Rite Style Fashions

National Labor Relations Board - Board Decisions

Jun 30, 1986

280 N.L.R.B. 1134 (N.L.R.B. 1986)

1134 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Michele Rena, and its alter ego, Rite Style Mer-
chandising, Inc., t/a Rite Style Fashions and
Local 130, International Ladies' Garment
Workers Union , AFL-CIO. Case 22-CA- 11612
30 June 1986
DECISION AND ORDER
By CHAIRMAN DOTSON AND MEMBERS
BABSON AND STEPHENS
Upon a charge filed on 6 May 1982, a first
amended charge filed on 17 May 1982, by the
Union, Local 130, International Ladies' Garment
Workers Union, the General Counsel of the Na-
tional Labor Relations Board issued a complaint
against the Respondent Michele Rena, and its alter
ego, Rite Style Merchandising, Inc., t/a Rite Style
Fashions, alleging that it has violated Section
8(a)(5), (3), and (1) of the National Labor Relations
Act. Although properly served copies of the
charge and complaint, the Respondent has failed to
file an answer to the complaint. It did inform the
General Counsel that it had filed a bankruptcy peti-
tion, which the Respondent claimed should auto-
matically stay this unfair labor practice proceeding.
On 22 December 1982 the General Counsel filed
a Motion for Summary Judgment. On 6 January
1983 the Board issued an order transferring the
proceeding to the Board and a Notice to Show
Cause why the motion should not be granted. The
Respondent filed no response. The allegations in
the motion are therefore undisputed.
The National Labor Relations Board has delegat-
ed its authority in this proceeding to a three-
member panel.
Ruling on Motion for Summary Judgment
Section 102.20 of the Board's Rules and Regula-
tions provides that the allegations in the complaint
shall be deemed admitted if an answer is not filed
within 10 days from service of the complaint,
unless good cause is shown. The complaint states
that unless an answer is filed within 10 days of
service, "all of the allegations in the complaint
shall be deemed to be admitted to be true and shall
be so found by the Board." Further, the undisputed
allegations in the Motion for Summary Judgment
disclose that the Respondent failed to file an
answer despite a telephone call and letter from the
General Counsel in addition to service of the com-
plaint. The only response submitted by the Re-
spondent in connection with the complaint took
the form of a letter from the Respondent's attor-
ney. This letter indicated that the Respondent had
filed a Chapter 11 bankruptcy reorganization peti-
tion on 30 August 1982, and that it was the Re-
spondent 's position that all actions pending against
the debtor were stayed pursuant to 11 U.S.C. §
362. The letter concluded that the Respondent
would consequently not be filing an answer to the
complaint.
The Respondent's financial condition does not
constitute good cause for its failure to file a timely
answer within the meaning of Section 102.20 of the
Board's Rules and Regulations. Evans Express Co.,
232 NLRB 655 (1977); Monroe Furniture Co., 231
NLRB 143 (1977). In addition, it is well established
as a matter of law that Board unfair labor practice
proceedings are exempt from the automatic stay
provisions of Federal bankruptcy law. E.g., Phoe-
nix Co., 274 NLRB 995 (1985). Consequently, we
reject the Respondent's attempt to invoke its bank-
ruptcy petition as a defense to its failure to file an
answer to the complaint.
In accord with the rule set forth above, and in
the absence of a showing of good cause for failure
to file a timely answer, the allegations of the com-
plaint are deemed to be admitted and are so found
by the Board, and the General Counsel's Motion
for Summary Judgment is granted.
On the entire record, the Board makes the fol-
lowing
FINDINGS OF FACT
I. JURISDICTION
Michele Rena and Rite Style are corporations
duly organized under and existing by virtue of the
laws of the State of New Jersey. At all material
times until about 31 March 1982, Michele Rena
maintained its principal place of business at 37 Wall
Street, Red Bank, New Jersey, where it engaged in
the business of manufacturing ladies' garments and
related products and services.
About 1 April 1982, Rite Style was established
by Michele Rena as a subordinate instrument to
and a disguised continuation of Michele Rena. At
all material times since that date, the two corpora-
tions have maintained a principal place of business
at 30 Bridge Avenue, Red Bank, New Jersey,
where they have engaged in the business of manu-
facturing ladies' garments and related products and
services. Michele Rena and Rite Style are, and
have been at all times material here, affiliated busi-
ness enterprises with common ownership and offi-
cers, integrated operations, and common labor rela-
tions policies and therefore constitute a single inte-
grated business enterprise. We find that Michele
Rena and Rite Style, hereafter referred to collec-
tively as the Respondent, are a single employer for
the purposes of the Act.
280 NLRB No. 72
RITE STYLE FASHIONS
The Respondent has, during the 12 months pre-
ceding issuance of the complaint, which period is
representative of its operations at all times material
here, performed services valued in excess of
$50,000 for various enterprises located in States
other than the State of New Jersey. In addition,
the Respondent has, during the above period, per-
formed services valued in excess of $50,000 for var-
ious enterprises located within the State of New
Jersey, each of which is directly engaged in inter-
state commerce.
We find that the Respondent is an employer en-
gaged in commerce within the meaning of Section
2(6) and (7) of the Act. We further find that the
Union is a labor organization within the meaning of
Section 2(5) of the Act.
H. THE UNFAIR LABOR PRACTICES
A. The 8(a)(5) and (1) Violations
The following employees of the Respondent con-
stitute a unit appropriate for collective-bargaining
purposes within the meaning of Section 9(b) of the
Act:
All employees employed by Respondent at its
Wall Street and Bridge Avenue, Red Bank,
New Jersey plants in the following crafts, in-
cluding cutters, graders, and markers; sample-
makers; examiners; factory floor workers; op-
erators; machine pressers, finishers, and press-
ers, but excluding all other employees, guards
and supervisors as defined in the Act.
The Respondent is, and at all material times has
been, an employer-member of an employer' s asso-
ciation named the American Cloak and Suit Manu-
facturers Association, Inc. (the Association). The
Respondent has delegated to the Association the
authority to bargain collectively on its behalf with
respect to the employees in the unit described
above. At all times material here, the Union has
been the designated exclusive collective-bargaining
representative of the Respondent's employees in
the unit described above. The Respondent has rec-
ognized the Union as such until about 15 March
1982, and has embodied such recognition in succes-
sive collective-bargaining agreements, the most
recent of which was effective by its terms for the
period 1 June 1979 through 31 May 1982. This last
collective-bargaining agreement contained provi-
sions requiring the Respondent to make contribu-
tions on behalf of its employees to: the Health and
Welfare Fund of Joint Board of Coat, Suit and
Allied Garment Workers Union; the I.L.G.W.U.
National Retirement Fund; and the I.L.G.W.U.
Health Services Plan (the Benefit Funds).
1135
About January 1982 the Respondent, without
notice to or agreement by the Union, unilaterally
ceased making contractual contributions to the
Benefit Funds. Further, about 15 March 1982, the
Respondent withdrew recognition of the Union as
the exclusive collective-bargaining representative
of its unit employees. Since that date, the Respond-
ent has repudiated the agreement and, acting
through its agents, has bypassed the Union and
dealt directly with its employees concerning rates
of pay, hours of work, and other terms and condi-
tions of employment. We find that the Respondent
has violated Section 8(a)(5) and (1) of the Act by
unilaterally ceasing contributions to the Benefit
Funds, withdrawing recognition of the Union, re-
pudiating the collective-bargaining agreement, and
bypassing the Union in dealing directly with unit
employees concerning rates of pay, hours, or other
terms and conditions of employment.
B. The 8(a)(3) and (1) Violations
About 22 April 1982 the Respondent discharged
its employee Rose Migliaccio. The Respondent en-
gaged in the above-described conduct in order to
discourage its employees from engaging in union
and other concerted protected activities. We find
that by this conduct the Respondent has discrimi-
nated in regard to terms and conditions of employ-
ment of its employees, thereby discouraging mem-
bership in the Union, in violation of Section 8(a)(3)
and (1) of the Act.
C. The 8(a)(1) Violations
About 16 March 1982 the Respondent's agent,
Nicholas Allegretta,' instructed its employees not
to engage in activities on behalf of the Union or to
give assistance to the Union. About 22 April 1982
Allegretta threatened Bridge Avenue plant employ-
ees with discharge if they engaged in activities on
behalf of or gave any assistance or support to the
Union. We find that by this conduct the Respond-
ent has interfered with, restrained, and coerced em-
ployees in the exercise of their Section 7 rights, in
violation of Section 8(a)(1) of the Act.
III. THE EFFECT OF THE UNFAIR LABOR
PRACTICES UPON COMMERCE
The activities of the Respondent, set forth in sec-
tion II, above, occurring in connection with its op-
erations described in section I, above, have a close,
intimate, and substantial relationship to trade, traf-
fic, and commerce among the several States and
tend to lead to labor disputes burdening and ob-
1 Nicholas Allegretta is plant manager of Rite Style and president of
Michele Rena
1136 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
structing commerce and the free flow of com-
merce.
CONCLUSIONS OF LAW
1. Michele Rena, and its alter ego, Rite Style
Merchandising, Inc., t/a Rite Style Fashions is an
employer engaged in commerce within the mean-
ing of Section 2(6) and (7) of the Act.
2. Local 130, International Ladies' Garment
Workers Union, AFL-CIO is a labor organization
within the meaning of Section 2(5) of the Act.
3. All employees employed by the Respondent at
its Wall Street and Bridge Avenue, Red Bank,
New Jersey plants in the following crafts, includ-
ing cutters , graders, and markers; samplemakers;
examiners; factory floor workers; operators; ma-
chine pressers, finishers, and pressers, but excluding
all other employees, guards and supervisors as de-
fined in the Act constitute a unit appropriate for
the purposes of collective-bargaining within the
meaning of Section 9(b) of the Act.
4. At all times material here, the Union has been
and now is the exclusive representative of all em-
ployees in the aforesaid unit for the purposes of
collective bargaining within the meaning of Section
9(a) of the Act.
5. By unilaterally ceasing contractually required
payments to employee benefit funds, by withdraw-
ing recognition of the Union, by repudiating a col-
lective-bargaining agreement during its term, and
by bypassing the Union in dealing directly with
employees in the bargaining unit represented by the
Union, the Respondent has engaged in unfair labor
practices within the meaning of Section 8(a)(5) of
the Act.
6. By discriminatorily discharging employee
Rose Migliaccio to discourage employees from en-
gaging in union and other protected concerted ac-
tivities, the Respondent has violated Section 8(a)(3)
of the Act.
7. By the acts described in section II, A, B, and
C above, the Respondent has interfered with, re-
strained, and coerced employees in the exercise of
the rights guaranteed in Section 7 of the Act, and
thereby has engaged in unfair labor practices
within the meaning of Section 8(a)(1) of the Act.
8. The aforesaid unfair labor practices are unfair
labor practices affecting commerce within the
meaning of Section 2(6) and (7) of the Act.
REMEDY
Having found that the Respondent has engaged
in and is engaging in unfair labor practices within
the meaning of Section 8(a)(5), (3), and (1) of the
Act, we shall order that it cease and desist and take
certain affirmative action designed to effectuate the
policies of the Act.
Such affirmative action shall include ordering
the Respondent, on request , to meet and bargain
with the Union as the exclusive representative of
its employees. The Respondent shall also be re-
quired to offer Rose Migliaccio reinstatement to
the position she held prior to her unlawful termina-
tion or, if such position no longer exists, to a sub-
stantially equivalent position, without prejudice to
her seniority or other rights and privileges. We
shall also order the Respondent to make Rose Mig-
liaccio whole for any loss of earnings she may have
suffered because of the discrimination against her,
to be computed in accordance with the formula ap-
proved in F. W. Woolworth Co., 90 NLRB 289
(1950), with interest to be computed in the manner
prescribed in Florida Steel Corp., 231 NLRB 651
(1977). Additionally, we shall order the Respond-
ent to restore the status quo ante by paying to the
Benefit Funds any moneys unlawfully withheld
from about January until 30 August 1982,2 the date
of the filing of the bankruptcy petition, and to
make its employees whole, plus interest, as comput-
ed in Ogle Protection Service, 183 NLRB 682 (1970),
for losses suffered on and after 15 March until 30
August 1982 by virtue of the Respondent's repudi-
ation of the contract and its direct dealing with
employees concerning wages, hours, and other
conditions of employment.3
ORDER
The National Labor Relations Board orders that
the Respondent, Michele Rena, and its alter ego,
Rite Style Merchandising, Inc., t/a Rite Style
Fashions, Red Bank, New Jersey, its officers,
agents, successors , and assigns, shall
1. Cease and desist from
(a) Refusing to bargain collectively concerning
rates of pay, wages, hours, and other terms and
conditions of employment with Local 130, Interna-
2 Because the provisions of employee benefit fund agreements are van-
able and complex, the Board does not provide for interest at a fixed rate
in the adjudicatory stage of proceedings We leave to compliance pro-
ceedings the question of how much interest the Respondent must pay
into the Benefit Funds in order to satisfy our "make-whole" remedy See
Merryweather Optical Co, 240 NLRB 1213, 1216 fn 7 (1979)
s The Respondent normally would be obligated to comply with the
terms and conditions of employment specified in the collective-barganung
agreement even after its 31 May 1982 expiration . Under NLRB v Bildisco
& Bildisco, 465 U S. 513 (1984), however, the Respondent would not
have violated Sec . 8(a)(5) and (1) of the Act by ceasing to observe ex-
pired contract terms after the filing of a bankruptcy petition . Goldstein
Co, 274 NLRB 682, 684 7 fn. 5 (1985) As this case arose and the Re-
spondent filed its petition in 1982, the Bildisco holding is controlling,
rather than the Bankruptcy Amendments and Federal Judgeship Act of
1984, Pub . L 98-353, 98 Stat 333 (1984) Consequently , we have limited
the Respondent 's make-whole liability for its 8 (a)(5) violations to the pre-
petition period Its backpay liability for the unlawful discharge of Rose
Migliaccio continues without limitation after the filing of the petition.
RITE STYLE FASHIONS
tional Ladies' Garment Workers Union, AFL-CIO,
as the exclusive bargaining representative of its em-
ployees in the following appropriate unit:
All employees employed by Respondent at its
Wall Street and Bridge Avenue, Red Bank,
New Jersey plants in the following crafts, in-
cluding cutters, graders, and markers; sample-
makers; examiners; factory floor workers; op-
erators; machine pressers, finishers, and press-
ers, but excluding all other employees, guards
and supervisors as defined in the Act.
(b) Refusing to bargain collectively with the
Union by unilaterally failing and refusing to make
required benefit fund payments on behalf of its unit
employees to: the Health and Welfare Fund of
Joint Board of Coat, Suit and Allied Garment
Workers Union; the I.L.G.W.U. National Retire-
ment Fund; and the I.L.G.W.U. Health Services
Plan.
(c) Refusing to bargain collectively with the
Union by repudiating its collective-bargaining
agreement with that labor organization, and by by-
passing the Union and dealing directly with unit
employees about rates of pay, wages, hours, and
other terms and conditions of employment.
(d) Discharging employees because of their
membership in, support of, or activities on behalf
of the above-named labor organization, or any
other labor organization.
(e) Instructing employees not to engage in union
or protected concerted activities and threatening to
discharge employees who engage in union or other
protected concerted activities.
(f) In any like or related manner interfering with,
restraining, or coercing employees in the exercise
of the rights guaranteed them by Section 7 of the
Act.
2. Take the following affirmative action neces-
sary to effectuate the policies of the Act.
(a) On request, bargain with the above-named
labor organization as the exclusive representative
of all employees in the aforesaid appropriate unit
with respect to rates of pay, wages, hours, and
other terms and conditions of employment and, if
an understanding is reached, embody such under-
standing in a signed agreement.
(b) Make whole the unit employees' Benefit
Funds for any contributions that were due but un-
lawfully withheld in and after January to 30
August 1982 and, if applicable, make whole any of
its employees for any loss of benefits or expendi-
tures incurred by them by reason of any discontin-
ued payment to such funds during this period.
(c) Make employees whole for losses suffered
from on and after 15 March 1982 by virtue of the
1137
Respondent's repudiation of the contract and direct
dealing with employees.
(d) Offer Rose Migliaccio immediate and full re-
instatement to her former job or, if that job no
longer exists, to a substantially equivalent position,
without prejudice to her seniority or any other
rights or privileges previously enjoyed, and make
her whole for any loss of earnings and other bene-
fits suffered as a result of the discrimination against
her, in the manner set forth in the remedy section
of the decision.
(e) Remove any reference in its personnel
records to the unlawful discriminatory discharge of
Rose Migliaccio and notify her in writing that this
has been done and that evidence of such unlawful
discipline will not be used against her in future per-
sonnel actions.
(f) Preserve and, on request, make available to
the Board or its agents for examination and copy-
ing all payroll records, social security payment
records, timecards, personnel records and reports,
and all other records necessary to analyze the
amount of backpay and restoration to the Benefit
Funds due under the terms of this Order.
(g) Post at its in Wall Street and Bridge Avenue,
Red Bank, New Jersey facilities copies of the at-
tached notice marked "Appendix."4 Copies of the
notice, on forms provided by the Regional Direc-
tor for Region 22, after being signed by the Re-
spondent's authorized representative, shall be
posted by the Respondent immediately upon re-
ceipt and maintained for 60 consecutive days in
conspicuous places including all places where no-
tices to employees are customarily posted. Reason-
able steps shall be taken by the Respondent to
ensure that the notices are not altered, defaced, or
covered by any other material.
(h) Notify the Regional Director in writing
within 20 days from the date of this Order what
steps the Respondent has taken to comply.
4 If this Order is enforced by a judgment of a United States court of
appeals, the words in the notice reading "Posted by Order of the Nation-
al Labor Relations Board" shall read "Posted Pursuant to a Judgment of
the United States Court of Appeals Enforcing an Order of the National
Labor Relations Board."
APPENDIX
NOTICE To EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found
that we violated the National Labor Relations Act
and has ordered us to post and abide by this notice.
1138 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
WE WILL NOT refuse to bargain collectively con-
cerning rates of pay, wages, hours, and other terms
and conditions of employment with Local 130,
International Ladies' Garment Workers Union,
AFL-CIO, as the exclusive representative of the
employees in the following bargaining unit:
All employees employed by us at our Wall
Street and Bridge Avenue , Red Bank, New
Jersey plants in the following crafts, including
cutters, graders, and markers ; samplemakers;
examiners ; factory floor workers; operators,
machine pressers , finishers , and pressers, but
excluding all other employees , guards and su-
pervisors as defined in the Act.
WE WILL NOT refuse to bargain collectively with
the Union by unilaterally failing and refusing to
make required benefit fund payments on behalf of
our unit employees to: the Health and Welfare
Fund of Joint Board of Coat, Suit and Allied Gar-
ment Workers Union ; the I .L.G.W.U. National Re-
tirement Fund; and the I.L.G.W.U. Health Serv-
ices Plan.
WE WILL NOT refuse to bargain collectively with
the Union by repudiating our collective -bargaining
agreement with that labor organization and by by-
passing the Union and dealing directly with our
unit employees about rates of pay, wages, hours,
and other terms and conditions of employment.
WE WILL NOT discharge our employees because
of their membership in, support of, or activities on
behalf of the above -named labor organization or
any other labor organization.
WE WILL NOT instruct our employees not to
engage in union or protected concerted activities
and threaten to discharge employees who engage
in union or protected concerted activities.
WE WILL NOT in any like or related manner
interfere with, restrain, or coerce our employees in
the exercise of the rights guaranteed them by Sec-
tion 7 of the Act.
WE WILL, on request, bargain with the above-
named Union, as the exclusive representative of all
employees in the bargaining unit described above,
with respect to rates of pay, wages, hours, and
other terms and conditions of employment and, if
an understanding is reached, embody such under-
standing in a signed agreement.
WE WILL make whole the unit employees' Bene-
fit Funds for any contributions due but unlawfully
withheld by us from about January to 30 August
1982 and, if applicable, make whole any of our em-
ployees for any loss of benefits or expenditures in-
curred by them by reason of any discontinued pay-
ment to such funds during this period.
WE WILL make employees whole for losses suf-
fered from about 15 March to 30 August 1982 by
virtue of our repudiation of the contract and direct
dealing with employees.
WE WILL offer Rose Migliaccio immediate and
full reinstatement to her former job or, if that job
no longer exists, to a substantially equivalent posi-
tion, without prejudice to her seniority or any
other rights or privileges previously enjoyed and
WE WILL make her whole for any loss of earnings
and other benefits resulting from her discharge, less
any net interim earnings , plus interest.
WE WILL remove any reference in our personnel
records to the unlawful discriminatory discharge of
Rose Migliaccio and we will notify her in writing
that this has been done and that the evidence of
such unlawful discipline will not be used against
her in future personnel actions.
MICHELE RENA, AND ITS ALTER EGO,
RITE STYLE MERCHANDISING, INC.,
T/A RITE STYLE FASHIONS