burgess Construction and Donald Burgess and
Verlon Hendrix d/b/a V & B Builders, 227 NLRB 765
(1977), the Board held at 766: "The period of limitations
prescribed by Section 10(b) does not begin to run on an
alleged unfair labor practice until the person adversely
affected is put on notice of the act constituting it." The
Board referred to its earlier decision in Wisconsin River
Valley District Council of the United Brotherhood of Car-
penters and Joiners of America, AFL-CIO (Skippy Enter-
prises, Inc.), 211 NLRB 227 (1974). In this connection,
see also the Board's decisions in Hot Bagels and Donuts
of Staten Island, Inc., 227 NLRB 1597 (1977); AMCAR
Division of ACF Industries, Inc., 231 NLRB 83 (1977),
and AMCAR Division, ACF Industries Incorporated, 234
NLRB 1063 (1978).
Accordingly, I conclude that the Respondent's affirm-
ative defense that Section 10(b) of the Act precludes the
finding of unfair labor practices to be without merit.
After considering all of the foregoing matters set forth
herein, I conclude finally that a preponderance of the
evidence establishes that the Respondent has engaged in
unfair labor practices within the meaning of Section
8(a)(1) and (5) of the Act as alleged in the General
Counsel's complaint.
CONCLUSIONS OF LAW
1. The Respondent is a successor employer to the busi-
ness formerly operated by Mike Kraft Plumbing Compa-
ny.
2. The Respondent has been at all times material
herein a member of the Plumbing and Air Conditioning
Contractors of Arizona, which is a multiemployer associ-
901
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ation of employers engaged in the construction industry,
and which exists for the purpose, inter alia, of engaging
in collective bargaining and negotiating collective-bar-
gaining agreements with the Union on behalf of employ-
er members of that Association.
3. The Plumbing and Air Conditioning Contractors of
Arizona has been authorized by the Respondent, at all
times material herein, to bargain collectively on behalf of
the Respondent with the Union concerning the wages,
hours, and other terms and conditions of employment of
the Respondent's employees who perform plumbing
work.
4. The Plumbing and Air Conditioning Contractors of
Arizona and the Union have been parties to successive
collective-bargaining agreements, the latest of which is
effective by its terms from July 1, 1978, through June 30,
1981, and thereafter from year to year unless notice of
termination is given. The terms of that collective-bar-
gaining agreement and the subsequent amendments there-
to are reflected in General Counsel's Exhibits 4, 4A, and
4B, which were introduced into evidence at the hearing
in this proceeding.
5. The Respondent is an employer engaged in com-
merce within the meaning of Section 2(6) and (7) of the
Act.
6. The Union is a labor organization within the mean-
ing of Section 2(5) of the Act.
7. The following employees of the Respondent consti-
tute a unit appropriate for the purposes of collective bar-
gaining within the meaning of Section 9(b) of the Act:
All employees of the Respondent engaged in
plumbing work as defined in the current collective-
bargaining agreement between the Plumbing and
Air Conditioning Contractors of Arizona and the
Union, and excluding all other employees, guards
and supervisors as defined in the Act.
8. The Union has been, at all times material herein, the
exclusive representative of all of the employees in the
above-described appropriate unit for the purposes of col-
lective bargaining.
9. By the following acts and conduct the Respondent
has engaged in unfair labor practices within the meaning
of Section 8(a)(l) and (5) of the Act:
(a) Failing and refusing to furnish to the Union certain
payroll records requested by the Union and necessary to
the performance by the Union of its collective-bargaining
functions.
(b) Refusing to recognize and bargain with the union
as the collective-bargaining representative in the unit of
the Respondent's employees described above.
(c) Repudiating and failing to honor, to abide by, and
to apply the terms of the collective-bargaining agreement
between the Association and the Union described above.
(d) Unilaterally discontinuing compliance with the
hiring hall provisions of the applicable collective-bar-
gaining agreement described above.
(e) Unilaterally discontinuing monthly contributions to
the health and welfare, pension, industry and apprentice-
ship funds provided for in the applicable collective-bar-
gaining agreement described above.
(f) Unilaterally failing to honor the dues deduction au-
thorizations of unit employees and failing to disburse
such dues to the Union in accordance with the terms of
the applicable collective-bargaining agreement described
above.
(g) Unilaterally instituting a new health and welfare
plan covering unit employees.
(h) Unilaterally increasing the wage rates of unit em-
ployees.
10. The unfair labor practices set forth above affect
commerce within the meaning of Section 2(6) and (7) of
the Act.
THE REMEDY
Since I have found that the Respondent has engaged
in unfair labor practices within the meaning of Section
8(a)(l) and (5) of the Act, I shall recommend to the
Board that the Respondent be ordered to cease and
desist from engaging in those unfair labor practices.
I shall also recommend to the Board that the Respond-
ent take certain affirmative action in order to effectuate
the policies of the Act. Such affirmative action will in-
clude the payment of backpay to unit employees who
have lost wages and other benefits as a result of the Re-
spondent's unfair labor practices described above. Back-
pay will be computed in accordance with the Board's de-
cisions in F. W. Woolworth Company, 90 NLRB 289
(1950); Isis Plumbing & Healing Co., 138 NLRB 716
(1962), and Florida Steel Corporation, 221 NLRB 651
(1977).
Such affirmative action to remedy the Respondent's
unfair labor practices will also include an order to make
appropriate payment to the funds for the fringe benefits
of its employees as provided for in the applicable collec-
tive-bargaining agreement previously described. Howev-
er, in accordance with Board decisions, I shall not pro-
vide for interest to be added to such payments. Fitzpa-
trick Electric. Inc., 242 NLRB 739 (1979).
Finally, I shall recommend to the Board a narrow
cease-and-desist order. Hickmott Foods, Inc., 242 NLRB
1357 (1979).
Upon the basis of the foregoing findings of fact, con-
clusions of law, and the entire record in this proceeding,
and pursuant to the provisions of Section 10(c) of the
Act, I hereby issue the following recommended:
ORDER
The Respondent, Kraft Plumbing and Heating, Inc., its
officers, agents, successors, and assigns, shall:
1. Cease and desist from:
(a) Failing and refusing to furnish to the Union certain
payroll records requested by the Union and which are
necessary to the performance by the Union of its collec-
tive-bargaining function.
I In the event that this Order is enforced by a Judgment of a United
States Court of Appeals, the words in the notice reading "Posted by
Order of the National Labor Relations Board" shall read "P'sted I'ursu-
ant to a Judgment of the United States Court of Appeals Enforcing an
Order of the National Labor Relations Board"
902
KRAFT PLUMBING AND HEATING, INC.
(b) Refusing to recognize and bargain with the Union
as the collective-bargaining representative in the unit of
the Respondent's employees described below.
(c) Repudiating and failing to honor, to abide by, and
to apply the terms of the collective-bargaining agreement
between the Plumbing and Air Conditioning Contractors
of Arizona and the Union. The terms of that collective-
bargaining agreement and the subsequent amendments
thereto are set forth in General Counsel's Exhibits 4, 4A,
and 4B.
(d) Unilaterally discontinuing compliance with the
hiring hall provisions of the applicable collective-bar-
gaining agreement described above.
(e) Unilaterally discontinuing monthly contributions to
the health and welfare, pension, industry and apprentice-
ship funds provided for in the applicable collective-bar-
gaining agreement described above.
(f) Unilaterally failing to honor the dues-deduction au-
thorization of unit employees and failing to disburse such
dues to the Union in accordance with the terms of the
applicable collective-bargaining agreement described
above.
(g) Unilaterally instituting a new health and welfare
plan covering unit employees.
(h) Unilaterally increasing the wage rates of unit em-
ployees. The appropriate collective-bargaining unit is:
All employees of the Respondent engaged in
plumbing work as defined in the collective-bargain-
ing agreement between the Plumbing and Air Con-
ditioning Contractors of Arizona and the Union, ex-
cluding all other employees, guards, and supervisors
as defined in the Act.
(i) In any like or related manner interfering with, re-
straining, or coercing its employees in the exercise of the
rights guaranteed them by the Act.
2. Take the following affirmative action which is
deemed necessary in order to effectuate the policies of
the Act:
(a) Recognize and, upon request, bargain collectively
with the Union as the exclusive collective-bargaining
representative of the employees of the Respondent in the
bargaining unit previously described above, and embody
in a signed agreement any understanding which may be
reached.
(b) Honor, abide by, and apply the terms of the exist-
ing collective-bargaining agreement between the Associ-
ation and the Union during the life of that contract.
(c) Make whole its unit employees for their loss of
wages and other benefits which resulted from the Re-
spondent's unfair labor practices, and pay to those em-
ployees appropriate interest on such amounts of money
as more fully described in The Remedy section of this
Decision.
(d) Make appropriate contributions to the trust funds
as provided for in the applicable collective-bargaining
agreement previously described, and make reimburse-
ment to the Union for the losses due to the Respondent's
failure to honor the union dues-deduction authorizations
of its employees.
(e) Forthwith provide to the Union the payroll records
previously requested by the Union.
(f) Preserve and, upon request, make available to
agents of the Board for examination and copying, the
payroll records, social security records, timecards, per-
sonnel records, and all of the other records necessary to
analyze the amount of money due under the terms of this
Order.
(g) Post at its Tempe, Arizona, facility, copies of the
attached notice marked "Appendix." 2 The Regional Di-
rector of Region 28 of the Board will provide copies of
the notice to the Respondent. After the Respondent's
representative has signed those copies, the Respondent
shall post those notices immediately after receiving them.
The Respondent shall maintain such notices for 60 con-
secutive days after they have been posted in conspicuous
places, including all of the places where the Respondent
customarily posts notices to its employees. The Respond-
ent shall also take reasonable steps to ensure that the no-
tices are not altered, defaced, or covered by any other
material during the posting period.
(h) Within 20 days from the date of this Order, the Re-
spondent shall write a letter to the Regional Director of
Region 28 of the Board and tell him what the Respond-
ent has done to comply with the terms of this Order.
In the event that no exceptions are filed, as provided by Sec. 102.46
of the Board's Rules and Regulations. the findings, conclusions and rec-
ommended Order herein shall. as provided by Sec. 102.48 of the Board's
Rules and Regulations. he adopted by the Board and become its findings,
conclusions, ad Order, and all objections thereto shall he deemed
waived for all purposes
903