National Transit Inc., And Its Successors And Alter Egos National Transit Services, Inc. And Carolina Paratransit

National Labor Relations Board - Board Decisions

Aug 13, 1990

299 N.L.R.B. 453 (N.L.R.B. 1990)

NATIONAL TRANSIT 453
National Transit Inc., and its Successors and Alter
Egos National Transit Services, Inc. and Caroli-
na Paratransit and General Drivers, Ware-
housemen and Helpers Local Union No. 968, af-
filiated with International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and
Helpers of America, AFL-CIO. Case 16-CA-
14204
August 13, 1990
DECISION AND ORDER
BY MEMBERS CRACRAFT, DEVANEY, AND
OVIATT
Upon a charge filed by General Drivers, Ware-
housemen and Helpers Local Union No 968, affili-
ated with International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of Amer-
ica, AFL-CIO (Union), on September 13, 1989,
and amended on October 24, 1989, the General
Counsel of the National Labor Relations Board
issued a complaint on October 26, 1989, against
National Transit, Inc (NTI) and its successors and
alter egos National Transit Services, Inc (NTS)
and Carolina Paratransit (CP), the Respondents, al-
leging that they have violated Section 8(a)(5) and
(1) of the National Labor Relations Act Although
properly served copies of the charge, the amended
charge, and the complaint, the Respondents failed
to file an answer
On January 8, 1990, the General Counsel filed a
Motion to Transfer Case Before the Board and
Motion for Summary Judgment, with exhibits at-
tached On January 11, 1990, the Board issued an
order transferring the proceeding to the Board and
a Notice to Show Cause why the motion should
not be granted The Respondents filed no response
On January 26, 1990, pursuant to the request of
counsel for Holland Industries, Inc (Holland), an
extension of time until February 8, 1990, was grant-
ed to file a response to the Notice to Show Cause
On February 5, 1990, Holland filed a response and
requested permission to file an answer On Febru-
ary 27, 1990, the General Counsel filed a Memo-
randum in Support of Motion for Summary Judg-
ment
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel
Ruling on Motion for Summary Judgment
Section 102 20 of the Board's Rules and Regula-
tions provides that the allegations in the complaint
shall be deemed admitted if an answer is not filed
within 14 days from service of the complaint,
unless good cause is shown The complaint states
that unless an answer is filed within 14 days of
service, "all of the allegations in the Complaint
shall be deemed to be admitted to be true and
may be so found by the Board" Further, the undis-
puted allegations in the Motion for Summary Judg-
ment disclose that counsel for the General Counsel
advised the Respondents by certified letters dated
November 15, 1989, that unless an answer to the
complaint was filed within 10 days of receipt of the
letters, a Motion for Summary Judgment would be
filed As noted, the Respondents failed to file an
answer
In its response to the Notice to Show Cause,
Holland states that about February 1, 1990, it pur-
chased the stock of NTI and thereby has taken
"the chance of being declared the successor em-
ployer to National Transit, Inc ," responsible for
remedying any unfair labor practices that the
Board might find were committed by the Respond-
ents Thus, Holland "requests that it be permitted
to answer the Unfair Labor Practice Complaint
against its predecessor, National Transit, Inc, nunc
pro tunc and be permitted to investigate, and, if
necessary, to defend against the charges in a hear-
ing" According to Holland, the opportunity to
defend these charges will permit it "the simultane-
ous opportunity to assess its status in light of its
purchase of the stock of National Transit, Inc
[and it is] conceivable that while preparing its de-
fense of this matter may be able to adjust the
situation, thereby averting a full hearing" Further,
Holland submits its belief that the Respondents
failed to file an answer because they were "in dire
financial straits," could not afford the cost of coun-
sel, and were about to file a Chapter 7 bankruptcy
petition For these reasons, Holland requests that
the Board deny the Motion for Summary Judgment
and remand the case to the Regional Director for a
hearing The General Counsel contends that none
of Holland's assertions excuse the Respondents'
failure to file an answer and that summary judg-
ment is appropriate
We find, in agreement with the General Counsel,
that none of the contentions raised by Holland con-
stitutes good cause for the Respondents' failure to
file an answer The Board has rejected claims of fi-
nancial crisis and inability to afford counsel,' the
filing of a bankruptcy petition, 2 and the possibility
of settlement 3 as justification for failure to file an
answer
Accordingly, we find that the Respondents' fail-
ure to file a timely answer has not been supported
'Monroe Furniture Co, 231 NLRB 143 (1977)
'Jim Rodgers Superior Insulation, 296 NLRB No 66, slip op at 2 fn 2
(Sept 8, 1989) (Not reported in bound volume )
'Sorenson Industries, 290 NLRB 1132 (1988)
299 NLRB No 58
454 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
by a showing of good cause and we grant the Gen-
eral Counsel's Motion for Summary Judgment 4
On the entire record, the Board makes the fol-
lowing
FINDINGS OF FACT
I JURISDICTION
Respondent NT!, a Texas corporation, and Re-
spondent CP, a North Carolina corporation, are
wholly-owned subsidiaries of Respondent NTS, a
Texas corporation, and they operate a facility in
Houston, Texas, where they are engaged in provid-
ing contract bus services During the 12-month
period preceding issuance of the complaint, a rep-
resentative period, Respondent NTS, in the course
and conduct of its busmess operations, derived
gross revenues in excess of $250,000 and purchased
and received products, goods, and materials valued
in excess of $50,000 directly from points located
outside the State of Texas
At all times material, NT!, CP, and NTS have
been affiliated business enterprises, with common
officers, ownership, directors, management, and su-
pervision, have formulated and administered a
common labor policy affecting employees of the
three corporations, have shared common premises
and facilities, have provided services and made
sales to each other, have interchanged personnel
with each other, and have held themselves out to
the public as a single integrated business enterprise
About September 1, 1989, CP was established by
NT! and NTS as a subordinate instrument to, and a
disguised continuation of, NT! and NTS By virtue
of these facts, we find that the Respondents NT!,
NTS, and CP are and have been at all times mate-
rial alter egos and a single employer within the
meaning of the Act Further, since about Septem-
ber 1, 1989, CP and/or NTS have continued to op-
erate the businesses of NTI in basically unchanged
form with a majority of employees who were pre-
viously employees of NT! By virtue of these facts,
we find that CP and/or NTS are successors of
NT!
We further find, on the basis of the foregoing,
that NT!, NTS, and CP are an employer engaged
in commerce within the meaning of Section 2(6)
and (7) of the Act and that the Union is a labor or-
ganization within the meaning of Section 2(5) of
the Act
4 We find that the issues raised by Holland regarding its potential
status as a successor of the Respondents and its possible liability for rem-
edying the Respondents' unfair labor practices are matters appropriate for
resolution in compliance proceedings Golden State Bottling Co v NLRB,
415 US 168, 174 (1973), Edward Cooper Painting, 297 NLRB 627 fn 4
(1990)
II ALLEGED UNFAIR LABOR PRACTICES
A The Unit and the Union's Representative
Status
The following employees of the Respondent
NTI constitute a unit appropriate for the purposes
of collective bargaining within the meaning of Sec-
tion 9(b) of the Act
INCLUDED All operators/drivers, service
workers, mechanics, and parts room clerks
employed by the Employer at its Houston,
Texas, facility
EXCLUDED All other employees, including
all charter/sales representatives, clerical em-
ployees, secretaries, dispatchers, lead drivers
and supervisors as defined in the Act
About October 9, 1986, the Union was certified
as the exclusive collective-bargaining representative
of the unit described above Smce about October 9,
1986, and at all times material, the Union, by virtue
of Section 9(a) of the Act, has been the exclusive
collective-bargaining representative of the Re-
spondent NTI's employees in the unit described
above, and since that date the Union has been rec-
ognized as such representative by NTI Such rec-
ognition has been embodied in a collective-bargain-
ing agreement, which is effective by its terms for
the period April 26, 1987, to April 21, 1990 Since
about September 1, 1989, the Union, by virtue of
Section 9(a) of the Act, has been the exclusive rep-
resentative of the employees of the Respondents
CP and NTS in the unit described above
B Refusals to Bargain
About August 9, 1989, the Union, by letter, re-
quested the Respondent NTI to continue to recog-
nize it as the exclusive collective-bargaining repre-
sentative of the umt employees and to give effect
to the existing collective-bargaining agreement, to
meet concerning grievances pending on behalf of
unit employees and to provide certain information,
including copies of contracts between the Respond-
ents and the University of Houston, from which
the Union could demonstrate that NT! and CP
constituted a single employer This mformation
necessary for, and relevant to, the Union's perform-
ance of its function as the exclusive representative
of the unit Since about August 11, 1989, the Re-
spondents have failed and refused, and continue to
fail and refuse, to recognize or bargain with the
Union, to furnish the Union the requested informa-
tion, and to honor the Union's request for arbitra-
tion concerning alleged breaches of the contract
Commencing about September 1, 1989, the Re-
spondents have failed and refused, and continue to
NATIONAL TRANSIT

455
fail and refuse, to pay various contractual benefits
on behalf of unit employees, thereby eliminating or
significantly lowering the wages, health insurance,
pension benefits, vacation entitlements, and other
benefits required to be paid pursuant to the collec-
tive-bargaining agreement Since about September
1, 1989, and continuing to date, the Respondents
have also failed and refused to check off union
dues and to remit the dues to the Union, as re-
quired by the collective-bargaining agreement
By the acts and conduct described above, the
Respondents have failed and refused, and are fail-
ing and refusing, to bargain collectively and in
good faith with the representative of their employ-
ees Accordingly, we find that the Respondents
have engaged in unfair labor practices within the
meaning of Section 8(a)(5) and (1) of the Act
CONCLUSIONS OF LAW
By failing to recognize and refusing to bargain
with the Union during the term of the collective-
bargaining agreement, by failing to provide the
Union with necessary and relevant information, by
failing to meet with the Union concermng employ-
ee grievances and to honor the Union's request for
arbitration concernmg alleged breaches of the col-
lective-bargaining contract, by failing to pay con-
tractual wages and various contractual benefits on
behalf of unit employees, and by failing to check
off and remit dues properly owed to the Union
pursuant to the collective-bargammg agreement,
the Respondents have refused to bargain collective-
ly and in good faith with the representative of its
employees and have engaged in unfair labor prac-
tices affecting commerce within the meaning of
Section 8(a)(5) and (1) and Section 2(6) and (7) of
the Act
REMEDY
Having found that the Respondents have en-
gaged in certain unfair labor practices, we shall
order them to cease and desist and to take certain
affirmative action designed to effectuate the poli-
cies of the Act
We shall order the Respondents to recognize and
bargain with the Union and to adhere to the terms
and conditions of their collective-bargaining agree-
ment with the Union, and to cease and desist from
making unilateral changes in the unit employees'
terms and conditions of employment by refusing to
honor their collective-bargaining agreement with
the Union We shall further order the Respondents
to provide the Union with the requested informa-
tion necessary for, and relevant to, the Union's per-
formance of its function as the exclusive collective-
bargaining representative of unit employees, to
honor the Union's request for arbitration concern-
ing alleged breaches of the contract, and to bargain
on request concerning grievances pending on
behalf of unit employees To remedy the Respond-
ents' unlawful refusal to continue in effect the
terms and conditions of its collective-bargaining
agreement with the Union by failing to make fringe
benefit contributions mandated therein, including
vacation, health insurance, pension, and other bene-
fits, we shall order them to comply with the collec-
tive-bargaining agreement by paying all contnbu-
tons 5 Further, the Respondents shall be ordered
to make whole all affected unit employees for any
losses incurred by virtue of their failure to make
contributions to the benefit funds established by the
collective-bargaining agreement Kraft Plumbing &
Heating, 252 NLRB 891 fn 2 (1980), enfd mem
661 F 2d 940 (9th Cir 1981) This shall include re-
imbursing employees for any contributions they
themselves may have made, with interest, for the
maintenance of any fund after the Respondents
made their unilateral change 6 To remedy the Re-
spondents' unlawful refusal to pay contractual
wages, we shall order the Respondents to make
employees whole for any losses Finally, to remedy
the Respondents' refusal to honor the bargaining
agreement by failing to remit dues to the Union,
we shall order the Respondents to honor the con-
tractual checkoff provisions and valid dues-check-
off authorizations and remit to the Union dues it
should have checked off pursuant to the terms of
the agreement All payments to the employees and
to the Umon shall be with interest as prescribed in
New Horizons for the Retarded, 283 NLRB 1173
(1987)
ORDER
The National Labor Relations Board orders that
the Respondents, National Transit, Inc , National
Transit Services, Inc , and Carolina Paratransit,
Houston, Texas, their officers, agents, successors,
and assigns, shall
1 Cease and desist from
(a) Changing the terms and conditions of em-
ployment of the employees in the bargaining unit
and refusing to bargain with General Drivers, War-
ehousemen and Helpers Local Union No 968, af-
filiated with International Brotherhood of Team-
5 Because the provisions of employee benefit fund agreements are vari-
able and complex, the Board does not provide for the addition of a fixed
rate of interest on unlawfully withheld fund payments at the adjudicatory
stage of the proceeding We leave to the compliance stage the question
whether the Respondents must pay any additional amounts Into the bene-
fit funds in order to satisfy our "make-whole" remedy Any additional
amounts shall be determined in the manner set forth in Merryweather Op-
ncal Co , 240 NLRB 1213 fn 7(1979)
5 See Concord Metal, 295 NLRB 912 (1989) •
456 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
sters, Chauffeurs, Warehousemen and Helpers of
America, AFL-CIO, as the exclusive representa-
tive of their employees in the appropriate unit set
forth below by withdrawing recognition during the
term of the collective-bargaining agreement, by
failing to furnish the Union information that is rele-
vant and necessary to its role as the exclusive bar-
gaining representative of the unit employees, by
failing to meet with the Union concerning employ-
ee grievances and to honor the Union's request for
arbitration concerning alleged breaches of the col-
lective-bargaining contract, by failing to pay con-
tractual wages and various benefits on behalf of
unit employees, and by failing to check off union
dues and remit dues properly owed to the Union
(b) In any like or related manner interfering
with, restraining, or coercing employees in the ex-
ercise of the rights guaranteed them by Section 7
of the Act
2 Take the following affirmative action neces-
sary to effectuate the policies of the Act
(a) Comply with the collective-bargaining agree-
ment effective by its terms from April 27, 1987, to
April 21, 1990, and recognize and, on request, bar-
gain with the Union as the exclusive representative
of the employees in the following appropriate unit
Included All operators/drivers, service work-
ers, mechanics, and parts room clerks em-
ployed by the Employer at its Houston,
Texas, facility
Excluded All other employees, including all
charter/sales representatives, clerical em-
ployees, secretaries, dispatchers, lead drivers
and supervisors as defined in the Act
(b) On request, furnish the Union with the re-
quested information that is relevant and necessary
to its role as the exclusive bargaining representative
of the umt employees
(c) On request, meet and bargain with the Union
concerning grievances pending on behalf of unit
employees and honor the Union's request to arbi-
trate alleged breaches of the collective-bargaining
agreement
(d) Pay all wages and benefits, including vaca-
tion, health insurance, and pension benefit contribu-
tions required by the collective-bargaining agree-
ment, as provided in the remedy section of this de-
cision
(e) Check off and remit to the Union all union
dues required by the collective-bargaining agree-
ment, with interest, as set forth in the remedy sec-
tion of this decision
(f) Make unit employees whole for any losses re-
sulting from the failure to adhere to the collective-
bargaining agreement, including reimbursing them
for expenses ensuing from the failure to pay fringe
benefits pursuant to the collective-bargammg agree-
ment in the manner set forth in the remedy section
of this decision
(g) Preserve and, on request, make available to
the Board or its agents for examination and copy-
ing, 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
(h) Post at its facility in Houston, Texas, copies
of the attached notice marked "Appendix "
Copies of the notice, on forms provided by the Re-
gional Director for Region 16, after being signed
by the Respondents' authorized representative,
shall be posted by the Respondents immediately
upon receipt and maintained for 60 consecutive
days in conspicuous places including all places
where notices to employees are customarily posted
Reasonable steps shall be taken by the Respondents
to ensure that the notices are not altered, defaced,
or covered by any other material
(i) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondents have taken to comply
7 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading "Posted by Order of the Nation-
al Labor Relations Board" shall read "Posted Pursuant to a Judgment of
the United States Court of Appeals Enforcing an Order of the National
Labor Relations Board"
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice
WE WILL NOT refuse to bargain with General
Drivers, Warehousemen and Helpers Local Union
No 968, affiliated with International Brotherhood
of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, AFL-CIO, by withdrawing
recogmtion and failing to continue in full force and
effect the terms and conditions of our collective-
bargaining agreement with the Union, by refusing
to furnish the Union with information necessary for
and relevant to its function as bargaining represent-
ative, by refusing to meet with the Union concern-
ing employee grievances or to honor the Union's
request for arbitration concerning alleged breaches
of the collective-bargaining contract, by refusing to
NATIONAL TRANSIT 457
pay wages and benefits, including vacation, health
insurance, and pension benefits, as required by the
collective-bargaining agreement, or by refusing to
check off and remit union dues to the Union as re-
quired by the collective-bargaining agreement
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce you in the exer-
cise of the nghts guaranteed you by Section 7 of
the Act
WE WILL recogmze the Union and, on request,
bargain with the Union as the exclusive representa-
tive of the employees in the following appropriate
unit and WE WILL comply with all terms and con-
ditions of the collective-bargaining agreement by
paying all wages and benefits, including vacation,
health insurance, pension, and other benefits
Included All operators/drivers, service work-
ers, mechanics, and parts room clerks em-
ployed by the Employer at its Houston,
Texas, facility
Excluded All other employees, mcludmg all
charter/sales representatives, clencal em-
ployees, secretaries, dispatchers, lead dnvers
and supervisors as defined in the Act
WE WILL, on request, furnish the Union with in-
formation it has requested that is necessary and rel-
evant to its function as bargaining representative
WE WILL, on request, meet with the Union con-
cerning employee grievances and honor its request
to arbitrate concerning alleged breaches of the col-
lective-bargaining agreement
WE WILL make unit employees whole for any
losses resulting from our repudiation of the collec-
tive-bargaining agreement and WE WILL reimburse
you for any expenses ensuing from our unlawful
failure to pay fringe benefits pursuant to the collec-
tive-bargaining agreement
WE WILL check off and remit dues to the Union
as required by the collective-bargaining agreement
NATIONAL TRANSIT, INC , NATIONAL
TRANSIT SERVICES, INC AND CARO-
LINA PARATRANSIT