Littler's, Inc.

National Labor Relations Board - Board Decisions

Jul 12, 1995

317 N.L.R.B. 1079 (N.L.R.B. 1995)

1079
317 NLRB No. 159
LITTLER’S, INC.
1 The unit consists of:
All clothing sales employees, furnishing sales employees,
stockpersons, cashiers, displaypersons, alteration employees, ex-
cluding all other employees, guards, and supervisors, as defined
in the Act.
Littler’s, Inc. and Commercial Workers Local 1001,
affiliated with United Food and Commercial
Workers International Union, AFL–CIO. Case
19–CA–23271
July 12, 1995
DECISION AND ORDER
BY MEMBERS STEPHENS, COHEN, AND
TRUESDALE
Upon a charge filed by the Union on March 17,
1994, the General Counsel of the National Labor Rela-
tions Board issued a complaint and notice of hearing
on April 22, 1994, and an amended complaint and no-
tice of hearing on August 24, 1994. The amended
complaint alleges that the Respondent engaged in cer-
tain unfair labor practices within the meaning of Sec-
tion 8(a)(5) and (1) of the National Labor Relations
Act by failing to make trust contributions on behalf of
unit employees as required by the current collective-
bargaining agreement between the Respondent and the
Union that were due in November and December
1993. Pursuant to the agreement, such trust contribu-
tions were due to the Retail Clerks Welfare Trust, Re-
tail Drug Employees Retirement Trust Fund, and West-
ern Employee Benefit Trust-401(k) Plan. The Respond-
ent filed an answer to the complaint, and an amended
answer and second amended answer to the amended
complaint.
On December 19, 1994, the parties jointly filed a
motion to transfer the proceeding to the Board and a
stipulation of facts. The parties waived a hearing be-
fore an administrative law judge, the findings of fact
and conclusions of law by an administrative law judge,
and the issuance of an administrative law judge’s deci-
sion and recommended Order. The parties agreed that
the stipulation, with attached exhibits, including the
charge, complaint, amended complaint, answer, amend-
ed answer, and second amended answer, shall con-
stitute the entire record in this case and that no oral
testimony is necessary or desired by any of the parties.
On February 15, 1995, the Board issued its Order
approving the stipulation and transferring the proceed-
ing to the Board. Thereafter, the General Counsel filed
a brief in support of his position.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the stipulation, the brief,
and the entire record in this proceeding and makes the
following
FINDINGS OF FACT
I. JURISDICTION
The Respondent is a State of Washington corpora-
tion, with an office and place of business in Seattle,
Washington, where it is engaged in the business of re-
tail merchandising. During the year prior to August 24,
1994, which period is representative of all material
times, in the course and conduct of its business oper-
ations the Respondent had gross sales of goods and
services valued in excess of $500,000. During the
same period, in the course and conduct of its business
operations, the Respondent sold and shipped goods or
provided services from its facilities within the State of
Washington, to customers outside the State, which cus-
tomers were themselves engaged in interstate com-
merce by other than indirect means, of a total value in
excess of $50,000. Also during the same period and in
the course and conduct of its business operations, the
Respondent purchased and caused to be transferred and
delivered to its facilities within the State of Washing-
ton goods and materials valued in excess of $50,000
directly from sources outside the State of Washington,
or from suppliers within the State of Washington that
in turn obtained such goods and materials directly from
sources outside the State. The parties stipulated, and
we find, that the Respondent has been, at all material
times, an employer engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act.
The parties stipulated, and we find, that at all mate-
rial times the Union has been a labor organization
within the meaning of Section 2(5) of the Act.
II. THE ALLEGED UNFAIR LABOR PRACTICES
A. Facts
Since at least 1959 and at all material times, the
Union has been the designated exclusive collective-
bargaining representative of certain of the Respond-
ent’s employees included in a unit that constitutes a
unit appropriate for the purpose of collective bargain-
ing within the meaning of Section 9(b) of the Act.1
Since 1959 and at all material times, the Respondent
has recognized the Union as the exclusive representa-
tive of the unit employees and the parties have em-
bodied this recognition in successive collective-bar-
gaining agreements, the most recent effective from Au-
gust 1, 1992, to August 1, 1995. At all times since
about 1959, the Union has been the exclusive collec-
tive-bargaining representative of the unit employees
within the meaning of Section 9(a) of the Act.
At all material times, David J. Rogers held the posi-
tion of the Respondent’s treasurer, and has been a su-
pervisor within the meaning of Section 2(11) of the
Act and is an agent of the Respondent within the
meaning of Section 2(13) of the Act. Acting through
Rogers, the Respondent failed to make pension and
1080 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
2 Crest Litho, 308 NLRB at 109 (footnote omitted). The General
Counsel states, and the Respondent does not dispute, that the pay-
ments for December were due on December 1 or 2. Thus, the liabil-
ity for both November and December occurred prior to the filing of
the petition.
health and welfare trust contributions on behalf of unit
employees for the months of November and December
1993 as required by the current collective-bargaining
agreement between the Respondent and the Union. The
Respondent failed to make these contributions without
affording the Union an opportunity to bargain with the
Respondent concerning this conduct relating to hours,
wages, and other terms and conditions of employment,
and without the Union’s consent.
On December 21, 1993, the Respondent filed a
bankruptcy petition under Chapter 11 of the Bank-
ruptcy Act.
B. Issues Involved and Contentions of the Parties
The issues presented here are whether the Respond-
ent violated Section 8(a)(5) of the Act by failing to
make trust contributions in November and December
1993 and whether the Respondent’s filing of a bank-
ruptcy petition on December 21, 1993, relieved it of its
obligations under the collective-bargaining agreement
to make contributions to the trusts. The General Coun-
sel contends that an employer violates Section 8(a)(5)
when it unilaterally fails to make contractually re-
quired contributions to benefit trusts. The General
Counsel further contends that economic inability to
make such contractually required trust contributions is
not a defense to the failure to make such contributions.
Accordingly, the General Counsel contends that be-
cause there is no dispute that the Respondent failed to
make the contractually required trust contributions dis-
cussed above, and that the Respondent did not give the
Union prior notice, nor an opportunity to bargain about
its cessation of payments, the Respondent’s actions
constitute a violation of Section 8(a)(5) of the Act.
Regarding the issue of whether the Respondent’s
bankruptcy petition provides a defense to this viola-
tion, the General Counsel contends that the filing of
the bankruptcy petition does not excuse the failure to
make the contractually required trust contributions at
issue here.
Although no brief has been received from the Re-
spondent, it denied in its answer, amended answer, and
second amended answer that it violated Section 8(a)(5)
as alleged. In this regard, although the Respondent ad-
mitted that it had failed to make the required trust con-
tributions for November and December 1993, it further
stated that it was prohibited from doing so by oper-
ation of the Bankruptcy Code.
C. Discussion
The contractual provisions at issue are mandatory
subjects of bargaining. Crest Litho, 308 NLRB 108,
109 (1992). As the Board stated in Abernathy Excavat-
ing, 313 NLRB 68, 68 (1993): ‘‘[a] unilateral modi-
fication or repudiation of such provisions during a con-
tract term is a violation of Section 8(a)(5).’’ Because
it is undisputed that the Respondent failed to make the
contractually required pension and health and welfare
trust contributions for the months of November and
December 1993 and that it did so without prior notice
to the Union and without affording the Union an op-
portunity to bargain concerning this conduct relating to
hours, wages, and other terms and conditions of em-
ployment, and without the Union’s consent, we find
that the Respondent has violated Section 8(a)(5) as al-
leged. We further find that the Respondent’s unsub-
stantiated claim, that it was ‘‘prohibited’’ from making
the required trust contributions by operation of the
Bankruptcy Code, is not a defense to these violations.
It is well settled that ‘‘[a] bankruptcy proceeding can-
not be a defense to [a] [r]espondent’s unlawful failure
to make timely prepetition payments.’’2 For these rea-
sons, we find that the Respondent violated Section
8(a)(5) of the Act by failing to make the contractually
required trust contributions for November and Decem-
ber 1993.
CONCLUSIONS OF LAW
1. The Respondent, Littler’s, Inc., is an employer
engaged in commerce within the meaning of Section
2(2), (6), and (7) of the Act.
2. United Food and Commercial Workers Local
1001, affiliated with United Food and Commercial
Workers International Union, AFL–CIO, is a labor or-
ganization within the meaning of Section 2(5) of the
Act.
3. The following is an appropriate unit for purposes
of collective bargaining:
All clothing sales employees, furnishing sales
employees, stockpersons, cashiers, displaypersons,
alteration employees, excluding all other employ-
ees, guards and supervisors, as defined in the Act.
4. The Respondent violated Section 8(a)(5) and (1)
of the Act by unilaterally, without notice to the Union
and without affording the Union an opportunity to bar-
gain, failing to make trust contribution payments in
November and December 1993, to the Retail Clerks
Welfare Trust, to the Retail Drug Employees Retire-
ment Trust Fund, and to the Western Employees Bene-
fit Trust 401(k), as per direction of employees in the
unit.
5. The Respondent’s actions constitute unfair labor
practices affecting commerce within the meaning of
Section 2(6) and (7) of the Act.
1081LITTLER’S, INC.
3 To the extent that an employee has made personal contributions
to a fund that are accepted by the fund in lieu of the employer’s
delinquent contributions during the period of delinquency, the Re-
spondent will reimburse the employee, but the amount of such reim-
bursement will constitute a setoff to the amount that the Respondent
otherwise owes the fund.
4 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
THE REMEDY
Having found that the Respondent has engaged in
certain unfair labor practices, we shall order it to cease
and desist and to take certain affirmative action de-
signed to effectuate the policies of the Act.
Specifically, having found that the Respondent has
violated Section 8(a)(5) and (1) by failing to make the
contractually required trust contributions, we shall
order the Respondent to make whole its unit employ-
ees by making all such delinquent contributions, in-
cluding any additional amounts due the trusts in ac-
cordance with Merryweather Optical Co., 240 NLRB
1213 (1979). In addition, the Respondent shall reim-
burse unit employees for any expenses ensuing from
its failure to make the required contributions, as set
forth in Kraft Plumbing & Heating, 252 NLRB 891 fn.
2 (1980), enfd. mem. 661 F.2d 940 (9th Cir. 1981). In-
terest on all such sums shall be paid in the manner
prescribed in New Horizons for the Retarded, 283
NLRB 1173 (1987).3
ORDER
The National Labor Relations Board orders that the
Respondent, Littler’s, Inc., Seattle, Washington, its of-
ficers, agents, successors, and assigns, shall
1. Cease and desist from
(a) Refusing to bargain in good faith with the Union
as the exclusive collective-bargaining representative of
the unit employees by failing and refusing to make
contractually required trust contributions.
(b) In any like or related manner interfering with,
restraining, or coercing employees in the exercise of
the rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Adhere to the terms of the 1992–1995 collective-
bargaining agreement with the Union.
(b) Remit the delinquent trust contributions, includ-
ing any additional amounts due the funds, and reim-
burse the unit employees for any expenses ensuing
from the Respondent’s failure to make the required
payments, in the manner set forth in the remedy sec-
tion of the decision.
(c) Preserve and, on request, make available to the
Board or its agents for examination and copying, all
payroll records, social security payment records, time-
cards, personnel records and reports, and all other
records necessary to analyze the amount of backpay
due under the terms of this Order.
(d) Post at its facility in Seattle, Washington, copies
of the attached notice marked ‘‘Appendix.’’4 Copies of
the notice, on forms provided by the Regional Director
for Region 19, after being signed by the Respondent’s
authorized representative, shall be posted by the Re-
spondent immediately upon receipt and maintained for
60 consecutive days in conspicuous places including
all places where notices to employees are customarily
posted. Reasonable steps shall be taken by the Re-
spondent to ensure that the notices are not altered, de-
faced, or covered by any other material.
(e) Notify the Regional Director in writing within 20
days from the date of this Order what steps the Re-
spondent has taken to comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this notice.
WE WILL NOT refuse to bargain in good faith with
United Food and Commercial Workers Local 1001, af-
filiated with United Food and Commercial Workers
International Union, AFL–CIO as the exclusive collec-
tive-bargaining representative of an appropriate bar-
gaining unit of our employees, by failing to adhere to
provisions of the August 1, 1992, to August 1, 1995
collective-bargaining agreement with the Union requir-
ing us to make contributions to the Retail Clerks Wel-
fare Trust, the Retail Drug Employees Retirement
Trust Fund, and the Western Employees Benefit Trust-
401(k).
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the
rights guaranteed you by Section 7 of the Act.
WE WILL adhere to the terms and conditions of em-
ployment of our collective-bargaining agreement with
the Union.
WE WILL make whole unit employees and the con-
tractual benefit funds for any losses resulting from our
failure to comply with provisions in the 1992–1995
collective-bargaining agreement with the Union.
LITTLER’S, INC.