Rock-Tenn Co.

National Labor Relations Board - Board Decisions

Mar 11, 1985

274 N.L.R.B. 772 (N.L.R.B. 1985)

772 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Rock-Tenn Company, Mill Division , Inc. and Rock-
Tenn Company (Partition Division), Employer-
Petitioners 1 and United Paperworkers Interna-
tional Union , Local 11062 Union . Case 25-UC-
128
11 March 1985
DECISION ON REVIEW AND ORDER
CLARIFYING UNIT
BY CHAIRMAN DOTSON AND MEMBERS
HUNTER AND DENNIS
. On 18 June 1984 the Regional Director for
Region 25 issued a Decision and Order in the
above-entitled proceeding in which he dismissed
the Petitioners' unit clarification petition which
sought to separate the existing two-plant unit repre-
sented by the Union at Eaton, Indiana, into two
single-plant units. Thereafter, in accordance with
Section 102.67 of the National Labor Relations
Board's Rules and Regulations, the Petitioners filed
a timely request for review of the Regional Direc-
tor's' decision on the grounds, inter alia, that the
Regional Director erred in failing to clarify the
unit as requested.
By mailgram order dated 7 September 1984, the
National Labor Relations Board (former Member
Zimmerman dissenting) granted the Petitioners' re-
quest for review.
The Board has considered the entire record in
this case, including Union's opposition, with re-
spect to the issue under review and makes the fol-
lowing findings.
In 1968, the Clevepak Corporation purchased
both a 'paper mill and a partition plant in Eaton, In-
diana. In late 1968, in Case 25-RC-4089, the Union
was' certified to represent the stipulated two-plant
unit involved herein, described as "All production
and maintenance employees of the Clevepak Cor-
poration." The first collective-bargaining agree-
merit was entered into on 12 August 1969, and Cle-
vepak and the Union continued to bargain on a
two-plant unit basis. The most recent collective-
bargaining agreement was effective through 11
August 1984.
However, on 1 August 1983 Clevepak sold the
paper mill to Rock-Tenn Company, Mill Division,
Inc., ^a Tennessee corporation, and sold the parti-
tion plant to Rock-Tenn, Inc. (Partition Division),
a Georgia corporation. Both are separate operating
divisions of Rock-Tenn Company, a holding com-
pany. In, April 1984 Petitioners jointly requested to
separate negotiations at each plant for a new con-
' Hereinafter referred to as Petitioners
2 Hereinafter referred to as the Union
tract. The Union refused, and Petitioners filed the
instant unit clarification petition.3
The Regional Director dismissed the petition
after a hearing, finding that the purchase of the
two plants by the Employer and the resulting orga-
nizational changes had little, if any, effect on the
day-to-day operations of the plant or on the em-
ployees' terms or conditions of employment.
Therefore, he concluded that there was no substan-
tial impact or effect on the appropriateness of the
historical unit and that clarification of the unit was
not warranted.
Petitioners contend that the Regional Director's
decision fails to address the primary thrust of Peti-
tioners' case: that the unit was inappropriate prior
to the change in ownership. Petitioners contend
that the Regional Director did not decide whether
the existing unit was an appropriate unit; rather, he
assumed that the unit was appropriate and thus fo-
cused his attention on whether the change in own-
ership made the unit inappropriate. Petitioners
argue that while bargaining history is accorded
weight, it is of limited significance where the unit
does not conform to other standards of appropri-
ateness. The Union acknowledges that where there
are significant changes after a prior certification,
the bargaining history on the former basis no
longer has a controlling effect. However, the
Union argues that in the instant case there have
been no significant changes in these two operations
since Petitioners assumed control of the plants.
Thus, the Union contends that the Petitioners re-
tained all the hourly and supervisory employees,
retained the same equipment, still manufacture the
same products through the same processes, and the
employees still enjoy the same terms and condi-
tions of employment they enjoyed with the prede-
cessor employer. Yet, the Union acknowledges that
the two facilities are autonomous in various re-
spects: the two facilities maintain separate person-
nel functions and office facilities; day-to-day con-
trol over labor relations is a separate function; the
employees enjoy separate wage rates; and there is
no employee interchange between the two facilities
and no substantial functional integration of the two
plants. We find merit in Petitioners' contentions
that the bargaining history on a two-plant basis
should not be controlling here.
In the first few years of operation under Cleve-
pak, the existence of the two plants in a single bar-
gaining unit caused few problems. Stan Collins, the
general manager of the paper mill since 1969, testi-
fied that the two operations were somewhat inte-
grated at that time, with centralized control of
3 The petition was filed on 3 May 1984
274 NLRB No. 114
ROCK-TENN CO.
labor relations and recordkeeping. By the late
1970s, the unworkability of the multiplant unit
became apparent to the plant and mill officials of
Clevepak, and during both the 1978 and 1980 nego-
tiations they proposed to the Union that they bar-
gain for the employees as separate plant units. On
both occasions, the Union rejected the proposals.
With the purchase by Rock-Tenn, both plants
are now owned by separate corporations, which
are separate operating divisions of Rock-Tenn, a
holding company. The few remaining factors of
commonality existing prior to the purchase, i.e.,
centralized labor control and single corporate con-
trol, ended. The record discloses that each plant is
engaged in a totally different operation. The manu-
facturing processes are different and not functional-
ly dependent on each other. The paper mill is a
"milling operation " which converts raw materials
into large rolls of paper. The partition plant is not
a production facility in the same sense. Rather, it
takes rolls of paper which it cuts, shapes, and folds
into cardboard partitions for use in corrugated con-
tainers. Although the paper mill sells approximate-
ly 50 percent of its product to the partition plant, it
does so at fair market value and makes a profit on
the sales.
There is no interchange among the employees of
the two facilities. None of the 47 employees in the
mill has any duties in the partition plant; nor do
employees in the mill have any contact with em-
ployees in the partition plant.' Each plant has sepa-
rate and distinct corporate management and super-
visory staff.
Labor relations control is completely decentral-
ized. Each plant has its own personnel officer, and
personnel records are kept separately. Labor rela-
tions policy decisions are developed along division
lines. The current collective -bargaining agreement
is administered on a separate basis for the partition
plant and for the paper mill. Thus, any meaning
given to ambiguous contract provisions by past
practice at one plant has no bearing on the other
plant's interpretation of the same provision. The
effect is that a provision of the contract may be in-
terpreted in the partition plant in one way, for ex-
ample, and the same provision may be interpreted
and applied entirely differently in the paper mill.
Grievances are handled separately for each plant
without consultation with the management of the
other plant.
There are also dissimilarities in working condi-
tions. The paper mill is a continuous, around-the-
clock, operation. The work force is divided into
four crews which work three rotating shifts, 7 days
° One paper mill employee on occasion "spots" trucks at the partition
plant
773
a week. The partition plant is a "job shop" process
and is in operation only to fill certain jobs and
orders. Generally, the partition plant operates only
two 8-hour shifts per day, 5 days per week. Be-
cause of the continuous nature of the operation,
production employees at the paper mill do not
have any fixed breaks or lunch periods, while em-
ployees in the partition plant have two 10-minute
breaks and one-half hour for lunch. The facilities
are separated by approximately 250 feet; each has a
different postal address and telephone number. Se-
niority at one plant does not carry over to the
other plant if an employee transfers; however, an
employee's seniority is honored for purposes of va-
cations, holidays, insurance, and other fringe bene-
fits established by the collective-bargaining agree-
ment. There is no job bidding between plants, and
each plant does its own hiring. Similarly, layoffs
and recalls are handled on a separate plant basis.
Based on the completely separate corporate and
operational structure, the lack of functional integra-
tion between the paper mill and the partition plant,
the decentralized labor relations policies of the two
plants, and the absence of employee interchange or
contact, we find that the former two-plant unit of
employees at the paper mill and the partition plant
is no longer appropriate, and that only separate
units are appropriate.5 We do not agree with the
Union that, because of the "long history" of bar-
gaining on a two-plant basis, separate units under
Petitioners' mode of operations are inappropriate.
While the Board places great weight on collective-
bargaining history, it is not determinative where, as
here, significant changes in the organizational
structure and operations of the two plants,have oc-
curred which negate any community of interes
that may have existed previously among the em
ployees of the two plants. Thus, "compelling cii
cumstances" exist here for disregarding the bar-
gaining history on a two-plant basis. We find that
the historical unit no longer conforms reasonably
well to the normal standards of appropriateness.
Crown Zellerbach Corp., 246 NLRB 202, 204
(1979).6 Capehart-Farnsworth Co., 111 NLRB 800,
802 (1955); cf. Mennen Co., 108 NLRB 355, 356
(1954). Accordingly, on the particular facts here,
the unit clarification petition is reinstated, and we
6 In these circumstances , the fact that employees enjoy certain
common contractual benefits such as pension benefits, health insurance,
and holidays does not warrant a contrary result
6 Although the parties to the bargaining history in that case did not
object to establishing separate units, the Intervenor sought to preserve
the combined unit as does the Union here We are of the view that when
the Board is called on to clarify an existing unit and the facts show that
the existing unit is no longer appropriate, a lack of agreement among the
parties should not affect our statutory responsibility
774 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
shall clarify the unit as requested by Petitioners to
find that only separate plant units are appropriate.?
' The Union asserts that clarification is not appropriate for upsetting an
agreement or an established practice even if the agreement was entered
into by one of the parties for reasons which it claims to be mistaken, or
the practice has become established by acquiescence and not expressed
consent Union Electric Co, 217 NLRB 666, 667 ( 1975) We do not agree
that under the particular facts herein unit clarification is inappropriate
Columbia Gas Transmission Corp, 213 NLRB 111, 112 (1974), cited by
the Regional Director, is factually distinguishable There , the parties' bar-
gaining history was of a 30-year duration , various consolidations, merg-
ers, and reorganizations had occurred over the years and the parties con-
tinued to sign succeeding agreements on the same unit basis Here, on the
other hand , the Petitioners acquired the plants only recently Although
they continued to abide by the predecessor 's collective -bargaining agree-
ment for the brief period prior to its expiration , shortly after commencing
operation they requested the Union to bargain on a separate plant basis
consistent with Petitioners ' separate organizational and operational struc-
ture, but the Union would not agree We do not view Petitioners ' interim
adoption of the two-plant agreement as precluding a resolution of this
ORDER
It is ordered that the Certification of Representa-
tive issued by the Board in Case 25-RC-4089 in
July 1969 for a unit comprised of paper mill and
partition plants at Eaton, Indiana, presently owned
by Employer-Petitioners and currently represented
by the United Paperworkers International Union,
Local 1106, be clarified so as to constitute two sep-
arate plant units.
unit dispute In the Columbia Gas case, supra , former Chairman Miller in
his separate concurrence stated, "If the two units proposed were
shown to be appropriate units by our usual standards , and if the existing
single unit had been rendered inappropriate by reason of organizational
changes, I would grant the petition " for clarification We adopt this posi-
tion , and to the extent any cases may suggest otherwise , they are over-
ruled