223 N.L.R.B. 279 (N.L.R.B. 1976)

Mego Corp.

National Labor Relations Board - Board DecisionsMar 24, 1976

223 N.L.R.B. 279 (N.L.R.B. 1976)

MEGO CORPORATION Mego Corporation and -Samet and Wells, Inc.' and Truck Drivers Local Union No. 807 , International Brotherhood of Teamsters, Chauffeurs, Warehouse- men and Helpers of America , Petitioner. Case 29- RC-3065 March 24, 1976 DECISION ON REVIEW AND ORDER BY CHAIRMAN MURPHY AND MEMBERS FANNING AND PENELLO Upon a petition duly filed under Section 9(c) of the National Labor Relations Act, as amended, a hearing was held before Hearing Officer Richard Brooks. On September 18, 1975, the Regional Direc- tor for Region 29 issued a Decision and Order, find- ing that the petition and the amended petition were untimely filed in relation to the duration of collec- tive-bargaining agreements between the Intervenor Associations 2 and the Intervenor Union.3 Thereafter, in accordance with Section 102.67 of the National Labor Relations Board Rules and Regulations , Series 8, as amended, the Petitioner filed a timely request for review of the Regional Director's decision, assert- ing that the Regional Director erred on substantial factual issues and that he departed from officially reported Board precedent.. The. Employer, the In- tervenor Union, and the Intervenor Associations filed a joint statement and brief in opposition to the Petitioner's request for review. By telegraphic order dated November 17, 1975, the Board granted the Petitioner's request for review. Thereafter, the Em- ployer, the Intervenor Associations, and the Interve- nor Union requested the Board to consider on review their original brief previously submitted in opposi- tion to. review. 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 reviewed the entire record in this case and makes . the following findings: There are three wholly owned subsidiaries of Mego International, Inc., relevant to this proceeding: Mego Corporation,, Samet and Wells, Inc., and Mego Service Corporation. 1 The names of the Employers appear as amended at the hearing. The parties are in agreement that the Employers are Joint Employers. 2 National Association of Doll Manufacturers , Inc., and Stuffed Toy Manufacturers Association intervened on the basis of a contractual interest. 3 Toy and Novelty Workers of America, Local 223, International Union of Dolls , Toys, Playthings, Novelties and Allied Products of the United States and Canada , AFL-CIO, intervened on the basis of a contractual interest. 279 Samet and Wells for many years manufactured stuffed toys at a location in New York City. In 1969, Samet and Wells joined the Stuffed- Toy Manufactur- ers, and its employees were thereafter covered.by a multiemployer collective-bargaining agreement be- tween that Association and the Intervenor Union. During 1971, Samet and Wells was acquired by Mego International, Inc., and, since that time it has remained a wholly owned subsidiary of that corpora- tion. On November 16, 1974, a fire destroyed the premises of Samet and Wells where, it had employed 18 to 20 employees. Mego Corporation was- formerly located in New- ark, New Jersey. It there employed only, clerical and management personnel, and used subcontractors for the manufacture of dolls. Mego Service Corporation formerly performed warehousing functions for Mego Corporation in .Port Newark, New Jersey. Its approximately 25 to 30 em- ployees were covered by a collective-bargaining agreement with a local of the International Longshoremen's Association which expired on May 31, 1975. Mego Service Corporation was no longer an operating company at the time of the hearing. In 1975, Mego International consolidated the op- erations of Samet and Wells and -Mego Corporation at facilities in Bohemia, New York. As noted, it ter- minated the operations of Mego Service Corpora- tion, which at the time of the hearing remained a nonoperating company. These actions were part of a plan to consolidate Mego International's domestic manufacturing, assembly, and warehouse operations: In furtherance 'of this plan; it leased premises at 70 and 100 Oroville Drive in Bohemia. Until .these premises were completed, however, temporary facili- ties in Bohemia at 120 Wilbur Place were leased. The Wilbur Place premises were utilized until the end of May 1975, when the facilities at 100 Oroville Drive were available. At the time of the hearing, 70 Oroville Drive was not yet in use, but it was anticipated.that those premises would be available in 2 weeks. In January 1975, James Ravnell, a business agent for the Intervenor Union, contacted Samet and, Wells about the proposed operations in Bohemia. Ravnell had previously serviced the Company's New York City location. It was agreed in January that the col- lective-bargaining agreement between Samet and Wells as a member of the Intervenor Association, Stuffed Toy Manufacturers, and the Intervenor Union would be applied to that Employer's employ- ees at the new location. This was at a time when Samet and Wells had no employees. Although its for- mer employees were offered employment at the new location, all, declined. In February 1975, Samet and Wells commenced 223 NLRB No. 55 280 DECISIONS OF NATIONAL LABOR RELATIONS BOARD operations at 120 Wilbur Place in Bohemia. As its former employees had declined further employment, it hired new employees . At the time the new employ- ees were hired , they were advised that they would be working under the terms of the collective-bargaining agreement between the Intervenor Union and the Stuffed Toy Manufacturers Association. That agree- ment required , in part, that the employees become members of the Intervenor Union. Business Agent Ravnell testified that he obtained membership appli- cations from all of Samet and Wells' new employees. In conformance with the consolidation of certain of Mego International 's operations , Mego Corpora- tion also moved its operations to Wilbur Place pend- ing the completion of the Oroville Drive facilities. It there planned to assume its own production, and the record indicates that it has done so. On April 7, 1975, about the time it commenced operations in Bohemia, it joined the National Association of Doll Manufac- turers, Inc., one of the Intervenor Associations here- in. Mego Corporation agreed to apply that Association's collective-bargaining agreement with the Intervenor Union to its employees4 That agree- ment contains union-security provisions. Mego Corporation's operations are now located at 100 Oroville Drive in Bohemia . At the time of the hearing, it employed approximately 26 employees who were engaged in assembly, packaging, ware- housing, shipping, and receiving operations. Ravnell testified that he obtained membership applications and checkoff authorizations from all of these em- ployees. The Petitioner seeks to represent a unit of ware- housemen, hi-lo operators , maintenance men, and order pickers employed by the Joint Employers, Samet and Wells and Mego Corporation, at the 100 Oroville Drive location . The Joint Employers and the Intervenors contend that their contracts covering all employees operate as a bar to the petitions filed here- in. They also contend that the petitioned-for unit is inappropriate and that in any event the unit is ex- panding and the petition is therefore untimely. As noted , the Regional Director found that the afore- mentioned contract barred the instant petitions. Be- cause of this conclusion , he found it unnecessary to consider the other issues raised by the parties. Contrary to the Regional Director , we are con- vinced by the foregoing facts that the collective-bar- gaining agreements between the Intervenor Union and the Intervenor Associations do not bar the in- stant petition. The consolidation of the Mego Corpo- ration and Samet and Wells operations to the Bohe- mia facilities was not "a mere relocation accompa- nied by a transfer of a considerable proportion of the employees to another plant ." 5 Rather , it was a merg- er of operations which resulted in the creation of an entirely new operation with major personnel changes. As noted, supra, none of the employees of Samet and Wells at the time of the hearing had been employed at its previous location. Similarly, when Mego Corporation commenced operation in April 1975, it did so with new employees whom it hired after the transfer of its operations.' Mego, which had joined the National Association of Doll Manufacturers on April 7, 1975, applied the terms of that Association's collective-bargaining agreement with the Intervenor Union to its employ- ees. Under these circumstances, the collective-bargain- ing agreements in issue do not bar the instant peti- tion. In General Extrusion Company,' the Board set forth the rule as follows: [A] contract does not bar an election if executed (1) before any employees had been hired or (2) prior to a substantial increase in personnel. In the instant case, it is clear that Mego Corporation and Samet and Wells agreed to the labor agreements in issue at a time before any employees had been hired .8 Neither the employees' applications for mem- bership to the Intervenor Union nor their execution of checkoff authorizations changes this result. The contract clauses requiring this action by the employ- ees "were invalid because . . . entered into at a time when the Employer had no employees, and the In- tervenor, perforce was not the representative of its employees as provided in Section 9(a) of the Act, and therefore not authorized to execute such clauses." 9 Accordingly, we conclude that the Regional Director erred when he dismissed the petition because of the aforementioned collective -bargaining agreements. However, notwithstanding the above, there are other considerations which in our opinion preclude the further processing of this petition. The unit sought by the Petitioner consists primarily of em- ployees who are engaged in warehouse operations. In this respect, Petitioner seeks to represent what it con- s See General Extrusion Company, inc., General Bronze Aiwintite Products Corp., 121 NLRB 1165 , 1167-68 ( 1958). 6 According to payroll records introduced by the Employer, Mego Corporation's employees did not begin their employment until after the payroll period ending April 9, 1975. 4 The National Association of Doll Manufacturers and the Stuffed Toy 121 NLRB at 1167. Manufacturers , the Intervenor Associations , each has a collective-bargain - At the time of the hearing , the combined employee complement of the ing agreement with the Intervenor Union. The terms of these labor agree - Joint Employers was 34. It was anticipated that within 1 year that number ments are substantially similar except for some variations in employee clas- would increase to 220. sifications . 9 Foothill Electric Corporation, 120 NLRB 1350, 1353 (1958). MEGO CORPORATION 281 tends are the employees who perform the functions previously performed by the employees of Mego Ser- vice Corporation.1° The Joint Employers, the Interve- nor Associations, and the Intervenor Union contend that the petitioned-for unit is inappropriate. We agree. At the outset, we note that Mego Service Corpora- tion is no longer an operating company. The ware- housing operations of that company are now per- formed by the employees of Mego Corporation and Samet and Wells." These employees, however, per- form not only the warehousing duties formerly per- formed by Mego Service Corporation, but also cer- tain production operations. The record shows that at the time of the hearing the combined employee com- plement of Mego Corporation and Samet and Wells, exclusive of clericals and management personnel, was 34 employees. Of these, seven or eight were on the Samet and Wells payroll, and the remainder were employed by Mego Corporation. According to the testimony of William Stuckey, plant manager of the Bohemia operations, the employees of the two Com- panies are interchangeable , not only between the cor- porations , as indicated , but also among the classifica- tions within each Company. Thus, for example, the assembly employees of Mego Corporation have per- formed packaging operations for Samet and Wells. Furthermore, Stuckey testified that assemblers em- ployed by Mego Corporation are generally inter- changeable with shipping and receiving employees, of both that Company and of Samet and Wells, as dictated by the needs of the Companies. In addition to this evidence of employee interchange, the record 10 The employees of Mego Service Corporation were principally engaged in shipping, receiving, and order picking , and as hi-lo operators. 11 The record indicates that the employees of Mego Corporation and Samet and Wells, including those engaged in warehousing operations, are interchangeable from one corporation to the other on a day -to-day basis. further indicates that supervisory personnel are inter- changeable between the warehousing and production . operations of the two Companies. At the time of the hearing, for example, the receiving manager of Mego Corporation was supervising a packaging operation for Samet and Wells. Thus, although conceptually there are employees at Bohemia who have assumed the duties formerly performed by the employees of Mego Service Corpo- ration, it is clear that by the consolidation of opera- tions effected by Mego International such employees have lost their separate identity and have been merged into a single unified operation. Under these circumstances, particularly the inte- gration of the Joint Employers' operations and the degree of interchange of both employees and super- visors between the Companies, we are unable to con- clude that the "warehouse" employees in the request- ed unit possess sufficient functional distinctness to warrant a finding that they have a separate commu- nity of interest for bargaining purposes.'2 We find, therefore, that a unit of warehouse employees is inap- propriate as too narrow in scope.13 Accordingly, as the Petitioner does not seek an election in a broader appropriate unit, we shall dismiss the petition here- in.14 ORDER It is hereby ordered that the petition be, and it hereby is, dismissed. 12 In view of the changed circumstances in the operations here in issue, we find no merit in Petitioner's argument that the employees it seeks are in effect "successors" to the former employees of Mego Service Corporation, which were represented by a local of the International Longshoremen's As- sociation. " See, e.g., Riker Laboratories, a Division of Rexall Drug and Chemical Co., 156 NLRB 1099 (1966). 14 In view of our disposition of this issue , we need not rule on the conten- tion that the unit is expanding and the petition is therefore untimely.