Smyth Manufacturing Co., Inc.; Beacon Industries

National Labor Relations Board - Board Decisions

Nov 25, 1985

277 N.L.R.B. 680 (N.L.R.B. 1985)

680 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Smyth Manufacturing Co., Inc .; Beacon Industries
and District 26, LL 354 , International Associa-
tion of Machinists and Aerospace Workers,
AFL-CIO. Cases 1-CA-12643, 1-CA-12812,
and 1-CA-13497
25 November 1985
SUPPLEMENTAL DECISION AND
ORDER
BY CHAIRMAN DOTSON AND MEMBER DENNIS
AND JOHANSEN
On 19 February 1980 the National Labor Rela-
tions Board issued a Decision and Order ' directing
the Respondent , inter alia , to make whole its em-
ployees for any loss of earnings resulting from the
Respondent 's unfair labor practices . On 5 January
1982 the United States Court of Appeals for the
Second Circuit entered a consent judgment enforc-
ing the Board 's Order . A controversy having arisen
over the backpay owed under the Board 's Order,
the Regional Director for Region 1 issued and
caused to be served on the parties an original and
amended backpay specification . The Respondent
filed answers , and a hearing was held before Ad-
ministrative Law Judge Walter J. Alprin, who
issued the attached supplemental decision on 30
January 1984. The Respondent and the General
Counsel filed exceptions and supporting and an-
swering briefs.
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 to the extent consistent with this Sup-
plemental Decision and Order.
We affirm the judge's conclusion that our origi-
nal Order does not limit the Respondent's backpay
liability to employees laid off on or after 30 Sep-
tember 1977. Rather , our Order requires the Re-
spondent to make whole all employees laid off or
terminated as a result of the Respondent 's unlawful
cessation of manufacturing operations at its Bloom-
field , Connecticut plant on 30 September 1977.
That includes employees laid off or terminated
during September 1977 because of the Respond-
ent's anticipated cessation of operations . This con-
struction accords with the plain sense of our deci-
sion, which is to make whole employees who were
the victims of the Respondent 's unfair labor prac-
' 247 NLRB 1139 (1980).
tices.2 We also affirm the judge 's finding that em-
ployees Klinkowski , Bailey , Finch , Pallotta, Von
Eisengrein , and Pawlak were laid off in September
1977 because of the Respondent 's anticipated cessa-
tion of operations at the end of that month, and
that they are entitled to backpay for their resulting
losses.3
With respect to employee Klinkowski , we find
merit in the General Counsel 's contention that the
Respondent is not relieved of its obligation to make
Klinkowski a valid offer of reinstatement and that
the Respondent 's backpay obligation to Klinkowski
should continue to run until such an offer has been
made . The Respondent contends that any backpay
obligation to Klinkowski was tolled when he told
the Board 's Regional Office in April 1980 that he
would not accept reinstatement with the Respond-
ent if it were offered .4 At the time Klinkowski
made this statement , he was employed elsewhere,
but he subsequently lost that interim job. For the
reasons stated in our supplemental decision in Hein-
rich Motors, 166 NLRB 783, 785-786 (1967), enfd.
403 F .2d 145 , 150 (2d Cir . 1968), we find that,
absent a valid offer of reinstatement from the Re-
spondent , Klinkowski 's statement to the Regional
Office did not constitute a waiver of his right to re-
instatement and, therefore , did not toll the Re-
spondent 's backpay liability to Klinkowski. Conse-
quently , Klinkowski 's backpay will continue to
accrue until he receives a valid reinstatement offer
from the Respondent.5
The judge found that employee Remus Sitaru
should be disallowed certain backpay because of
his failure to accept an offer of interim employment
2 In reaching this conclusion , we find it unnecessary to rely on corre-
spondence, which the Respondent characterizes as offers to compromise,
between the Respondent 's prior counsel and the Board 's Regional Office.
® We find, however , in agreement with the judge , that employee Ca-
varic's layoff on 9 September 1977 was attributable to the temporary
nature of his job rather than to the Respondent's unlawful cessation of
operations. When Cavaric was recalled on 10 August 1977, he was noti-
fied that his job was temporary and that it would probably be completed
within 2 months. The General Counsel relies on evidence that Cavaric
performed general work unconnected to any particular project, and that
he was bumped from his job on 9 September 1977 by a union official.
That evidence is insufficient, in our estimation , to establish that Cavaric's
job was permanent or that his temporary job was prematurely terminated
because of the Respondent's cessation of operations at the end of Septem-
ber
4 Klinkowski 's statement was made to the Regional Office during its
investigation of possible voluntary compliance with the Board's Order.
5 We have modified the judge 's recommended Order to clarify that the
amount of backpay listed in the backpay specification does not limit the
Respondent 's backpay obligation. Rather, the Respondent 's obligation
continues until the Respondent fully complies with the Board 's Order in
the underlying unfair labor practice case . See Amshu Associates, 234
NLRB 791, 797 ( 1978); Stevens Ford, Inc., 271 NLRB 628 (1984). We
note , however , that the General Counsel concedes that the backpay
period for employees other than Klinkowski ended no later than 11 No-
vember 1980, by which time the Respondent had offered reinstatement to
all entitled employees except Klinkowski . Interest on the backpay awards
will, of course, continue to accrue until full compliance.
277 NLRB No. 66
SMYTH MFG. Co
as an experimental machinist with Chandler-Evans
in West Hartford, Connecticut, at the end of Feb-
ruary 1978. Sitaru testified that he did not accept
that job because he had "in mind" a job with Hart-
ford Tool and Die. The judge inferred from this
testimony that the job at Chandler-Evans was
equivalent to Sitaru's prior employment with the
Respondent and that Sitaru had incurred a willful
loss of interim earnings by failing to accept it.
However, the record shows that on 15 March
1978, about 2 weeks after the job offer from Chan-
dler-Evans, Sitaru accepted a job as a toolmaker
with Hartford Tool and Die, which was substan-
tially equivalent in pay to Sitaru's prior employ-
ment. In the 2-3/4 years following Sitaru's employ-
ment with Hartford Tool and Die, he earned as
much or more per quarter than the backpay formu-
la calculated that he would have earned with the
Respondent in all but 3 quarters. Even in the 3
quarters when he earned less, the difference was
comparatively small, ranging from $49 to $148 per
quarter.
Although the job at Chandler-Evans was offered
about 2 weeks before the job at Hartford Tool and
Die, we cannot say that Sitaru incurred a willful
loss of earnings by electing to accept the second
job rather than the first. Indeed, since the record
shows nothing about the terms and conditions of
employment at Chandler-Evans, it is entirely possi-
ble that the job at Hartford Tool and Die paid
better or offered more regular hours than the job at
Chandler-Evans, and that the net result of accept-
ing the second job rather than the first was to
reduce the total backpay owing to Sitaru.6 At any
rate, we do not believe that delaying employment
briefly to secure a job that the employee believes
will be preferable constitutes a willful loss of earn-
ings.
6 Similarly, we find that Sitaru, who was qualified as a journeyman
toolmaker, was justified in focusing his search for interim employment on
toolmaker jobs, although he was employed as a machinist at the time of
his layoff from the Respondent. It may well be that by seeking and secur-
ing toolmakers' work Sitaru reduced the Respondent's total backpay li-
ability. At any rate, concentrating his efforts on the search for a toolmak-
er's job did not constitute a willful loss of earnings Moreover, we note
that although Sitaru answered "yes" when asked if he "only look[ed] for
a job as a toolmaker," other portions of his testimony indicate that he
sought interim work as both a machinist and a toolmaker
We affirm the judge's findings that Sitaru was not required to accept
jobs offered him at lower pay or on an undesirable shift, or for which he
was not qualified, according to his uncontradicted testimony.
In addition, we reject the Respondent's contention that Sitaru's back-
pay claim of $148 for the third quarter of 1978 should be disallowed be-
cause at the backpay hearing in 1983 Setaru stated, on cross-examination,
that "it could be I was out a week or two sick" in the third quarter of
1978. The Respondent made no effort to proffer records from Hartford
Tool and Die showing that such an absence in fact occurred; nor did it
proffer evidence that any such absence would have exceeded authorized
sick leave , or that it would have resulted in a loss of earnings equaling
$148 in that quarter, had Sitaru remained in the Respondent's employ
681
The judge also found that Sitaru had intentional-
ly concealed his job offer at Chandler-Evans in
February 1978 because he failed to mention it in a
Regional Office questionnaire in May 1983, and
that this concealment was the equivalent of an in-
tentional concealment of interim earnings, disquali-
fying Sitaru from backpay for the first quarter of
1978. See American Navigation Co., 268 NLRB 426
(1983). We find, on the contrary, that the failure to
mention an unaccepted job offer 5 years ago may
be attributable to a lapse of memory rather than to
a desire to conceal. In any event, since we have
found that Sitaru was justified in passing up the
Chandler-Evans offer to accept a job at Hartford
Tool and Die about 2 weeks later, the failure to
mention the earlier offer cannot be equated with an
intentional concealment of interim earnings.? Ac-
cordingly, we have corrected the judge's calcula-
tions of the backpay due Sitaru to restore the im-
properly excluded amounts.
The judge found that Robert Woods Sr. was en-
titled to backpay from the time of his unlawful
layoff on 30 September 1977 until he suffered a dis-
abling heart attack on 28 March 1978. We affirm,
but on somewhat different grounds from those
relied on by the judge. Counsel for the Respondent
conceded at the backpay hearing that Woods' ill-
ness was so serious as to preclude him from testify-
ing and disavowed any claim that the Respondent
was denied its procedural rights because of its in-
ability to examine Woods. Instead, the Respondent
called as a witness the supervisory compliance offi-
cer from the Board's Regional Office to testify
what Woods had told him concerning his search
for interim work.
The compliance officer testified that he tele-
phoned Woods early one evening, about 4 weeks
before the backpay hearing, and talked to him for 5
to 7 minutes. In his direct testimony, the compli-
ance officer stated that Woods had told him that he
"didn't apply" for any jobs following his layoff. On
cross-examination, counsel for the Union asked the
compliance officer whether he had asked if Woods
had gone to any employers seeking to file applica-
tions for work. The compliance officer answered:
"I don't recall his exact response. My recollection
is that what he said was, in essence . . . that he
had not gone out searching for work." The compli-
ance officer acknowledged, however, that his con-
temporaneous notes of his conversation with
Woods merely indicated that Woods "didn't apply
for jobs" after his layoff.
' The judge's finding that Sitaru was not guilty of an intentional con-
cealment of earnings with respect to other jobs that lie was justified in
not accepting (see fn 6) is affirmed.
682 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
On further cross-examination, the compliance of-
ficer testified that Woods had said that he collected
unemployment compensation after his layoff. The
compliance officer added that he was "not sure,"
but he "believe[d]" that he had asked Woods
"whether he had been sent out on any job inter-
views . . . by the unemployment office," and that
he "believe[d]" that Woods had said that he had
not.
The General Counsel thereafter proffered a
sworn statement from Woods that she had taken
during a personal interview of approximately 1-1/2
hours at Woods' home on 25 May 1983, about a
week before the backpay hearing. Woods' affidavit
states that from the time of his layoff in September
1977 until his heart attack in March 1978, Woods
had gone "around to a number of companies . . .
looking for work" and that he specifically remem-
bered going to East Granby Machine; B & E Tool
in Southwick, Massachusetts; Delta in East
Granby; and Gerber in Windsor, Connecticut. The
affidavit further states that Woods collected unem-
ployment compensation, that the unemployment
office arranged two interviews for Woods at the
office, and that Woods continued to look for work
in the newspapers.
Counsel for the Respondent objected to the ad-
mission of Woods' affidavit at the hearing on the
ground that it was hearsay. After the judge over-
ruled that objection, however, the Respondent
dropped the argument in its brief to the judge. The
Respondent's brief merely urged that the judge,
faced with two apparently inconsistent statements
from an unavailable witness, should credit the com-
pliance officer's recollection and conclude that
Woods did not make a reasonably diligent search
for interim work.
The judge found that Woods' written and sworn
statement to the General Counsel should be cred-
ited over his oral, unsworn statement, as remem-
bered by the compliance officer. Although Woods
was not available as a witness, the judge noted that
the Respondent could have sought to meet its
burden of proof with respect to mitigation of dam-
ages by obtaining evidence from the state unem-
ployment office and from the employers named in
Woods' affidavit. Absent any such evidence, the
judge concluded that Woods as a victim of the Re-
spondent's unfair labor practice, should be given
the benefit of any doubt and his backpay claim
upheld.
The Respondent, in its exceptions and brief to
the Board, now urges that Woods' affidavit should
have been excluded from evidence as hearsay be-
cause it is self-serving and does not come within
any of the hearsay exceptions. On the view we
take of this case, it is unnecessary to reach that
issue. Assuming arguendo that Woods' written affi-
davit is hearsay and that his oral statements, as
recollected by the compliance officer, are not, we
nonetheless conclude that the Respondent had not
met its burden of establishing that Woods incurred
a willful loss of earnings by failing to make a rea-
sonably diligent search for work.8
The compliance officer's contemporaneous notes
of his conversation with Woods merely state that
Woods did not "apply" for any jobs after his
layoff. That statement is ambiguous since it may
refer merely to the filing of a formal application
for work. An employee who goes to various em-
ployers looking for work may not be permitted to
file an employment application if there are no
openings. The compliance officer acknowledged
that he did not ask Woods for a more specific
answer to his question and did not "recall" Woods'
"exact response ." In these circumstances, we do
not regard as sufficiently probative the compliance
officer's "recollection," on cross-examination, that
what Woods said "in essence . . . was that he had
not gone out searching for work," As the judge
pointed out, the issue here is not the compliance
officer's credibility, but whether his recollection of
his brief telephone conversation with Woods ade-
quately establishes that Woods did not make a rea-
sonably diligent search for work. We note that
telephoning an invalid's home in the evening and
talking to him for 5 to 7 minutes is unlikely to
produce a full or totally reliable account of his ef-
forts to find work before his disabling heart attack.
Indeed, as noted, the Regional Office did not treat
the compliance officer's telephone call as disposi-
tive; instead, counsel for the General Counsel went
to Woods' home for a personal interview lasting
about 1-1/2 hours.
It is well settled that the ultimate burden of
proof is on a respondent to prove diminution of
damages through willful loss of earnings. Mastro
Plastics Corp., 136 NLRB 1342, 1346-47 (1962),
enfd. 354 F.2d 170 (2d Cir. 1965), cert. denied 384
U.S. 972 (1966); Heinrich Motors, 166 NLRB 783
8 Cf. NLRB v Mastro Plastics Corp, 354 F 2d 170, 179 (2d Cir 1965),
cert denied 384 U S 972 (1966), where the Second Circuit stated
Even if the testimony here received would be inadmissible hearsay
in a civil action we are not prepared to require the Board to exclude
it from a backpay hearing. As the discriminatee could not be pro-
duced, the Board could accept other evidence which tended to es-
tablish the facts Here, the evidence was testimony as to the de-
ceased's discussions of his search for alternative work We do not
consider it "practicable," as that word is used in Section 10(b) [of
the Act], to exclude this relevant testimony Moreover, since the
burden of proving lack of a diligent search was on Mastro, we fall to
see how the admission of this testimony was prejudicial, As we
stated above , the Board can only be expected to make available for
the employer 's cross-examination such evidence as it may reasonably
obtain
SMYTH MFG. CO.
(1967), enfd. 403 F.2d 145, 148 (2d Cir. 1968). In
the present case, backpay claimant Woods was
concededly unable to testify. The General Counsel,
therefore, proffered an affidavit from Woods in
which he named four companies where he had
sought work and referred to two employment
interviews set up by the unemployment compensa-
tion office. Assuming, as the Respondent contends,
that Woods' affidavit was hearsay, it nonetheless
provided the Respondent with specific information
that could have been checked to determine the
truth of Woods' assertions concerning his search
for interim work. As the judge noted, the Respond-
ent elected not to pursue those inquiries and, in-
stead, relied solely on the compliance officer's
recollection of his brief telephone conversation
with Woods. For the reasons stated above we do
not believe that the evidence is sufficient to meet
the Respondent's burden of proving that Woods
did not make a reasonably diligent search for work
after he was unlawfully terminated by the Re-
spondent. We therefore affirm the judge's allow-
ance of Woods' backpay claim.9
An issue is presented concerning the appropriate
backpay period for pension contributions. Under
the collective-bargaining agreement between the
Respondent and the Union that expired in Febru-
ary 1977, the Respondent agreed to make weekly
pension contributions of $6 for each covered em-
ployee to the IAM Pension Fund (the Fund). Fol-
lowing expiration of the collective-bargaining
agreement, the Respondent continued payments to
the Fund through September 1977, when the Re-
spondent ceased operations. Thereafter, the Re-
spondent sought and secured from the Fund a
refund of the Respondent's contributions from Feb-
ruary through September 1977, apparently because
there was no collective-bargaining agreement in
effect during that period. The Respondent signed
another collective-bargaining agreement with the
Union on 15 March 197910 that provided for pen-
sion contributions to the Fund for current employ-
ees from 6 February 1977, when the prior agree-
merit expired. The Fund, however, would not
accept the retroactive contributions that the Re-
spondent tendered for the four covered employees
then on the payroll and returned the contributions
to the Respondent. Thereafter, the Respondent
9 Although we affirm the judge's findings of a willful loss of earnings
by employees Earl P. Wilder and Dudley 0 White, we note that White's
period of willful idleness ended when he secures suitable interim employ-
ment on 16 January 1978 The judge therefore erred in disallowing
White's backpay claim thereafter See Laredo Packing Co, 264 NLRB
245, 246-248 (1982), enfd 730 F 2d 405 (5th Cir 1984), Avon Convalescent
Centel, 219 NLRB 1210, 1219 (1975), enfd in relevant part 549 F 2d 1080
(6th Cir 1977)
10 The efFective date of the new agreement was 15 March 1979, rather
than 5 March 1979, as stated in the judge's decision
683
paid the retroactive pension contributions directly
to the four employees and gave them a wage in-
crease of 15 cents an hour (or $6 for a 40-hour
week), the equivalent of the pension contributions
provided for in the collective-bargaining agree-
ment.11
On these facts, we find that the payments in lieu
of pension contributions that the Respondent made
to its current employees in 1979 are the best meas-
ure of what the employees still on layoff lost in
pension contribution payments as a result of their
continuing layoff following the Respondent's un-
lawful cessation of operations. Since current em-
ployees received payments for pension contribu-
tions retroactive to February 1977, and continuing
thereafter, we may reasonably infer that the re-
maining employees would have received like pay-
ments for their pension contributions had they not
been laid off or terminated as a result of the Re-
spondent's unfair labor practice. See Richard W.
Kaase Co., 162 NLRB 1320, 1326 (1967). We there-
fore adopt the judge's recommendation that the
Respondent be required to recompense employees
for pension contributions of $6 per week for each
employee from 6 February 1977 until 1 January
1980, when the Respondent and the Union agreed
to a profit-sharing program in lieu of their previous
pension plan.12
The consent judgment entered by the United
States Court of Appeals for the Second Circuit en-
forcing the underlying Order in this case provided
that the Respondent would furnish the Board's Re-
gional Office, on req+glest, information relevant to
the issue of determining whether reestablishment of
the Respondent's manufacturing operations would
"endanger Respondent's continued viability . . . in
light of current economic conditions." In the event
that agreement could not be reached on whether
reestablishment would endanger the Respondent's
continued viability, the consent judgment provided
for determination of the issue in the backpay pro-
ceeding. That issue was litigated in the instant
backpay proceeding and the judge concluded that
"there is no evidence to contradict Smyth's assess-
I I The General Counsel therefore did not seek backpay for the four
employees who were recompensed for their pension contributions
12 We find merit in the Respondent's exception to the judge's inclusion
of $906 for accrued pension contributions in employee Mullen's backpay,
since the judge found that the Respondent had already made Mullen
whole for pension contributions by contributing to another plan on Mul-
len's behalf. However, we find without merit the Respondent's conten-
tion that employees Jorgenson, Mihalick, Tauscher, Vabalas, Michalski,
and Perkins are not entitled to backpay for pension contributions after 15
March 1979 because they had secured "suitable jobs" by that date Al-
though no backpay for base wages is claimed for these employees after
the first quarter of 1979, because they had by then obtained interim em-
ployment that paid as well in base wages as their jobs with the Respond-
ent, the record does not show that they secured equivalent pension bene-
fits with their interim employers
684 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
ment that due to technological changes in the
market it no longer can compete and that it is
unable to achieve reestablishment in light of cur-
rent economic conditions." (Sec. III , C, par. 4.)
The judge noted , however , that Smyth was sub-
contracting some manufacturing operations to fill
orders for parts and recommended that the Re-
spondent be ordered "forthwith [to] cease and for-
ever discontinue subcontracting or assigning to
others the manufacture of parts for or on behalf of
Smyth Manufacturing Co.," to prevent the Re-
spondent from transferring "to other shops for the
benefit of Respondent . . . jobs from which [em-
ployees] were unlawfully discharged ." The judge's
recommended Order further provides that if the
Respondent complies with the ban on subcontract-
ing, "it will not be required to reestablish the man-
ufacturing facilities of Smyth Manufacturing Co.,
Inc. as heretofore Ordered." Although no excep-
tion was taken to the recommended ban on subcon-
tracting , we conclude that the words "and forever
discontinue" are overly broad and should be delet-
ed from the remedy . As amended , the Order will
proscribe such subcontracting for the indefinite
future , but will leave open the possibility of modifi-
cation of the proscription should future events
prove that warranted.
The General Counsel has excepted to the judge's
failure to order the Respondent to furnish informa-
tion necessary to police compliance with the sub-
contracting remedy and specifically requests inclu-
sion of the following language:
Preserve and, upon request, make available
to the Board or its agents, for examination and
copying, all invoices , work orders, corre-
spondence , ' financial disbursements and other
records related to the manufacture , sales and/-
or subcontracting of spare parts and bookbind-
ing equipment and machinery by and for
Smyth Manufacturing , Inc. and Beacon Indus-
tries.
The Respondent , in its answering brief, states
that "[w]hile Respondent sees no need for this ad-
ditional language , if it is to be included . . . [it]
should . . . be limited as to the time it is to remain
in effect and , also to the scope of the remedial
order, i.e., subcontracting." Accordingly, the Re-
spondent contends that the "applicable language
offered by General Counsel should . . . be limited
to the following:"
[O]ther records relating to the subcontracting
or assigning to others the manufacture of parts
for or on behalf of Smyth Manufacturing Co.,
Inc.
We find merit both in the General Counsel's re-
quest for information necessary to police compli-
ance with the subcontracting remedy and in the
Respondent 's contention that the General Counsel's
information request is unduly broad . In our view,
the information provision of the Order should track
the subcontracting provision and thus should re-
quire the Respondent to preserve and furnish to the
Board or it agents, on request , for examination and
copying , all documents and records related to
"subcontracting or assigning to others the manufac-
ture of parts for or on behalf of Smyth Manufac-
turing Co ." We have therefore modified the Order
accordingly . With respect to the Respondent's con-
tention that there should be a time limitation on the
information provision of the Order , we believe that
the need for information will continue so long as it
is necessary to police compliance with the subcon-
tracting remedy . As noted , the subcontracting
remedy will remain in effect for the indefinite
future , but will be subject to modification at a later
date should the parties demonstrate that subsequent
events warrant a change . The same is true for the
requirement that the Respondent furnish informa-
tion necessary to police compliance with the sub-
contracting provision.
The parties have called to our attention various
arithmetical or transcription errors in the amounts
of backpay for individual employees set forth in
the summary chart in section II,D of the judge's
decision and we have corrected the Order accord-
ingly.13
Finally , we affirm , for the reasons stated in the
judge 's decision , his conclusion that interest should
be ordered on the backpay awards and that the Re-
spondent's laches defense is without merit.
ORDER
The National Labor Relations Board orders that
the Respondent, Smyth Manufacturing Co., Inc.,
Beacon Industries , Bloomfield and East Hartford,
Connecticut , its officers, agents , successors , and as-
signs, shall
1. Cease and desist from subcontracting or as-
signing to others the manufacture of parts for or on
behalf of Smyth Manufacturing Co., Inc., upon
which the Respondent will not be required to rees-
19 These corrections are-
Cavaric-accrued vacation $618, total $831
Danilla, B. -accrued vacation 0, total $395
Danilla, V.-accrued vacation $413 , total $560
Garcia-accrued vacation $ 142, total $142
Gill-accrued vacation 0, total unchanged
Griffin, Albert-total $720
Mullen-accrued pension 0, total $219
Zihal-accrued vacation $282, total $282
SMYTH MFG. CO.
tablish the manufacturing facilities of Smyth Manu-
facturing Co., Inc., as heretofore ordered.
2. Take the following affirmative action neces-
sary to effectuate the policies of the Act.
(a) Preserve and furnish to the Board or its
agents on request , for examination and copying, all
documents and records related to subcontracting or
assigning to others the manufacture of parts for or
on behalf of Smyth Manufacturing Co., Inc.
(b) Make whole the following employees by pay-
ment to them of the moneys listed below, with in-
terest, as provided in the Board's Order in the un-
derlying unfair labor practice proceeding as en-
forced by the United States Court of Appeals for
the Second Circuit, as well as any additional back-
pay, plus interest accruing after the backpay hear-
ing, until the Respondent fully complies with this
Order.
MPLOY-
EE
ASE
WAGES
PAY
FOR
LOST
HOURS
AC-
CRUED
VACA-
TION
PAY
AC-
CRUED
PEN-
SION
PAY-
MENTS
OTAL
Bailey $9,558 $906 $10,464
Boyle, C. $658 658
Boyle, D. $150 330 480
Burks 108 280 388
Burnham 125 541 666
Cavaric 165 618 48 831
Danilla,
B. 191 204 395
Danilla,
V. 147 413 560
Derench 264 264
Finch 894 906 1,800
Foley 334 334
Garcia 142 142
Gill 230 230
Goodnow 115 297 412
Gordon 1 ,004 316 150 1,470
Griffin,
Alan 125 102 227
Griffin,
Albert 122 598 720
Griffin , H. 375 375
Jean 214 214
Jorgensen 1,501 336 1,837
King 212 212
Klin-
kowski 4,318 115 906 5,339
Leemon 224 224
Marag-
nano 115 237 352
Martel 155 579 734
McKinney 140 308 448
Meres-
chuck 176 494 670
Michalski 75 204 279
Mihalick 922 230 906 2,058
Mullen 219 219
PAY
EMPLOY- BASE FOR
EE WAGES LOST
HOURS
AC-
CRUED
VACA-
TION
PAY
AC-
CR UED
PEN-
SION
PAY-
MENTS
685
TOTAL
Murdza 140 307 447
Musgrave 190 190
Pallotta 906 906
Pawlak 1,243 906 2,149
Palurszyk 210 210
Perkins 133 205 906 1,244
Richard,
E. 153 854 1,007
Richard,
F. 264 264
Sitaru 8,106 228 906 9,240
Soza 282 282
Stupcenski 170 467 637
Tauscher 92 230 906 1,228
Tregubow 147 411 558
Vabalas 2,213 215 906 3,334
Vielleux 183 183
Von
Eisen-
grein 818 906 1,724
White, D. 244 230 816 1,290
White, E. 176 333 509
Wilder 138 138
Wilson 162 123 285
Winters 264 264
Woods 5,081 169 354 5,604
Zaman 282 282
Zihal 282 282
Cathleen F. McCarthy, Esq., for the General Counsel.
Edward F. O'Donnell, Esq. and Gary Starr, Esq. (Siegel,
O'Connor & Kainen), of Hartford, Connecticut, for the
Respondent.
James L. Kestell, Esq. (Kestell, Pogue & Dienhart), of
Hartford, Connecticut, for the Charging Party.
SUPPLEMENTAL DECISION
WALTER J. ALPRIN, Administrative Law Judge. This
case involves backpay specifications issued February 28,
1983, ammended May 12 , 1983, relating to unfair labor
practices which occurred in 1977.1 The backpay issue
was heard on May 31 and June 1, 1983, at Hartford,
Connecticut . 2 Parties filed briefs on July 27, 1983.
On the entire record, including my observation of the
demeanor of the witnesses , and after considering the
briefs of counsel for Respondent and for the General
Counsel, I make the following
' All dates are in 1977 unless otherwise indicated . The dates on which
charges were filed and complaint issued were not recorded in this pro-
ceeding . The judge issued his recommended Decision and Order on
August 31 , 1979, which was affirmed by the Board on February 19, 1980
at 247 NLRB 1139. The U.S. Court of Appeals for the Second Circuit
issued a consent judgment enforcing the Board's Order on January 5,
1982.
' The General Counsel's unopposed motion to correct the transcript,
dated July 27, 1983, is granted.
686 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
FINDINGS OF FACT
I. BACKGROUND
Smyth Manufacturing Company, Inc. (Smyth), has its
principal office and place of business in Bloomfield, Con-
necticut , where it formerly engaged in the manufacture,
sale, and servicing of bookbinding machinery and parts.
It currently limits its operations to the sale of stock and
manufactured replacement parts. Beacon Industries
(Beacon) has its principal office and place of business in
Hartford, Connecticut, where it engages in the manufac-
ture, sale, and servicing of winches, aircraft parts, and
other tooled metal products . Beacon purchased a con-
trolling interest in Smyth in 1976 in a move fostered by
their common banker in order to keep Smyth from bank-
ruptcy. Beacon and Smyth were found to constitute a
joint employer.
The judge's order in the underlying proceeding, inter
alia, required Respondent to "Reestablish the manufac-
turing operations of Smyth Manufacturing Corporation,
Inc., at their Bloomfield, Connecticut, plant," with vari-
ous make-whole provisions for employees.
H. ISSUES AFFECTING BACKPAY
A. Effective Date of Board Order
1. Facts
The record in this matter to date has used several dif-
fering phrases, italicized in the following quotations, to
delineate the time frame which Board action was intend-
ed to cover. The amended complaint in the underlying
proceeding herein alleged that Respondent had ceased
manufacturing operations "on or about" September 30.
The recommended Order adopted by the Board included
a "make whole" provision, requiring Respondent to:
Offer to those employees who were laid off and/or
terminated as a result of the September 30, 1977 ces-
sation of manufacturing operations . . . and make
each of them whole for any loss of earnings . . . in
the manner provided in the section of this Decision
entitled the Remedy.
The remedy portion of the decision includes the recom-
mendation:
that Respondent be ordered to reinstate its manufac-
turing operation . . . and to reinstate all employees
who were laid off on and after September 30, 1977,
because of the cessation of manufacturing operations
. .. and to make them whole for any loss... . The
amount of backpay will be computed in the manner
set forth in F. W. Woolworth Company . .. .
The remedy also required Respondent to post a notice to
employees to include the following provision:
WE WILL offer to the employees who were laid off
or terminated as the result of the September 30, 1977
cessation of manufacturing operations . . . full rein-
statement . . . and WE WILL make each of them
whole for any loss.
It was specifically found that as early as September 1,
1977, Smyth had announced its plan to close its plant on
September 30, and that all manufacturing employees
would be laid off. It also made known that its manufac-
turing machines were to be sold to Beacon, that a fore-
man was leaving to work for Beacon, and that Beacon
had decided to advertise for workmen . Thereafter, on
September 9, 1983, employee K1lnkowski was laid off.
When Klinkowski complained that his layoff did not
follow the seniority roster, he was told to forget about
seniority since all the employees would be gone shortly.
Employee Cavaric had been laid off in March 1977,
prior to any proven intent to close the facility at the end
of September . On August 10, 1977, he received a recall
letter stating that "we have a job that is temporary, with
probable completion within a 2 -month period." He
worked for 3 weeks on what appeared to him to be gen-
eral work not connected to any particular project. He
was notified that he would be laid off on September 9, in
order to allow another employee , who was a union offi-
cial with "super seniority " to "bump" into his job and
thereby remain employed.
Employees Bailey , Finch, Pallotta, and Von Eisen-
grein were laid off the following Friday , September 16,
and employee Pawlak on the next Friday , September 23.
When asking for a reason Pawlak was told, "Well you
see the way things are going" and "you see how the
other people were getting laid off." Pawlak was given a
letter of recommendation stating that he "is being termi-
nated as of September 23, 1977 due to the closing of our
manufacturing facilities."
2. Discussion
Respondent argues ' that the underlying decision and
order herein limits the class of those entitled to be made
whole to employees laid off "on or after" September 30,
and that any other finding or interpretation constitutes an
unauthorized relitigation of a matter previously deter-
mined . The argument is predicated on the inclusion by
the judge of a provision in the remedy portion of his rec-
ommended decision, after having found the cessation of
operations to have been an unfair labor practice, which
would therefore recommend "that Respondent be or-
dered . . . to reinstate those employees who were laid
off on or after September 30, 1977 . . . and to make them
whole." Smyth Mfg. Co., 247 NLRB 1139, 1172 (1980).
The amended complaint placed in issue whether
Smyth's cessation of operations "on or about" September
30 constituted an unfair labor practice. (Emphasis
added. ) The decision specifies as Conclusion of Law 9
that Smyth's cessation of operations "on or about Septem-
ber 30," was an unfair labor practice . (Id. at 1171.) (Em-
phasis added.) The Order of the decision , at paragraph
2(b), required Respondent to offer reinstatement, and to
make whole, "those employees who were laid off and/or
terminated as a result of the September 30, 1977, cessa-
8 One of Respondent's arguments on this point relates to the admission
into evidence of certain correspondence between Respondent 's previous
counsel and the Board's compliance officer Without changing the origi-
nal ruling of admissibility, it is pointed out that the weight given such
evidence was insufficient to include it in the discussion of facts
SMYTH MFG. CO.
tion." (Emphasis added.) (Id. at 1173.) The Order also
required Respondent to post a notice that it would offer
reinstatement , and make whole, "employees who were
laid off or terminated as the result of the September 30,
1977, cessation." (Emphasis added.)
However, the portion of the remedy decision between
the Conclusions of Law and the Order, lumps together a
recommendation requiring reinstitution of the discontin-
ued operations to achieve the status quo ante, on the one
hand, and, on the other, a recommendation to require re-
instatement and payment of lost wages to "those employ-
ees who were laid off on and after September 30, 1977."
(Emphasis added.) It is only at this single point that the
phrase "on and after" is used. The phrase "on or about"
is used in both the amended complaint and in the specific
Conclusion of Law thereon, while the phrase "as a result
of" was used in both the Order and the required notice.
The pertinent issue determined in the prior proceeding
was as to the commission of an unfair labor practice. In
finding the allegations of the amended complaint to be
true the judge found the unfair labor practice took place
on or about September 30, and that any employee ad-
versely affected as a result of the unfair labor practice is
entitled to be made whole. The judge recommended an
order which included as the class of employees to be re-
instated and made whole, all those laid off as a result of
Smyth's unfair labor practice, and repeated the key
phrase, as a result of, in the notice to be posted. I find
the clear intent of the order was to relate to employees
laid off about September 30, as a result of Respondent's
unfair labor practice of ceasing operations.
The plan to cease operations was announced Septem-
ber 1, and those laid off thereafter were the victims of
that unfair labor practice even if terminated prior to the
final cessation of operations on September 30. The action
in laying off Klinkowski on September 9 was a result of
the September 30 cessation, and he was told that less
senior employees would likewise be terminated shortly.
Bailey, Finch, Pallotte, and Von Eisengrein were laid off
the following week, also a result of the same unfair labor
practice. Pawlak, laid off still another week later, was
given a letter attesting to the fact that his layoff of Sep-
tember 23 was caused by the closing of the facilities
though that act did not take place for another 7 days.
These employees were thus clearly discharged as a result
of the unfair labor practice.
Cavaric was also laid off on September 9. At the time
Cavaric was a temporary employee. His temporary re-
employment was prior to any evidence of a plan to cease
operations and there is no reason to believe that his em
ployment would have been continued had operations not
ceased, Cavaric therefore is not one of the employees re-
quired to be made whole, except for lost hours before
March 11, accrued vacation, and, as later discussed, 8
weeks of pension entitlement.
B. Refusals of Offers of or Failure to Seek
Employment
1. Remus Sitaru
a. Facts
687
Sitaru had been employed by Smyth since 1962, most
recently as a machinist mechanic. He was laid off on
September 30, at which time his wage was $6 per hour,
with 3 weeks' paid vacation per year. He registered with
the state unemployment office a week after being laid
off. During October, November, and December, he
phoned, called on, or submitted an application to the fol-
lowing, with results as indicated:
Colt Firearms, Hartford: No openings
Macristy Industries, New Britain Job offered at
$4.95 per hour, insurance benefits not as good as
Smyth; job refused.
Delta Industries, East Granby: No openings
Hamilton Standard: No openings
Eastern Tool and Die, Newington: No openings
Prat & Whitney: No openings
After Christmas and to the end of February 1978, Sitaru
phoned, called on, or submitted an application to the fol-
lowing, with results as indicated.
Collins Switch, West Hartford: February, 1978, job
toolmaker offered at over $6 per hour. Refused on
the basis that Sitaru was unable to perform the
work, on small dies and making small scale tools.
Dynamic Metal Products Corporation, Manchester:
No openings
4-D Tool, West Hartford: No openings
Stanadyne, Windsor: Job offered, but refused be-
cause it was on the night shift.
Windsor Manufacturing, Windsor: No openings.4
Berkin Manufacturing, Bloomfield: No openings
Skinner Manufacturing, New Britain: No openings
New England Aircraft: No openings
At the end of February 1978, Sitaru applied to and was
offered a job by Chandler-Evans, at West Hartford. It
appears that the job was equivalent to his prior employ-
ment, but Sitaru refused it because he "had in mind" a
job with Hartford Tool and Die. He applied to Hartford
Tool and Die the first week of March, and was hired ef-
fective March 15, 1978.
On May 11, 1983, Sitaru completed a work search
questionnaire at the request of the Board's Compliance
Officer. Line 2C called for the names of prospective em-
ployers. Line 3 asked, "In addition to the employers
listed on 2C, did you visit other employers for work, yes
or no." Sitaru indicated the affirmative, and listed Hamil-
ton Standard, Mintalux, 4-D Tool, Armoured Metal Cor-
4 Sttaru could testify about these contacts only after referring to
"notes" made by him several'days prior to the hearing and 5 years after
the events The note as to Windsor Manufacturing contained the same
comment as that of Stanadyne, to wit- "Night shift-no." Sitaru testified
however that the notation regarding Windsor was in error and that there
were no openings.
688 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
poration, Chandler-Evans, Pratt & Whitney, Collins
Switch, Skenner Manufacturing, Eastern Tool and Die,
and Berkin Manufacturing. Line 3B asked, "At which or
any of these employers did you file an application?", and
Sikaru named Chandler-Evans, Collins Switch, and East-
ern Tool and Die. Line 3C asked, "Did any of them
listed above offer you a job, yes or no," and Sitaru re-
sponded in the negative. His reason for doing so was "I
maybe had a mind that the other jobs listed above, they
didn't offer me any jobs. That's probably why I put a no
there."
Sitaru was a qualified operator of various machines,
but did not respond to any of the numerous newspaper
advertisements placed by Beacon for such employees. In
addition, there were other newspaper advertisements for
similar employment to which Sitaru did not respond,
b. Discussion
It has been established that even where "the evidence
may leave a question as to whether [the discriminatee]
could have been more diligent in seeking other employ-
ment , the highest standard of diligence is not required.
... [Citation] Rather, the individual is held `only to rea-
sonable exertions in this regard.' [Citation] Finally, it is
well settled that any uncertainty in the evidence is to be
resolved aginst Respondent as wrongdoer." Inland
Empire Meat Co., 255 NLRB 1306, 1308 (1981). Though
Sitaru did not exhaust all possible means of finding other
employment after having been discriminatorily dis-
charged by Respondent his efforts were reasonable.
Sitaru did not abuse the Board's processes by failing to
report offers of jobs paying less, on less desirable shifts
than his prior position with Respondent, or for work he
was unable to perform. Those offerings were not the
equivalent of the prior position, did not have to be ac-
cepted by the discriminatee, and therefore should not
have to be reported to the Board.
Sitaru did, however, fail to advise the Board, or admit
until questioned by Respondent, that he rejected the
offer of an equivalent position at Chandler-Evans at the
end of February 1978. His representation to the Board
that he had not received such an offer from prospective
employers to whom he submitted an application was in
response to clearly enunciated questions, and the reason
he gives for making the false statement is so inadequate
that a conclusion of intentional concealment is inescap-
able. The Board's current policy is to deny backpay of
wages for the full quarter in which a claimant intention-
ally conceals earnings from interim employment. Ameri-
can Navigation Co., 268 NLRB 426 (1983).5 I find that
Sitaru's intentional concealment of the interim offer of
equivalent employment is tantamount to an intentional
concealment of interim earnings , disqualifying him from
backpay of wages for the first quarter of 1978, the
amount of $3627.
In addition, since Sitaru failed to accept the offer of
equivalent employment at the end of February 1978, his
claims for backpay for the third quarter of 1979 ($123),
as well as all pension benefit entitlements, hereinafter dis-
5 That policy, however, does not extend to the amounts claimed as
pension entitlements, hereinafter discussed.
cussed , after July 1978 (95 weeks, $570), must also be
disallowed . His entire claim is thereby reduced $4468, to
the amount of $4634.
2. Dudley O. White
a. Facts
White was discharged on September 30, and was un-
employed until January 1978. Within a week of his dis-
charge White applied to the state unemployment office,
which did not refer him to employers but which did re-
quire that in order to obtain unemployment benefits he
make at least three contacts seeking employment. During
October, November, and December 1977, White contact-
ed three prospective emloyers-two on a single day and
the other the following or second following day. He tes-
tified that he looked at newspaper want-ads 5 days a
week, which was the source of the position he eventually
found.
On his discharge White was told by his supervisor that
he could get a job at Beacon but "probably" would have
to take a pay cut as well as losing seniority. At Smyth,
White operated a CIM-X machine, which was sold and
did not go to Beacon. He was also qualified to operate
horizontal and vertical milling machines, for which
Beacon advertised positions during the period of his un-
employment. There were newspaper advertisements by
other employers to which White did not respond.
b. Discussion
The statement to White by his supervisor at Smyth did
not constitute an offer of employment, by Beacon,
whether "equivalent" or not, That White never investi-
gated the possibility of employment at Beacon, transmit-
ted both by his former supervisor and by the newspaper
advertisements which, by his own testimony he must
have seen, must be considered in terms of whether White
conducted a bona fide search for employment.
A discriminatee is not required to seek work immedi-
ately upon discharge, and the sufficiency of his efforts to
mitigate backpay is determined from his efforts during
the entire backpay period as a whole. I. T O. Corp. of Bal-
timore, 265 NLRB 1322 (1982). In spending 2 days
during the 3-month period in contacting prospective em-
ployers, however, White did no more than meet mini-
mum qualifications for state unemployment benefits.
Even crediting White's testimony that he looked at the
newspaper advertisements 5 days a week, he made no at-
tempt to use the information therein to obtain employ-
ment until January 1978, contacting neither Beacon nor
any other advertiser to determine details of job openings.
I find that White's loss of earnings between discharge
and reemployment was willfully incurred, and he is
therefore not entitled to lost wages or pension payments
after September 30.
3. Robert Woods Sr.
a. Facts
Woods was discharged September 30, and was eligible
for employment until disabled by a heart attack on
SMYTH MFG. CO.
March 28, 1978. Because of his physical condition and on
his doctor's advice, Woods was unable to testify herein.
On May 4, 1983, Woods had a phone conversation
with the Board 's Compliance Officer in which Woods
reportedly stated he had made no search for employment
following his layoff. On May 25, 1983, however, White
gave a sworn statement to the General Counsel stating in
part as follows:
When I was laid off from Smyth I registered with
the Connecticut unemployment office. They did not
send me out on interviews but they did arrange for
two interviews for me at the unemployment office.
.. . From my layoff up to my heart attack in
March, 1978 I went around to a number of compa-
nies on my own looking for work. I went to East
Cranby Machine, B & E. Tool in Southwick, Massa-
chusetts , Delta in East Granby and Gerber in Wind-
sor, Connecticut . . . . I also went to others whose
names I cannot recall . I put in applications at all
these places. . .. I also kept looking at the newspa-
pers.
b. Discussion
It is Respondent 's position that it has established
through the more credible testimony of the Board's
Compliance Officer, which was untainted by the pros-
pects of a windfall of some $5000, that Woods did not
make a reasonably diligent search for work. We are not
concerned with the credibility ' of the person reporting
the phone conversation , but with the truth of the state-
ment made in the phone conversation . We are faced with
contradictory statements by `Woods, one oral and uns-
worn, and the other in writing and sworn . In the absence
of evidence supporting the contrary, the written and
sworn statement should be given credence . Though
Woods was not available for direct examination , to meet
its burden of proof Respondent could have obtained evi-
denice from the state unemployment office and from the
employers named in the affidavit in order to dispute it.
As the matter stands I must give the discriminatee the
benefit of any doubt, and find that Woods actively
sought employment until the time of his disability.
4. Earl P. Wilder
a. Facts
Wilder was discharged on September 30 and was un-
employed until he was offered and accepted a position at
Beacon on March 6, 1978. Within a week of discharge
he had applied for state unemployment benefits. Before
his employment at Beacon , Wilder applied to one pro-
spective employer , looked at newspaper advertisements
daily, and spoke to a friend about employment with an-
other company.
Sometime in March 1978, an officer of Beacon stopped
to chat with Wilder in the plant, and inquired what
Wilder had been doing during the period of his unem-
ployment . The response, given jokingly according to
Wilder's testimony, was that he had just "retired back
to" his hometown. Wilder was 60 years of age at the
689
time and he testified that he had no intention of retiring
at that age.
b. Discussion
I credit Wilder 's testimony that he did not intend to
retire at the time of his discharge , and that any comment
to such effect to an officer of Respondent was if not sar-
casm no more than ironic humor . This does not alter the
fact, however, that in over 5 months of unemployment
Wilder did no more than look at newspaper advertise-
ments, contact one prospective employer, and talk to a
friend about another possible employer. I do not find this
to constitute a reasonable search for employment, and
find that Wilder's loss of earnings between discharge and
reemployment was willfully incurred.
C. Pension Formula in Backpay Specification
1. Facts
In February 1974, Respondent and the Union entered
into a collective -bargaining agreement by which Re-
spondent contributed $6 per week for covered employees
to the International Association of Machinists and Aero-
space Workers National Pension Plan (the plan). That
agreement terminated in February 1977 but Respondent
continued payments through September 30, 1977, when
its plant closed . Following certain discussions , the plan
refunded to Respondent its contributions from February
through September 1977, since there was no agreement
in effect for that period calling for such payments.
When Respondent signed another collective-bargaining
agreement with the Union on March 5, 1979, it included
a similar pension contribution provision , calling for retro-
active payments for any then present employees actively
employed from February 6, 1977 , to date. In conform-
ance with the retroactive provision payment was ten-
dered for four employees-Wilder, Griffin, Perkins, and
Wilson. The plan, however, would not accept the retro-
active payments , which were returned to Respondent.
Effective January 1, 1980, Respondent and the Union
agreed to a profit-sharing program in lieu of the fund
pension plan. Discriminatees Dion and Mullen had been
rehired by Beacon , and given credit in Beacon's profit-
sharing plan for time employed at Smyth. On termination
of employment in June 1980 , Dion received a lump stem
payment of $ 1818, and Mullen is fully vested in a balance
of $3,931.45.
2. Discussion
Respondent argues that it should not be required to in-
clude in backpay any retroactive pension payments for
the period from February 6 through September 30. It
argues that the underlying decision and order only re-
quire, in the words of Respondent's brief, "that employ-
ees laid off on or after September 30, 1977, be awarded
back pay to that date." The fact is that the underlying
decision , at sheet 87, ordered Respondent to "Take the
following affirmative action to effectuate the policies of
the Act. (b) Offer to those employees who were laid off
and/or terminated as a result of the September 30, 1977
cessation of manufacturing operations . . . immediate
690 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
and full reinstatement . . . and make each of them whole
for any loss of earnings." Thus, as previously discussed,
payment is not limited to employees terminated Septem-
ber 30. Further, the order does not discontinue the make-
whole requirement as of that date.
Respondent next argues that it should not be liable for
pension contributions which it offered to but which were
rejected by the plan, and that "if anyone should pay pen-
sion contributions to the employees, it is the IAM Plan,
not Respondent." This is not correct. As was stated in
Rice Lake Creamery Co., 151 NLRB 1113, 1127 (1965),
"these contributions, although `wages, ordinarily were
not paid to the discriminatees, but went to the insurance
carrier as premiums for the pension insurance. This pre-
sents the question of whether it is more appropriate, in
this backpay proceeding, to require the Respondent to
pay the contributions omitted during the backpay period,
to the discriminatees." Finding that such payment to dis-
criminatees was not punitive to Respondent, and other-
wise "reasonable and appropriate," the Board there or-
dered the payment to be so made. In the matter at hand
it is also reasonable and appropriate to order the pay-
ments to the individual discriminatees. It is required to
make them whole. The payments will not be accepted by
the fund, and leaving the moneys in the hands of Re-
spondent would constitute an unjust enrichment.
Respondent argues that those employees not entitled
to backpay by reason of failure to make a diligent search
for employment after discharge are also not entitled to
pension benefits. I agree that such a discriminatee cannot
logically be said to deserve benefits, whether pension
contributions or accrued vacation, for periods after dis-
charge when not entitled to basic wages. Such benefits,
however, are payable for the time from February 6,
1977, to the date of discharge even for those employees
failing to thereafter make reasonable search for employ-
ment.
It is also true that certain discriminatees became super-
visory employees of Beacon and have been given credit
for Smyth employment in vesting benefits of the Beacon
profit-sharing plan. Discriminatees Dion and Mullen
have in this manner already received the benefit of pen-
sion payments due them through Respondent's contribu-
tion to another plan on their behalf, and do not require
further pension benefit payments to be made whole. See
Sinclair & Valentine Co., 238 NLRB 754 (1978).
D. Specific Payments Due Discriminatees
Respondent admits the accuracy of the General Coun-
sel's calculations of backpay, as amended before and at
the hearing, concerning discriminatees Dion, Foley,
Gordon, Griffin, Jorgensen, Mihalick, Mullen, Perkins,
Tauscher, Vablas, and Wilson. It also admits the proprie-
ty of the formula and the accuracy of the amended speci-
fications about wages lost as a result of the reduction in
hours by named employees between January 24 and July
24, 1977, and about vacation pay for the period June 21,
1976, to May 31, 1977. Except for the four discriminatees
individually discussed above about whether reasonable
search for employment was made, Respondent offered
no evidence contesting the other amounts set forth in the
amended specification, other than pension benefits due.
After making adjustments to the claims for lost wages
for discriminatees Cavaric, Sitaru, Woods, and Wilder,
and adjustments in pension payment entitlements, all as
discussed above, I find the amounts due to discriminatees
are as follows:
Employee Wages LostHours
Accrued
Vacation
Accrued
Pension Total
Bailey 9,558 906 10,464
Boyle, C. 658 658
Boyle, D. 150 330 480
Burks 108 280 388
Burnham 125 541 666
Cavaric 165 681 48 894
Danilla, B. 191 413 204 808
Danilla, V. 147 147
Derench 264 264
Dion 0
Finch 894 906 1,800
Foley 334 334
Gill 230 230 230
Goodnow 115 297 412
Gordon 1,004 316 150 1,470
Griffin, Alan 125 102 227
Griffin, Albert 122 598 820
Griffin, H. 375 375
Jean 214 214
Jorgensen 1,501 336 1,837
King 212 212
Klinkowski 4,318 115 906 5,339
Leemon 224 224
Maragnano 115 237 352
Martel 155 579 734
McKinney 140 308 448
Mereschuk 176 494 670
Michaelski 75 204 279
Mihalick 922 230 906 2,058
Mullen 219 906 1,125
Murdza 140 307 447
Musgrave 190 190
Pallotta 906 906
Pawlack 1,243 906 2,149
Palurszyk 210 210
Perkins 133 205 906 1,244
Richard , E. 153 854 1,007
Richard, F. 264 264
Sitaru 4,208 228 198 4,634
Soza 282 282
Stupcenski 170 467 637
Tauscher 92 230 906 1,228
Tregubow 147 411 558
Vabalas 2,213 215 906 3,334
Vielleux 183 183
Von
Eisengrein 818 906 1,724
White, D. 230 204 434
White, E. 176 333 509
Wilder 138 138
Wilson 162 123 285
Winters 264 264
Woods 5,081 169 354 5,604
Zaman 282 282
Zihal 284 284
SMYTH MFG. CO. 691
III. REESTABLISHING THE PLANT
A. Pleadings Board Order, and Enforcement Order
The amended specifications allege that Respondent has
not complied with the Board 's Order to reestablish the
Smyth Manufacturing Company, Inc., manufacturing fa-
cility in Bloomfield , Connecticut , to a level of operation
and employment which existed just prior to its Septem-
ber 30 unlawful cessation of operations . The underlying
decision provides that "We continue to adhere to the
well established principle that, in cases involving dis-
criminatory conduct, the restoration of the status quo
ante is the proper remedy unless the wrongdoer can
demonstrate that the normal remedy would endanger its
continued viability ." The ordering provisions of the deci-
sion requires Respondent to "Reestablish the manufactur-
ing operations of the Smyth Manufacturing Company,
Inc., at their Bloomfield , Connecticut plant."
The consent judgment entered in the Second Circuit
Court of Appeals on January 5, 1982, ordered Respond-
ent to "comply with the Board's Order of February 19,
1980 in all respects ." It also ordered Respondent to pro-
vide certain information , and ordered that if the Board's
Regional Director "and Respondent are unable to agree
with respect to whether reestablishment will endanger
Respondent 's continued viability , or the Respondent's
achievement of reestablishment in light of current eco-
nomic, conditions" a hearing , on those issues may be had
before an administrative law judge pursuant to Board
Rules and Regulations . The Order further provided that,
"'Nothing in this Order shall be taken to deny Respond-
ent the right lawfully to abandon any of its business op-
erations at any time in the future for legitimate business
reasons, if such action is not taken for the purpose of de-
nying to employees rights conferred by the National
Labor Relations Act."
In its answer to the amended specification on this
issue , Respondent stated its position "that to resume the
level of operation and employment that existed just prior
to September 30, 1977, would be unduly burdensome and
endanger the continued viability of the Respondent."
B. Economic Factors
1. Financial statements
Certified consolidated financial statements of Respond-
ent as of December 31, 1980, 1981, and 1982, report,
inter alia, the following items:
1980 1981 1982
Net Sales $17 ,539,500 $19,141,800 $ 16,197,000
Income from
operations 909,80D 729, 100 118,900
Net income 1,586,90D 389, 500 140,200
Total Assets 14,035 , 500 13,104 ,000 10,721,800
Current Assets 8,586,400 8 ,406,900 6,459,500
Current
Liabilities 4,315,600 4,712,900 3,880,000
2. Condition of Smyth
Smyth has maintained a semblance of corporate and
commercial viability. It identifies its Bloomfield premises
and continues telephone service in its own name. It re-
tains ownership of extensive equipment, currently uti-
lized in the manufacture of winch parts for Beacon. The
last time Smyth had an order for an entire book binding
machine, assembled from parts on hand and manufac-
tured to order, was in 1981, with completion in early
1982. Its current operations consist of supplying replace-
ment parts, from existing stock or from parts manufac-
tured to order by outside contractors. There is insuffi-
cient manufacture of parts to employ a single machinist
full time. The change in volume and type of operation is
attributed by Respondent's uncontradicted testimony to
technological changes in the book binding industry re-
sulting in a changed market place in which it cannot
compete.
Testimony on behalf of Smyth was offered that one
Irving Ratzenberg was hired in January 1981 as sales
marketing manager, that a promotional budget was pre-
pared for- 1982 of over $24,000, that "several" thousands
of dollars were expended to no avail, and that having
failed to promote orders, Ratzenberg left Smyth in April
1982. Company documents, however, revealed that Rat-
zenberg had been hired by Smyth in October 1979 as
managing director, and that promotional recommenda-
tions for 1982 were virtually identical to those made in
1981. "The Smyth News," a one-sheet, two-page, promo-
tional piece for distribution to current and prospective
customers, was printed for March, May, and September
1980, March, August, and October 1981, and March and
May 1982. The "Promotional Program and Budget Pre-
pared for Smyth Manufacturing Company, January 1,
1982-December 31, 1982," prepared by its advertising
agency, proposing a budget just over $24,000, begins
with the following analysis:
Promotional recommendations for Smyth in 1982
will be virtually identical to those made in 1981.
The company continues to drift, apparently aimless-
ly, without real attempts to penetrate the market or
to encourage binderies to consider (or reconsider)
Smyth equipment. Very little progress has been
made in the R & D area beyond the development of
mechanical fixes for existing machinery problems.
Under these circumstances, the agency can only
recommend a continuation of existing promotional
programs to maintain some semblance of market po-
sition and recognition for Smyth until a decision is
made as to what course the company should
pursue. .. .
Concerning the "Smyth News," the agency commented
that:
For the past 1-1/2 years, the Smyth News has been
the most productive promotional medium employed
by the agency, as issue after issue continues to de-
velop requests for further information and additions
to the mailing list.
692 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Smyth offered reinstatement to 19 of the discrimina-
tees with the offer of a single job, which all 19 refused.
All of the original discriminatees have obtained other
employment at ' greater compensation, refused reinstate-
ment, or have accepted reinstatement only to be later
discharged for lack of work.
C. Discussion
The original Board Order required reestablishment of
the manufacturing facility to the "level of operation and
employment which existed" at the time of unlawful dis-
continuance. The amended specifications herein made the
same demand. The circuit court, however, in effect
amended that Order by requiring Respondent to reestab-
lish only if it does not "endanger Respondent's continued
viability," which the Board itself has recognized as a
bona fide reason for failure to reestablish.6 The circuit
court also added as a condition to reestablishment, that it
could be achieved "in light of current economic condi-
tions."
Respondent has presented evidence which it claims
proves that reestablishment would endanger continued
viability, and which shows reestablishment to be impossi-
ble in light of current economic conditions.' In consider-
ing both arguments it must be recalled that the Respond-
ent herein is not Smyth alone, but rather the entity
"Beacon Industries," of which Smyth is but a single divi-
sion.
Respondent's consolidated financial statements for
1980 through 1982 indicate a fairly slight variance in net
sales compared to a drastic loss, more than 90 percent, in
net income. During the same period total assets have de-
creased roughly 25 percent, and the excess of current
assets over current liabilities has decreased some 40 per-
cent. Though income from operations for 1982 was over
$16 million, and the excess of current assets over current
liabilities over $2.5 million, comparison with prior years
does not reflect a healthy position. On the other hand,
Respondent has facilities and machinery with which to
reestablish operations, has extensive resources, and its
only expense would be for labor. As noted in its brief,
should orders for equipment not be forthcoming within a
reasonable period employees could be laid off, on valid
economic grounds, without violating the Board's or the
circuit court's orders. Respondent has thereby failed to
prove that reestablishment of Smyth's manufacturing op-
erations could threaten the viability of Beacon Industries.
I do not credit testimony that Smyth attempted to re-
establish operations. It is clear that Ratzenberg was hired
over a year before the date alleged and was hired as gen-
eral manager and not to develop sales. Smyth was told
and was aware that its management was aimlessly drift-
ing without real attempts to penetrate the market. On the
other hand, there is no evidence to contradict Smyth's
assessment that due to technological changes in the
market it no longer can compete and that it is unable to
6 R & H Masonry Supply, 238 NLRB 1044 fn. 3 (1978), enfd in part
627 F 2d 1013 (1980)
' The evidence submitted on this point relating to attempts to comply
with the order to reestablish I accept as being relative to the issue of
whether reestablishment is feasible in light of economic conditions, rather
than as a separate affirmative defense which Respondent failed to plead.
achieve reestablishment in light of current economic con-
ditions. Respondent has the right, pursuant to the circuit
court's order as well as general provisions of law, to
abandon any of its business operations for legitimate busi-
ness reasons if such action is not taken for the purpose of
denying to employees rights conferred by the Act. Great
Chinese American Sewing Co., 227 NLRB 1670 (1977),
enfd. 578 F.2d 251 (9th Cir. 1978). However, in order to
fill orders for parts not in stock, Smyth currently sub-
contracts some manufacturing operations. If the purposes
of the Act are to be achieved employees must be pro-
tected not only by making them whole for lost wages
and benefits, but also by seeing that the manufacturing
jobs from which they were unlawfully discharged are
not permitted to be transferred to other shops for the
benefit of Respondent. It will therefore be recommended
that Respondent be ordered to discontinue this subcon-
tracting. Lack of willingness to do so could only be in-
terpreted as an admission that reestablishment is a viable
option, in which case an order to reestablish would be
the logical consequence.
IV. INTEREST ON BACKPAY
Respondent argues that it should not be required to
pay interest on backpay awards because of the Board's
"delay." The violations here occurred in 1977, but be-
cause Respondent exercised its right to an initial hearing,
liability was not determined by an administrative law
judge until August 31, 1979. Exceptions filed by Re-
spondent delayed a final Board Order until February 19,
1980, and Respondent's resistance to enforcement result-
ed in the circuit court order not being issued until Janu-
ary 5, 1982.
Even assuming that the Board was responsible for that
delay from 1977 to 1982, which is not the case, the Su-
preme Court "has held before that the Board is not re-
quired to place the consequences of its own delay, even
if inordinate, upon wronged employees, to the benefit of
wrong doing employers." NLRB v. J. H. Rutter-Rex
Mfg. Co., 396 U.S. 258, 264-265 (1969). Regarding what
constitutes an "inordinate" delay, laches was rejected as
a defense where 5 years had elapsed between Board
Order and backpay specifications. Southeastern Envelope
Co., 246 NLRB 423 (1979).
The Respondent has been the beneficiary of the re-
tained backpay for this period of time. There is no
reason why interest on backpay in this matter should
inure to its benefit rather than to the benefit of those
former employees which it wronged.
CONCLUSIONS OF LAW
In addition to the conclusions of law of the prior deci-
sion, it is concluded that the various employees named
herein are entitled to backpay for wages and benefits in
the amounts stated. It is further concluded that, in the
event Respondent discontinues subcontracting manufac-
ture of parts for Smyth, reestablishment of the manufac-
turing capabilities of Smyth is not required to comply
with the order of the circuit court or to satisfy the pur-
poses of the Act. It is further concluded that Respondent
SMYTH MFG. CO.
is not excused from the payment of interest on backpay
awarded.
On these findings of fact and conclusions of law and
on the entire record, I issue the following recommend-
ed8
ORDER
The Respondent, Smyth Manufacturing Co., Inc.,
Bloomfield, Connecticut, and Beacon Industries, East
Hartford, Connecticut, shall make the employees named
8 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
693
herein whole by payment to them of the sums herein
found to be due to each, together with interest thereon
to be computed in the manner prescribed in Florida Steel
Corp., 231 NLRB 651 (1977).9
Further, the Respondent shall cease and discontinue
subcontracting or assigning to others the manufacture of
parts for or on behalf of Smyth Manufacturing Co., Inc.,
on which it will not be required to reestablish the manu-
facturing facilities of Smyth Manufacturing Co., Inc. as
ordered.
9 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."