Norfolk Maintenance Corp.

National Labor Relations Board - Board Decisions

Feb 25, 1993

310 N.L.R.B. 527 (N.L.R.B. 1993)

527
310 NLRB No. 79
NORFOLK MAINTENANCE CORP.
1 The only issues raised in the request for review were whether the
Regional Director erred by not finding that cessation of the Employ-
er’s operation was imminent and by directing an immediate election
and whether the Regional Director erred in permitting the hearing
officer to introduce allegedly hearsay testimony at the hearing.
1 The name of the Employer is in accord with the decision reached
herein.
Norfolk Maintenance Corporation, Successor to FD
Services, Inc. and International Association of
Machinists and Aerospace Workers, (IAM), Pe-
titioner. Case 15–RC–7731
February 25, 1993
ORDER DENYING REVIEW
BY CHAIRMAN STEPHENS AND MEMBERS OVIATT
AND RAUDABAUGH
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel, which has considered the Employer’s request for
review of the Regional Director’s Decision and Direc-
tion of Election (pertinent portions are attached). The
request for review is denied as it raises no substantial
issues warranting review.1
APPENDIX
DECISION AND DIRECTION OF ELECTION
Upon a petition duly filed under Section 9(c) of the Na-
tional Labor Relations Act, a hearing was held before a hear-
ing officer of the National Labor Relations Board.
Pursuant to the provisions of Section 3(b) of the Act, the
Board has delegated its authority in this preceding to me.
Upon the entire record in this proceeding, I find:
1. The hearing officer’s rulings made at the hearing are
free from prejudicial error and are hereby affirmed. At the
hearing in this matter the Petitioner maintained that the em-
ployer of the petitioned for employees was FD Services,
Inc.1 (FD). Both FD and Norfolk Maintenance Corporation
(Norfolk), who were represented at the hearing by the same
attorney, maintained that the sought after employees are now
employed by Norfolk. The hearing officer referred counsel
for FD and Norfolk’s motion to amend the petition herein to
name Norfolk as the employer in this matter to me for rul-
ing.
Both FD and Norfolk are wholly owned subsidiaries of
Fluor Corporation (Fluor), and California corporations en-
gaged in the business of providing alongside aircraft refuel-
ing service (AAR) at Pensacola, Florida, and at Norfolk, Vir-
ginia, pursuant to contracts with the United States Govern-
ment Defense Fuel Supply Center (DFSC). In addition, FD
also performs AAR services at Jacksonville, Florida, pursu-
ant to a DFSC contract. The only facility involved herein is
the Naval Air Station at Pensacola, Florida (NAS Pensacola).
In 1991, FD became the AAR contractor at NAS Pensa-
cola by virtue of an assignment by Williams Brother Engi-
neering Company, another wholly owned subsidiary of Fluor.
The assigned contract between FD and DFSC for the NAS
Pensacola operations (the FD/NAS contract), by its terms
would have expired on April 30, 1993, absent any exten-
sions.
FD’s AAR contracts at Norfolk, Jacksonville, and Pensa-
cola are all being transferred to Norfolk as part of an effort
for FD to exit the AAR business. As of the date of the hear-
ing, the project managers at these three locations continue to
report directly to George Roy Smith, manager of projects for
FD, who works out of FD’s corporate headquarters in Green-
ville, South Carolina. Recently, Norfolk delegated to Smith
the responsibility of managing their projects.
On January 12, 1993, FD retroactively assigned its
FD/NAS contract to Norfolk effective January 1, 1993.
Smith testified that the employee at the Pensacola site ceased
working as employees of FD as of December 31, 1992, and
become employees of Norfolk effective January 1, 1993.
Pensacola site employees have been apprised of FD’s antici-
pated assignment to Norfolk. However, at the time of the hir-
ing, they had not yet been apprised that they are now em-
ployed by Norfolk. Shoemaker testified that there has been
no change in the AAR operation at NAS Pensacola, and the
billing to DFSC is still by FD. Norfolk asserts that the em-
ployees at the Pensacola site will shortly be paid by Norfolk,
which ‘‘is [still] in the process’’ of getting new checks and
letterhead printed and stocked in its name. When this is ac-
complished, the employees at the Pensacola site will be paid
from a separate bank account, with income tax withholdings
being reported in the name of Norfolk.
After FD’s assignment to Norfolk, FD’s Pensacola site
project manager, Eddie Shoemaker, was retained by Norfolk
in that capacity and he reports directly to Smith. Since the
assignment, all the employees at the Pensacola site were re-
tained by Norfolk and no additional employees were hired.
The Petitioner’s basis for maintaining that FD is the only
employer at issue herein is that the DFSC has not yet for-
mally approved the assignment of the FD/NAS contract from
FD to Norfolk. The petition did concede that, if the DFSC
approves the assignment, Norfolk will became the employer
of the petitioned for employees.
Federal Acquisition Regulations require an extensive nova-
tion process for the assignment of a Government contract. To
obtain a notation agreement, FD must make application to
the contracting officer in Alexandria, Virginia. If the notation
is approved, the contracting officer sends the contracting of-
ficer’s representative at NAS Pensacola, William C. Mul-
ligan, notice of the novation. Mulligan is responsible for
monitoring the AAR contract on a daily basis to ensure that
the contractor is performing in the required manner. Prior to
the hearing, Mulligan had no knowledge of FD’s assignment
to Norfolk. According to Smith, the DFSC was notified of
FD’s intention to assign all its NAS/FD contracts to Norfolk
when it sought a novation with regard to its Norfolk, Vir-
ginia site. The record reveals that FD has not yet initiated
a formal application for approval of FD’s assignment to Nor-
folk of the FD/NAS contract.
It appears that, as of the date of the hearing, FD was the
employer of the petitioned-for unit herein. This finding is
based on the record as a whole and particularly the facts that
the employees were still being paid by FD at the time of the
hearing and that unit employees were not yet apprised that
they were employed by Norfolk Company. Nevertheless, it is
also clear that based on FD’s assignment of the FD/NAS
528 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
contract to Norfolk, a successorship situation is imminent
and will be completed by the date of the election in this
case. Inasmuch as there appears to be no change in the em-
ploying industry and, noting particularly that Norfolk has
hired FD’s entire work force and FD’s project manager and
that Norfolk is performing the same operation, I find Norfolk
to be FD’s successor. Texas Eastman Co., 175 NLRB 626
(1969).
Therefore, I shall treat counsel for FD and Norfolk’s mo-
tion to amend the petition as a motion to correct the name
of the employer herein, which the record reflects to be, and
I so find to be: Norfolk Maintenance Corporation, successor
to FD Services, Inc. If FD’s plans change and it continues
as the employer, I will entertain an appropriate motion to
designate the correct name of the employer. Cf. Larson Ply-
wood, 223 NLRB 1161 fn. 2 (1976).
2. At the hearing, the parties stipulated that, during the last
12 months Norfolk, directly received raw materials valued in
excess of $55,000 from points outside the State of Florida
for use in its Florida operations. In view of the above, Nor-
folk clearly exceeds the Board’s direct inflow standard.
Siemons Mailing Service, 122 NLRB 81 (1958). Although
the parties did not stipulate to the commerce facts with re-
gard to FD, the record reflects that, since early 1991, FD has
assumed an existing 4-year contract with the DFSC, valued
in excess of $2.5 million, to provide AAR services, to the
DFSC at NPS Pensacola. As set forth in a recently issued
modification to that contract, each month of such service is
valued in excess of $60,000. Accordingly, I find that during
the past calendar year FD provided the above-described serv-
ices valued in excess of $50,000 to the DFSC. Further, given
FD’s services during the past calendar year to the United
States Government, an organization exempted from the
Board’s jurisdiction but with operations of a magnitude nec-
essary for assertion of jurisdiction over comparable non-
exempt organizations, FD clearly exceeds the Board’s indi-
rect outflow standard. Siemons, 122 NLRB at 85 fn. 12. In
addition, given the FD/NAS contract and Norfolk’s recently
initiated performance of that contract as a de facto subcon-
tractor, both FD and Norfolk provide services that have a
substantial impact on the national defense of the United
States of America and accordingly the assertion of jurisdic-
tion is appropriate. Ready Mixed Concrete & Materials, 122
NLRB 318 (1958). Thus, both FD and Norfolk are employ-
ers engaged in commerce within the meaning of the Act and
it will effectuate the purposes of the Act to assert jurisdiction
herein.
3. The labor organization involved claims to represent cer-
tain employees of Norfolk.
4. Norfolk moved to dismiss the petition at the hearing
contending that an election in the sought after unit would be
futile due to the April 30, 1993 expiration of the FD/NAS
contract. Norfolk contends neither FD nor Norfolk plan to
continue AAR work at any of the three Naval Air Station
sites. On November 9, 1992 at 3 p.m., the bid period closed
for the NAS Pensacola site. Neither FD nor Norfolk (nor any
subsidiary or parent thereof) bid on the new contract for
AAR delivery work at NAS Pensacola.
However, the FD/NAS contract contains an extension pro-
vision which the DFSC can exercise on a month-to-month
basis up to a 6-month maximum. On January 12, 1993, FD
received a modification by facsimile from the DFSC exer-
cising the FD/NAS contract by 4 months. Although con-
ceding that the FD/NAS contract could be extended by as
much as 6 months, Smith asserted that DFSC doesn’t have
the authority to extend the contract other than in 1-month in-
tervals. As a result, Smith considers the extension of the
FD/NAS contract to be invalid and plans to notify DFSC of
his interpretation of the contract. Norfolk further argues that
the DFSC’s 4-month extension does not comply with the
terms of the FD/NAS contract in that said contract only al-
lows extensions of 1 month at a time. Regardless of the mer-
its of the Employer’s interpretation of the contract, it is clear
that the DFSC has unequivocally expressed its intention to
extend the FD/NAS contract for at least 4 months. The fact
that the DFSC may have to rescind the existing 4-month ex-
tension and issue the same extension in another form does
not render the DFSC’s intent to extend the contract specula-
tive. Thus, I find that the FD/NAS contract will remain in
effect until at least August 31, 1992, and that Norfolk will
remain the Employer of the unit employees until at least Au-
gust 31, 1993.
Board precedent with regard to the timing of elections dic-
tates that a case-by-case approach be followed. Clement-
Blythe Cos., 182 NLRB 502 (1970). Based on the above and
acting particularly that DFSC has expressed its intention to
extend the FD/NAS contract by 4 months, thereby leaving a
7-month period between the issuance of this decision and the
contract’s expiration, I find that an election should be di-
rected without any further delay. E. I. du Pont & Co., 117
NLRB 1048 (1957) (election directed with only 6 months
left until the Employer’s operations ceased). Accordingly, I
shall deny Norfolk’s motion to dismiss the petition herein.
In its brief, Norfolk argues that the DFSC’s extension of
the FD/NAS contract is speculative. In support of this posi-
tion the Employer relies on Clark Construction Co, 129
NLRB 1348 (1961), wherein the Board dismissed the Peti-
tioner’s petition because the Employer’s operation and work
force were close to termination. Moreover, the likelihood of
a resumption of further work was found to be conjectural in-
asmuch as no additional contract had been awarded yet. In
this case, the DFSC has already notified FD of its intention
to extend the contract for at least 4 months. Thus, the Em-
ployer’s reliance on Clark is inapposite.
In support of its position that there is insufficient time for
an election and meaningful collective bargaining, the Em-
ployer relies on the Board’s holding in the Longerier Co.,
277 NLRB 570 (1985). In that case, the Employer’s last
project was completed 8 months before the Board concluded
its Decision and Order. The Board concluded that it could
be futile to directing an election in these circumstances and
therefore dismissed the petition therein. contrary to the Em-
ployer’s assertion, there was no finding in Longerier that 10
months was insufficient time for an election and meaningful
collective bargaining.
Therefore, I find that a question affecting commerce exists
concerning the representation of certain employees of the
Employer within the meaning of Section 9(c)(1) and Section
2(6) and (7) of the Act and I shall direct an election in the
unit found appropriate herein.
5. Based on the stipulation of the parties and the record
as a whole, the following employees of Norfolk Maintenance
Corporation, successor to FD Services, Inc. constitute a unit
529NORFOLK MAINTENANCE CORP.
appropriate for the purpose of collective bargaining within
the meaning of Section 9(b) of the Act:
All full-time and regular part-time production and
maintenance employees, including dispatchers/drivers,
storage operators/drivers, mechanics, mechanic helpers,
driver operators, and plant clericals employed by Nor-
folk Maintenance Corporation, successor to FD Serv-
ices, Inc. at its Naval Air Station Pensacola location;
excluding all guards, professional employees, and the
project manager and other supervisors as defined in the
Act.
[Direction of Election omitted from publication.]