McLoughlin Manufacturing Corp.

National Labor Relations Board - Board Decisions

Jun 1, 1970

182 N.L.R.B. 958 (N.L.R.B. 1970)

958 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
McLoughlin Manufacturing Corporation ; Lady Jo, Inc.;
Sidney Smith , Individually and as a Director and Officer
of McLoughlin Manufacturing Corporation and Lady
Jo, Inc ; Walter Eckerling , Individually and as a Director
and Officer of McLoughlin Manufacturing Corporation
and Lady Jo, Inc. and International Ladies' Garment
Workers' Union , AFL-CIO. Case 25-CA-2397
June 1, 1970
SUPPLEMENTAL DECISION'AND ORDER
BY CHAIRMAN MCCULLOCH AND MEMBERS FANNING
AND BROWN '
On April 26, 1967, the National Labor Relations Board
issued a Decision and Order' in the above-entitled pro-
ceeding, finding, in disagreement with the Trial Examin-
er, that the Respondents, in deciding to close their
Peru, Indiana, plant and in subsequently deciding to
relocate in Uniontown, Alabama, had not acted for
discriminatory reasons; and, since the Respondents bar-
gained with the Union concerning the closing of the
Peru plant, their failure to notify and bargain with the
Union over the subsequent decision to relocate, as well
as the failure to notify and bargain with respect to
subcontracting unfinished work preparatory to closing
the Peru plant, was at most a technical violation not
requiring a remedial order.' Therefore, the Board rev-
ersed the Trial Examiner and dismissed the complaint
herein. Thereafter, the Charging Party filed a petition
with the United States of Appeals for the District of
Columbia to review, the Board's Order. By order dated
March 5, 1968, the court granted motions of the General
Counsel and the Charging Party and remanded the case
to the Board for consideration of the motions of General
Counsel and Charging Party to reopen the record and
for appropriate further action.
On September 25, 1968, the Board ordered that the
motions to reopen the record be granted, and that a
further hearing be held for the purpose of receiving
additional evidence.
On July 17, 1969, Trial Examiner John P. von Rohr
issued his Supplemental Decision, finding that the
Respondents had violated Section 8(a)(1), (3), and (5)
of the Act. Thereafter, the General Counsel, the Charging
Party, and the Respondents filed exceptions to the Deci-
sion and supporting briefs, and the Respondents filed
an answering brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the Board
has delegated its powers in connection with this case
to a three-member panel.
The Board has reviewed the rulings of the Trial Exam-
iner made at the reopened hearing and finds that no
164 NLRB 140
' Member Zagoria would have found that Respondents violated Sec.
8(a)(5) of the Act by failing to notify and bargain with the Union
prejudicial error was committed. The rulings are hereby
affirmed. The Board has considered the Trial Examiner's
Supplemental Decision, the exceptions and the entire
record in the case, and hereby adopts the findings,
conclusions, and recommendations of the Trial Examiner
with'the following modifications.
1. In our initial decision we found that the Respond-
ents were not discriminatorily motivated in closing the
Peru, Indiana, plant and in subsequently relocating in
Uniontown, Alabama. Rather we concluded:
. . . there is no evidence of opposition to the
employees' exercise of their statutory rights. Nor
is there evidence of overt hostility to the Union.
Rather, Respondents have dealt amicably with the
Union for many years. It was Respondents' eco-
nomic and operational difficulties arising in part
from an onerous contractual provision, and their
inability to obtain relief therefrom and the Union's
overall intransigent attitude with respect to the
negotiation of a new agreement that appear to
have been the determining factors in the decision
to close the plant.
No additional evidence was offered at the reopened
hearing which would establish discriminatory motivation.
Accordingly, we find that Respondents did not violate
Section 8(a)(3) of the Act.
2. For the reasons stated by the Trial Examiner in
his Supplemental Decision, we find that Respondents
violated Section 8(a)(5) and (1) of the Act by failing
to notify and bargain with the Union concerning their
decision to relocate in Uniontown, Alabama.
THE REMEDY
The Trial Examiner patterned his remedy recommen-
dations after those adopted by the Board in the Garwin
case.3 However, the bases for the remedy in Garwin
were the findings that the respondent in that case had
demonstrated a "propensity to violate the Act," had
manifested "opposition to collective bargaining," and
had resorted to "wholesale discharges and plant removal
to defeat employee organization." In the present case,
by contrast, we have found that "there is no evidence
of opposition to the employees' exercise of their statuto-
ry rights. Nor is there evidence of overt hostility to
the Union." Further, we have found, contrary to the
Trial Examiner, that Respondents were not discriminato-
rily motivated in closing the Peru, Indiana, plant and
in subsequently relocating in Uniontown, Alabama.
Under these circumstances, the detailed prescriptions
of the Garwin remedy are not appropriate to correct
the only violation found in this case, to wit, Respondents'
failure to notify the Union of its contemplated move
to Alabama and to give the Union the opportunity to
bargain over the matter. Accordingly, we shall only
direct Respondents to bargain with the Union, to make
employees whole in the manner set forth hereinafter,
with respect to plant relocation, but agreed that no remedial order Garwin Corporation, 153 NLRB 664, 169 NLRB 1030
was necessary.
182 NLRB No. 139
MCLOUGHLIN MANUFACTURING CORP
and to mail notices of the Board action to the former
employees of the Peru plant
In remedying unfair labor practices, the Board seeks,
insofar as practicable, to restore the conditions which
would have existed but for the unfair labor practices
In the present case, the theoretically ideal remedy would
be to require Respondents to reactivate the Peru opera-
tions and then to bargain about the decision to transfer
operations to the Uniontown plant and the effects of
the transfer upon the employees But such a remedy
is not practicable It would probably cause the bankrupt
cy of Respondents without achieving any corresponding
benefits for the former employees of the Peru plant
The transfer of manufacturing facilities from Peru to
Uniontown has become in a practical sense irreversible
Hence, we shall not now order Respondents to bargain
about the decision to move operations from Peru to
Uniontown However, we can still provide a meaningful
remedy for Respondents' failure to bargain with the
Union about the effects of the plant shift upon employ-
ees Bargaining about effects will cover the question
of the reinstatement of former Peru plant employees
in the new plant in Uniontown But a simple order
to bargain about effects will not suffice as a complete
remedy for the unfair labor practices found If Respond-
ents had timely fulfilled its bargaining obligation, the
Peru plant employees would not have been terminated
without the protection of collective bargaining It must
be presumed, as in Winn-Dixie ,4 that the employees
would have retained their jobs at least until Respondents
had fulfilled their bargaining obligation by negotiating
to a bona fide impasse It is both reasonable and neces-
sary to require that "the employees whose statutory
rights were invaded by reason of Respondent's unlawful
unilateral action, and who may have suffered losses
in consequence thereof, be reimbursed for such losses
until such time as the Respondent remedies its violation
by doing what it should have done in the first place "5
Accordingly, in addition to requiring Respondents to
bargain with the Union about effects of the transfer,
we shall order Respondents to make the former Peru
plant employees whole for any loss of pay suffered,
as a means of remedying the 8(a)(5) violation found
herein Ordinarily, as set forth in Winn-Dixie, backpay
would not terminate until a future bargaining impasse
In the present case, however, the Union learned of
the transfer of operations by early September 1965 but
did not seek to bargain with Respondents about the
transfer of its effects In these circumstances, we believe
that it is equitable to terminate backpay at about this
date, which we shall fix for converience's sake as Sep-
tember 1, 1965, rather than the usual i- passe date
As the Peru, Indiana, plant is closed, the customary
posting of notices to employees is not feasible We
shall therefore order Respondents, in lieu thereof, to
mail copies of the attached notice to each of the former
Winn Dixie Stores Inc 147 NLRB 788 792 of d in pertinent
part 361 F 2d 512 (C A 5)
1 Ibid
959
employees of the Peru plant who was affected by the
plant shutdown at his last known place of address
ORDER
Upon the entire record in this case, and pursuant
to Section 10(c) of the National Labor Relations Act,
as amended, the National Labor Relations Board hereby
orders that Respondents McLoughlin Manufacturing
Corporation, Lady Jo, Inc , J Sidney Smith, and Walter
Eckerling, Peru, Indiana, and Uniontown, Alabama, their
officers, agents, successors, and assign, shall
I Cease and desist from
(a) Refusing to bargain collectively with International
Ladies' Garment Workers' Union, AFL-CIO, as repre-
sentative of the unit of the Peru, Indiana, employees,
or any other unit of their employees in which this
union may be selected by a majority as the exclusive
bargaining representative of such employees
(b) In any like or related manner interfering with,
restraining, or coercing their employees in the exercise
of their right to self-organization, to form, join, or
assist the above-named Union, or any other labor organi-
zation, to bargain collectively through representatives
of their own choosing, or to engage in concerted activities
for the purpose of collective bargaining or other mutual
aid or protection, or to refrain from any and all such
activities
2 Take the following affirmative action which is nec-
essary to effectuate the policies of the Act
(a) Upon request, bargain with International Ladies'
Garment Workers' Union, AFL-CIO, about the effects
of the transfer of their operations from Peru, Indiana,
to Uniontown, Alabama, upon Peru, Indiana, unit
employees
(b) Make whole their former employees in the Peru,
Indiana, unit for the period June 10, 1965, until Septem-
ber 1, 1965, as provided in the section of the Trial
Examiner's Decision entitled "The Remedy," as mod-
ified herein, for any loss of earnings they may have
suffered as a result of the failure to bargain with their
representative
(c) Preserve and, upon request, make available to
the Board or its agents, for examination and copying,
all payroll records, social security payment records,
timecards, personnel records and reports, and all other
records necessary to analyze the amount of backpay
due under the terms of this Order
(d) Mail to each employee terminated at the Peru,
Indiana, plant on and after June 10, 1965, copies of
the attached notice marked "Appendix "" Copies of
said notice, on forms provided by the Regional Director
for Region 25, after being duly signed by Respondents'
representative shall bc, mailed to the aforesaid employ-
ees
^ In the event chat 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 be changed
to read Posted Pursuant ro A Judgment of the United States Court
of Appeals Enforcing an Order of the National Labor Relations Board
960 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
(e) Notify the Regional Director for Region 25, in
writing, within 10 days from the date of this Order,
what steps the Respondents have taken to comply here-
with.
MEMBER FANNING, concurring in part and dissenting
in part:
I agree with the majority finding in this case, affirming
a unanimous full Board decision of April 26, 1967,
that Respondents did not violate Section 8(a)(3) of the
Act in relocating their plant from Peru, Indiana, to
Uniontown, Alabama.
I disagree with the majority conclusion reversing the
full Board's decision of that date and finding Respondents
in violation of Section 8(a)(5) of the Act on the basis
of supplemental evidence, offered to prove that certain
of the Board's findings were based "on misrepresentation
and fraud by the Respondents."
The events which my colleagues in the majority now
find to constitute an unfair labor practice and which
they do not fully remedy because it would be inequitable
to do so occurred in the spring of 1965, 5 years ago.
Since that time two formal hearings have been held,
two decisions have been issued by the Trial Examiner,
two decisions have been issued by the Board, and the
end is not in sight.
I have carefully reviewed the evidence in this supple-
mental proceeding and I can find no reasonable ground
to support the serious allegations that Respondents have
practiced misrepresentation and fraud on the Charging
Party and the Board. The newly proffered evidence
consists of testimony that Respondents had sought out
a New York brokerage company to facilitate the sale
of their Peru, Indiana , plant in February or March
1965, prior to their last meeting with the Union on
April 6. Upon being advised by a member of this concern
that other alternatives, including relocation of the plant,
were available, Respondents apparently agreed to consid-
er the possibility, of establishing a plant at Uniontown,
Alabama. A labor survey was conducted at the latter
city on March 26 and 27 with Respondents ' officials
Eckerling and Smith present. This is the sum and sub-
stance of the evidence, labeled "serious misrepresenta-
tions of fact," upon which the majority predicates its
reversal of the Board's 3-year-old decision.
In my view, such evidence is not inconsistent with,
nor does it impinge upon, the Board's finding that
by April 6 Respondents had made an irrevocable decision
to sell the Peru plant and so informed the Union. The
fact that other alternatives may also have been under
consideration hardly warrants the conclusion that
Respondents were guilty of misrepresentation and fraud
because they did not take the Union into their full
business confidence. This Union has been found by
the Board to have exhibited an "overall intransigent
attitude." Substantial responsibility for the eventual sale
or relocation of the Peru plant has been laid squarely
at the Union's door. In these circumstances it should
come as no surprise that Respondents were reluctant
to disclose that Uniontown was attempting to persuade
them to relocate in that city. To hold, as the majority
does, that Respondents' failure to make this extraordi-
nary disclosure is violative of the statutory duty to
bargain in good faith seems to me unwarranted on
the facts.
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing it was determined that McLoughlin
Manufacturing Corporation moved its Peru, Indiana,
operation to Uniontown, Alabama, where it resumed
operations under the name of Lady Jo, Inc., without
notifying and bargaining with the representative of its
Peru, Indiana, employees. In order to remedy this unlaw-
ful conduct, we have been required to take the following
steps:
WE WILL bargain collectively with International
Ladies' Garment Workers' Union, AFL-CIO, about
the effect of the transfer of our operation upon
the Peru, Indiana, unit employees, and for any
other unit of our employees for which this Union
may be selected by a majority in an appropriate
unit as the exclusive bargaining representative of
those employees with respect to rates of pay, wages,
hours of employment, and other conditions of
employment.
WE WILL make Peru, Indiana, employees whole
for the period from June 10 until September 1,
1965, for any loss of pay suffered as a result
of our moving our plant without bargaining with
their representative concerning the move.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employees
in the exercise of their right to self-organization,
to form, join, or assist the above-named Union
or any other labor organization, to bargain collec-
tively through representatives of their own choos-
ing, or to engage in concerted activities for the
purpose of collective bargaining or other mutual
aid or protection, or to refrain from any and all
such activities.
APPENDIX
MCLOUGHLIN
MANUFACTURING
CORPORATION ; LADY JO,
INC.; J . SIDNEY SMITH;
WALTER ECKERLING
(Employer)
Dated By
(Representative) (Title)
This is an official notice and must not be defaced
by anyone.
This notice must remain posted for 60 consecutive
days from the date of posting and must not be altered,
defaced, or covered by any other material.
MCLOUGHLIN MANUFACTURING CORP. 961
Any questions concerning this notice or compliance
with its provisions, may be directed to the Board's
Office, 614 ISTA Center, 150 West Market Street, Indian-
apolis, Indiana 46204, Telephone 317-633-8921.
TRIAL EXAMINER'S SUPPLEMENTAL DECISION
JOHN P. VON ROHR, Trial Examiner: Pursuant to
a Decision and Order issued on April 26, 1967, by
the National Labor Relations Board, the complaint in
this proceeding was dismissed in its entirety. Thereafter,
the Charging Party filed a petition with the United States
Court of Appeals for the District of Columbia to review
the Board's Order. By order dated March 5, 1968,
the court granted motions of the General Counsel and
the Charging Party, and remanded the case to the Board
for consideration of the motions of General Counsel
and Petitioner to reopen the record and for appropriate
further action. On March 28 and April 1, 1968, respec-
tively, the General Counsel and the Charging Party
filed motions before the Board to reopen the record
in this case so that further evidence could be adduced.
The motions were based upon their contentions that
evidence had been discovered which indicated that cer-
tain findings of the Board were based on misrepresenta-
tion and fraud by the Respondents. On September 25,
1968, the Board issued an Order granting said motions
and directed that a further hearing be held for the
purpose of receiving such further evidence. The Board
further ordered that upon conclusion of said hearing
I prepare a Supplemental Decision containing findings
of fact, conclusions of law, and recommendations based
upon the evidence received and the entire record in
the case and that, following service of such Supplemental
Decision on the parties, the provisions of Section 102.46
of the Board's Rules and Regulations, Series 8, as
amended, shall be applicable.
Pursuant to said Order, and the parties being duly
notified, a further hearing was held before me in Indian-
apolis, Indiana, on February 17 and 18, 1969. All parties
were represented by counsel and were afforded to adduce
evidence, to examine and cross-examine witnesses, and
to file briefs. Briefs have been received from the General
Counsel, the Respondent, and the Charging Party and
they have been carefully considered.'
A. The Evidence and Testimony Adduced at the Second
Hearing
It may be stated at the outset that the evidence
adduced at the instant hearing with respect to the timing
of actions taken by the Respondents in effecting the
relocation of the plant from Peru, Indiana, to Uniontown,
Alabama, the substantial part of which evidence is undis-
puted or conceded by Respondent witnesses, is material-
ly different from the timing of such actions as testified
' On April 17, 1969 , the General Counsel filed a motion requesting
that I receive as part of G.C 's Exh 18 the "Findings of Fact, Conclusion
of Law, and the Decree" in tax payer suit No. 1726, which by an
inadvertent error was not included in the original General Counsel's
exhibits. The said motion, which is unopposed, is hereby granted.
to by Respondent's witnesses in the original hearing
herein. The facts of the situation, as developed in the
instant hearing, are first of all set forth below without
reference to or comparison with the testimony of
Respondents' witnesses in the original hearing and the
findings of the Board in the original Decision herein.
In about the last week of February or first week
of March 1965,2 Walter Eckerling went to New York
City to meet with officials of the Manufacturers and
Contractors Service of New York, hereinafter called
MCS. Bernard Rosenthal, the president of MCS and
the principal spokesman with whom Eckerling met, tes-
tified that Eckerling came to him either "through our
advertising or word of mouth." Concerning this meeting
Rosenthal testified that Eckerling first indicated that
he wished to sell the plant as a going business. Although
Rosenthal said that he could not recall the details of
this discussion, he testified that during the course of
this meeting they discussed the "possible sale" of the
going plant. He also advised Eckerling of all of the
functions and services provided by his company, these
being (1) the procurement of excess production (i.e.,
contracting out) for manufacturing; (2) acting as broker
to buy and sell plants; and (3) acting as agent for
the relocation of plants and going businesses.3
On March 9 or 11, Eckerling met with Rosenthal
for the second time.4 Rosenthal testified that at this
time he and Eckerling definitely discussed the possibility
of "setting up a plant" at Uniontown, Alabama.5 The
record reflects that the discussion went so far as Rosen-
thal's proposing that a plant of 25,00 square feet should
be adequate for Respondents' needs. However, and
more importantly, it is undisputed that at this meeting
Rosenthal advised Eckerling that it was essential, prelimi-
nary to any further plans, that a labor survey be conduct-
ed at Uniontown for the purpose of ascertaining whether
the labor supply there was adequate. It is further undis-
puted that Eckerling agreed that a labor survey should
be held. He also assured Rosenthal "that he would
be willing to look at the area and he would be at
the labor survey. "11
Pursuant to an agreement made in about the first
or second week of February between Thomas R. Long,
the Mayor of Uniontown, and officials of the Alabama
State Employment Service, a labor survey was conducted
' Unless otherwise indicated, all dates herein refer to the year 1965
The only function displayed on the Company's letterhead states
"Southern Factory Locating Service."
' The time of the meeting is reflected by Rosenthal's handwritten
notes on a single sheet of yellow legal sized paper which were made
by him at or about the time of the meeting. (G.C Exh 13)
Rosenthal learned of Uniontown ' s interest in a new plant from
Philip Kantor Associates, Inc. and William James Associates. The former
company is engaged in the business of designing factories and the
latter is engaged in the actual construction of them . The two companies
work in conjunction with each other, in fact occupy adjoining suites
at the same address in Memphis, Tennessee. On December 9, 1964,
William James Associates executed a location agreement with Union-
town, the substance of which was that it would undertake to locate
a manufacturing company to build a plant at Uniontown and that
it would design and construct the plant if this effort proved successful.
" Testimony of Rosenthal.
962 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
in Uniontown on March 26 and 27, 1965 7 In accordance
with prearranged plans, those present for the 2 days
during which the survey was held included Eckerling,
J Sidney Smith, Rosenthal, Philip Kantor, of Kantor
Associates, and Larry Malloy, president of Williams
James Associates S On the day prior to the survey,
a county newspaper carried an article which in part
stated that "Officials of Uniontown expect the labor
survey to assure the location of [two] plants in Union-
town if enough workers are found within 30-mile radius
of Uniontown " Richard Quinny, a representative of
the Alabama Employment Service who was in Union-
town to assist in conducting the survey, testified that
Uniontown has a population of approximately 2,000
and that approximately 1,500 applicants appeared for
the survey Rosenthal testified "there was a much larger
quantity of possible applicants than would be needed
by any of my clients "
During the 2-day period of the survey it is noteworthy
that the following took place
1 All of the parties noted above inspected the plant
of the Canebrake Shoe Company, of which Mayor Long
is the president As indicated in my earlier Decision,
McLaughlin moved into a portion of these premises
pending construction of the new plant Concerning the
purpose of this visit, Rosenthal testified
Prior to entering into any agreement with anyone,
I, in the survey, or being in the town's environs,
would always look for space, hoping that that would
be a part of my selling to my people, saying to
them that while the building won't be ready until
next July or August, we can put in a little training
program We have a little space available This
is part of my selling in all enterprises
2 Mayor Long engaged in discussions with the
McLaughlin representatives, concededly for the purpose
of attempting to persuade them to move the McLaughlin
plant to Uniontown As he testified, "I presented what
I thought were the advantages of Uniontown, Alabama,
to Mr Smith "9
3 The final results of the survey were presented
to the McLaughlin representatives by Mayor Long before
they returned to Indiana
With final respect to the visit to Uniontown by Ecker-
ling and Smith on March 25 and 26, the record in
the original hearing and in the instant hearing leaves
a serious question as to whether or not these officials
signed any document on behalf of the Respondents
as a culmination of the labor survey and their discussions
with Mayor Long, Rosenthal, Malloy, and Kantor I
refer first to a so-called "letter of intent," this being
a document containing the term, of inducements, pro-
Teti mony of R c lard !I Qu uney of the Alabama State Employment
per ' r nthal estif u fh t he and Phil Kantor of Kantor Associates
weir ^ i umental in setting up the "incculnr dates of the so'' ey
Rosen 41 also testified Vle tosetler w th ne town of Unioutiwn
arranged for that survey to take place
" These individuals registered by Rosenthal as B Roscntnal and
party sta, ed at the Motel Demopolis /0 miles from Uniontown
0 Later in his testimony Long siid th-it }IL han a similar conversation
with Eckerling
posed by Malloy, which "the town offers a manufacturer
in order to induce it to locate in that particular communi-
ty "10 The parties would be the community [in this
case Uniontown], the manufacturer [in this case the
Respondents], and William James Associates With
respect to the letter of intent, Eckerling conceded that
"this was handed to me by Mr William Malloy on
my visit to Uniontown on March 25 and 26 " However,
he testified "there was no executed letter of intent
in 1965 by McLaughlin or any of its, or any of the
other corporations named "It Although this document
was subpenaed by the General Counsel, there was a
general of disclaimer of any knowledge as to its present
whereabouts or existence Thus, Eckerling, Smith, Mal-
loy, and Kantor all gave testimony to this effect 12
In addition to the letter of intent, a clause in the lease
agreement (sec 4 1, p 8 thereof) specifically refers
to "the proposal dated March 25, 1965 to the lessee
from Williams James Associates, Inc , of Memphis,
Tennessee "13 Again, although this document was subpe-
naed, none of the parties involved in the survey professed
to have any knowledge of its present whereabouts or
existence However, Malloy of James Associates, when
queried about this document, testified, "Obviously, there
was such a document What it was otherwise called,
or what it contained specifically, I cannot recall
I am afraid I have a very poor memory for dates
and facts and this sort of thing " From the foregoing,
and from the terms of the lease itself, I can but find
and conclude that this document did exist and that
it did represent some form of a concrete proposal made
by James Associates during the March 25 and 26 labor
survey 14 As to the letter of intent, while it is indeed
10 Testimony of Malloy
11 Eckerling s testimony at the first hearing concerning his signing
a letter of intent was somewhat ambiguous Thus his testimony then
was as follows
Q And was there anything in writing that was discussed by
either you or Mr Smith or anyone there at Uniontown on the
first visit of ours and Mr Smith s9
A I think there was a letter of intent that was signed at that
time
Q And do you have that letter?
MR YAFFE I don t know
THE WITNESS I think that that also has to be dug up I don t
have it Can we go off the record9
TRIAL EXAMINER On the record
THE WITNESS The letter of intent was signed with the builder
with William James and Associates of Tennessee
Q (By Mr Lanker) But you signed no document with the town
of Uniontown on your first visit9
A No
12 Much of this testimony was evasive and confusing Thus when
Kantor was first asked if he recalled a letter of intent he testified
If there was one I don t I don t remember the date of it He
later testified There probably was a letter of intent but I couldn t
know the date en it Smith testified that he did not remember seeing
any i°tter of intent Malloy who said that it was standard procedure
to prepare a letter of intent in this type of business testified that
a letter of cite it must have existed that he could not rLCad presenting
It IL Il'e Me)- tughlin officials on any particular day dur ng the survey
and also that h' did not recall the McLaughlin officials signing any
document during this period
13 This lease agreement is referred to in my initial Decision This
document was signed by Mayor Long on behalf of Uniontown and
c'i Smith on behalf of McLaughlin on October 14 1965
11 On December 9 1964 James Associates enterLd into a location
MCLOUGHLIN MANUFACTURING CORP. 963
strange that this document was allegedly missing and
could not be produced, in reaching my ultimate conclu-
sion herein I find it unnecessary to decide whether
or not this letter was signed by a representative of
the Respondents.15
Mayor Long testified that he kept in contact with
Respondents' officials following their visit to Uniontown
on March 25-26. Concerning these contacts Long tes-
tified, "It was a kind of continuing thing since the
labor survey." He further testified that during this entire
time he was trying to persuade him [Smith] to move
down to Uniontown. It is undisputed that on April
8, 1965, Long 'made a trip to Peru, Indiana, at which
time he inspected the plant and again spoke to Respond-
ents' officials. As to the purpose of this trip, Long
testified, "I was hoping to sell him (Smith) on the
idea of moving his plant to Uniontown and it was
merely an investigation to look his plant over. "'"
I arrive here at a significant point in the chain of
events. Thus, Long testified that it was at some point
prior to May 3, 1965, that Respondents' officials made
an oral agreement with him to move the plant to Union-
town. The consideration for this agreement, as Long
conceded, was the inducements which he proposed to
Respondents on behalf of Uniontown to make the move
attractive."
Preparatory toward the authorization of a bond issue
to finance the construction of the new plant, Mayor
Long and, the Town Council of Uniontown met in a
special session on May 3, 1965. Significantly, Long
testified that, under the authority he held as mayor,
he contacted his attorneys on about April 3, 1965, and
instructed them to prepare minutes for this meeting
relative to the requisite legal steps that be taken to
agreement with Uniontown Paragraph 3 of this agreement provides
that. "Locator [William James Associates] agrees to assist Client [Union-
town ] and Industry in negotiating a mutually beneficial agreement.
15 However, I believe it appropriate to note a further reason for
suspecting that Respondents signed a letter of intent at the time of
the labor survey. Thus, at section III, C, of my initial Decision are
set forth the terms which Uniontown committed itself to give to the
Respondents as inducements for the relocation of McLoughlin plant
in Uniontown These terms are not, as indicated in the initial Decision,
embodied in the lease agreement . Rather , these terms were testified
to by Eckerling in the first hearing and are also set forth in his affidavit
(G C Exh. 6). In the earlier hearing Eckerling testified merely that
he learned of these inducements from the MCS Corporation. However,
as has been noted above , it is in fact the letter of intent which sets
forth and describes the various terms to which the community commits
itself as an inducement to have the employer establish a plant in
its locality.
16 Although Mayor Long, as well as Rosenthal, Kantor, and Malloy,
were called as General Counsel witnesses, there can be no doubt
but that the interests of these individuals lie with the Respondents
I think it can be safely surmized that a fuller development of all
the pertinent facts and details in this case would have been made
had these been strictly neutral witnesses.
11 J. Sidney Smith testified that the first time he made any committment
of any kind whatsoever with regard to Uniontown was on August
25, 1965, which was about the time William James Associates, Inc ,
contracted with Uniontown to build the plant. This testimony is obviously
incredible At this time Respondent had already occupied the Canebrake
plant and was engaged in manufacturing operations . It is unbelievable
that Respondents would have moved the plant from Peru to Uniontown
without, at the very least, having reached some oral understanding
with all the parties concerned
authorize the bond issue. Concerning this action Long
testified, "I told [the attorneys] I had two companies
that I wanted bond issues prepared. I only received
those minutes the morning of the meeting, incidentally."
The record reflects that two sets of minutes were pre-
pared for the May 3 meeting . One set reflects that
a meeting on this date was held pursuant to a "Notice
and Call of Special Meeting." This document, which
was signed by five older men, provided in pertinent
part as follows: -
In my opinion the interest of the public requires
that a special meeting of the, Mayor and Town
Council of the Town of Uniontown, Alabama, be
held at'the Town Hall in said town at 10:00 o'clock
a.m. on the 3rd day of May, 1965, for the purpose
of considering the call of an election to be held
in the `town to submit to the qualified electors
thereof the proposition whether the town shall con-
struct a manufacturing building in the town, issue
bonds to finance such construction, lease the said
building to McLaughlin Manufacturing Corporation,
an Indiana Corporation, and, pledge as security
for the said bonds, in addition to the revenues
from the said building, all or part of a special
ad valorum tax of the town at a rate not exceeding
2% per annum.18
The second set of minutes, signed by Mayor Long
and authenticated by the town clerk, reflect the adoption
of an ordinance authorizing a special municipal election
to be held on July 13, 1965. The proposition to be
submitted to the voters stated in part as follows:
For the purpose of promotion local industrial devel-
opment by aiding McLaughlin Manufacturing Cor-
poration, an Indiana corporation, in the establish-
ment in the Town of Uniontown, Alabama, of
a, plant for the manufacture of clothing, the Town
of Uniontown, Alabama, proposes (a) to construct
a building suitable for use as a plant for the manufac-
turer of clothing, (b) to finance the said construction
by the sale and issuance, on the full faith and
credit of. the town, of the General Obligation Indus-
trial, Development First Mortgage Bonds of the
town in an aggregate principal amount not exceeding
250,000 to be dated August 1, 1965 . . . and (c)
to lease the said plant to the said McLaughlin
Manufacturing . . .
Pursuant to the ordinance adopted on May 3, 1965,
an election was held on July 13, 1965, which resulted
in a majority of the electors voting in favor of the
bond issue and proposition noted above. The bonds
were ultimately, sold on December 13, 1965. However,
in June 1965, Kantor and Associates began working
on architectural plans for the plant proposed to be
constructed for the Respondent.1e The actual construc-
tion contract between Kantor and Uniontown was execu-
ted on August 4, 1965. Nonetheless, in the interim
(and as noted in my initial Decision) it was on July
le The minutes further reflect that the council approved the holding
of the special meeting for the purpose indicated
19 Stipulation of the parties.
964 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
7, 1965, that Respondent began the transfer of equipment
and machinery from Peru , Indiana , to the space in
the Canebrake Shoe plant in Uniontown As also noted
in the earlier Decision , the first employees for Respond-
ents' Uniontown operations were hired On July 12,
1965
B Findings and Conclusions
From the foregoing recital of facts it is unmistakably
clear , and I find , that Respondent officials (particularly
Eckerling) have heretofore made serious misrepresenta-
tions of fact which are involved in this proceeding
These include (a) misrepresentations of material facts
to the union representatives during the final collective-
bargaining meeting held on April 6, 1965, and (b ) misre-
presentation of material facts dunng the initial hearing
herein on April 19 and 20 , 1966 The particular misrepre-
sentations to which I refer will be reiterated in the
discussion which follows below
In my view , the focal point in the Board's decision,
and upon which it based its ultimate conclusion that
the Respondents had not committed any of the alleged
unfair labor practices , was its finding that "In April,
1965, Respondents decided to go out of business and
close their plant in Peru , Indiana [and ] so notified
the Union and discussed both the decision and its impact
upon unit employees " This finding was, first of all,
based upon Eckerling 's uncontroverted testimony to this
effect But beyond this self-serving declaration, this
finding was more importantly predicated upon Ecker-
ling's further testimony that (a) he first learned of
the prospective Uniontown opportunity in early June
1965, this during a personal telephone conversation with
the MCS Corporation , and (b) it was not until "early
June," 1965, that he made his first visit to Uniontown,
and further, that he made a second trip to Uniontown
in the latter part of June or early July 1965 As reflected
in the preceding section herein , this testimony has proved
to be patently false To reiterate , the evidence in the
instant hearing discloses as follows
I Eckerling did not learn of the Uniontown opportuni-
ty at the time and in the manner concerning which
he testified earlier Rather , the evidence now conclusive-
ly establishes that Eckerling made two trips to New
York City for meetings with representatives of the MCS
Corporation The first trip was made in late February
or early March , the second on March 9 or 11 He
was advised of the Uniontown opportunity not over
the telephone in early June 1965, but dunng the foregoing
trips which he made to New York in late February
or early March 1965
2 Contrary to Eckerling's earlier testimony that he
did not make a trip to Uniontown until June 1965,
it has now been established that in fact Eckerling and
Smith made a visit of 2-day duration to Uniontown
on March 25 and 26 , 1965 The nature and extent of
the activities in which they then participated , but con-
cerning which Eckerling did not reveal at the first hearing,
has been hereinabove set forth
In addition to the foregoing, I find that Eckerling
misled the Union, as well as the Board, by his misrepre-
sentations to the Union and the Board as to the future
of Respondent's business at the time of the final (April
6, 1965) bargaining meeting with the Union 20 Thus,
it was at this meeting that Eckerling advised the union
representatives (as he also earlier testified) that Respond-
ents had made an "irrevocable" or "irreversable" deci-
sion to close the operation and go out of business,
and that he (Eckerling) intended to take a job as a
salesman and that Smith was going to accept a job
as plant manager for a company in the South In view
of the evidence discussed above, the latter statement
obviously was not true More importantly, however,
and in view of the heretofore related entire circumstances
and developments surrounding the visit of Respondents'
officials to Uniontown some I 1 days prior to this meeting,
it can hardly be said that Respondents had in fact
reached as irrevocable decision to go out of business,
as Eckerling at this time so advised the Union Indeed,
I am persuaded upon the entire evidence in this case
that not only had Respondents not reached an irrevocable
decision to go out of business, as it advised the Union,
but to the contrary at this time was actively engaged
in negotiations contemplative of moving the plant from
Peru, Indiana, to Uniontown, Alabama It is true the
evidence does not establish that Respondents, as of
the time of the final bargaining meeting with the Union
on April 6, 1965, had actually committed themselves
to any signed agreement with Uniontown to make the
move Nevertheless, extensive progress had been made
in this direction and I think it can be reasonably conclud-
ed that Respondents at this time had ample cause to
believe that an agreement with Uniontown would be
successfully negotiated Thus, as heretofore discussed,
Eckerling had already made two taps to New York
to meet with the MCS Corporation and on March 9
or 10, 1965, conferred with this organization concerning
the prospects of moving to Uniontown The labor survey
which took place a few weeks later in Uniontown was
not a mere coincidence, but in fact was arranged and
scheduled in furtherance of Respondents' interest in
relocating their plant 21 Respondent officials not only
attended this survey and learned of its results, but
at this time, as Mayor Long conceded, were advised
by Long of the "advantages" which Uniontown had
to offer Upon the entire record, and whether or not
they were embodied in a signed letter of intent, I am
persuaded that these advantages in fact were the very
20 I here use the word misrepresentation not only in its literal
sense but also in the sense that Eckerling did not reveal (i e covered
up ) material facts which as I later find he was required to disclose
under the bargaining obligations imposed by Sec 8 (a)(5) of the Act
These misrepresentations and concealments not only were made to
the Union at the April 6 meeting but were further propounded in
the testimony which he gave at the original hearing herein
2' See the uncontroverted testimony set forth in fn 7 supra Although
Mayor Long testified that an official of the J P Harless Company
a manufacturer of fire engines was also present dunng the survey
there is no evidence that this concern was instrumental in setting
up the survey or that it participated in the arrangements therefor
MCLOUGHLIN MANUFACTURING CORP.
inducements which Uniontown committed itself and
upon which Respondent relied.22
In sum, and in view of all the foregoing, I conclude
and find that as of April 6, 1965, the date of the final
collective-bargaining meeting with the Union, the
Respondents had become so fully involved in the process
of planning to relocate its plant from Peru, Indiana,
to Uniontown, Alabama, that they were duty bound
to advise the Union of the contemplated move and
give the Union the opportunity to bargain over the
matter. As the Board stated in Ozark Trailers, Inc.,23
Accordingly, we think it no significant intrusion
on management freedom to run the business to
require that an employer-once he has reached
the point of thinking seriously about taking such
an extraordinary step as relocating or terminating
a portion of his business-discuss that step with
the bargaining representative of the employees who
will be affected by his decision. [Emphasis sup-
plied.]24
Accordingly, and except for a modification in the
recommended remedy, noted below, I reaffirm my
findings and conclusions, as stated in the initial Trial
Examiner's Decision herein, that Respondents violated
Section 8(a)(5) of the Act, as alleged in the complaint.
I also reaffirm my previous findings and conclusions
that, to the extent indicated, Respondents violated Sec-
tion 8(a)(1) and (3) of the Act.
The Respondents again assert that Section 10(b) bars
the finding of any unfair labor practice herein. Although
this defense has been rejected in the initial Decision,
this same result has been recently reached in an anala-
gous case25, wherein the court stated:
22 See sec. III , C, 6 of my initial Decision
In light of the evidence adduced in the instant hearing, there is
another peculiar aspect of this case which is worthy of comment
Thus, as reported in the initial Decision , the minutes of Respondents'
stockholders meeting held on April 3, 1965, reflect only a decision
to sell or liquidate the business It is indeed strange that these minutes
did not reflect the extensive activities of Respondents' officials toward
relocating the plant in Uniontown which had already taken place prior
to this meeting . Moreover , the record in the original hearing reflects
further that a special meeting of Respondents ' stockholders and directors
was subsequently held on May 24, 1965. Although the minutes of
this meeting again reflect a resolution "to abandon the premises and
dispose of the equipment by the time its present lease expires at
the end of August 1965 . [and] that Mr. Walter Eckerling continue
to seek ways to salvage the investment of the shareholders
no mention in these minutes is made of Respondents ' plans to relocate
the plant in Uniontown . Significantly , Mayor Long testified that
Respondents had agreed to move to Uniontown at some point prior
to May 3, 1965. While I am reluctant to suggest that Respondents
falsified the minutes of the April 3 and May 24 stockholders meetings
(by withholding mention of material facts ) as part of a fraudulant
and purposeful design to evade its bargaining obligations , upon the
entire record in this case it is abundantly clear that if Respondent
indeed ever made a decision to sell or liquidate its business , this decision
was soon changed to one that contemplated relocation of the plant
23 161 NLRB 561, 569 But compare McGregor Printing Corporation,
163 NLRB 938
24 Since there can be no doubt but that on April 6, 1965, Respondents
were, at the very least, "thinking seriously" about relocating the plant,
I deem it unnecessary to decide whether Respondents signed a letter
of intent at the March 25-26 labor survey.
25 N.L R B v. Louisiana Bunkers, Inc., and Surprise, Inc , Successor
965
We find no merit in respondent's contention that
this action is barred by the statute of limitations
in Section 10(b) of the Act. Section 10(b) provides
that a complaint must be filed within six months
of the occurence of an unfair labor practice.
Respondents argue that the refusal to bargain
occurred on March 12, 1965, and the charge was
not filed until over six months later on September
28, 1965. The record indicates that although the
respondents initially refused to bargain on March
12, the Union requested, and was refused, recogni-
tion on April 1, April 12, and September 24. These
repeated refusals , in violation of respondent's con-
tinuing duty to bargain, clearly make the filing
of the charge timely. [Emphasis supplied.]
Although here the Union did not make any further
bargaining requests following the April 6, 1965, bargain-
ing meeting, needless to say it hardly could have been
expected to do so after Respondents' flat assertion at
that meeting that they had decided to go out of business
and close the plant. Accordingly, I find no merit to
Respondents' contention that Section 10(b) bars a finding
of the unfair labor practice found herein. 211
Turning to the remedial aspect of this case, the remedy
followed by me in the initial Trial Examiner's Decision
herein was patterned after the remedy set forth by
the Board in Garwin Corporation, 153 NLRB 664. Subse-
quently, however, the Board filed a petition with the
United States Court of Appeals for the District of Colum-
bia for enforcement of its Order in the said case. The
court, while enforcing the Board's Order in all other
respects, rejected the remedial requirement that
Respondents recognize and bargain with the Union for
employees at the Florida location, irrespective of the
Union's representative status among those employees .27
Accordingly, the court remanded the record to the Board
for "further consideration of this aspect of the remedy.
. . ." The Board thereafter issued a Supplemental Deci-
sion and Order in the Garwin case28 in which it modified
its Decision and found "that other remedial measures
are proper and necessary to effectuate statutory policies"
at the Florida location. In accordance with the remedial
changes made by the Board in the latter decision, I
recommend that my'initial Trial Examiner's Recommend-
ed Order be modified in the following respects:29
1. Delete paragraphs 2(e), (f), and (g) and in their
place insert the following paragraphs:
"(e) Upon request, bargain with International Ladies'
Garment Workers Union, AFL-CIO, on proof that a
majority of employees ,in the appropriate unit at Union-
to Patterson Menhaden Corp , 409 F .2d 1295 (C A. 5)
2" Citing Holmerg v Armbrecht , 327 U .S. 392, and Glus v. Brooklyn
Eastern District Terminal 359 U.S. 231 , the Charging Party also contends
that fraudulent concealment bars invocation of the statute of limitations
(Sec. 10(b)) However , in view of my finding above , I deem it unnecessary
to reach this point
N.L R. B v. Garwin Corporation ,374 F 2d 295
169 NLRB 1030 , enfd. 70 LRRM 2465 (C A D C ), cert denied
395 U S 980
21 It would be unrealistic to recommend any Order contemplative
of Respondents' reopening the Peru , Indiana, plant Clearly, it has
no intention of ever doing so.
966 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
town, Alabama, have designated the Union as their
exclusive representative
"(f) Upon request made within 1 year of the issuance
of this Supplemental Trial Examiner's Decision, immedi-
ately supply the International Ladies' Garment Workers
Union a list of the names and addresses of all employees
at their Uniontown, Alabama, plant, and keep that list
current for a 1-year period
"(g) Upon request, immediately grant the Internation-
al Ladies' Garment Workers Union, AFL-CIO, and
its representatives reasonable access, for a 1-year period,
to plant bulletin boards and all places where notices
to employees are customarily posted at the Uniontown,
Alabama, plant
"(h) Permit employees at the Alabama plant to have
unrestricted access to union organizers during nonwork-
ing time on plant approaches and parking lots for a
period of 1 year from the issuance date of this Supple-
mental Trial Examiner's Decision, subject only to such
reasonable and nondiscriminatory regulations as
Respondents may find it necessary to impose in the
interest of plant efficiency and discipline, provided, how-
ever, that said regulations do not serve to thwart the
employees in the exercise of the right guaranteed them
herein
"(i) Post at their plant in Uniontown, Alabama, copies
of the notice attached to the initial Trial Examiner's
Decision marked "Appendix ,"30 as hereinafter modified
Copies of said notice, on forms provided by the Regional
Director for Region 25, after being duly signed by Res-
pondents' representative, shall be posted by Respondents
3° In the event that this Recommended Order is adopted by the
Board the words A Decision and Order shall be substituted for
the words The Recommendations of a Trial Examiner in the notice
In the further event that the Board s Order is enforced by a decree
of the United States Court of Appeals the words A Decree of
the United States Court of Appeals Enforcing an Order shall be
substituted for the words A Decision and Order
immediately upon receipt thereof, and be maintained
by them for 60 consecutive days thereafter, in conspicu-
ous places, including all places where notices to employ-
ees are customarily posted Reasonable steps shall be
taken by Respondents to insure that said notices are
not altered, defaced, or covered by any other material
"(j) Notify the Regional Director for Region 25, in
writing, within 20 days from the date of this Supplemental
Trial Examiner's Decision what steps Respondents have
oaken to comply herewith "31
2 Delete the first and second paragraphs of the
Appendix and insert in their place the following
After a hearing duly held, it was determined that
McLoughlin Manufacturing Corporation unlawfully
moved its Peru, Indiana, operations to Uniontown,
Alabama, where it resumed operations under the
names of McLoughlin Manufacturing Corporation
and Lady Jo, Inc in order to defeat the rights
of its employees to bargain and deal with a union
of their choice In order to remedy this conduct
we have been required to take the following steps
WE WILL bargain collectively, upon request, with
International Ladies' Garment Workers Union,
AFL-CIO, as the exclusive representative of all
our employees at our Uniontown, Alabama, plant,
in the appropriate unit described below, provided
that, upon our compliance with the prescribed Order
of reinstatement, a majority of the employees in
the appropriate unit at our Uniontown plant have
designated the Union as their representative
The appropriate bargaining unit is
All our employees, excluding office, clerical,
guards, professional and supervisory employ-
ees as defined in the Act
31 In the event that this Recommended Order is adopted by the
Board this provision shall be modified to read Notify said Regional
Director in writing within 10 days from the date of this Order what
steps the Respondents have taken to comply herewith