M.C.P. Foods

National Labor Relations Board - Board Decisions

Jul 16, 1993

311 N.L.R.B. 1159 (N.L.R.B. 1993)

1159
311 NLRB No. 140
M.C.P. FOODS
1 In connection with this issue, the Regional Director inadvertently
cited, inter alia, Bannon Mills, 146 NLRB 611 (1964); it is evident
that the Regional Director meant to cite the immediately preceding
case, Grainger Bros. Co., 146 NLRB 609 (1964).
2 See General Cable Corp., 130 NLRB 1123 (1962).
3 In addition, the petition was filed prior to the open period rel-
ative to the expiration date of the ‘‘premature extension’’ period.
4 Shen-Valley, supra, fns. 5 and 8. 1 The Employer’s name appears as amended at the hearing.
M.C.P. Foods, Inc. and Mary Morrissey, Petitioner
and General Truck Drivers, Office, Food &
Warehouse Union, Local 952, International
Brotherhood of Teamsters, AFL–CIO. Case 21–
RD–2494
July 16, 1993
ORDER
BY CHAIRMAN STEPHENS AND MEMBERS
DEVANEY AND RAUDABAUGH
The Union’s request for review of the Regional Di-
rector’s Decision and Direction of Election is denied as
it fails to raise substantial issues warranting review.
Pertinent portions of the Regional Director’s Decision
and Direction of Election are attached.
In addition to agreeing with the Regional Director
that the employing entity in this case at all times re-
mained the same,1 we also agree with the Regional Di-
rector that the Employer’s collective-bargaining agree-
ment with the Union does not serve as a bar to the pe-
tition herein. In doing so, we rely on the principles set
forth in our decision in Shen-Valley Meat Packers, 261
NLRB 958 (1982). The parties in that case, like the
parties here, agreed to a 5-year contract. They signed
an amendment to the contract, reaffirming the contract
and restating its expiration date, during the first 3
years of the initial long-term contract. The Board
found, relying on Southwestern Portland Cement Co.,
126 NLRB 931 (1960), that the amendment was, in ef-
fect, a premature extension of the contract because it
was executed during the 3-year period of ‘‘reasonable
duration’’2 and extended the contract beyond 3 years.
The Board held that the premature extension governed
the timeliness of a decertification petition which was
filed after the initial 3-year anniversary date of the
long-term contract.3 Since the petition was not timely
filed, it was dismissed.4
The parties in the instant case signed a 5-year con-
tract and signed an amendment, reaffirming the con-
tract and its expiration date, prior to the 3-year anni-
versary date of the initial agreement. The amendment
is therefore, as in Shen-Valley, a premature extension
of the initial agreement and in other circumstances, the
term of the contract following the amendment would
govern the timeliness of the petition. However, unlike
the situation in Shen-Valley, the petition here was filed
during the open period relative to the third anniversary
date of the original, overly long contract. Were we to
find that only the later, as amended, contract filing pe-
riod applied, Petitioner would have been deprived of
the window period of the original contract. A pre-
mature extension cannot serve to deprive a petitioner
of the open period under the original contract. Deluxe
Metal Furniture Co., 121 NLRB 995, 1001–1002
(1958); H. L. Klion Inc., 148 NLRB 656, 660 (1964).
MEMBER DEVANEY, dissenting.
I would grant the Union’s request for review.
APPENDIX
DECISION AND DIRECTION OF ELECTION
On March 8, 1993, Mary Morrissey, an employee and
member of the bargaining unit, filed the instant petition. The
Union contends that the collective-bargaining agreement cur-
rently in effect between the parties is in the second year of
its term and thus, the contract bars the filing of the petition
at this time. Accordingly, the Union moved to dismiss the
petition.
The Employer, on the other hand, asserts that the collec-
tive-bargaining agreement to which the parties are obligated,
has effective dates from June 1, 1990, through June 1, 1995.
As the agreement has a duration period of over 3 years, the
petition was timely filed within the appropriate window pe-
riod before the third anniversary for the collective-bargaining
agreement, and the contract cannot serve as a bar.
The Employer is a Delaware corporation engaged in the
manufacturing of flavor food products with a facility located
at 424 South Atchison Street, Anaheim, California (the Ana-
heim facility).
The record disclosed that on January 26, 1991, the Union
and M.C.P. Foods-Borden signed a collective-bargaining
agreement which had effective dates of June 1, 1990, to June
1, 1995. The employing entity, MCP Foods, Inc. (MCP
Foods or Employer)1 was a wholly-owned subsidiary of Bor-
den’s Inc.
On September 30, 1991, effective September 27, 1991,
Firmenich, Incorporated (Firmenich) purchased and acquired
the stock of MCP Foods, Inc. As a result of this transaction,
MCP Foods, Inc. became a wholly-owned subsidiary of
Firmenich. Subsequent to the stock purchase, the business
operation continued without any change in the nature of the
operation.
Early in September 1991, before the above acquisition was
complete, officials from Firmenich were advised of the col-
lective-bargaining agreement between the Union and MCP
Foods. On September 12, 1991, Vice President John
Layendecker and other management representatives from
Firmenich met with Frank Sevilla, business representative for
the Union, at the Anaheim facility, to discuss the effects of
the sale. Sevilla was informed of the impending sale and ad-
vised that some changes in the benefits would be requested
but otherwise the collective-bargaining agreement would con-
tinue in effect. Either at this meeting or a meeting held short-
ly thereafter, the parties first discussed the specific details of
the major changes. Sevilla was asked for his input and con-
cerns relating to the changes proposed by Firmenich. Sevilla
1160 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
2 The Board has distinguished the rights and obligations owed to
the employees’ collective-bargaining representative and the unit em-
ployees by a legal successor under NLRB v. Burns Security Services,
406 U.S. 272 (1972), and a continuing employing entity after a stock
transfer.
informed Layendecker that the Union would be open to dis-
cuss all of Firmenich’s proposals; however, before any of the
proposals could be agreed to by the Union, they would have
to be ratified by the unit employees.
The record testimony reflects that after September 30,
1991, the parties held 6 to 10 meetings during which
Firmenich presented certain alternatives to specific terms in
the collective-bargaining agreement. Under the collective-bar-
gaining agreement in effect at the time of the acquisition,
Borden provided Borden-sponsored company benefits to in-
clude a shared premium company health plan; a company
profit-sharing/pension plan; nine paid holidays; a limited
company sick leave plan; and an employees’ company sav-
ings plan, but no long-term disability insurance. Layendecker
informed the Union that as the health plan and the savings
plan under the collective-bargaining agreement were Borden-
sponsored plans, Firmenich could not provide them. Thus,
Firmenich would provide for health coverage with CIGNA
with a 100-percent Employer-paid premium and offer a 401-
A/401-K plan to the bargaining unit employees. Further,
Firmenich would offer 10 paid holidays and a more liberal
sick leave policy than provided for by Borden. Finally,
Firmenich would provide long-term disability insurance cov-
erage. The parties addressed other minor changes to the
terms and conditions of employment stated in the collective-
bargaining agreement, including the accrual of vacation
leave, makeup pay for disability leave, leaves of absence, fu-
neral leave, a substance abuse policy, tuition and aide plan,
and jury duty.
At a meeting on November 18, 1991, Firmenich presented
to the Union a written health and welfare package as well
as other language changes desired. Sevilla stated to
Layendecker that to enable the Union to make a decision, he
and the shop steward wished to meet with a CIGA represent-
ative. Sevilla also requested that the Employer call a meeting
of the employees to allow them to receive information on the
health and welfare, as well as the 401-A/401-K plans.
Layendecker agreed to the meeting and informed Sevilla that
the employees were already getting some of the benefits and
others would be implemented over the next couple of days.
A copy of the package was distributed to all of the employ-
ees covered. It is not clear from the record on which date
the Employer implemented the changes in the health and
welfare benefits.
On December 13, 1991, the proposed changes were ap-
proved by the bargaining unit employees. Subsequent thereto,
Sevilla had the Union’s counsel review documents pertaining
to the memorialization of the change. Several revised drafts
were exchanged between the parties during March and/or
April 1992. A final draft was signed by Sevilla and Robert
Daunais as president of M.C.P./Firmenich on July 8, 1992.
The cover page of the agreement executed on July 8,
1992, states that the agreement is between M.C.P./Firmenich
and the Union, with effective dates of June 1, 1990, through
June 1, 1995, as amended January 1, 1992.
The Union contends that MCP Foods, as a result of the
purchase by Firmenich, is a ‘‘legal successor’’ to the com-
pany previously owned by Borden. As such, it argues that
when the parties executed the agreement described above on
July 8, 1992, the effective dates of the agreement became ef-
fective January 1, 1992, to June 1, 1995. The Union thus as-
serts that this new successor agreement controls the time pe-
riod when a decertification petition can be filed. Accord-
ingly, the Union contends that the window period under the
1992–1995 agreement controls, and that the petition herein is
untimely.
The Employer contends that the stock purchase by
Firmenich has not changed the legal status of the employing
entity, MCP Foods. Thus, while the parties executed an
amendment to the 1990–1995 agreement on July 8, 1992, the
amendment did not affect the viability of the 5-year agree-
ment, and the petition was timely filed.
The Board has long held that a mere change of stock own-
ership does not absolve a continuing corporation of responsi-
bility under the Act. Western Boot & Shoe, 205 NLRB 999
(1973). If the changes in the ownership and corporate name
do not result in any significant changes in the nature of the
operation, the management, the composition of the contrac-
tual unit, or the stability of the existing bargaining relation-
ship, there is no break or hiatus between two legal entities,
but rather the continuing existence of a legal entity, albeit
under new ownership. Bannon Mill, 146 NLRB 611 (1964);
Hendricks-Miller Typograhic Co., 240 NLRB 1082 (1979).
The record in the present case reveals that the employing
entity, MCP Foods, is a Delaware corporation which is a to-
tally owned subsidiary of the parent company, Firmenich.
Aside from some personnel changes in the management
level, MCP’s operations continued and its employee com-
plement was not altered as a result of Firmenich’s acquisition
of stock from Borden. Further, Sevilla testified that the par-
ties continued to enforce and abide by the terms of the origi-
nal collective-bargaining agreement after the transfer of the
stock. Accordingly, the record supports a conclusion, and I
find, that MCP Foods continued as the same employing enti-
ty after the stock acquisition by Firmenich, with enforceable
obligations under the existing 1990–1995 collective-bar-
gaining agreement. EPE, Inc., 284 NLRB 191 (1987), enfd.
in pertinent part 845 F.2d 83 (4th Cir. 1988).
The Union contends that this case should be controlled by
the Board’s decision in Ideal Chevrolet, 198 NLRB 280
(1972). In Ideal Chevrolet, the Board found that the union
and the predecessor employer had executed a 3-year collec-
tive-bargaining agreement. During the term of the agreement,
the predecessor was purchased by a successor employer.
Subsequent to the successor employer assuming the business,
the union and the successor employer entered into a new
agreement. Thereafter, a petition was filed by a rival union,
which would have been timely had the terms of the prede-
cessor agreement been controlling. The Board dismissed the
rival union’s petition inasmuch as it concluded that parties’
successor agreement was controlling for purposes of deter-
mining when a petition should be timely filed.
I have found that the Employer herein is not a legal suc-
cessor, but rather the same employing entity since 1990. The
Board’s holding in Ideal Cheverolet is, therefore, not appli-
cable herein.2 Further, while the record discloses that the par-
ties executed an agreement on July 8, 1992, I find that the
parties amended the 1990–1995 collective-bargaining agree-
1161M.C.P. FOODS
ment, and that the parties did not enter into a new or suc-
cessor collective-bargaining agreement.
The Board, in General Cable Corp., 139 NLRB 1123,
1125 (1962), held that a collective-bargaining agreement of
more than 3 years’ duration is treated for contract-bar pur-
poses as expiring on its third anniversary date, and that it
does not bar a petition filed in the window period 90 to 60
days preceding the long-term contract’s third anniversary
date.
In the instant case the decertification petition was filed on
March 8, 1993. The terms of the initial agreement which I
have found controlling are from June 1, 1990, to June 1,
1995. In applying the Board’s General Cable Corp. ruling,
the third anniversary date of the agreement for contract-bar
purposes would be in 1993. As the petition herein was filed
within the window period preceding the initial agreement’s
third anniversary date, the petition was timely filed. Based
on the foregoing, I find that the current collective-bargaining
agreement between the Union and the Employer herein does
not constitute a bar to the instant petition, and I conclude
that an immediate election is appropriate.
5. The following employees of the Employer constitute a
unit appropriate for the purpose of collective bargaining
within the meaning of Section 9 (b) of the Act:
All production and maintenance employees employed
by the Employer at its facility located at 424 South
Atchison Street, Anaheim, California, including traffic
department (shipping and receiving), working fore-
persons, and durarome operators and helpers employed
within the pilot plant department, excluding all other
employees, office/clerical employees, professional em-
ployees, Company officials, confidential employees,
managerial employees, advertising employees, sales
personnel, laboratory employees, inclusive of quality
control and research and development employees, and
outside janitorial service employees, guards and super-
visors, as defined in the Act.
The unit description is substantially in accord with a stipu-
lation of the parties.
There are approximately 56 employees in the unit.