Naccarato Construction Co.

National Labor Relations Board - Board Decisions

Dec 22, 1977

233 N.L.R.B. 1394 (N.L.R.B. 1977)

DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Frank Naccarato, a Sole Proprietor, d/b/a Naccarato
Construction Company and Tacoma Framing
Company; and Naccarato Construction Company,
Inc. and Seattle District of Carpenters, United
Brotherhood of Carpenters and Joiners of America,
AFL-CIO. Case 19-CA-9087
December 22, 1977
DECISION AND ORDER
BY CHAIRMAN FANNING AND MEMBERS
JENKINS AND MURPHY
On July 19, 1977, Administrative Law Judge
Russell L. Stevens issued the attached Decision in
this proceeding. Thereafter, the General Counsel
filed exceptions and a supporting brief, and Respon-
dents filed exceptions and a supporting brief, and the
General Counsel filed a response to Respondents'
cross-exceptions and a supporting brief.
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended, the
National Labor Relations Board has delegated its
authority in this proceeding to a three-member panel.
The Board has considered the record and the
attached Decision in light of the exceptions and
briefs and has decided to affirm the rulings, find-
ings,' and conclusions2 of the Administrative Law
Judge, to modify his remedy, 3 and to adopt his
recommended Order, as modified herein.4
ORDER
Pursuant to Section 10(c) of the National Labor
Relations Act, as amended, the National Labor
Relations Board adopts as its Order the recommend-
ed Order of the Administrative Law Judge as
modified below and hereby orders that the Respon-
dents, Frank Naccarato, a Sole Proprietor, d/b/a
Naccarato Construction Company and d/b/a Taco-
ma Framing Company; and Naccarato Construction
Company, Inc., Tacoma, Washington, their officers,
agents, successors, and assigns, shall take the action
set forth in the said recommended Order, as so
modified:
1. Substitute the following for paragraph 2(c):
"(c) Reimburse the contractually agreed-upon trust
funds on behalf of the unit employees for the loss of
all health and welfare, pension plan, and other
payments incurred by said trust funds as a result of
Respondents' illegal actions described above."
2. Insert the following as paragraph 2(d) and
reletter the subsequent paragraphs:
"(d) Preserve and, upon request, make available to
the Board or its agents, for examination and copying,
all payroll records, social security payment records,
233 NLRB No. 196
timecards, personnel records and reports, and all
other records necessary to analyze the amount of
backpay due under the terms of this recommended
Order."
3. In the new paragraph 2(e) substitute "Tacoma,
Washington," for "Seattle, Washington."
4. Substitute the attached notice for that of the
Administrative Law Judge.
I Respondents have excepted to certain credibility findings made by the
Administrative Law Judge. It is the Board's established policy not to
overrule an Administrative Law Judge's resolutions with respect to credibili-
ty unless the clear preponderance of all of the relevant evidence convinces
us that the resolutions are incorrect. Standard Dry Wall Products. Inc., 91
NLRB 544 (1950), enfd. 188 F.2d 362 (C.A. 3, 1951). We have carefully
examined the record and find no basis for reversing his findings.
In sec. Ill,l,b, of his Decision, the Administrative Law Judge miscited
certain portions of the transcript. The record indicates that Administrative
Law Judge Stevens posed the following initial question: "Why was Tacoma
Framing formed, first of all, and then how was it formed?" The first portion
of the witness' response reads as follows: "It was formed simply-it seemed
simple at the time, at least, to pick up an area in the market which I couldn't
compete in, and that was the nonunion market...." We hereby correct
these inadvertent errors.
2 We adopt the Administrative Law Judge's conclusion that Tacoma
Framing Company is bound to the collective-bargaining agreements
executed on February 1, 1974, between Naccarato Construction Company
and the Union and on August 13, 1976, between Naccarato Construction
Company, Inc., and the Union, respectively. In so doing, however, we note
that, under the Supreme Court's opinion in South Prairie Construction Co. v.
Local No. 627, International Union of Operating Engineers, AFL-CIO, et al.,
425 U.S. 800 (1976), the fact that several entities constitute a single employer
is not dispositive of the ultimate issue of whether each is bound to the
collective-bargaining agreements of the others. Rather, the test is whether,
given a single-employer finding, the employees of the separate companies
constitute the appropriate unit or whether the employees of each of the
individual companies constitute distinct and separate units. The criteria for
finding a single employer are different from those for determining the
appropriateness of the unit. Peter Kiewit Sons' Co. and South Prairie
Construction Co., 231 NLRB 76 (1977). In the present case the operations of
the three companies and the work of their employees are so intertwined as to
render an employerwide unit the appropriate unit and to preclude the
finding of separate appropriate units.
3 Interest on monetary awards mandated by this Decision is to be
computed in the manner set forth in Florida Steel Corporation, 231 NLRB
651 (1977).
4 In par. 2(c) of his recommended Order, the Administrative Law Judge
provided that Respondents reimburse the Union for the loss of all health
and welfare, pension plan, and other payments incurred as a result of
Respondents' illegal actions, whereas it is clear from the record that such
payments were required to be paid to the contractually agreed-upon trust
funds. Additionally, in par. 2(d), the Administrative Law Judge, in requiring
Respondents to post appropriate notices, referred to their principal place of
business as being located in Seattle, rather than Tacoma, Washington. We
shall modify his recommended Order accordingly.
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
After a hearing at which all sides had a chance to
give evidence, the National Labor Relations Board
has found that we violated the National Labor
Relations Act, as amended, and has ordered us to
post this notice. We intend to abide by the following:
The Act gives all employees these rights:
1394
NACCARATO CONSTRUCTION COMPANY
To organize themselves
To form, join, or help unions
To bargain collectively through represen-
tatives of their own choosing
To act together for collective bargaining
or other mutual aid or protection
To refuse to do any or all of these things.
WE WILL NOT refuse to recognize that Tacoma
Framing is bound by the terms and conditions of
collective-bargaining agreements executed on
February 1, 1974, by Frank Naccarato d/b/a
Naccarato Construction Company and the Seattle
District of Carpenters, United Brotherhood of
Carpenters and Joiners of America, AFL-CIO
(Union), and on August 13, 1976, by Naccarato
Construction Company, Inc., and the Union.
WE WILL NOT refuse to recognize and bargain
with the Union as the representative for purposes
of collective bargaining on behalf of the employ-
ees in the following appropriate unit:
All journeymen and apprentice carpenters
and joiners employed by Naccarato Con-
struction Company, Tacoma Framing Com-
pany and Naccarato Construction Compa-
ny, Inc., excluding office clerical employees,
guards and supervisors as defined in the Act.
WE WILL NOT repudiate our obligations under
an agreement entered into between Naccarato
Construction Company, Inc., and the Union on
August 13, 1976, and refuse to comply with the
terms and conditions thereof.
WE WILL NOT deal directly with our employees
and require them to sign lien waivers as a
condition to being paid, without prior notification
to, or bargaining with, the Union.
WE WILL bargain collectively with the Union
by acknowledging that Framing is bound by the
collective-bargaining agreements executed on
February 1, 1974, by the Company and the
Union, and on August 13, 1976, by the Corpora-
tion and the Union; recognize and comply with
all terms and conditions of the aforesaid two
agreements between the Union and the Company
and the Corporation; and recognize the Union as
the representative for purposes of collective bar-
gaining on behalf of the employees in the appro-
priate unit described above.
WE WILL, jointly and severally, make whole all
employees in the appropriate unit defined above,
for any and all loss of wages and benefits they
incurred because of our illegal refusal to recog-
nize and abide by contractual terms and condi-
tions, and repudiation of agreement with the
Union.
WE WILL reimburse the contractually agreed-
upon trust funds on behalf of the unit employees
for the loss of all health and welfare, pension
plan, and other payments incurred by said trust
funds as a result of our illegal actions described
above.
FRANK NACCARATO, A
SOLE PROPRIETOR, D/B/A
NACCARATO
CONSTRUCTION COMPANY
AND D/B/A TACOMA
FRAMING COMPANY; AND
NACCARATO
CONSTRUCTION
COMPANY, INC.
DECISION
STATEMENT OF THE CASE
RUSSELL L. STEVENS, Administrative Law Judge: This
matter was heard at Seattle, Washington, on May 24 and
25, 1977.1 The complaint, issued January 28, 1977, is based
on a charge filed December 13 by Seattle District of
Carpenters and Joiners of America, AFL-CIO (Union).
The complaint alleges that Frank Naccarato, a Sole
Proprietor, d/b/a Naccarato Construction Company and
d/b/a Tacoma Framing Company; and Naccarato Con-
struction Company, Inc., hereinafter collectively referred
to as Respondents and individually referred to as Naccara-
to, or as the Company, or as Framing, or as the Corpora-
tion, violated Section 8(aX5) and (1) of the National Labor
Relations Act, as amended (Act).
All parties were given full opportunity to participate, to
introduce relevant evidence, to examine and cross-examine
witnesses, to argue orally, and to file briefs. Briefs, which
have been carefully considered, were filed on behalf of
General Counsel and Respondent.
Upon the entire record of the case, and from my
observation of the witnesses and their demeanor, I make
the following:
FINDNoS OF FACT
1. JURISDICTION
The Company is, and at all times material herein has
been, a Washington sole proprietorship with office and
place of business located at Tacoma, Washington. It is
engaged in the business of carpentry contracting.
Framing is, and at all times material herein has been, a
Washington sole proprietorship with office and place of
business located at Tacoma, Washington. It is engaged in
the business of carpentry contracting.
I All dates hereinafter are within 1976, unless stated to be otherwise.
1395
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
The Corporation is, and at all times material herein has
been, a Washington corporation with office and place of
business located at Tacoma, Washington. It is engaged in
the business of carpentry contracting.
The Company, during the past 12 months, which period
is representative of all times material herein, provided
services outside the State of Washington, and provided
services and materials to customers engaged in interstate
commerce by other than indirect means, having a total
value in excess of $50,000.
Framing commenced business operations in or about
June 1976, and since commencement of operations has, in
the ordinary course and conduct of its business, provided
services outside the State of Washington or to customers
which themselves are in commerce by other than indirect
means, valued in excess of $50,000; or, in the alternative
has, during that time, provided services at a rate which, if
projected across its first 12 months of operations, would
exceed $50,000.
The Corporation commenced business operations in or
about August 1976, and since the commencement of
operations has, in the ordinary course and conduct of its
business, provided services outside the State of Washington
or to customers which themselves are in commerce by
other than indirect means, valued in excess of $50,000; or,
in the alternative has, during that time, provided services at
a rate which, if projected across its first 12 months of
operations, would exceed $50,000.
I find that Respondents are alter egos of each other, as
discussed below, and that each of them is, and at all times
material herein has been, engaged in commerce within the
meaning of Section 2(6) and (7) of the Act.
II. THE LABOR ORGANIZATION INVOLVED
Seattle District of Carpenters, United Brotherhood of
Carpenters and Joiners of America, AFL-CIO is, and at all
times material herein has been, a labor organization within
the meaning of Section 2(5) of the Act.
III. THE ALLEGED UNFAIR LABOR PRACTICES
Background 2
Naccarato has been in business as a building contractor
for at least 10 years. He was declared bankrupt in 1974,
and in February of that year organized Naccarato Con-
struction Company (the Company). In order to obviate the
necessity of extensive financing required to build houses
and other buildings, he decided to limit his operations. He
acquired a business license for the Company as a framing
contractor rather than a general contractor. The Company
has continued in existence until the present time.
Shortly after the Company was organized, Naccarato
signed a contract for it with Shaw House Construction, to
build four fourplexes. The Company's resources being
limited, it started construction with Naccarato, some of his
relatives, and a few employees he hired, doing the work.
During the course of construction Naccarato was visited at
the site by Norman Nagel, business representative for the
2 This background summary is based on facts acknowledged or undis-
puted by the parties.
Union, and later, by a Shaw House representative. Both
persons told Naccarato that he had to be a "Union"
contractor on that job. Naccarato signed a "residential"
agreement with the Union on February 1, 1974, on behalf
of the Company and effective until June 1, 1974, and
thereafter from year to year unless canceled pursuant to
provisions of the contract. After the contract was signed
with the Union, the Company obtained a 144-unit job
called the Islander. The Company's own carpenters were
union members but much of the subcontract work was
done by nonunion organizations. The Company then
obtained another job, called Islander II. Naccarato worked
closely with Nagel and the Union during both Islander
jobs, and there were no major problems. Naccarato then
obtained a job for the Company with C.H.G. International,
to construct seven tracts of houses, scattered over a large
area of separate towns in the Puget Sound region. Naccara-
to dealt with several union locals and different business
representatives on the C.H.G. job, and all his work was
closely policed by the Union.
Some time during 1975 a dispute arose between Naccara-
to and the Union, relative to amounts due and owing from
the Company to the union trust fund. Naccarato acknowl-
edged to the Union an amount he contended was due. The
Union conducted an audit, and contended a larger amount
was due.
Approximately in June 1976 Naccarato organized Fram-
ing as a separate company, and obtained a business license
for it. It was intended from the outset, and was operated
from its inception, as a nonunion business. Framing still is
in operation. Its manager is Naccarato; its foreman
presently is Charles Kinnan; most of its tools and equip-
ment are rented from the Company. Framing's first job, a
64-unit apartment complex, was for Tim Easter. Bill Bird
was foreman on the Easter job. Its second job was the
Higgins project, a 46-unit apartment building.
In July, Naccarato went to Saudi Arabia with a crew, on
an independent project not related to the issues herein. Just
before leaving to go to Saudi Arabia, Naccarato bid on,
and obtained, a $250,000 contract in the name of the
Company, for Coldwell Banker. Naccarato set up the crew,
equipment, and accounts, and left three men in charge of
the project: Bird, Kinnan, and Mark Amdal.
Shortly after arrival in Saudi Arabia, Naccarato received
a telephone call from Bird, who advised him that Coldwell
Banker would not let the job be started by the Company
because of union resistance. The Union refused to dispatch
carpenters to the job, because of the dispute concerning
delinquent payments to the union trust fund. Naccarato
suggested that Framing do the job.
Soon after the first telephone conversation, Naccarato
received a second telephone call, from Kinnan, who stated
that Coldwell Banker would not accept Framing on the job
because Framing was nonunion. Coldwell Banker required
a union contractor. Naccarato refused to let Framing "go
Union." Kinnan then suggested that a new corporation be
formed to take over the job, and Naccarato agreed. The
Corporation was organized on August 12, 1976, and, with
Coldwell Banker's agreement, went onto the job with
1396
NACCARATO CONSTRUCTION COMPANY
Kinnan in charge of the project. Kinnan placed telephone
calls to Naccarato in Saudi Arabia on at least five
occasions, to obtain the latter's approval or advice when
problems arose. Naccarato's wife, Charlotte, was incorpo-
rator of the Corporation; initial directors were Charlotte
Naccarato, Naccarato, Kinnan, and Bird. Initial officers
were the same persons.3 On August 13 Kinnan signed, as
"officer" of the Corporation, a contract with the Union; 4
Nagel, as business representative, signed for the Union.
Soon after the Corporation took over the Coldwell
Banker job, problems developed, the first of which was
Coldwell Banker's contention that the Corporation did not
have knowledgeable people on the job. Other problems
followed, and they became so serious that Naccarato left
Saudi Arabia. He returned to Washington State about
September 24, and took over administration of the Corpo-
ration, as president. He investigated the problems between
Coldwell Banker and the Corporation, and his first action
was to stop work "in order to reorganize." A dispute
developed relative to payment obligations under the con-
tract, and Coldwell Banker withheld some funds from the
Corporation. As a result, Naccarato did not timely meet
the payroll due the first week in October, and he was
confronted by a group of employees, totaling about 30 to
50. A union representative also was present. Naccarato
paid the employees, but talked with them prior to giving
them their checks, concerning releases to be signed by
them.5 All employees then were paid by Naccarato, from
his own funds. Coldwell Banker alleged that the Corpora-
tion was in breach of the work contract, and required that
the Corporation leave the worksite, which it did.
Framing's Higgins job was finished in October. On
October 22, Naccarato signed a framing subcontract on
behalf of the Corporation, for a job with Lovell Construc-
tion Company covering a 59-unit apartment on Mercer
Island. Several discussions were held at the worksite in
November, attended by representatives of Lovell, the
Union, and the Corporation, relative to the Corporation's
failure to pay fringe benefits on the Coldwell Banker job.
On November 19, Naccarato told Gerald Marsh, one of the
Union's business representatives, that Kinnan had no
authority to sign the compliance agreement for the Corpo-
ration. On December 6 Lovell advised the Corporation in
writing, that the contract was being terminated because of
the Union's opposition to the Corporation being on the
job, due to failure to pay fringe benefits. The contract was
taken over by Framing on December 6, by instrument
signed by Naccarato. Subsequently, on a date not estab-
lished at the hearing, the Union objected to Framing
working on the Lovell job, and on December 13 the Union
filed the charge herein, partially on the basis of the Lovell
job.
The Corporation filed bankruptcy proceedings in Febru-
ary 1977 and those proceedings presently are pending. Also
pending is the dispute between Naccarato and the Union
3 Charlotte Naccarato signed the new contract between the Corporation
and Coldwell Banker, and she also signed the agreement terminating the old
contract between the Company and Coldwell Banker.
4 The fact that the Company already had an agreement with the Union is
immaterial. In view of the alter ego status of the three companies, discussed
infra. simultaneous existence of two union agreements does not alter the
relative to amounts allegedly still due and owing to the
union trust fund.
I. The question of alter ego status
a. The Company6
Naccarato is the sole owner and manager of the
Company. He organized the Company in 1974, in his own
name and with his own funds. He obtains the jobs on
which the Company works, and he hires all its employees,
including Bird, who worked for the Company from
February 1975 until June 1976, and Kinnan, who worked
for the Company from late 1974 until early 1975. Naccara-
to uses foremen on particular jobs, but at all times until the
present, he alone has administered and managed the affairs
of the Company. All labor relations of the Company are in
Naccarato's hands. Naccarato signed the Company's
agreement with the Union on February 1, 1974,7 and he
has supervised all payments by the Company to the
Union's trust fund. He alone has dealt with the Union, and
with Nagel, on a regular and continuing basis, at each job.
b. Framing
Naccarato is the sole owner and manager of Framing.
He organized the business about June 1976. Naccarato
testified:
JUDGE STEVENS: You were referring to Framing?
THE WITNESS: Yes. I formed that strictly at least, to
pick up an area in the market which I couldn't compete
in, and that was the non-union market. And I formed it
specifically to be non-union. There was no secret as to
what it was for. We never hid the fact. And I guess now
that there was other things I should have done or could
have done, but I did it openly and I did it with what
knowledge I had at the time and what I could know. I
got a new license, another license. I tried to keep-I did
keep separate books, separate checking, separate tele-
phone and things like that. I tried to run a union and a
non-union shop, plain and simple, at least I thought it
was.
Q. You do keep your books and records for
Tacoma Framing separate from Naccarato Construc-
tion Company?
A. Yes.
Q. Are they separate also from Naccarato Con-
struction Company, Inc.?
A. Yes.
Framing has but few tools and equipment; most of them
are rented from Naccarato. Naccarato stated:
Any equipment Tacoma Framing uses, it pays the
rent for the equipment to me. I mean, I don't, you
know, if it's the same tools that are on another job or
legal positions of the parties, or preclude a remedy against all three
companies.
This matter is discussed infra, as an alleged violation of the Act.
6 The summaries made in a, b, and c hereof are based on Naccarato's
testimony, and on undisputed testimony and evidence in the record.
7 G.C. Exh. 2.
1397
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
not. I don't really distinguish between them. They pay
the burden of the rent, that's all.
Naccarato has obtained all of Framing's jobs, and he hires
all its employees, again including Bird, who worked for
Framing as a foreman from June 1976 until December of
that year, and Kinnan, who has worked for Framing from
an undetermined date in 1976 until the present. All his job
foremen report directly, and only, to Naccarato. All
administration and management of the business are han-
dled solely by Naccarato. It was Naccarato's decision, and
his alone, to establish Framing as a nonunion contractor
and to keep it that way to the present. Framing has a
separate telephone, but its daily operations and administra-
tion are not segregated from those of the Company and the
Corporation, and all three businesses have the same
business address, and the same secretary.
c. The Corporation
The incorporator on August 12, 1976, was Naccarato's
wife, but that occurred only because Naccarato was out of
the country at the time of incorporation. He was on the
initial board of directors, and he assumed full and exclusive
control of the Corporation upon return from Saudi Arabia
approximately September 25. Recommendation to incor-
porate was made to Naccarato during an overseas tele-
phone conversation in August, but the decision to incorpo-
rate was Naccarato's, and his alone. At the hearing
Naccarato testified that he owns no stock, and that all
stock is held by his wife.8 However, Naccarato at all times
since incorporation has been in complete and exclusive
control of all corporate affairs. Naccarato has obtained all
of the Corporation's jobs, and he hires all employees, again
including Bird and Kinnan, both of whom worked on the
Coldwell Banker and the Lovell jobs. Naccarato, and he
alone, has conducted all labor relations for the Corporation
since its inception,9 including all conversations with union
representatives. 10
Discussion
Based on interrelation of operations, single ownership,
management, control," and centralized conduct of labor
relations, it is clear beyond question that the three
businesses are one and the same.
Naccarato freely acknowledges that Framing was orga-
nized and managed as a nonunion firm, solely to avoid
union contracts that had become oppressive to the Compa-
a This fact is given no weight, in view of the circumstances described
herein.
9 The agreement between the Corporation and the Union was signed by
Kinnan. This matter is discussed below.
'0 The testimony shows conversations on policy matters among Naccara-
to acting for the Corporation, and representatives of Coldwell Banker,
Lovell, and the Union.
I" Naccarato made no attempt to show his wife's alleged stock ownership
in the Corporation was personal to her or anything more than a convenient
statement made while Naccarato was in Saudi Arabia. It is assumed, and
inferred, that Naccarato's interest was held at least jointly with his wife.
12 Respondent relies upon Commercial Gas Boiler & Heating Co., et aL,
212 NLRB 109 (1974), in arguing that Framing is not bound by the
Company's contract, even though the three companies may be a single
employer. However, Commercial Gas is not applicable herein since there the
union and the employer historically had agreed that some employees who
ny.12 He also acknowledges that all three businesses use the
same office and business address, and the same tools and
equipment.1 3 All three entities are engaged in the same
type of business.
Naccarato's full control of all matters relating to the
Union, so far as all three businesses are concerned, is
illustrated by the Lovell job. Naccarato knew that was a
union job, and he started it by using the Corporation,
which was a union firm. Lovell addressed a letter of
termination of the contract, to Naccarato; the Union
would not allow the Corporation to do the job. Also, the
Union would not allow the Company to do the job,
because of the delinquent trust fund dispute. Naccarato
then decided to put Framing on the job, and he contemp-
lated signing a union agreement in order to do so.
Naccarato testified:
. . . to be truthful with you, when I put Tacoma
Framing on that job, I had intended on signing a
Compliance Agreement, because I knew that there were
so many problems that it was no sense in not - you
know, I knew that I was coming on to a union job. I
had never put Tacoma anywhere near a union job
before that and never had any intent of putting Tacoma
Framing on a union job. And I knew and I promised, in
fact, Lovell that I would comply with his agreement.
And if that meant signing the Compliance Agreement,
that is what I would do. And I knew that if I did, from
that point on I would be cannibalizing my non-union
operation, but I was willing to do that at that point.
The fact that Naccarato was in sole and exclusive control
of all labor relations of the three businesses, and manipu-
lated the businesses as required to get along with the
Union, further is demonstrated by Naccarato's talks with
union representatives at various times on the Coldwell
Banker, 7-tract units, Tim Easter and many individual
jobs, as set forth in the record.
The law relating to alter ego status has been enunciated
in several cases. It is clear that several factors must be
present before an alter ego can be found, and that the basic
indicia must be somewhat the same as indicia for finding a
"single employer," i.e., interrelation of operations, central-
ized control of labor relations, common management, and
common ownership or financial control.14 However, more
must be shown to establish that one organization is the
alter ego of another, since the alter ego theory may be relied
worked for a partnership partially owned by the employer were not included
in an agreement between the union and the corporate employer. In the
instant case, the Union did not know until about the time of the filing of
charges that Respondents were attempting to "double-breast" their opera-
tions.
Central Nesw Mexico Chapter, etc., 152 NLRB 1604 (1965), relied upon by
Respondent, involves a unit question, wherein two firms were a single
employer, but the two locations separately were supervised. That is not this
case. Similarly, B & B Industries, Inc., et al., 162 NLRB 832 (1967), relied
upon by Respondent, involves a single employer with operations that were
separately maintained, operated, and supervised. Such is not the case herein.
13 Naccarato testified that he owned the tools and equipment, and rented
them to the Company and Framing. He also testified that his tools and
equipment were used by the Corporation on the Coldwell Bankerjob.
14 Sakrele of Northern California, Inc.. 140 NLRB 765 (1963), enfd.
Sakrete of Northern California, Inc. v. N.LR. B., 332 F.2d 902 (1964).
1398
NACCARATO CONSTRUCTION COMPANY
upon to bind one company, not signatory to an agreement,
to the agreement of another company.' 5
Here, the basic indicia described in Sakrete are shown
beyond any question. Further, the requirements for finding
an alter ego, exemplified by Schultz, equally are clear.
Actual control of labor relations of all three firms by
Naccarato, as distinguished from potential control,16 is
shown by the record. Framing was organized solely for
union reasons, to avoid the costs then being incurred by the
Company in its jobs that required union labor. The
Corporation was organized solely for union reasons. The
Corporation initially was used on the Lovell job instead of
the Company, and Framing later was used as a substitute
for the Corporation, solely for union reasons. In every
instance, Naccarato alone made the decision required by
union considerations. All three businesses were run from
the same office, used the same tools, and used the same
foremen; i.e., Bird and Kinnan. Additionally, employees
were transferred among the three businesses, as necessary
in order to work on projects, and funds have been
transferred among the businesses. Finally, Naccarato
acknowledges that (a) Framing remitted to the Union some
trust fund payments in amounts computed according to the
Company's union agreement, and (b) he contemplated
signing a union agreement for Framing on the Lovell job,
but did not do so because the Union would not agree to
sign for a single job. Under such circumstances, it is clear,
and found, that the three businesses are alter egos of each
other, and that Framing is bound by the agreements signed
by Naccarato for the Company and the Corporation.
Naccarato's three businesses are inextricably intertwin-
ed, and he is the sole manager, operator, and administrator
of all three, as shown above. It is found that, under the law
of Sakrete, supra, all three businesses constitute a single
employer.
Defenses
(a) Naccarato contends that the Union knew he ran
Framing as a nonunion operation; that the Union con-
doned his actions and therefore now cannot complain. In
support of this contention, Naccarato testified that he
talked on the telephone with a union representative, whose
name he does not know, about Framing being a nonunion
contractor, just after Framing started its first job and the
union representative said, "There is no problem." Naccara-
to said the same representative told him that, if Naccarato
ran the Coldwell Banker job as a union job, the Union
would help him. Naccarato testified that he talked person-
ally with the same union representative the following day,
and was told the Union "would completely overlook
Tacoma Framing as long as we agreed that Naccarato
Construction and Coldwell Banker was run legitimately by
the Union." Naccarato testified that at no time did the
Union complain to him orally or in writing about Framing.
Bird testified that he talked with a union business agent on
one occasion at the Easter job, which was Framing's first
job. Bird said his truck had a Naccarato Construction sign
on it and the agent asked who was doing the job. Bird
15 Schultz Painting & Decorating Co., 202 NLRB 1 I (1973).
16 Peter Kiewit Sonr' Co and South Prairie Construction Co., 206 NLRB
replied that it was Tacoma Framing, and the agent went
into the office. Bird said, "That was the last I ever heard of
him."
Marsh testified that he first learned Naccarato was doing
business as Tacoma Framing about the time the Corpora-
tion and Coldwell Banker "were having a turmoil."
Naccarato told Marsh that Framing was going to go onto
the Lovell job, and Marsh did not know what to do about
the situation.
Nagel testified that he first learned of Naccarato doing
business as Tacoma Framing from an apprentice, on a date
Nagel does not remember.
Discussion
The Union objected to Framing's work on the Lovell
job; it took action when Framing went onto the job, and
the present controversy in large part was precipitated by
Framing working on that job.
The only testimony or evidence to show the Union's
earlier knowledge of Framing are the two instances given
by Naccarato. That testimony initially is suspect because it
is contrary to the Union's practice as acknowledged by
Naccarato, who testified that the Union regularly, and
often, policed all jobs he did under the name of the
Company and the Corporation. Naccarato said Framing
worked on many jobs, and did a total gross business of
approximately $200,000 since its organization in June 1976.
It is unrealistic to conclude that the Union, which is so
insistent upon adherence to its contracts, knowingly would
ignore a nonunion contractor of Framing's magnitude,
particularly in view of the continuing dispute concerning
trust fund payments.
In addition to the illogical nature of Naccarato's testimo-
ny, it is suspect because the union representative with
whom he allegedly talked was not named; and the
testimony appeared self-serving, both in its substance and
in the manner in which it was given. Naccarato was an
unconvincing witness. His testimony often was evasive,
self-contradictory, and illogical. It was not given in a
persuasive manner and he appeared hesitant to testify
directly on many subjects. His testimony on this subject is
not credited, and this defense is found to be without merit.
Bird's testimony is ambiguous and of no assistance in
resolving this issue. He did not tell the agent anything
about Framing or its ownership; the conversation was very
brief; Bird never saw the agent thereafter. Without support,
this testimony is of no probative value. The most it could
do would be to create a suspicion that the agent may have
talked on the telephone or in the office with someone else;
there is no indication of what, if anything, was said.
Based on the record thus made, there is ample support
for the conclusion that the Union did not know, prior to
the Lovell job, that Naccarato was doing business as a
nonunion contractor, or that Naccarato was doing business
under the name of Tacoma Framing Company. This
defense is not supported by the evidence.
(b) Naccarato contends that the Corporation is not
bound by the terms of the agreement it signed with the
562 (1973); Gerace Construction, Inc., and Helger Construction Company,
Inc., 193 NLRB 645 (1971).
1399
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Union, because Kinnan was not authorized to sign that
document. In support of this contention, Naccarato testi-
fied that he never authorized Kinnan to sign the agree-
ment, and that Charlotte Naccarato did not know anything
about the business. Kinnan testified that he was instructed
by Naccarato, during a telephone call to Saudi Arabia, not
to enter into any agreement between the Corporation and
the Union, but that he ignored the instruction in order to
prevent a breach of the construction contract with Cold-
well Banker. Kinnan testified that there had been no
meeting of the board of directors prior to his signing the
union agreement, and he was not authorized to sign the
document.
Nagel testified that Kinnan came to his office and asked
to sign an agreement with the Union. The two had a brief
conversation, after which Kinnan signed. Nagel said he
checked Kinnan's signature, and made certain that Kinnan
had shown his position with the Corporation, on the
document. He said such a check was customary practice.
Discussion
Aside from any question of authority, it is clear from the
record, including Kinnan's testimony, that the union
agreement was entered into by both parties, freely and
voluntarily, with full knowledge of the consequences,' 7 and
for the benefit of the Corporation. Those benefits were real
and substantial, and were carefully anticipated by Kinnan:
(a) the Coldwell Banker job was a large and lucrative one;
it was a union job, and the only way Naccarato could keep
it was to sign a union agreement; (b) the union agreement
gave Naccarato a source of carpenters for the job, which he
needed and did not have.
After the contract was signed, the Corporation moved
onto the job, collected money therefor, accepted the
benefits of the contract, and used carpenters that were
referred by the Union for the job. Further, the Corporation
initially paid into the union trust fund, pursuant to
provisions of the union agreement. But for the union
agreement, the Corporation would have lost the job.
Naccarato did not deny Kinnan's authority to sign the
union agreement, when first he learned of it. That position
was not taken by Naccarato until later, after partial
performance under the agreement, when he denied Kin-
nan's authority for another purpose.
So far as authority is concerned, Kinnan was a member
of the board of directors of the Corporation when he
signed.18 At the time of signing, the union representative
asked about Kinnan's position, and was told by Kinnan
that he was an officer. No question was raised at time of
signing, relative to Kinnan's authority, and Kinnan said
nothing about the subject.
Under the circumstances, it is clear beyond question that
Kinnan had apparent authority to sign the union agree-
ment, whether or not he had actual authority, and further,
the Corporation is estopped now from challenging the
I' Naccarato already had executed one union contract, which he and
Kinnan worked under for the Company.
s8 As a practical matter, the union agreement had to be signed in order to
save the Coldwell Banker job; according to Naccarato, his wife Charlotte,
who was president of the Corporation, knew nothing about the business;
according to Naccarato and Kinnan, the latter ran the business when
union agreement on the ground of lack of authority to sign,
both parties having partially performed under it and
having received benefits therefrom.
This defense is without merit.19
(c) A Collyer defense affirmatively was pleaded by
Respondent. This controversy does not involve interpreta-
tion of a contract; it involves the existence of a contract, in
addition to several other matters. Points at issue, and the
potential remedies involved, are outside the arbitral area.
Further, there is no indication that the parties sought
arbitration of the issues, or were interested in that forum.
This defense has no merit.
(d) Respondent's answer stated that these proceedings
must be held in abeyance, pending the bankruptcy court
lifting its stay. That matter was disposed of by the
bankruptcy court, which refused to stay the proceedings
herein.
2. Alleged direct dealing with employees
Paragraph 9 of the complaint alleges that, in or about
September 1976, Naccarato required employees to sign lien
waivers before they received their checks, without first
notifying the Union.
Marsh testified that he went to the Coldwell Banker
jobsite about the first week of October, in response to a
telephone call from one of the Corporation's employees.
About 30 to 50 employees were gathered together, com-
plaining that they had not been paid. Shortly thereafter,
Naccarato arrived and "commenced to make the payroll."
Marsh stated: 20
When he did make the payroll, he passed out - he
gave a stack of release forms to one of his people and
told him to pass them out and he told everyone that
they had to sign this release form in order to obtain
their payroll check. There was a lot of commotion, a lot
of mumbling going on. I took a look at one of them and
said three or four times as loud as I could say it over the
commotion that those people, I didn't feel, had to sign a
release in order to obtain their paycheck.
It is stated in the release that all taxes and benefits
had been paid and they would not be held liable. I said
you don't have to sign anything of that nature in order
to receive their paychecks. Most of those people came
to me and said they didn't know what they were
supposed to do. They need their paycheck. This is
important.
To the best of my knowledge everyone signed the
release forms except one man and he told Frank - I
was standing there - and Frank was in the truck and
while I was standing there Frank says, "Where is your
release form?" and he says, "I gave it to you" and he
did not sign one. He is the only one that I'm aware of
that did not sign one at that time.
Naccarato was out of the country. That left only Kinnan to sign the union
agreement.
19 A.B.C. Drywall Company, Inc., 221 NLRB 238 (1975).
20 A copy of the release was not offered into evidence, but Marsh
credibly and without challenge described the release. That description
shows the release to have been a lien waiver.
1400
NACCARATO CONSTRUCTION COMPANY
Naccarato testified that he had to make the last payroll
on the job from his own funds, because he was unable to
collect money due to him from Coldwell Banker. Payment
to employees was delayed, and 30 to 50 employees
gathered together at the jobsite. Marsh was there and
objected to the employees having to sign lien waivers.
Naccarato said getting the waivers was something he had
to do in order for him to get paid by Coldwell Banker.
Naccarato testified that he told Marsh:
The men didn't have to sign it if they didn't want to,
but if they would sign it it would help me to get paid.
That is standard throughout the construction industry
with lien waivers, as far as I know.
In explaining why the waivers were requested, Naccarato
testified that he talked with two Coldwell Banker represen-
tatives:
They told me that either I get - they give me the
option of either being terminated or taking and making
the payroll - one of the big questions was as to
whether I would make the payroll or not since they
weren't paying me as the contract outlined. They said:
either you will be terminated or you will take these
release forms and have them signed and pay your men
before we will pay you. Upon that I had about twenty
minutes to make my mind up of whether I was going to
lay on the table $30,000 of my own money or become in
breach of contract. I gambled that I didn't feel like I
wanted to be in breach of contract. I hadn't been back
that long and I didn't feel like I wanted that, so I
gambled with my own money and took the paychecks
- and they were over $30,000 - and with the forms
and I simply told the men that in order for me to get
paid they would have to sign this form because
Caldwell [sic] Banker required that form.
The ones who refused to sign it still got their checks and
the ones who did sign also got their checks. Everybody
got their checks.
Discussion
To the extent that Naccarato's testimony differs from
that of Marsh, Marsh is credited. Naccarato was not a
convincing witness, as discussed supra. Marsh was an
unusually persuasive witness, who testified in very credible
manner.
Naccarato's stated reason for asking that employees sign
the waiver may have been compelling, and there is no
question but what he had a financial problem at the time of
the incident. However, that is immaterial to the issue. The
question is whether or not the employees were required to
sign waivers, prior to being paid. Marsh testified that there
was such a requirement. Naccarato testified that the
employees were requested to sign waivers, but were not
required to do so, and that those who refused to sign were
paid anyway. Marsh is credited.
A violation of Section 8(a)(5) of the Act is clear beyond
any reasonable doubt. Naccarato wanted to collect money
due him from Coldwell Banker, but the latter was unwilling
to pay unless it had some assurance that the payment
would go where it was intended to go; i.e., to payment of
wages. That assurance could be given only through lien
waivers. Hence, Naccarato told the employees they would
be paid, but only after they signed the waivers. The
employees complained to the Union, and Marsh talked
with Naccarato. Naccarato insisted, according to his own
testimony, that the waivers be signed. He said he told
Marsh "that was something that I had to do in order for
myself to get paid." Marsh told the employees they did not
have to sign, but in the noise and confusion, and with a
desire to be paid, the employees signed the waivers as
required by Naccarato. Thus, Naccarato in effect admitted
that he refused to bargain with the Union relative to this
matter.
Employees are entitled to be paid without being required
to sign waivers. That requirement being a wage condition
not set forth in the contract, it was incumbent upon
Naccarato to discuss the requirement before it was stated
to the employees. That was not done. The Union was at the
gathering only because of an employee's telephone call.
When Marsh attempted to discuss the matter, Naccarato's
reply simply was to proceed as he originally planned. This
allegation is supported by the record.
3. Alleged repudiation of the union contract
Paragraph 10 of the complaint alleges that, within the
past 6 months, Respondents have repudiated and aban-
doned their union agreement so far as employees of
Framing and the Corporation are concerned by failing and
refusing to honor the terms of the agreement and by
specific oral repudiation given to union representatives.
The fact that Framing consistently has repudiated the
union agreement at times relevant herein is amply demon-
strated throughout the record. The fact that Framing paid
some fringe benefits under the agreement, when it took
over the Lovell job for a short time, is incidental, as
discussed above.
It also is shown by the record, and is not disputed, that
the Corporation failed to pay fringe benefits for some of
the work done on the Coldwell Banker job. Further, as
discussed above, Naccarato takes the position that Kinnan
did not have authority to sign the union agreement, which
position is, in effect, a repudiation of the agreement.
Naccarato was insistent that he told Kinnan that, if a
corporation was organized, it was not under any circum-
stances to sign an agreement with the Union.
It is found, supra, that Framing and the Corporation are
alter egos of the Company, and that all three businesses are
run by Naccarato as a single employer.
It is clear from the facts summarized above, that
Naccarato and his businesses, Framing and the Corpora-
tion, have repudiated the union agreement as alleged. Such
repudiation is a violation of Section 8(aX5) of the Act.
IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES
UPON COMMERCE
Respondents' activities set forth in section III above,
occurring in connection with the operations of Respon-
dents described in section I, above, have a close, intimate,
and substantial relationship to trade, traffic, and commerce
1401
DECISIONS OF NATIONAL LABOR RELATIONS BOARD
among the several States, and tend to lead to labor disputes
burdening and obstructing commerce and the free flow of
commerce.
V. THE REMEDY
Having found that Respondents have engaged in unfair
labor practices in violation of Section 8(a)(1) and (5) of the
Act, I shall recommend that they be ordered to cease and
desist therefrom, and to take certain affirmative action
designed to effectuate the policies of the Act.
The record shows that Respondents did not pay, or
unilaterally discontinued paying, wage rates and fringe
benefits, as required by collective-bargaining agreements. I
shall, therefore, recommend that Respondents make whole
the Union and all unit employees for any and all losses
incurred because of Respondents' illegal and unilateral
changes described above, with interest as prescribed in Isis
Plumbing & Heating Co., 138 NLRB 716 (1962), provided,
however, that reimbursement hereunder shall be limited to
the period following June 13, 1976, which is 6 months prior
to the filing of the charge herein on December 13, 1976.
CONCLUSIONS OF LAW
1. Frank Naccarato, a Sole Proprietor, d/b/a Naccara-
to Construction Company and d/b/a Tacoma Framing
Company; and Naccarato Construction Company, Inc.,
are, and each of them is, an employer within the meaning
of Section 2(2) of the Act.
2. Tacoma Framing Company and Naccarato Con-
struction Company, Inc., are alter egos of Naccarato
Construction Company.
3. Seattle District of Carpenters, United Brotherhood
of Carpenters and Joiners of America, AFL-CIO, is a
labor organization within the meaning of the Act.
4. All journeymen and apprentice carpenters and join-
ers employed by the Company, Framing, and the Corpora-
tion in western and central Washington, excluding guards,
office clericals, and supervisors as defined in the Act,
constitute a unit appropriate for the purposes of collective
bargaining within the meaning of Section 9(b) of the Act.
5. At all times since February 1, 1974, the Union has
been, and now is, the exclusive representative of all
employees in the aforesaid appropriate unit for the purpose
of collective bargaining within the meaning of Section 9(a)
of the Act.
6. Framing, by not recognizing since June 1976 that it
is bound as the alter ego of the Company and the
Corporation to the collective-bargaining agreements exe-
cuted February 1, 1974, by the Company and the Union,
and August 13, 1976, by the Corporation and the Union;
and by refusing since June 1976 to bargain with the Union
as the representative for purposes of collective bargaining
on behalf of the employees in the appropriate unit
described above, has engaged in, and is engaging in, unfair
labor practices within the meaning of Section 8(aX5) and
(1) of the Act.
21 In the event no exceptions are filed as provided by Sec. 102.46 of the
Rules and Regulations of the National Labor Relations Board, the findings,
conclusions, and recommended Order herein shall, as provided in Sec.
7. The Corporation, by repudiating since August 13,
1976, its obligations under an agreement entered into on
said date with the Union, and thereafter refusing to comply
with the terms and conditions of said agreement, has
engaged in, and is engaging in, unfair labor practices
within the meaning of Section 8(a)(5) and (1) of the Act.
8. By dealing directly with its employees and requiring
them to sign lien waivers as a condition to being paid,
without prior notification to or bargaining with, the Union,
Respondents violated Section 8(a)(5) and (1) of the Act.
9. The aforesaid unfair labor practices are unfair labor
practices affecting commerce within the meaning of Sec-
tion 2(6) and (7) of the Act.
Upon the foregoing findings of fact and conclusions of
law, and the entire record, and pursuant to Section 10(c) of
the Act, I hereby issue the following recommended:
ORDER 2 1
The Respondents, Frank Naccarato, a Sole Proprietor,
d/b/a Naccarato Construction Company, and Tacoma
Framing Company; and Naccarato Construction Compa-
ny, Inc., their officers, agents, successors, and assigns,
shall:
I. Cease and desist from:
(a) Tacoma Framing Company not recognizing that it is
bound as the alter ego of the Company and the Corpora-
tion, to the collective-bargaining agreements executed on
February 1, 1974, by the Company and the Union, and on
August 13, 1976, by the Corporation and the Union; and
by refusing to recognize and bargain with the Union as the
representative for purposes of collective bargaining on
behalf of the employees in the following appropriate unit:
All journeymen and apprentice carpenters and joiners
employed by the Company, Framing, and the Corpora-
tion in western and central Washington, excluding
office clerical employees, guards, and supervisors as
defined in the Act.
(b) The Corporation repudiating its obligations under an
agreement entered into with the Union on August 13, 1976,
and refusing thereafter to comply with the terms and
conditions of said agreement.
(c) The Corporation dealing directly with its employees
and requiring them to sign lien waivers as a condition to
being paid, without prior notification to, or bargaining
with, the Union.
2. Take the following affirmative action which is
necessary to effectuate the purposes of the Act:
(a) Bargain collectively with the Union by acknowledg-
ing that Framing is bound by the collective-bargaining
agreements executed February 1, 1974, by the Company
and the Union, and August 13, 1976, by the Corporation
and the Union; recognize and comply with all terms and
conditions of the aforesaid two agreements between the
Union and the Company and the Corporation; and
recognize the Union as the representative for purposes of
102.48 of the Rules and Regulations, be adopted by the Board and become
its findings, conclusions, and Order, and all objections thereto shall be
deemed waived for all purposes.
1402
NACCARATO CONSTRUCTION COMPANY
collective bargaining on behalf of the employees in the
appropriate unit described above.
(b) Jointly and severally make whole all employees in the
appropriate unit defined above, for any and all loss of
wages and benefits they incurred because of Respondents'
illegal refusal to recognize and abide by contractual terms
and conditions, and repudiation of agreement with the
Union.
(c) Reimburse the Union for the loss of all health and
welfare, pension plan, and other payments incurred by the
Union as a result of Respondents' illegal actions described
above.
(d) Post at its principal place of business in Seattle,
Washington, copies of the attached notice marked "Appen-
22 In the event that the Board's 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
dix." 22 Copies of said notice on forms provided by the
Regional Director for Region 19, after being duly signed by
an authorized representative of Respondents, shall be
posted by Respondents immediately upon receipt thereof,
and be maintained for 60 consecutive days thereafter, in
conspicuous places, including all places where notices to
employees are customarily posted. Reasonable steps shall
be taken by Respondents to insure that the notices are not
altered, defaced, or covered by any other material.
(e) Notify the Regional Director for Region 19, in
writing, within 20 days from the date of this Order, what
steps Respondents have taken to comply herewith.
to a Judgment of the United States Court of Appeals Enforcing an Order of
the National Labor Relations Board."
1403