Overseas Motors, Inc.

National Labor Relations Board - Board Decisions

Nov 19, 1985

277 N.L.R.B. 552 (N.L.R.B. 1985)

552 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Overseas Motors, Inc. and Miroljub Mitkovski.
Cases 7-CA-18251, 7-CA-18355, and 7-CA-
18477
19 November 1985
SUPPLEMENTAL DECISION AND
ORDER
BY CHAIRMAN DOTSON AND MEMBERS
JOHANSEN AND BABSON
On 3 July 1985 Administrative Law Judge
Robert W. Leiner issued the attached supplemental
decision. The Respondent filed exceptions and a
supporting brief, and the General Counsel filed an
answering brief.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
The Board has considered the decision and the
record in light of the exceptions and briefs' and
has decided to affirm the judge' s rulings ,2 find-
ings,3 and conclusions and to adopt the recom-
mended Order.
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge and orders that the Respondent, Overseas
Motors, Inc., Livonia, Michigan, its officers,
agents, successors , and assigns , shall take the action
set forth in the Order.
' The Respondent has requested oral argument. The request is denied
as the record , exceptions , and briefs adequately present the issues and the
positions of the parties.
2 The Respondent contends that the judge's rulings and conduct of the
hearing demonstrated bias against the Respondent . We disagree Our
review of the record reveals no evidence that the judge prejudged the
case, made prejudicial rulings, or demonstrated any bias . Contrary to the
Respondent 's contention , we find that the Respondent was accorded due
process, including a fair hearing in all respects . We further find, in agree-
ment with the judge, that the Regional Compliance Officer exhibited no
bad faith , bias, or prejudice against the Respondent in formulating the
backpay specifications in this case.
s The Respondent has excepted to some of the judge 's credibility find-
ings. The Board's established policy is not to overrule an administrative
law judge ' s credibility resolutions unless the clear preponderance of all
the relevant evidence convinces us that they are incorrect . Standard Dry
Wall Products, 91 NLRB 544 (1950), enfd. 188 F 2d 362 (3d Cit. 1951).
We have carefully examined the record and find no basis for reversing
the findings
Jerome Schmidt, Esq., for the General Counsel.
J. Leavin Weiner, Esq., C. Robert Wartell, Esq., and Wil-
liam E. Sigler, Esq. (Maddin, Weiner, Hauser, Wartell &
Roth), of Southfield, Michigan, for the Respondent.
SUPPLEMENTAL DECISION
STATEMENT OF THE CASE
ROBERT W. LEINER, Administrative Law Judge. On
20 October 1981, Administrative Law Judge Lowell
Goerlich issued his decision in the above-captioned pro-
ceeding on 11 March 1982 the Board adopted the judge's
decision and recommended Order (260 NLRB 810), with
modifications not pertinent herein. On 23 November
1983, the United States Court of Appeals for the Sixth
Circuit enforced the Board's Order in its entirety (721
F.2d 570). The Board's Order, as enforced, required,
inter alga, that Respondent offer reinstatement to and
make whole the Charging Party, Miroljub Mitkovski, an
individual, for any loss of earnings he may have suffered
by reason of Respondent's unlawful conduct against him
by payment to him of backpay plus interest, equal to that
which he would have earned less interim earnings, if
any, from the date of his unlawful termination to the
date of an unconditional offer of reinstatement, to be
computed in the manner prescribed in F. W. Woolworth
Co., 90 NLRB 289 (1950). Interest on any such backpay
was to be computed as specified in Florida Steel Corp.,
231 NLRB 651 (1977), and Isis Plumbing Co., 138 NLRB
716 (1962).
A dispute having arisen over the amount of backpay
due the claimant under the Board's Order, the Regional
Director for Region 7 of the National Labor Relations
Board, on 7 November 1984, issued a backpay specifica-
tion and notice of hearing to which Respondent filed an
answer. During the hearing, I granted the General Coun-
sel's motion to amend the backpay specification which
was thereafter amended and filed on 26 February 1985.
Respondent filed a timely answer to the amended back-
pay specification on 4 March 1985. The hearing in this
matter took place on five occasions on and between 13
February and 12 March 1985. At the hearing, all parties
were represented by counsel who enjoyed full opportuni-
ty to present evidence, to examine witnesses both indi-
rect and on cross-examination, and to make argument on
the record. At the close of the taking of testimony, coun-
sel for the parties waived final argument and elected to
submit posthearing briefs. Thereafter, the parties submit-
ted timely briefs which have been fully considered.
Based on the record as a whole, including my observa-
tion of the witnesses and their demeanor as they testified,
and upon consideration of the posthearing briefs, I make
the following
FINDINGS AND CONCLUSIONS
I. BACKGROUND
The introductory allegation of the original and amend-
ed backpay specification alleges that the gross backpay
due to the Charging Party is the amount of earnings he
would have received but for the discrimination against
him. In Respondent's original and amended answer, Re-
spondent denies the allegation therein and alleges that (a)
there was no discrimination against the Charging Party
and, moreover, the Charging Party was entitled to no
backpay because he was unemployable; because of (b) a
277 NLRB No. 61
OVERSEAS MOTORS
poor driving record , lack of driver 's license, and lack of
mechanic 's license, and (c) because his suspended driver's
license rendered him uninsurable or insurable only at
rates greatly in excess of standard insurance rates. Re-
spondent further argues that (d) to have employed the
Charging Party under these circumstances would have
caused Respondent to lose its own license as an automo-
bile repair facility because it would be operating in viola-
tion of a Michigan statute . Further, arguendo , Respond-
ent argues (e) that the alleged interim earnings in the
backpay specification should be further reduced by other
interim earnings including unemployment compensation
payments . Moreover , the answer and Respondent 's brief
put in issue both the (f) formula, derived from the base
period, with regard to the calculation of gross backpay
and (g) the use of the particular "representative" em-
ployee during the backpay period on which to apply the
base period formula.
Indeed , one of the few things upon which the parties
agree is the backpay period itself. The backpay period
commenced 15 September 1980 when the Charging
Party was discriminatorily suspended and, except for pe-
riods of intermediate reinstatement on at least two occa-
sions thereafter , the exact configuration and dates being
in dispute , the backpay period then commenced again on
23 October 1980 when the Charging Party was discri-
minatorily discharged and continued until 11 July 1984
when he was offered reinstatement to his former posi-
tion. In fact, the period between the date of entry of the
court decree (23 November 1983 ) enforcing the Board
Order requiring reinstatement , and 11 July 1984, when
Respondent actually offered reinstatement, was occupied
by proceedings by the Board in civil contempt , bringing
to the court's attention Respondent 's failure and refusal
to comply with the court 's 23 November 1983 reinstate-
ment Order. I mention this fact particularly to under-
score both the hostility which , from Respondent and the
Charging Party , pervaded the testimony of the witnesses
in this proceeding carrying over from the underlying
unfair labor practice case and the skepticism with which
I regarded almost all the testimony . The effect of such
hostility, of course, bears on the credibility of the wit-
nesses.
II. THE BASE PERIOD; BACKPAY FORMULA AND
GROSS AND NET BACKPAY
A. The Contentions of the Parties
The General Counsel utilized as the "appropriate
measure of gross backpay for the Charging Party" (par.
3(a) of the amended backpay specification) a ratio cre-
ated by dividing the average weekly commissions earned
by the Charging Party, an automobile mechanic ("a spe-
cialty mechanic")' for a specified "base" period prior to
' The State of Michigan licenses and prescribes "specialties" for me-
chanics State of Michigan Motor Vehicle Service & Repair Act, PA300
(1976).
There are eight "specialties" Tune-up, front-end alignment, brakes;
transmission ; automatic transmission , engine repair , differential and rear
axle; and heating , air-conditioning . After 1981, no major repair could be
made in these specialty areas unless performed by a state-certified me-
chanic or by a trainee holding a "permit" and working under a master
553
his discharge (from week ending 2 May 1980 to week
ending 12 September 1980), by the average weekly com-
missions earned by a fellow automobile mechanic,
Arthur Miruzzi (a "master mechanic "), for the same
specified "base" period. This fraction was then applied to
and multiplied against the total quarterly earnings, in-
cluding vacation pay, of Arthur Miruzzi as a "represent-
ative employee" during the, backpay period (15 Septem-
ber 1980 to 11 July 1984). In its original configuration in
the first backpay specification, this base-period ratio of
the Charging Party's earning to Miruzzi' s earnings
equaled 131.26 percent.
This base period selected by the General Counsel, as
above noted, commenced with the payroll period ending
2 May 1980. This starting date was chosen by the Gener-
al Counsel, according to the testimony of the Regional
Director's compliance officer, because it was at this point
that Charging Party Mitkovski ceased receiving pay as
an assistant shop foreman or service manager and revert-
ed to pay as a mere automobile mechanic. The base
period ends with the payroll period ending 12 September
1980, the date on which Respondent embarked on its
unfair labor practices against the Charging Party. Apply-
ing this ratio (Schedule A) to Miruzzi's earnings in the
calendar quarters in the backpay period (the third quar-
ter in 1980 through the third quarter 1984) (Schedule B),
meanwhile deducting therefrom the alleged interim earn-
ings (Schedule C), the original backpay specification
showed net backpay of $131,351.84. At the hearing, this
figure was at the outset reduced, by diminutions from
gross backpay in certain quarters in 1981, 1982, and 1984,
to $127,639.53.
Later in the hearing, between 13 and 15 February
1985, the General Counsel alleged that he had discov-
ered, on notice from Respondent, that certain documents
supplied by Respondent, utilized in the computation sup-
porting the backpay specification, did not accurately re-
flect the base period earnings of employee Arthur Mir-
uzzi. It was upon the discovery of these alleged mathe-
matical errors that I granted the General Counsel's
motion, without Respondent's objection, to redefine and
clarify the gross and net backpay. As above noted, on 26
February 1985, the General Counsel issued an amended
backpay specification wherein the ratio (based upon the
comparative earnings of Mitkovski to Miruzzi in the
above base period (2 May-12 September 1980) was re-
duced (to 1.0698), and when multiplied against Miruzzi's
earning during the backpay period (1980-1984) resulted
in a net backpay, taking into account the same interim
earnings, of $101,740.83. When Respondent then demon-
strated that, nevertheless, there existed a mathematical
error with regard to the computation of gross backpay
for the third quarter of 1981, the General Counsel agreed
and thereafter reduced the net backpay figure, at the re-
sumed hearing, to $101,105.93.
Respondent's preliminary contentions as above noted
are; (1) that there is no backpay whatever due to the
Charging Party because of no discrimination against him.
mechanic (certified in the eight specialties) Fred J Pirochta, Michigan
director of repair facilities, testified that the State routinely and immedi-
ately'grants trainee permits.
554 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
That defense is not available to Respondent because, as I
mentioned on several occasions in the hearing to Re-
spondent, the findings and Order in the underlying case,
including enforcement in the court of appeals, demon-
strated that Respondent was responsible for backpay be-
cause of discrimination against Mitkovski. That issue in
this mere supplementary proceeding has been resolved
and is the "law of the case," NLRB v. Laredo Packing
Co., 730 F.2d 405 (5th Cir. 1984) Respondent may not
relitigate that defense in a supplementary proceeding to
determine the amount of backpay.
Respondent's further defense (2) is that the base period
ratio formulated by dividing Mitkovski's earnings by
Miruzzi's earnings is not an appropriate use of this
device because Mitkovski was a mere "specialty" me-
chanic whereas Miruzzi was a "master" mechanic, both
having different qualifications, different pay rates, and
performing different functions. Indeed, Respondent notes
that Michigan lawn prohibits Respondent from permit-
ting a mere specialty mechanic to perform work which is
not within his various specialties but that a master me-
chanic is allowed to practice his trade in all the special-
ties. Thus, Respondent urges, it is mixing apples and or-
anges to compare the earnings of Mitkovski (a specialty
mechanic) with the earnings of Miruzzi (a master me-
chanic). Instead, Respondent urges that if there is any
backpay due to Mitkovski at all, both the appropriate,
base period ratio and the backpay period application
would be based upon employees of Respondent who had
"comparable qualifications and held comparable positions
to that of the Charging Party" (par. 3(a), Respondent's
amended answer; Br. 48 et seq.). In this regard, Respond-
ent points to its having hired, on various occasions
during the 4-year backpay period, several specialty me-
chanics whose average wages should be the wages used
to create a gross backpay figure for Mitkovski. Respond-
ent's amended answer (par. 12 et seq.) and brief would
demonstrate that by utilization, during the backpay
period, of the average earnings of specialty mechanics,
the gross backpay would not exceed $61,772.28.
Moreover (3) Respondent, in its answer and brief, re-
peatedly further attacks the General Counsel's selection
(through the Region's compliance officer) of the 2 May
to 12 September 1980 base period as being one chosen in
bad faith or by caprice because it creates a ratio which is
the highest of any of nine possible ratios which could
have been selected; and that this selection, whether in
bad faith, ignorance, or merely arbitrary, should not be
accepted.3 Thus, for instance, Respondent asserts that if
the base period were actually 5 September to 12 Septem-
ber 1980, the ratio would be in Miruzzi's favor as a mere
73.54 percent when multiplied against Miruzzi's backpay
2 See fn. 1, supra.
3 Whatever the alleged unsuitability in the General Counsel's selecting
a base period and a formula, my observation of the demeanor and testi-
mony of the compliance officer disclosed no suggestion of bad faith, ca-
price, or negligence There is no evidence to support Respondent's re-
peated allegation that the compliance officer demonstrated hostility to
Respondent in the choice of the backpay period, the multiplying formula,
a failure to fully investigate interim earnings , and other alleged wrongdo-
ing. In its brief, Respondent also alleges that I was guilty of bias and
prejudice As to that allegation, I refer Respondent to the Board's Rules
and Regulations and refer the Board to the record herein
period earnings. If the base period were 1 August
through 12 September 1980, the base period ratio would
be a mere 69.6 percent. If the period were 4 January
through 12 September 1980 it would be 105.64 percent.
By the General Counsel choosing the base period 2 May
to 12 September 1980 the ratio is 106.98 percent, the
highest ratio. The Regional Director's compliance officer
testified that the selection of this period derived only
from an unbroken, lengthy period during which, and
commencing when, neither Miruzzi nor Mitkovski re-
ceived any additional moneys for supervisory functions
and ending with Respondent's engaging in its first unlaw-
ful conduct against Mitkovski.
There is no dispute that, at the beginning of the base
period, in or about 5 May 1980, Miruzzi, a master me-
chanic, certified in all eight specialties, was receiving
from Respondent hourly wages at the rate of $10.10 per
hour. At the same time, the Charging Party, Mitkovski, a
mere specialty mechanic, was receiving hourly wages at
the rate of $10.60 an hour, a 50-cent-per-hour difference
in favor of the mere specialty mechanic, Mitkovski. In
addition, Respondent was paying Mitkovski an additional
60 cents per hour to act as assistant foreman in the shop.
In fact, therefore, Mitkovski's gross hourly pay was actu-
ally at the rate of $11.20 per hour compared to Miruzzi's
$10.10 per hour. It is the 60 cents per hour which Mit-
kovski was being paid as assistant foreman, eliminated at
the beginning of the base period, in or about 5 May 1980,
which caused the Regional Director's compliance officer
to choose that date for the purpose of commencing the
base period for comparing Miruzzi's and Mitkovski's
wages ($10.60 to $10.10). As the Board and the court of
appeals noted, it was on 12 September 1980 that Re-
spondent gave a pay raise to all its employees, the high-
est paid of all mechanics, Mitkovski, receiving a pay
raise of only 60 cents per hour (thus raising him to
$11.20 per hour) whereas the other mechanics received
greater pay increases so that Miruzzi, the master me-
chanic, was receiving $11.20 per hour, the same pay rate
as Mitkovski.4
The court of appeals noted that, in granting the pay
raise, Respondent stated that the pay raise stood regard-
less of the wishes of any of the employees and regardless
of any suggestions that they were being in any way un-
fairly dealt with.
In addition, the Board, affirming Judge Goerlich (and
thereafter particularly sustained by the court of appeals)
found that Respondent threatened that if Mitkovski com-
plained to the Labor Board he would not thereafter re-
ceive "any desirable assignments"; and that Respondent
considered Mitkovski to be a "good" auto mechanic. In
this latter regard, in addition, the court of appeals also
affirmed the Board's finding that Respondent had unlaw-
4 It was this pay raise inequitable in Mitkovski's eyes, that sent him to
the Labor Board, resulting in Respondent's commission of the unfair
labor practices. During the base period other specialty mechanics re-
ceived $9.50/hour compared to Mitkovski at $10 60/hour (with an addi-
tional 60 cents an hour as an assistant supervisor)
OVERSEAS MOTORS
fully threatened Mitkovski that he would "not get any
jobs to make enough living so [he] would fire himself."5
B. Discussion and Conclusions
1. Base period and backpay period projections
a. Base period..- backpay formula (ratio)
As noted in East Wind Enterprises, 268 NLRB 655
(1984), an administrative law judge must consider con-
flicting backpay formula arguments and select the most
accurate method of determining backpay.6 In selecting
the most accurate method uncertainties will be assessed
against the wrongdoer. Thus, the Board has rejected the-
oretical formulas for determining backpay offered by
various respondents which, while internally consistent,
do not reflect the realities of the events involved.
As I view the evidence, I conclude, as Respondent
argues, that the use of a protracted base period is unnec-
essary in this case notwithstanding that the General
Counsel's compliance officer's testimony demonstrates a
rational and good-faith choice in selecting the base
period notwithstanding that it results in the highest ratio.
As noted, this period was selected because it eliminated,
commencing 5 May 1980, any inflation in Mitkovski's
pay based upon his additional pay as an assisant shop
foreman. The facts, without contradiction, show that
prior to Respondent's unlawful discrimination, Mit-
kovski, a mere specialty mechanic, was considered not
only a good mechanic, but in the everyday workplace
evaluation of the worth of work, i.e, rate of pay, the su-
perior of Miruzzi. Thus, over an extended period, Re-
spondent, without regard to supervisory pay, paid Mit-
kovski at a higher rate as a mere specialty mechanic than
it did Miruzzi, who, Respondent asserts, is Mitkovski's
superior because Miruzzi is a "master mechanic." In so
far as payment of wages reflects Respondent's own esti-
mate of comparative value, I reject Respondent's argu-
ment that the use of Miruzzi's earnings is improper. It is
apparent that during the pleaded 4-month base period,
Mitkovski was paid at the rate of $10.60 per hour where-
as Miruzzi, supposedly his functional superior, was paid a
mere $10.10 per hour.
The record therefore shows, without contradiction,
that during the base period, Respondent, whether as a
matter of informed business judgment or otherwise, fa-
vored Mitkovski, up through 5 September 1980, with a
higher wage rate, notwithstanding that Mitkovski was a
"mere specialty mechanic." This Respondent evaluation,
in terms of the superior wage rate and earnings paid to
5 The court of appeals sustained the Board's finding that Respondent
unlawfully suspended Mitkovski for 2 days on 15 September 1980 and 3
days on 16 October 1980 Any dispute that Respondent has raised in this
backpay proceeding based upon an assertion that the length of those two
intermediate suspensions (before the 23 October 1980 discharge) was in-
correctly found may not be litigated in light of the Board's and the
court's contrary findings.
6 It follows that, as directed in East Wind Enterprises, supra, calcula-
tions offered by each party determine which formula and what calcula-
tions produce the most accurate gross backpay amount, keeping in mind
that uncertainties must be resolved against a respondent whose illegal
conduct "produced both the uncertainties at issue and the injury the in-
stant litigation is intended to remedy "
555
Mitkovski, I regard as exceptionally strong evidence to
support the finding that Mitkovski, regardless of other
specialty mechanics, was paid more than master mechan-
ics. I reject Respondent's arguments that (1) Mitkovski
should not be compared to Miruzzi because of their dis-
tinctive qualifications and that (2) regardless of the base
period, during the 4 years of the backpay period, special-
ty mechanics were paid less than Miruzzi and the other
master mechanics. I find and conclude that prior to the
onset of unlawful discrimination, Respondent valued Mit-
kovski as a mechanic worthy of pay superior to Miruzzi.
It is clear from the Board's and court of appeals' deci-
sions that Respondent used its discretion in assigning
work to Mitkovski as a "good" mechanic. It is also clear
on this record that he could and did make money most
often equal to or surpassing Miruzzi notwithstanding
Mitkovski's more limited qualifications. There is no sug-
gestion in the evidence that any of the specialty mechan-
ics thereafter hired in the backpay period were viewed
by Respondent as "good" mechanics or, in any event,
the equal, much less the superior, of Mitkovski. Lastly,
only Miruzzi was employed throughout the base period
and backpay period.
Mitkovski's unlawful discharge makes it impossible for
us to know whether Respondent might have applied a
different, and perhaps a stricter, wage standard to Mit-
kovski during the 4 years of the backpay period by low-
ering his wages to rates enjoyed by specialty mechanics
first hired in the backpay period. It is a matter of specu-
lation. This uncertainty must be resolved against Re-
spondent since it was Respondent that created this situa-
tion. NLRB v. Westin Hotel, 758 F.2d 1126 (6th Cir.
1985); NLRB v. Miami Coca-Cola Bottling Co., 360 F.2d
569 (5th Cir. 1966). I am, therefore, prepared to find, and
do find, that the use of a base period ratio comparing
Miruzzi's earnings to that of Mitkovski is not unreason-
able since, regardless of technical qualifications, Mit-
kovski, even when not additionally paid as a supervisor,
was an employee whom Respondent favored with a
wage rate as high or higher than Miruzzi's, a master me-
chanic; Mitkovski's base period earnings ordinarily
equaled or surpassed Miruzzi's; other base period me-
chanics were paid less than Mitkovski (i.e., $9.50/hour
compared with Mitkovski at $10.60/hour) and since Mir-
uzzi was the only employee employed during the base
period and the entire backpay period.
Yet, as above noted, while I conclude that a
Mitkovski/Miruzzi base period ratio is proper, I agree
with Respondent that the use of the base period (2 May
to 12 September 1980) used by the General Counsel in
computing the ratio is not the most accurate measure of
ratio to be used. It cannot be denied that for the payroll
period ending 5 September 1980, Respondent fortuitously
created, for reasons on this record, of pure business ne-
cessity, without taint of unlawful considerations, an exact
equality in the pay rates of Mitkovski and Miruzzi. Each
was paid $11.20 per hour. Thus, the ratio in this short,
but untainted, period is exactly an integer; that is, with
the equality of earnings, the ratio becomes "one." It is
therefore unnecessary to use the Genei al Counsel's much
longer base period, or any other period, to compare their
556 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
wages. I therefore conclude that the most accurate "base
period" use of the comparison between Miruzzi and Mit-
kovski occurred when Respondent , on this record , equat-
ed their wages for purely business reasons, a result which
Mitkovski resented and which led ultimately to the
unfair labor practices thereafter initiated by Respondent.
In any event , I find that the most accurate earnings ratio
between these two highest paid, longtime, skilled em-
ployees is the ratio of their earnings in the period both
most proximate and prior to Respondent 's unlawful con-
duct, which period , the payroll period 5 September to 12
September , reveals an exact equality of earnings . I there-
fore conclude that a ratio establishing exact equality of
Mitkovski-Miruzzi earnings is the proper and most accu-
rate ratio to be applied in the projected backpay period.
b. Backpay period.- Miruzzi's earnings
With regard to the ensuing 4-year backpay period, I
have already noted my disagreement with Respondent
that the earnings of Miruzzi are irrelevant because Mir-
uzzi was a master mechanic. I accept, arguendo, Re-
spondent 's arguments that ( 1) specialty mechanics work
only in their specialties whereas master mechanics can
do all the work of all specialty mechanics ; (2) during the
backpay period Respondent experienced almost 50 per-
cent of its work in "tune-ups" and that Mitkovski was
not certified in the specialty of "tune-ups"; and that the
specialty mechanics hired during the 4-year backpay
period received lower wage rates and earnings than did
the master mechanics . The facts remain that the only un-
controverted data and economic experience untainted by
Respondent 's unfair labor practices in the base period
demonstrate that Mitkovski held a favorable position
with Respondent . Respondent's testimony in the underly-
ing unfair labor practice case went so far as to describe
Mitkovski as a "very good " mechanic , then suspiciously
diminshed to a mere "good mechanic ," the latter finding
supported by the Administrative Law Judge , the Board,
and the court of appeals . It is clear on this record that
whatever Mitkovski 's deficiencies in specialization as a
mechanic , he regularly received , even excluding supervi-
sory pay, during the entire base period pleaded in the
General Counsel's specification, earnings superior to the
master mechanic (Miruzzi) whom Respondent thereafter
made an assistant foreman . It was only on the date in the
payroll period ending 5 September 1980 (announced on
12 September 1980) that Miruzzi reached equality with
Mitkovski in wage rate . To suggest that Mitkovski, en-
joying this superior position, because of Respondent's use
of untainted business discretion in assigning him work
which led to his superior earnings , would have been rel-
egated to lesser earnings as a mere specialty mechanic
during the 4 -year backpay period , is to indulge in the
very speculation forbidden under Board law.7 Thus,
absent proof by Respondent that the favored veteran,
highly paid , Mitkovski , would " have been relegated to the
pay rates and earnings of newly hired specialty mechan-
ics, who came and went during the 4 -year backpay
7 I would especially avoid speculating on this uncertainty in the face of
Respondent 's repeated threats of economic reprisal against Mitkovski if
he complained to the NLRB
period, I cannot conclude that Respondent had submitted
sufficient evidence to support this defense . This Re-
spondent defense, in fact, is unsupported by any evidence
in this regard outside the mere naked earnings of the spe-
cialty mechanics employed in the 4 -year backpay period.
As noted , none of these enjoyed Respondent 's accolade
as "good" mechanics and none of them were employed
during the base period so that a reasonable extrapolation
could be made to demonstrate how they would have
been treated during the 4-year backpay period . The only
hard evidence is that Mitkovski 's base period wage rates
were at least equal to Miruzzi 's and higher than all other
specialty mechanics employed alongside Mitkovski in the
base period ($ 10.60/$9.65). On such evidence, I further
conclude that the use of Miruzzi 's earnings , the earnings
of a "representative employee" working during the
entire backpay period , East Wind Enterprises , 268 NLRB
655, 656, was an accurate and reasonable method of as-
certaining a gross backpay for Mitkovski during the base
period , was paid higher than any specialty mechanic and
at least as high as any other mechanic , including master
mechanics, it would be improper to use, accurate and
reasonable method of ascertaining a gross backpay for
Mitkovski during the 4-year backpay period ," and that
because Mitkovski, at all times in the base period, was
paid higher than any specialty mechanic and at least as
high as any other mechanic, including master mechanics,
it would be improper to use, much less average, the
earnings in the backpay period of specialty mechanics es-
pecially where they were not employed during the entire
backpay period. Compare Central Freight Lines, 266
NLRB 182 (1983 ), with Berry-Mahurin Construction, 273
NLRB 1044 (1984).
2. Respondent's defenses ; Mitkovski's loss of his
driver's license and uninsurability
The parties stipulated that Mitkovski 's driver's license
was suspended on 22 October 1980 and reinstated on 23
July 1981. In fact, the General Counsel conceded that, in
that period, Mitkovski had no driver's license at all. To
that extent , Respondent asserts that since a driver's li-
cense was functionally necessary for the employment of
Mitkovski as a mechanic , it should not be held liable for
backpay in any quarter in which Mitkovski was without
a driver's license. Mitkovski, without a driver's license,
would be unable to certify that his repair work rendered
the car fit to operate since he would be unable to drive it
and check it out . The problem , however , is that Re-
spondent made the same argument in the underlying
s To the extent Respondent would diminish Miruzzi's earnings in the
4-year backpay by showing that he was paid moneys as a supervisor, Re-
spondent's proof does not establish same . Payment for "policy" hours
shows merely payment out of funds (insurance , "house" money) not from
customers . Where money paid to Miruzzi for supervisory functions is es-
tablished, such money should be deducted from any use in determining
Mitkovski's backpay Respondent failed to prove that any backpay period
payments to Miruzzi's were for supervisor functions ; and also failed to
prove that any payments to Miruzzi were for any service other than to
assure a rate of $11 20 per hour As the General Counsel notes , Respond-
ent admitted that Miruzzi was paid the same hourly rate regardless
whether working as a mechanic or allegedly overseeing the shop (Tr
308-309)
OVERSEAS MOTORS
unfair labor practice case: that, among the reasons for its
discharge of Mitkovski, was that Mitkovski had lost his
driver's license , or rather had it suspended; that in fact,
he was without the ability to legally drive, and that this
resulted in a threat by Respondent's insurance carrier to
cancel its insurance.
That argument, relating to the cause of Respondent
discharging Mitkovski, was rejected by the Board and by
the court of appeals and may not be relitigated under the
guise of avoiding backpay in any quarter in which the
loss of licence occurred. The underlying reason for this
conclusion was that the Board and the court of appeals
found that Respondent employed Mitkovski as a mechan-
ic for long periods when it knew that he had a suspended
license; was not legally permitted to drive; was neverthe-
less driving cars he serviced; and in view of the Board's
findings that Respondent testified that it was "doing ev-
erything in my power [regarding insurability and license
suspension] not to have him terminated ." (Overseas
Motors, 260 NLRB 810, 813 (1982).) The Board and the
court of appeals quite clearly held that Respondent con-
cealed Mitkovski's driving record from its insurance car-
rier and it was only after he filed charges with the Labor
oard that Respondent became "concerned'"' about Mit-
kovski's driving record (the quotation marks surrounding
concerned appear in the court of appeals' opinion).
The defense of Mitkovski's loss of driver's license and
his resulting uninsurability was explicitly the subject of
litigation in the underlying unfair labor practice case.
Thus, in cases where a respondent merely fails to raise a
defense which would meet the allegations of unfair labor
practice and thus indirectly eliminate the backpay liabil-
ity (failure to reinstate an employee because of picket
line misconduct where the picket line misconduct oc-
curred prior to the hearing in an unfair labor practice
proceeding), the respondent is collaterally estopped from
raising that matter as a defense in the backpay proceed-
ing. Compare Fibreboard Corp., 180 NLRB 142, 149-151
(1969), enfd. 436 F.2d 908 (D.C. Cir. 1970), cert. denied
403 U.S. 905 (1971), with Olson Bodies, Inc., 220 NLRB
756, 757, (1975).
In the instant case, it is not a matter of mere collateral
estoppel, for the defenses of loss of driver's license and
resulting loss of insurability were explicitly litigated and
expressly rejected in the underlying unfair labor practice
case . Thus, I conclude that Respondent is not merely
collaterally estopped from raising those defenses in the
backpay proceeding but is barred from raising those de-
fenses under the doctrine of "law of the case." The in-
stant backpay proceeding is a continuation of, and a
mere supplement to, the unfair labor practice case.
Hence, this proceeding is not a "new" litigation requir-
ing the application , if appropriate, of the rule of collater-
al estoppel or res judicata. Indeed, in the recent NLRB v.
Laredo Packing Co., 730 F.2d 405 (5th Cir. 1984), enfg.
the backpay order in 271 NLRB 553 (1974), the court
noted (at 407), in its per curiam enforcement, where the
respondent's proof, inter alia, consisted of a relitigation
of its contention that the employer was justified in its
failure during the backpay period to offer driving jobs to
truckers (because they were uninsurable and that its
backpay liability was thereby tolled), that the uninsurabi-
557
lity issue had already been decided adversely against the
employer in the underlying Board and court proceeding.
The court held that rather than applying the doctrine of
res judicata it would apply the doctrine of "law of the
case" and that the uninsurability of the drivers was not a
matter to toll backpay liability: that matter had been re-
jected in the case-in-chief. Likewise, in the instant case,
to permit the defenses of loss of drivers's license and un-
insurability with regard to Respondent's allegation that
Respondent's insurance carrier (Central Insurance)
would no longer insure him, would be to permit relitiga-
tion of the reason for the pretextual discharge under the
guise of tolling backpay. This was expressly rejected by
the court of appleals in NLRB v. Laredo Packing Co.,
supra, and there have been no reasons advanced here to
not apply the rule of that case. Therefore, as a first
reason, as a matter of law, I may not entertain Mitkovs-
ki's lack of a driver's license or his uninsurability by Re-
spondent's insurance carrier , if true, as a tolling element
in this backpay proceeding.
Secondly, as above noted, Respondent demonstrated,
in fact, that it would ignore Mitkovski's loss of license
and uninsurability and would even conceal that status in
order to keep him as a mechanic . If it was willing to
follow such a course of conduct prior to unlawfully dis-
charging Mitkovski, I find that Respondent has shown
no reason it would not have followed the same course of
conduct during the backpay period. Thirdly, there was
no evidence adduced in this backpay proceeding, nor
does the face of the unfair labor practice proceeding
show, that Respondent's insurance carrier actually can-
celed Respondent's insurance or even threatened to
cancel it. Fourthly, there was no effort, on any record
herein, demonstrating that Respondent sought to appeal
any declaration either by its insurance agent or the insur-
ance carrier that the insurance would be canceled or that
Mitkovski would be excluded. This failure shows that
there has been no proof that the driver (Mitkovski) was
in fact uninsurable (NLRB v. Laredo Packing Co., supra,
730 F.2d at 407) by Respondent's own carrier. Thus,
added to "law of the case," and Respondent's avowed
willingness to conceal Mitkovski's shortcomings, there is
the additional ground that there was no proof that Mit-
kovski was in fact or in law "uninsurable" by Respond-
ent's own carrier or by any carrier. The burden of proof
to show overall insurability is on Respondent. Overseas
Motors, 260 NLRB 810, 815 fn. 12.
The one exception to the use of the argument tolling
backpay based on "uninsurability" appears in footnote 12
of the Administrative Law Judge Goerlich's decision
adopted by the Board and enforced by the United States
Court of Appeals (ibid.):
Respondent is not precluded, in subsequent com-
pliance proceedings, from contending that, after a
good-faith exploration of Mitkovski's insurability, he
is actually uninsurable with any carrier, and that its
backpay liability should be commensurably reduced
See Golden Beverage of San Antonio, Inc. [256
NLRB 469 (1981).] See also Viele & Sons, Inc., 227
NLRB 1940, 1950, 1951 (1977).
558 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Although Respondent called as its witnesses its insur-
ance agent (Donald E. Spain), as well as its insurance
carrier (David Hoerauf), both admitted that they never
sought coverage for Mitkovski with any other insurance
carrier; Respondent never requested its agent to place its
insurance coverage with any carrier other than Citizen's
Insurance Co.; and no effort was made to place Mitkovs-
ki's coverage with a high-risk carrier or with a "pool"
insurance group which would insure high-risk employ-
ees. Moreover, Respondent' s carrier, Citizen's Insurance
Co., never threatened to cancel Respondent' s insurance,
never was asked to pass on Mitkovski's insurability, and
was never presented with the option of ignoring Mit-
kovski or getting Respondent to waive his coverage. The
fact that Respondent's insurance agent (Spain) believed
Mitkovski's insurance would cause any ordinary carrier
to cancel all of Respondent's liability insurance hardly
meets the burden of Respondent proving that Mitkovski
was "actually uninsurable with any carrier."
Thus, there is a complete failure of proof that Mit-
kovski was actually "uninsurable with any carrier" since
neither Respondent nor its agent nor its insurance carrier
made any effort to see if he would be insurable with
"any carrier" within the meaning of the footnoted excep-
tion provided by the Board. Thus, not only did Respond-
ent fail to make any exploration with regard to Mitkovs-
"ki's insurability but there has been no showing of a
"good-faith exploration" of that issue with any other car-
rier or agent, with the insurance "pool," or with Citi-
zen's for an exception or a waiver. I thus conclude that
there was a failure of proof with regard to the tolling of
Respondent's backpay liability based upon Mitkovski's
failure to have a driver's license or his "uninsurability"
and that, in fact, in the instant case, as in Golden Beverage
of San Antonio, 256 NLRB 469 (1981), Respondent had
"used alleged problems involving insurance coverage to
mask its real reasons." Thus, there shall be no tolling
based on those propositions.
Finally, Respondent argues that even if alternative in-
surance was available if it continued to employ Mit-
kovski, the substantially higher cost of the insurance
would have placed an unfair burden on Respondent.
There is no proof in this record as to what the asserted
"substantially higher cost" of alternative insurance would
be and therefore Respondent has failed to meet its
burden on this ground as well.
Therefore there shall be no tolling of backpay liability
based upon Mitkovski's failure to have a driver' s license
during the backpay period or his "uninsurability."
3. The failure of Mitkovski to renew his mechanic's
certificate on 17 October 1980
Respondent notes that Mitkovski failed to renew his
mechanic 's certificate on 17 October 1980 and that he re-
mained without certification until 3 November 1983
when he did renew it. Respondent argues that to have
employed Mitkovski during this period as a mechanic
would have violated the Michigan Motor Vehicle Serv-
ice and Repair Act (Michigan Public Act, 1974, No. 33)
and could have led to loss of Respondent 's license. Re-
spondent concludes that, the mechanic 's certificate
having been not renewed for 3 years , Mitkovski was thus
rendered unemployable by Respondent in that period
and that no backpay could be accrued in that period.
As with the case of the loss of Mitkovski's driver's li-
cense as a reason to discharge him, Respondent, in the 22
and 23 July 1981 hearings in the underlying unfair labor
practice case, raised as an additional reason for lawfully
discharging Mitkovski his "horseplay, use of the tele-
phone, an expired mechanic's license, and fondling of
female customers" (emphasis added). These excuses were
rejected because the Board found these reasons "had
been overlooked by Respondent prior to Mitkovski's
contact with the Board and which had not been initially
cited as reasons for his discharge," Overseas Motors, 260
NLRB 810, 813.
Thus, Mitkovski's October 1980 failure to renew his
mechanic's license was actually raised and litigated in 'the
July 1981 unfair labor practice hearings and rejected. I
conclude that, as in the matter of his failure to have a
driver's license and his "uninsurability," Mitkovski's lack
of a mechanic's license has already been litigated and re-
jected by the Board and the court of appeals. As the
"law of the case" it cannot be resurrected in the guise of
tolling backpay in this backpay proceeding. Further-
more, in view of Respondent's willingness, prior to its
unfair labor practices, to conceal Mitkovski' s licensing
shortcomings, I conclude it would have continued in
such conduct during the backpay period.
The credited and uncontroverted evidence adduced at
the hearing was that, under Michigan law, after January
1981 (testimony of Fred J. Pirochta, Michigan Bureau of
Automotive Regulation), a mechanic could not perform
major repairs unless certified in that specialty or unless
he obtained a trainee permit to perform the work under
a specialty or master mechanic. The evidence is undis-
puted that a mechanic can immediately receive a "trainee
permit" by applying for it and the grant of the permit is
a routine matter. Further evidence showed that after Jan-
uary 1981, a mechanic with a "trainee permit" working
under a certified mechanic, including a master mechanic,
could do the major repairs in which he received the
"trainee permit."
Mitkovski's failure to have a current mechanic's li-
cense was not a deficiency which rendered him inherent-
ly unfit for work in the repair facility, such as his being
out of the country, incarcerated, or ill. Such conditions
would toll Respondent's backpay liability.
As a first conclusion, therefore, to permit Respondent
to litigate the question of Mitkovski's failure to have a
current mechanic's certificate or license would be to
permit relitigation of a defense rejected in the underlying
unfair labor practice proceeding in the guise of tolling
backpay in the supplementary backpay proceeding. This,
the Board rule, enforced by the courts, prohibits.
Moreover, Respondent may not be heard to argue that
backpay should be tolled because of the intervening pro-
visions of the Michigan Motor Vehicle Service and
Repair Act, 1976, with relation to tolling the backpay
even after 1 January 1981, after the 23 October 1980 dis-
charge. That statute requires only that an uncertified me-
chanic work under a master mechanic or a certified-me-
chanic. As in the case of Mitkovski's uninsurability and
OVERSEAS MOTORS
failure to have a current driver's license, Respondent
would be prohibited from now interposing this defense
on the theory of "law of the case" or, if it was not actu-
ally raised and litigated in the underlying case, on the
theory that Respondent would have to be, and is collat-
erally estopped from raising that defense since it was
availiable to Respondent at the unfair labor practice
hearing. Thus, if the statute went into effect in 1976 and
if the provisions of the statute requiring uncertified me-
chanics to work under certified mechanics or a master
mechanic went into effect only on and after 1 January
1981, those facts would have clearly been available to
Respondent in the unfair labor practice case which was
not heard until 22 July 1981. Respondent's failure to
raise the defense of the application of the statute was
either, therefore, prohibited as a defense because it was
litigated in the underlying unfair labor practice case
Overseas Motors, supra at 810, 813 fn. 10, or should have
been interposed as a defense and Respondent is now col-
laterally estopped. Fibreboard Corp., 180 NLRB 142,
149-151 (1969), citing Justice Frankfurther in NLRB v.
Donnelly Garment Co., 330 U.S. 219 (1947) ("and the
Wagner Act does not require that ground be covered a
second time, or piecemeal"). Compare Olson Bodies, Inc.,
supra, with Rogers Furniture Sales, 213 NLRB 834 fn. 8
(1974). In short, since the applicability of the statute
commenced in January 1981 and since the unfair labor
practice proceeding did not commence until 6 months
later in July 1981, Respondent's failure to plead and
prove the existence and effect of the Michigan statute
must now be collaterally estopped, assuming, arguendo,
that the matter was not actually particularly raised and
litigated in the unfair labor practice case.
Lastly, since the grant of the trainee permit was a
matter of mere routine, as Respondent's witness Pirochta
testified, Respondent may not toll the backpay since an
offer of reinstatement would have presumably cured the
licensing defect.
4. Tolling of backpay because of conflicts with
dates of layoff in the Board decision and court
decree
Respondent, on several occasions, in its pleadings and
proof, alluded to the allegedly incorrect statement of
conclusions in the Board order and court decree regard-
ing the duration of Respondent's unlawful layoffs of Mit-
kovski in September and October 1980, preceding his 23
October 1980 discharge. This matter likewise was specifi-
cally, litigated before the Board and the court and is
barred from relitigation under the guise of a tolling Re-
spondent's backpay obligation in this supplementary pro-
ceeding . To the extent Respondent argues that periods
after the September and October unlawful layoffs but
prior to 23 October 1980, when Mitkovski was not un-
lawfully suspended, should not be included in the back-
pay computation of gross backpay, the short answer is
that they were not. The third quarter of 1980 was treat-
ed entirely as a quarter in which backpay accrued and all
of Respondent's payments of wages to Mitkovski were
included as interim earnings throughout the period.
Thus, Respondent's assertion that periods between the
unlawful layoffs and the unlawful discharge should not
559
be included in the computation of gross backpay was
rectified by treating the quarter as starting with the pay-
roll period ending 19 September and then including as
interim earnings all the wages paid by Respondent to
Mitkovski in that quarter. Thus, all wages paid to Mit-
kovski represent what Mitkovski actually earned in the
quarter during the period of unlawful suspension and
therefore takes account of the fact that during that
period he was paid by Respondent.
5. Tolling because of periods of alleged
unavailability
(a) To the extent that Respondent pleaded (Respond-
ent's amended answer, p. 6, par. 10) that Mitkovski was
unavailable for work during 5 to 6 days in the period
ending 6 July 1984, that defense, in partial tolling of the
backpay computation, was withdrawn during the hear-
ing.
(b) To the extent that Respondent argues that the
backpay should be tolled for the pay period ending 8
April 1983, when Mitkovski was unable to work for 3 of
the 6 days, the Regional Director's compliance officer
testified that this matter was rectified by the computation
showing that Mitkovski was out of the country from 21
November 1982 to 2 April 1983 and that Mitkovski was
able to work commencing Monday, 3 April 1983. Re-
spondent called Mitkovski as its witness and Mitkovski
thereafter again appeared in rebuttal. There was no testi-
mony, controverting the General Counsel's pleadings
and assertions, that Mitkovski was not back in the coun-
try on or about 3 April. Under American Mfg. Co. of
Texas, 167 NLRB 520, 522 (1967), in order to toll back-
pay, Respondent has the burden of showing the periods
that the discriminatee was unavailable for employment.
See Greyhound Taxi Co., 274 NLRB 459 (1985). I am
therefore unable to conclude that Respondent has pro-
duced any evidence to show that Mitkovski was not in
the country and available for work commencing on or
about 3 April 1983. There is no proof, consistent with
Respondent's answer (amended answer, p. 6, par. 9), that
Mitkovski was unable to work for 3 of the 6 days in the
pay period ending 8 April 1983. The backpay period
may therefore not be tolled on that basis.
6. Interim earnings
As noted in Sioux Falls Stock Yards Co., 236 NLRB
543, 545 (1978), the burden of proof is on Respondent to
establish its affirmative defenses including, the obligation
to show that Mitkovski did not make a bona fide effort
to seek employment and was therefore willfully idle,
NLRB v. Westin Hotel, 758 F.2d 1126 (6th Cir. 1985);
Aircraft & Helicopter Leasing & Sales, 227 NLRB 644,
646 (1976); NLRB v. Mooney Aircraft, 366 F.2d 809, 815
(5th Cir. 1966), and Respondent does not meet that
burden by presenting evidence of a lack of an employee's
success in the gaining of interim employment or low in-
terim earnings . Rather, Respondent must affirmatively
demonstrate that the employee, Mitkovski, neglected to
make reasonable efforts to find interim work, NLRB v.
Westin Hotel, 267 NLRB 244 (1983), enfd. 758 F.2d 1126
(6th Cir. 1985); NLRB v. Miami Coca-Cola Bottling Co.,
560 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
360 F.2d 569, 575-576 (5th Cir. 1966). The alleged discri-
minatee must make only "reasonable efforts to mitigate
the loss of income and not undertake the highest stand-
ard of diligence," NLRB v. Arduini Mfg. Co., 394 F.2d
420, 422-423 (1st Cir. 1968). In determining the reason-
ableness of the effort, the employee's skills and qualifica-
tions must be taken into account, Mastro Plastics, 136
NLRB 1342, 1359 (1962).
The backpay specification alleged, and Mitkovski testi-
fied, that in the approximately 4 years constituting the
backpay period, Mitkovski received $4,061 (in the 26-
week period following his 23 October 1980 discharge) as
unemployment compensation from the State of Michigan.
This sum, repayable'to the State of Michigan, was not
included in Mitkovski's interim earnings. He testified that
he received no substantial moneys as gifts and he lived
off loans. He further testified that during the backpay
period he was self-employed, worked as a part-time me-
chanic (Lincoln Park Foreign Car Co.), and as an out-
side salesman for an employer (Woodruff and Associates)
selling "stop a flat" materials in 1981 or 1982.
Mitkovski also testified that commencing in the
summer of 1981 he began doing mechanical repairs at his
home. He paid a fee for such right in 1983 and again in
1984. He could not specify how many cars he averaged
per week but stated that he averaged at least one car a
week and, at most, two cars per week but not in every
week. He also was unable to say which auto repairs he
did at particular times but asserted that he repaired
brakes, alternators, and changed oil. In the entire 4 years
he worked on two exhaust systems and did tuneups. In
performing repairs, he charged for his labor only and
either had the submitting car owner purchase the parts
or he charged the parts to the car owner. With regard to
his work at the repair shop of Lincoln Park Foreign
Cars, he testified that he last worked there in 1981; that
he never wrote down his interim earnings and that the
interim earnings that he told the General Counsel of, in
preparation of the backpay specification, amounted to
about $12,000 in the entire 4-year period.
He further testified that his trips to his native Yugo-
slavia were either gifts from his relatives or were heavily
subsidized by his relatives. Mitkovski also testified that
with regard to some of those trips to Yugoslavia, he was
licensed as a sales person by Overseas International Co.,
a business enterprise in the State of Michigan. He testi-
fied however, that he never received any pay from
Overseas International (engaged in the importation of
Yugoslavian liquor).
Mitkovski also testified that prior to his discharge by
Respondent, he often was approached by the owners of
Lincoln Park Foreign Cars to work for it, but thereafter,
after the discharge, Lincoln Park's principles always told
him, when he requested employment, that there was no
work for him.
As a result of Mitkovski's statements to the NLRB, the
Regional Office, commencing with the first quarter of
1981 and ending with the third quarter of 1984, deter-
mined that Mitkovski earned approximately $13,000 in
the 14 quarters in which he was available for employ-
ment during the backpay period (other than in the third
and fourth quarters of 1980 in which the discrimination
occurred). Thus, the Regional Office divided Mitkovski's
asserted interim earnings commencing January 1981 into
equal parts, arriving at the figure of $923.07 per quarter
in each quarter he was available for work (thus exclud-
ing the first quarter of 1983 in which Mitkovski was out
of the country). The grand total of interim earnings was
$14,621.46 (Schedule C).
Respondent attacked Mitkovski's veracity and the
amount of alleged interim earnings through the testimo-
ny of a mechanic with whom Mitkovski worked after
being reinstated by Respondent in the summer of 1984.
Thus, Respondent' s witness , Howard M. Gardella, tes-
tified that he first met Mitkovski when Mitkovski re-
turned to employment. Within a short time, Mitkovski
learned that Gardella wanted a different job where he
could earn more money and Mitkovski told him that he
would try to get him a job at Lincoln Park. This oc-
curred after Mitkovski was reinstated, when the principal
at Lincoln Park was at Respondent's place of business
and told Mitkovski that he was looking for a mechanic.
Although Mitkovski took Gardella to Lincoln Park and
although Gardella received an offer of employment, Gar-
della turned it down because Lincoln Park was too far
away as a workplace and was not offering enough
money. However, in various conversations with Mit-
kovski, Gardella testified that Mitkovski told him that
Lincoln Park was a good place to work and that Mit-
kovski made $700 a week at Lincoln Park, being "paid
under the table." He told Gardella that he did not want
Respondent to know that he had worked there. On sev-
eral occasions after Mitkovski was unlawfully terminat-
ed, he applied for work at Lincoln Park but was turned
down.
Although Mitkovski at first testified that he did not
recall telling Gardella that he received money under the
table, he ultimately admitted that he "might have" (Tr.
861). He absolutely denied having received money under
the table from Lincoln Park but he admitted that he
might have told that to Gardella to make the job attrac-
tive to Gardella and to have Gardella leave Respondent
and thus have more work available for Mitkovski at Re-
spondent. Although Mitkovski denied that he would lie
under oath to hurt Respondent, he admitted that he
would lie to somebody else (i.e., Gardella) about condi-
tions in ,order to hurt Respondent (Tr. 262-263).
I find that Mitkovski did tell Gardella that he was paid
$700 per week "under the table" in order to have Gar-
della leave Respondent's employ thereby providing more
work for Mitkovski. I also credit him that he did not, in
fact, either receive $700 per week or $700 per week
under the table because I credit his testimony that he in
fact did not receive $700 per week at Lincoln Park (or
any other place) because he would not leave a job which
paid him $700 a week, since such a job would make him
a "king today" (Tr. 864). I also credit Mitkovski's further
uncontradicted testimony (Tr. 864-865) that prior to his
discharge from Respondent, employers were seeking to
employ him but that after he filed the charges alleging
unlawful action against him by Respondent he went to
many dealerships in the Detroit area (which sold Fiat
and Lancia cars like Respondent) and these employers
OVERSEAS MOTORS
told him that they had no opening "at this time" (Tr.
865). I also accept as credible his testimony that he re-
turned to Respondent's employ pursuant to the offer of
reinstatement because he could not get a job elsewhere
after trying to do so and that his earnings after return
have been lower than other employees at Respondent's
shop and lower than he previously earned.
In short, I do not find credible evidence that Mit-
kovski earned $700 a week while employed by Lincoln
Park in or about 1981, or any other time , or that he was
paid "under the table." Respondent made no effort to
subpoena Lincoln Park's payroll records or personnel in
order to contradict or, in any case, to undermine, Mit-
kovski's denials and assertions.
Other testimony regarding Mitkovski's attempt to
engage in the radio business with Zoran Mihailovich (Tr.
932 et seq.) demonstrated that the use of time bought
from a local radio station to entertain the Yugoslav com-
munity resulted in a losing proposition (Tr. 934-935).
The record shows that Mitkovski, nevertheless, made at-
tempts to earn a living.
I have examined the record with regard to Mitkovski's
testimony as to how he supported himself in the 4-year
backpay period and I was met principally with $4000 of
Michigan unemployment compensation ," $14,000 worth
of interim earnings, and the remainder , loans. The evi-
dence showed that it took a minimum of approximately
$9000 a year for Mitkovski's expenses and therefore
there is an $18,000 to $20,000 gap in the 4-year period
($36,000 minus $18,000) in loans and earnings to be ex-
plained by "loans." The burden on Respondent, howev-
er, is not merely to litigate the question of the existence
or nonexistence of "loans," but to show that there were
other interim earnings or proof of Mitkovski's failure to
engage in reasonable efforts to gain interim employment.
Mitkovski's uncontradicted testimony was that he sought
employment. Mitkovski's uncontradicted testimony was
that he sought employment in the Detroit area from
Lancia and Fiat dealers who had previously sought him
as an employee and was turned down, with the implica-
tion tht he was being blackballed for having engaged in
the activity of pursuing his NLRB unfair labor practice.
It is unnecessary to answer that question but merely to
find, as I do, that he sought employment as a mechanic,
his trade, while he was engaged in self-employment as a
mechanic and a salesman of radio time and a flat-tire
cure from his home. His engaging in self-employment did
not take him out of the labor market nor prevent him
from seeking further employment in the Detroit area as
an automobile mechanic.
Nevertheless, Respondent urges that, as a matter of in-
ference, I should conclude that Mitkovski did engage in
other interim employment, did receive other net earnings
therefrom, and that his lack of credibility on the witness
stand demonstrated that he did have such interim earn-
ings and that the backpay should be tolled to the extent
B Respondent persists in alleging the General Counsel 's and the compli-
ance officer's error in not including , as interim earnings , payments of
Michigan unemployment compensation to Mitkovski. It has been the law
for 35 wears that state unemployment compensation payments are not in-
terim earnings and are not deducted from backpay . Gullet Gin Co. Y.
NLRB, 340 U S. 361 (1951)
561
that such unreported earnings in any quarter prevent
Mitkovski from being considered as eligible for backpay.
American Navigation Co., 268 NLRI) 426 (1983). Re-
spondent 's argument , however, does not rest upon proof
of Mitkovski failing to report interim earnings, which
failure would require elimination of backpay for any
such quarter . In the absence of evidence of a failure to
disclose, however , there is no substantial evidentiary base
on which to erect that inference . Absent such an eviden-
tiary base, and absent such inference , Mitkovski 's having
lived on loans and modest earnings from self-employ-
ment does not , as a matter of proof, necessarily suggest,
as a matter of law, or of necessary inference , that he is
not disclosing interim earnings . In the absence of such
evidence , even in the presence of reasonable suspicion
that Mitkovski could well have had other income, I
cannot conclude that any period during the backpay
period should be tolled because of his failure to disclose
interim earnings . Compare McDonnell Douglas Corp., 270
NLRB 1204 ( 1984), and Flite Chief Inc., 246 NLRB 407
(1979), with American Navigation Co., 268 NLRB 426,
(1983 ), and Great Plains Beef Co., 255 NLRB 1410
(1981).
Miscellaneous Defenses
(a) Respondent also urges that to the extent that Mir-
uzzi was paid money as a supervisor during the 4-year
backpay period, his earnings , as reflected in Schedule B
of the amended backpay specification, should be low-
ered, thus lowering Respondent's gross and net backpay
obligation to Mitkovski. As a matter of fact, however,
the evidence failed to disclose that Miruzzi was, in fact,
paid as a supervisor. Rather, the evidence showing that
he was paid for "shop labor," or for "policy" matters
merely demonstrated, on Mitkovski's uncontradicted and
credited testimony, that the money flowing io Miruzzi
was payment out of funds from sources other than cus-
tomers, such as from insuracne companies and from Re-
spondent's own sources. Where, however, payment to
Miruzzi was for work as "service manager" or similar
designation, his earnings , and thus Mitkovski's projected
earnings , should be reduced. The evidence shows no
definite payment to Miruzzi as a supervisor . Rather, the
evidence shows payments to Miruzzi to maintain his pay
at the rate established for that period.
(b) Respondent also argues that during the backpay
period, 50 percent of its business was in engine tuneups.
If a mechanic, like Mitkovski, was not certified in engine
tuneups, his earnings necessarily would be substantially
diminished.
In fact, however, Respondent adduced only general
testimony (proving that 50 percent of its business during
the backpay period for mechanics was in engine tuneups)
from Demrovsky. This testimony was not supported by
Respondent's books and records. It is not necessary to
reject Demrovsky's unsupported testimony as incredible
since Mitkovski, though not certified in "tune-ups"
would have been fully able to acquire that trainee status
as a matter of simple application according to the testi-
mony of Respondent's own witness, Fred J. Pirochta, of
the Bureau of Automotive Regulation of the State of
562 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Michigan . Pirochta testified that a noncertified mechanic
could perform such functions „ in the certification special-
ty merely by requesting and obtaining a "trainee permit"
which was granted as a matter of routine . There is no
proof that , as a matter of function, Mitkovski could not
do "tune-up ." Indeed , Demrovsky testified that even
though 50 percent of Respondent 's work became "tune-
ups," he would not have fired Mitkovski because he had
no certificate in tuneups (Tr. 199-201).
Lastly, two further facts are noteworthy: (a) Respond-
ent, prior to terminating Mitkovski, assigned him tuneup
work even without certification (Tr. 239); and (b) in
view of Respondent 's practice of equalizing work assign-
ments (Tr. 236), there is no reason to believe that Mit-
kovski 's backpay period income would have been re-
duced even 'if he were not assigned tuneup work' in the
backpay period.
Moreover , Mitkovski 's lack of certification in "tune-
up" must be measured against the Board finding, sup-
ported by the court of appeals , that immediately before
Respondent embarked on its unfair labor practices
against Mitkovski, his earnings and wage rate were
higher than all other specialty mechanics (Gonterman,
Tr. 262-263) and equal to or higher than that of Miruz-
zi's, at $11.20 per hour. The Board, again supported by
the court of appeals , noted that, after Demrovsky
learned tht Mitkovski went to the NLRB , Demrovsky
threatened Mitkovski that he would "not receive any de-
sirable assignments"; and that Demrovsky considered
Mitkovski to be at least a "good " mechanic . On the basis
of these findings , I conclude that Respondent would
have used its discretion , during the 4-year backpay
period, as it had prior to unlawfully dealing with Mit-
kovski , to see to it that Mitkovski 's earnings did not fall
below earnings to which he was accustomed prior to the
discrimination against him, i.e., to be kept at a high level,
as high as Miruzzi. Thus, during the backpay period, Re-
spondent must be held to award Mitkovski sufficient
work, even apart from "tune-ups," to keep him at a wage
level consistent with his wage level prior to -Respond-
ent's discrimination against him as measured by Miruzzi's
compensation (apart from any supervisory pay).
It should be noted , in this regard , that the pay rates of
the specialty mechanics hired before and during the
backpay period were appreciably below the rates and
earnings of Mitkovski . None of them was favored by Re-
spondent 's characterization of Mitkovski as a "good" me-
chanic and none of them had pay rates or earnings at the
rate of Mitkovski. These specialty mechanics (Nemir-
ovsky, Pervine, Gardella, Wambough , and Becoskey,
Respondent 's amended answer, pp . 17-18; and see Gon-
terman, Tr . 262-263) also were not favored with receiv-
ing "desirable assignments " which Mitkovski historically
received , as noted by the court of appeals and the Board,
and none of them was threatened by Respondent that
they would "not get any jobs to make enough living so
that [Mitkovski] would fire [himself]," as found by the
court of appeals . Thus, as a matter of Mitkovski 's histori-
cally high earning record, the explicit exercise of Re-
spondent 's prediscrimination business discretion in the
base period and its various subsequent threats and predic-
tions, I conclude that Mitkovski would have had earn-
ings higher than the intermediately hired specialty me-
chanics in the backpay period ; and that specialty me-
chanics hired in the backpay period are not "similarly
situated" employees or a "representative group." Com-
pare Berry-Mahurin Construction , 273 NLRB 1044 ( 1984),
with Central Freight Lines, 266 NLRB 182 (1983). That
proof of this reconstructed level of earnings rests on an
evidentiary basis derived from Respondent 's prediscri-
mination conduct is not a bar to its utility. Respondent's
unfair labor practices are at the root of the quality of
proof requiring projection . It may not be heard to com-
plain on the point since , in backpay cases, Respondent
may not be allowed to benefit from the uncertainties
caused by its own misconduct. Berry-Mahurin Construc-
tion, 273 NLRB 1044 (1984).
In sum, I conclude that Respondent has failed to sup-
port its burden of proving10 that Mitkovski failed to
make reasonably diligent efforts to seek interim employ-
ment; that he failed to disclose earnings from interim em-
ployment and that the pleaded gross backpay and net
backpay assertions in the amended backpay specification,
as amended at the hearing , were to be tolled by circum-
stances alleged by Respondent. Accordingly , I conclude
that Mitkovski 's earnings in the backpay period should
be calculated by applying a base period ratio of 100 per-
cent to Miruzzi's earnings in the backpay period
($108,270.19) against which must be deducted the net in-
terim earnings ($ 14,621.46); issue the following recom-
mended"
ORDER
On the basis of the foregoing findings and conclusions,
it is ordered that Respondent , Overseas Motors, Inc., its
successors , officers, agents, and assigns, shall pay to Mir-
oljub Mitkovski , the sum of $93,648.73 together with in-
terest on that sum as provided in Florida Steel Corp., 231
NLRB 615.12
10 To the extent that Respondent asserts that the compliance officer
specifically acted in bad faith or was negligent in investigating the extent
of Mitkovski's interim earnings , such argument is rejected The obligation
to prove mitigation, in general , and undisclosed interim earnings , in par-
ticular, is on Respondent, not on the compliance officer The evidence
discloses neither bad faith nor negligence on the part of the compliance
officer While, as above noted, it is arguable that Mitkovski 's testimony,
that he met much of his expenses with "loans" and that his foreign trips
were financed by "gifts," leaves one in doubt whether there were other
interim earnings, such a record does not reflect on the compliance offi-
cer's honesty or capacity
1 r If no exceptions are filed as provided by Sec 102 46 of the Board's
Rules and Regulations, the findings, conclusions , and recommended
Order shall, as provided in Sec 102 48 of the Rules, be adopted by the
Board and all objections to them shall be deemed waived for all pur-
poses
12 See generally Isis Plumbing Co, 138 NLRB 716 (1962)