Presidents Island Steel And Wire, Inc.

National Labor Relations Board - Board Decisions

Oct 31, 1985

277 N.L.R.B. 30 (N.L.R.B. 1985)

30 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Presidents Island Steel and Wire , Inc. and Highway
and Local Motor Freight Employees, Local
Union No. 667, a/w International Brotherhood
of Teamsters , Chauffeurs , Warehousemen and
Helpers of America. Case 26-CA-10263
31 October 1985
DECISION AND ORDER
By MEMBERS DENNIS, JOHANSEN, AND
BABSON
On 28 March 1984 Administrative Law Judge
Philip P. McLeod issued the attached decision. The
Respondent filed exceptions and a supporting brief,
to which 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, findings,
and conclusions and to adopt the recommended
Order.
ORDER
The National Labor Relations Board adopts the
recommended Order of the administrative law
judge and orders that the Respondent, Presidents
Island Steel and Wire, Inc., Memphis, Tennessee,
its officers, agents, successors, and assigns, shall
take the action set forth in the Order.
' The General Counsel filed a motion to strike extra-record material
included in the Respondent's brief regarding the number of employees
currently employed by the Respondent We find that this information
was not presented as evidence at the hearing and, therefore, is not part of
the record in this proceeding See Sec 102 45(b) of the Board's Rules and
Regulations Accordingly, we grant the General Counsel's motion to
strike See Weldtnont Corp, 275 NLRB 1432 fn 1 (1985 ), Today's Man,
263 NLRB 332, 333 (1982)
John Goree, Esq., for the General Counsel.
Donald R . Wellford, Esq. (Boone, Wellford, Clark,
Langschmidt & Apperson), of Memphis, Tennessee, for
the Respondent.
Duria Jones, Jr., Esq., of Memphis , Tennessee , for the
Union.
DECISION
STATEMENT OF THE CASE
PHILIP P. MCLEOD, Administrative Law Judge. This
case was heard by me on October 24, 1983, in Memphis,
Tennessee . It originated from a charge filed on June 15,
1983, by Highway and Local Motor Freight Employees,
Local Union No. 667, a/w International Brotherhood of
Teamsters , Chauffeurs, Warehousemen and Helpers of
America (the Union) against Presidents Island Steel and
277 NLRB No. 5
Wire, Inc. (Respondent). On July 22, 1983, a complaint
and notice of hearing was issued alleging, inter alia, that
Respondent violated Section 8(a)(1) and (5) of the Na-
tional Labor Relations Act (the Act), by failing and re-
fusing to recognize and bargain with the Union as the ex-
clusive collective-bargaining representative of its em-
ployees. In its answer to the complaint, Respondent ad-
mitted certain allegations, including the filing and serv-
ing of the charge, its status as an employer within the
meaning of the Act, the status of the Union as a labor
organization within the meaning of the Act, and that the
following employees constitute a unit appropriate for the
purpose of collective-bargaining within the meaning of
Section 9(b) of the Act:
All production and maintenance employees em-
ployed by the Respondent at its Memphis, Tennes-
see, location; excluding all office clerical employees,
guards, watchmen and supervisors as defined in the
Act.
Respondent denied having any obligation to bargain with
the Union as the exclusive collective-bargaining repre-
sentative of its employees and denied having engaged in
any conduct which could constitute an unfair labor prac-
tice within the meaning of the Act.
At the trial herein, all parties were represented and
were afforded full opportunity to be heard, to examine
and cross-examine witnesses, and to introduce evidence.
Following the close of the trial, the General Counsel
filed a timely brief which has been duly considered.'
On the entire record in this case and from my observa-
tion of the witnesses, I make the following
FINDINGS OF FACT
1. JURISDICTION
Presidents Island Steel and Wire, Inc. is a corporation
with an office and place of business in Memphis, Tennes-
see, where it is engaged in manufacturing wire and steel
products.
Respondent admits that about June 1, 1983, it pur-
chased the assets of Piper Industries, Inc., Wire Division,
including the plant and equipment, and since that date it
has been engaged in the same business operation, at the
same location, selling the same product to substantially
the same customers, and has as a majority of its employ-
ees individuals who were previously employees of Piper
Industries, Inc.
Based on a projection of its operations since about
June 1, 1983, at which time Respondent commenced its
operations, Respondent, in the course and conduct of its
operations, will annually sell and ship from its Memphis,
' At the close of the trial, I set November 28, 1983, as the day when
briefs were to be received by me if any party desired to file a posthearing
brief Respondent filed a brief dated November 28 , which was received
in the Board 's Atlanta, Georgia branch office of the Division of Judges
on November 29, 1983 No good cause having been shown by Respond-
ent for its failure to file a timely brief, I shall not specifically address ar-
guments advanced therein in my decision I have, however, considered
Respondent's argument advanced at the trial and I shall give it appropri-
ate consideration
PRESIDENTS ISLAND STEEL 31
Tennessee facility products , goods, and materials valued
in excess of $50,000 directly to points outside the State
of Tennessee . Similarly , Respondent will annually pur-
chase and receive at its Memphis , Tennessee facility
products , goods , and materials valued in excess of
$50,000 directly from points outside the State of Tennes-
see.
Respondent is and has been at all times material an
employer engaged in commerce within the meaning of
Section 2(6) and (7) of the Act.
II. LABOR ORGANIZATION
Highway and Local Motor Freight Employees, Local
Union 667 , a/w International Brotherhood of Teamsters,
Chauffeurs , Warehousemen and Helpers of America is a
labor organization within the meaning of Section 2(5) of
the Act.
III. THE UNFAIR LABOR PRACTICES
The sole issue in this case is whether Respondent has
continued the employing entity and is a successor of
Piper Industries , Inc. with the concomitant obligation, as
such , to recognize and bargain with the Union which
was the certified exclusive collective -bargaining repre-
sentative of employees of Piper Industries , Inc., in the
appropriate bargaining unit described above.
The facts in this case are uncontested . Piper Industries,
Inc., Wire Division (Piper), manufactured wire which
was sold to customers to be used in making products
such as barbecue grills , refrigerator racks , nails, bed-
springs, and upholstered furniture springs.
On December 14, 1981, the Union was certified as the
exclusive collective-bargaining representative of Piper's
employees in the unit described above . On August 2,
1982, Piper and the Union entered into a collective-bar-
gaining agreement covering employees in the certified
bargaining unit. This agreement was effective by its
terms from July 12 , 1982 , until July 11, 1983.
Jack L . Long served as general manager of Piper's
wire division since October 1977. At a later date, Long
assumed management responsibilities over Piper's steel
division as well. Long signed the collective-bargaining
agreement with the Union on behalf of Piper.
Long , who had no ownership interest in Piper, was in-
terested in expanding its wire division , but Piper did not
want to make further investment in such expansion. As a
result, Long began steps to acquire a wire manufacturing
company in Greenville, Mississippi , which he had previ-
ously managed . At the same time , Long advised Piper of
his negotiations to buy this company . Piper responded by
offering to sell Long its own wire division . In May 1983,
Presidents Island Steel and Wire , Inc. was formed, and it
immediately entered into a contract with Piper to pur-
chase the land, building , and equipment of Piper's wire
division . The sale was to be closed on June 1 , 1983. Re-
spondent is owned in equal shares by Long and Robert
C. Wilcox, the latter of whom had no prior relationship
with Piper . A complicated financial package was ar-
ranged for the purchase and expansion of Piper 's wire di-
vision , each portion of which was contingent on the suc-
cessful completion of other portions of the package. Re-
spondent was unable to complete one portion of the fi-
nancial package in time to close the sale and conclude
the other financing arrangements on the June 1 closing
date . Nevertheless , Respondent assumed actual control
and commenced operations on that date by use of alter-
native short -term financial arrangements . The sale later
closed on July 29, 1983.
There was no significant hiatus between the closing of
Piper 's operations and the commencement of Respond-
ent's operations on June 1. Approximately May 26, em-
ployees of Piper were notified their employment was
being terminated effective May 31. Piper employees
were contacted on the job and given an opportunity to
fill out applications for Respondent prior to the closing
of Piper . The plant was closed on May 30 and 31 in
order for Piper to take a physical inventory in connec-
tion with the sale to Respondent . David Lunsford, who
was employed by Piper as plant superintendent, was
hired by Respondent in the same capacity . On June 1,
1983, Lunsford conducted brief interviews with former
production and maintenance employees of Piper. On
June 1 and 2 Respondent hired 22 of Piper 's 26 bargain-
ing unit employees.
In summary , it may be said that Respondent entered
into a contract to purchase and took over the operation
of Piper on June 1 , 1983. Respondent began operations
with 22 production and maintenance employees, all of
whom had been employees of Piper . Long , Piper's gen-
eral manager , became a 50-percent owner and president
of Respondent . Lunsford continued as plant superintend-
ent with Respondent as he had with Piper. The com-
plaint alleges , and Respondent admits, that since June 1,
Respondent has engaged in the same business operation
at the same location , selling the same product to substan-
tially the same customers, and has as a majority of its
employees individuals who were previously employees
of Piper.
As I indicated above, Long had plans from the time he
incorporated Respondent to expand to some degree the
amount of business which Piper had done. At the time
Respondent commenced operations on June 1, it ac-
quired five wire-drawing machines from Piper . From the
outset, Respondent planned to purchase two additional
wire-drawing machines and an Annealer furnace. Be-
cause of the problems in arranging financing for the pur-
chase of Piper, purchase orders for the acquisition of this
equipment were delayed until July 29 , when the
sale/purchase between Piper and Respondent was for-
mally closed. By the time of the trial herein , Respondent
had taken delivery of the two additional wire-drawing
machines . Respondent currently employs 30 production
and maintenance employees . The Annealer is in the proc-
ess of being fabricated and will not be in operation
before April or May 1984 . When asked on cross-exami-
nation if the Annealer would change the kind of product
that Respondent produces , Long replied that it would.
Long later admitted , however , that "it would still be
wire , but it will be just another application we can
supply to a different industry ...." Long testified that
he planned to use the same unit employees to operate the
new equipment , and that the forklift driver will be able
32 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
to operate the Annealer . At most, Respondent will have
to hire one additional person per shift to run the new
equipment . Long estimated that the maximum anticipated
work force would be 35 employees.
By letter dated June 7, 1983, the Union requested Re-
spondent to recognize that it was the successor to Piper
for purposes of collective bargaining and to bargain with
it on behalf of unit employees . Respondent did not re-
spond to the letter or otherwise indicate a willingness to
recognize and bargain with the Union as the exclusive
collective-bargaining representative of employees in the
unit described above.
Long testified that the reason he did not respond to
the Union 's request for bargaining was that he "did not
feel that they represented the majority of the employees
out there anymore ." When questioned regarding his basis
for doubting the Union 's majority status, Long respond-
ed, "there was about just 50 percent of them that was in
the bargaining unit at any time really, for Piper. And
there was about 50 percent of them that we hired when
we came over and also from the comments made by indi-
viduals that was part of the bargaining unit." Long
admits that these were the sole reasons why he refused
to recognize and bargain with the Union.
Though in his initial reply, Long refers to only 50 per-
cent of Piper employees being "in the bargaining unit," it
is clear from Long 's other testimony and the record as a
whole that Long is actually referring to the fact that
only about 50 percent of Piper employees in the bargain-
ing unit were dues -paying members of the Union. When
questioned about the comments made by individuals to
which Long refers, Long could recall only one conver-
sation with a unit employee , Sylvester McBee, and an
occasion when Plant Superintendent Lunsford informed
him that two individuals had said to Lunsford they were
glad they did not have a union . Long admitted , howev-
er, that neither his conversation with McBee nor his con-
versation with Lunsford took place prior to his refusing
to bargain with the Union. Both the conversation with
McBee and the conversation with Lunsford occurred
July 1983.
According to Long , in the conversation with McBee,
McBee stated, "We're no longer represented by the
Union." Long responded, "Yeah." McBee replied,
"Good." Lunsford testified he could recall only two unit
employees, Jerome Rigney and Joe Anderson , coming to
him and asking him if they were still represented by the
Union . In both cases, Lunsford replied , "No." Anderson
responded : good-that he needed the extra money.
When asked what the basis was for his telling employees
they were no longer represented by the Union , Lunsford
testified, "only that you know , that it was a new compa-
ny as far as I was concerned."
Analysis and Conclusions
Respondent purchased the assets of Piper , including
the plant and equipment , and since June 1 , 1983, Re-
spondent has been engaged in the same business oper-
ation , at the same location , selling the same product to
substantially the same customers, and has as a majority
of its employees individuals who were previously em-
ployees of Piper . Though Respondent has purchased and
plans to purchase certain additional equipment in order
to expand its volume of business , there has been no sub-
stantial change in the nature of the employing enterprise
between Respondent and Piper . The two wire -drawing
machines purchased by Respondent are exactly the same
type of equipment which Respondent acquired from
Piper. Though Long first asserted that the Annealer,
which is still in the process of being fabricated, would
change the kind of product Respondent manufactures,
Long later admitted that in fact it would not , that "it
would still be wire, but it will be just another application
we can ' supply to a different industry . . . ." Further,
Respondent plans to use current bargaining unit employ-
ees, in particular the forklift driver, to operate the An-
nealer.
There was no significant hiatus between the termina-
tion of Piper's operation and the commencement of Re-
spondent's. While they were still employees of Piper,
people in the bargaining unit were invited to fill out ap-
plications for employment with Respondent . Production
ceased for only 2 days while Piper inventoried its prod-
uct and materials in preparation for the sale to Respond-
ent. Long, who had been Piper's general manager and is
now Respondent 's president, and Lunsford , plant manag-
er for both Piper and Respondent, continued to control
and run the day-to-day operations of Respondent. At the
time Respondent commenced operations , its entire 22-
person production and maintenance work force were
former employees of Piper. Even now that Respondent
has increased its work force to 30 employees , at least
two-thirds of them, a vast majority remain former Piper
employees . Even if Respondent should in fact increase its
work force to the maximum anticipated level of 35 em-
ployees, a clear majority of them will have been former
Piper employees.
In view of these facts, and the record as a whole, I
find that Respondent is clearly a successor employer of
Piper Industries Inc., Wire Division . NLRB v. Burns Se-
curity Service, 406 U .S. 272 (1972).
Respondent admits that it received the Union 's letter
of June 7 requesting Respondent to recognize and bar-
gain with it as the exclusive collective -bargaining repre-
sentative of its employees . Long testified that the sole
reason he did not respond to the Union's request was
that he doubted the Union 's majority status . According
to Long , his basis for doubting the Union's majority
status was that the dues-checkoff list at Piper showed
that only about 50 percent of the employees were on
dues checkoff and that Long received some comments
from three or four employees indicating they no longer
wished to be represented for purposes of collective bar-
gaining by the Union . When questioned, however, Long
could recall only one conversation with a unit employee
and the conversation with Lunsford in which Lunsford
told Long that two employees had told Lunsford they
were glad the Union no longer represented them. It is
significant, however, that in the conversations Lunsford
had with employees, the statements by employees that
they were glad not to be represented by the Union came
only after Lunsford told them they were no longer rep-
resented . Even more significant, however, is the fact
PRESIDENTS ISLAND STEEL
Long admits that his conversation with employee McBee
as well as his conversation with Lunsford did not occur
until July 1983, several months after Respondent chose
to ignore the Union's request for bargaining. From the
record as a whole it is clear that Long's and Lunsford's
conversations with employees played no part in Re-
spondent's refusal to recognize and bargain with the
Union. Instead, the real reason, and the only reason, Re-
spondent in any way doubted the Union's lack of majori-
ty support was because Long knew as general manager
of Piper that only about 50 percent of employees in the
bargaining unit at Piper were on union dues' checkoff.
Respondent's position, however, contains a major flaw in
that it equates support for the Union with dues checkoff
and membership. It simply does not follow in States
which have enacted "right to work" laws that only
members of the Union prefer representation than it does
in other States which permit "union security clauses"
that everyone who is a member of a union desires repre-
sentation. It is well established that Respondent may not
use the number of employees who are union members
nor the number of employees on dues checkoff to dem-
onstrate a purported lack of majority support by employ-
ees for the Union. Stratford Visiting Nurses Assn., 264
NLRB 1026 (1982); Odd Fellows Rebekah Homes, 233
NLRB 143 (1977). Accordingly, I find that Respondent's
refusal to recognize and bargain with the Union as the
exclusive collective-bargaining representative of its em-
ployees in the appropriate unit described above violated
Section 8(a)(1) and (5) of the Act.
CONCLUSIONS OF LAW
1. The Respondent, Presidents Island Steel and Wire,
Inc., is an employer engaged in commerce within the
meaning of Section 2(2), (6), and (7) of the Act.
2. Highway and Local Motor Freight Employees,
Local Union No. 667, a/w International Brotherhood of
Teamsters, Chauffeurs, Warehousemen and Helpers of
America is a labor organization within the meaning of
Section 2(5) of the Act.
3. Respondent purchased the assets of Piper Industries,
Inc., Wire Division, including the plant and equipment,
and since June 1, 1983, has engaged in the same business
operation, at the same location, selling the same product
to substantially the same customers, and has as a majori-
ty of its employees individuals who were previously em-
ployees of Piper; and Respondent has thereby continued
the employing entity and is a successor of Piper.
4. The following employees of Respondent constitute a
unit appropriate for the purposes of collective bargaining
within the meaning of Section 9(b) of the Act:
All production and maintenance employees em-
ployed by Presidents Island Steel and Wire, Inc., at
its Memphis, Tennessee location; excluding all
office clerical employees, guards, watchmen, and
supervisors as defined in the Act.
5. By letter dated June 7, 1983, the Union requested
Respondent to recognize it as the exclusive collective-
bargaining representative of Respondent's employees in
the unit described above and to bargain collectively with
33
it 'with respect to their rates of pay, wages, hours of em-
ployment, and other other terms and conditions of em-
ployment.
6. Since June 7, 1983, Respondent has failed and re-
fused to recognize, and is failing an refusing to recognize
and bargain with the Union as the exclusive collective-
bargaining representative of employees in the appropriate
unit described above; and Respondent thereby violated
and is violating Section 8(a)(1) and (5) of the Act. -
7. The unfair labor practices which Respondent has
been found to have engaged in, as described above, have
a close, intimate, and substantial relationship to trade,
traffic, and commerce among the several States and tend
to lead to labor disputes burdening and obstructing com-
merce and the free flow of commerce within the mean-
ing of Section 2(6) and (7) of the Act.
THE REMEDY
Having found that Respondent has engaged in certain
unfair labor practices in violation of Section 8(a)(1) and
(5) of the Act, I shall recommend that it be ordered to
cease and desist therefrom and to take certain affirmative
action designed to effectuate the policies of the Act.
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
ed2
ORDER
The Respondent, Presidents Island Steel and Wire,
Inc., Memphis, Tennessee, its officers, agents, successors,
and assigns, shall
1. Cease desist from
(a) Failing and refusing to recognize and bargain with
the Union as the exclusive collective-bargaining repre-
sentative of employees in the appropriate unit described
above.
(b) In any other like or related mariner interfering
with, restraining, or coercing employees in the exercise
of rights guaranteed them in Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Bargain , on request, with Highway and Local
Motor Freight Employees, Local Union No. 667, a/w
International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America as the exclusive
collective-bargaining representative of Respondent's em=
ployees in the unit described above with respect to their
rates of pay, wages, hours of employment, and other
terms and conditions of employment, and, if an agree-
ment is reached embody such agreement in a signed con-
tract.
(b) Post at its Memphis, Tennessee facility copies of
the attached notice marked "Appendix."," Copies of the
3 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
3 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-
Continued
34 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
notice, on forms provided by the Regional Director for
Region 26, after being signed by the Respondent's au-
thorized representative, shall be posted by the Respond-
ent immediately upon receipt and maintained for 60 con-
secutive days in conspicuous places including all places
where notices to employees are customarily posted. Rea-
sonable steps shall be taken by the Respondent to ensure
that the notices are not altered, defaced, or covered by
any other material.
(c) Notify the Regional Director in writing within 20
days from the date of this Order what steps the Re-
spondent has taken to comply.
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 or-
dered us to post and abide by this notice.
WE WILL NOT fail and refuse to recognize and bargain
with Highway and Local Motor Freight Employees,
Local Union No. 667, a/w International Brotherhood of
Teamsters , Chauffeurs , Warehousemen and Helpers of
America as the exclusive collective -bargaining represent-
ative of employees in the following appropriate unit:
All production and maintenance employees em-
ployed by the employer at its Memphis , Tennessee,
facility; excluding all office clerical employees,
watchmen, guards and supervisors as defined in the
Act.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce employees in the exercise of
rights guaranteed them in Section 7 of the Act.
WE WILL recognize and bargain, upon request, with
the Union as the exclusive collective-bargaining repre-
sentative of our employees in the unit described above
with respect to their rates of pay, wages, hours of em-
ployment, and other terms and conditions of employ-
ment, and, if an agreement is reached, embody such
agreement in a signed contract.
PRESIDENTS ISLAND STEEL AND WIRE,
INC.