Spitzer Akron, Inc.

National Labor Relations Board - Board Decisions

Jul 9, 1975

219 N.L.R.B. 20 (N.L.R.B. 1975)

20 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
Spitzer Akron , Inc. and Auto Mechanics Local 1363,
District 54 of the International Association of Ma-
chinists and Aerospace Workers , AFL-CIO. Case
8-CA-6177
July 9, 1975
SECOND SUPPLEMENTAL DECISION AND
ORDER
BY MEMBERS FANNING, JENKINS, AND KENNEDY
On January 26, 1972, the National Labor Rela-
tions Board issued its Decision and Order' in the
above-entitled proceeding, finding that Respondent
had engaged in and was engaging in unfair labor
practices in violation of Section 8(a)(5) and (1) of the
Act and ordering that it cease and desist therefrom
and, upon request, bargain collectively with the Auto
Mechanics Local 1363, District 54 of the Internation-
al Association of Machinists and Aerospace Work-
ers, AFL-CIO, herein referred to as the Union, as
the exclusive representative of all employees in an
appropriate unit. The Board also ordered Respon-
dent, upon request, to cancel any changes of benefits
or working conditions which it made on September
4, 1970, or later, which may have resulted in financial
or other detriment to its employees. Finally, the
Board ordered the Respondent to offer reinstatement
to those strikers to whom it had not heretofore made
an unconditonal offer of reinstatement immediate
and full reinstatement to their former or substantially
equivalent jobs, and to make whole all employees
who went on strike on September 22, 1970, for any
loss of earnings they may have suffered from the
time of their unconditional offer to return to work to
the date that the Respondent offered them reinstate-
ment. In light of the Supreme Court's opinion in
N.L.R.B. v. Burns International Security Services, Inc.,
406 U.S. 272 (1972), and N.L.R.B. v. Wayne Conva-
lescent Center, Inc., 465 F.2d 1039 (C.A. 6, 1972), en-
forcement of the Board's Order was granted on No-
vember 27, 1972, by the United States Court of
Appeals for the Sixth Circuit.' Subsequently, Re-
spondent petitioned the Supreme Court of the Unit-
ed States for certiorari, and on May 14, 1973, the
Supreme Court granted Respondent's motion, vacat-
ed the court of appeals' judgment, and remanded the
proceeding to that court with instructions to remand
the case to the Board for such further proceedings as
may be appropriate, in the light of N.L.R.B. v. Burns
International Security Services, Inc., 406 U.S. 272
'195 NLRB 114.
2 470 F.2d 1000.
(1972); Federal Trade Commission v. Sperry & Hutch-
inson Co., 405 U.S. 233, 245-250 (1972); Securities
Exchange Commission v. Chenery Corp., 318 U.S. 80,
87-88 (1943); Bachrodt Chevrolet Co. v. N.L.R.B., 411
U.S. 912 (1973); Denham Co. v. N.L.R.B., 411 U.S.
945 (1973).
On August 15, 1973, the court of appeals issued an
unreported order which remanded the case to the
Board "for such further proceedings as may be ap-
propriate" in light of the cases cited in the order of
the Supreme Court.
The Board reconsidered the case and through an
inadvertent oversight failed to notify Respondent
Spitzer Akron that the case had been redocketed or
to afford it an opportunity to participate. Thereafter
the Board issued its Supplemental Decision and Or-
der in which it adhered to its previous finding that
Spitzer Akron had violated Section 8(a)(5) of the Act
and determined that "[N]othing in Burns requires the
Board to change these findings." 3 The Supplemental
Decision and Order reaffirmed "the findings, conclu-
sions, and remedy" of the original Decision and Or-
der.
On October 14, 1974, the Sixth Circuit Court of
Appeals issued an order stating:
Implicit in the instructions accompanying the
remand of the case to the Board was a require-
ment that the petitioner be given notice of the
reconsideration of the case by the Board with an
opportunity to present its views on the meaning
of the Supreme Court opinions referred to there-
in and the applicability to the facts of this case
thereto, together with the right to petition to re-
open proof in the case if it desired to do so. By
not affording petitioner an opportunity to be
heard and to participate in the reconsideration,
the Board has failed to comply with the mandate
of this court. [504 F.2d 28, 29.]
Accordingly, the court of appeals granted the peti-
tion for review and denied the Board's cross-applica-
tion for enforcement of the Board's Order. The Sup-
plemental Decision and Order of the Board entered
on January 25, 1974, was set aside and the case was
remanded to the Board for further proceedings con-
sistent with the provisions of the circuit court's order.
On December 10, 1974, the Board received a mem-
orandum from Respondent presenting "its views on
the meaning of the Supreme Court opinions referred
to therein and applicability to the facts of this case
thereto." Also, Respondent noted, "Incorporated
herein as part of this memorandum is the
respondent's exceptions filed with the Board prior to
the issuance of the Board's decision reported in 195
'208 NLRB 700 (1974).
219 NLRB No. 2
SPITZER AKRON, INC.
NLRB No. 24, respondent's brief filed in the United
States Court of Appeals (6th Circuit) in Case No.
72-1187, 470 F.2d 1000, respondent's petition for a
writ of certiorari filed with the United States Su-
preme Court and reported at 411 U.S. 979 (1973),
and respondent's brief filed before the United States
Court of Appeals (6th Circuit) in Case No. 74-1151."
Pursuant to the provisions of Section 3(b) of the
National Labor Relations Act, as amended. the Na-
tional Labor Relations Board has delegated its au-
thority in this proceeding to a three-member panel.
In its original Decision and Order in this case, the
Board found that Respondent had violated Section
8(a)(5) and (1) of the Act by making unilateral
changes of wages and working conditions of employ-
ees in the appropriate unit on September 4, 1970, and
by thereafter failing and refusing, on request, to rec-
ognize, meet, and bargain with the Union with re-
spect to rates of pay, wages, hours of employment,
and other terms and conditions of employment of
employees in the unit. As noted above, on November
27, 1972, the Sixth Circuit Court of Appeals ordered
that the decision of the Board be enforced, stating:
We conclude that there is substantial evidence
to support the conclusion of the Board that Spit-
zer Akron was a successor employer and was
obligated to bargain with the Union as the rep-
resentative of the predecessor employer, all of
whom were employed by Spitzer Akron.
N.L.R.B. v. Burns International Security Services,
Inc., 406 U.S. 272 (1972); N. L. R. B. v. Wayne
Convalescent Center, Inc., 415 F.2d 1039 (6th Cir.
1972).
We further conclude that all other parts of the
decision of the Board are supported by substan-
tial evidence on the record considered as a
whole. [470 F.2d at 1001].
The Board has again reviewed the record duly con-
sidering the Respondent's memorandum in the light
of Burns and we adhere to our original findings. In
this regard, the Board originally found that the Re-
spondent is a successor employer to East Town and
obligated to recognize and bargain with the Union as
the collective-bargaining representative of the unit
employees. The Board, therefore, found that the
Company had violated Section 8(a)(5) and (1) of the
Act by unilaterally changing the wages and working
conditions of employees on September 4, 1970, and
by thereafter refusing, on request, to recognize and
bargain with the Union.4 Finally, the Board conclud-
4 Member Jenkins joined in the unanimous 3-to-O decision that the Com-
pany violated Sec. 8 (a)(5) and ( 1) of the Act; he added that he did not rely
on the Trial Examiner's conclusion that the Company had "no 'good faith
doubt' " of the Union 's majority.
21
ed that the subsequent strike by the employees on
September 22, 1970, was an unfair labor practice
strike, caused by the Company's unlawful refusal to
bargain, and that the strikers were entitled to uncon-
ditional reinstatement upon their application to re-
turn to work on March 26, 1971. The Board's Order
directs the Company to cease and desist from mak-
ing unilateral changes in terms and conditions of em-
ployment and to bargain with the Union on request.
The Order further requires the Company to offer
each striker to whom it has not made an uncondi-
t onal offer of reinstatement immediate and full rein-
statement to his former job or a substantially equiva-
lent position, and to make whole all its employees
who went on strike for any loss of earnings they have
suffered from the time of their unconditional appli-
cation for work on March 26, 1971, until such time as
the Company unconditionally offers them reinstate-
ment.
The facts as found by the Board and sustained by
the circuit court show that the Company continued
its predecessor's operation in substantially -un-
changed form; that, prior to assuming control, it in-
dicated an intention to retain the predecessor's em-
ployees, and that it effectuated this intention by
taking over 10 of 11 of the predecessor's work force
in the portion of business which the Company decid-
ed to operate.
In this regard, and as noted in our earlier decision,
the Respondent is engaged in the business of retail
and wholesale selling and servicing of automobiles,
parts, and accessories. In 1964, Local 762 of the Ma-
chinists, a predecessor local of the Charging Union,
entered into a multiemployer agreement with certain
automobile dealers, including Arnett Chrysler-Plym-
outh, a predecessor of East Town Chrysler-Plym-
outh. Respondent thereafter leased the premises that
were occupied by Arnett Chrysler-Plymouth and
East Town Chrysler-Plymouth.
The collective-bargaining agreement was to expire
in 1967 but was extended to August 31, 1970. East
Town Chrysler-Plymouth was not signatory to the
contract of September 1964, nor to its amendments.
On August 27, 1968,- the Union and East Town
Chrysler-Plymouth entered into a separate agree-
ment which also expired on August 31, 1970.
On August 13, 1970, East Town Chrysler-Plym-
outh formally terminated said contract by letter to
the Union, and on the same date sent a letter to
Chrysler Corporation terminating its franchise as an
official Chrysler-Plymouth dealer, effective August
22.
The record further shows that in April 1970 repre-
sentatives of Spitzer management began negotiating
22 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
for the purchase of certain assets of East Town
Chrysler-Plymouth, and these negotiations were con-
cluded on September 4, 1970, 5 days after the expira-
tion of the bargaining agreement. The negotiations
between Spitzer Akron and East Town or Chrysler
Corporation were culminated on September 4, 1970,
and, as part of that agreement, Spitzer was to pay
retroactively to September 1, 1970, those employees
retained. Substantially all of the employees in the
bargaining unit under the previous contract were re-
tained by Spitzer Akron. At a meeting with the em-
ployees on September 4, 1970, wage scales and bene-
fits were established by Spitzer Akron which were
greater than the previous rates paid under the ex-
pired contract.
We noted in our original Decision and Order that
the employing industry has been continued by Re-
spondent in essentially the same form and scope as it
was before the transfer of ownership, so that it would
appear prima facie that Respondent legally succeeds
to any bargaining obligation of its predecessor creat-
ed by the Act. We then concluded that the continuity
of the employing enterprise was not substantially dis-
turbed or its nature changed during its interim opera-
tion by Chrysler, which was trying to operate it as a
viable and thus a saleable business, until such time as
Spitzer interests or some other entrepreneur took it
over. Therefore, the Respondent took over a going
business, not a defunct or liquidated one, and it fol-
lows that its bargaining obligation as a successor em-
ployer continued. Nothing in Burns requires the
Board to change these findings. Accordingly, we af-
firm them. Additionally, we affirm our earlier finding
that Respondent was not reasonably justified by ob-
jective circumstances in doubting the Union's major-
ity status on September 14, 1970, and that Respon-
dent further refused on and after that date to bargain
with the Union in violation of Section 8(a)(5) and (1)
of the Act.
In our earlier opinion, we also found that Respon-
dent violated Section 8(a)(5) of the Act when it made
unilateral changes of wages and certain working con-
ditions of the employees in the bargaining unit.
In Burns, the Supreme Court held that in the ordi-
nary situation a successor employer is free unilateral-
ly to set initial terms on which it will hire the employ-
ees of a predecessor , since , until the successor
employer has hired his full complement of employ-
ees, it may not be clear that the union represents a
majority of the employees in the unit. However, the
Court also stated that:
[T]here will be instances in which it is perfectly
clear that the new employer plans to retain all of
the employees in the unit and in which it will be
appropriate to have him initially consult with
the employees' bargaining representative before
he fixes terms . In other situations, however, it
may not be clear until the successor employer
has hired his full complement of employees that
he has a duty to bargain with a union, since it
will not be evident until then that the bargaining
representative represents a majority of the em-
ployees in the unit as required by §9(a) of the
Act, 29 U.S.C. § 159(a). [406 U.S. at 294-295.]
Clearly, the phrase "plans to retain all the employees
in the unit," when read in the light of the sentence
which follows, would cover not only the situation
where the successor's plan includes every employee
in the unit, but also situations where it includes a
lesser number but still enough to make it evident that
the union's majority status will continue. The instant
case is one of the type referred to by the Supreme
Court in the above-quoted language.
The evidence indicates that the work force was
hired by Respondent prior to the announcement of
the changes; and that such changes had not been a
part of the initial terms of rehiring. In operating the
dealership, Respondent has been conducting the
same business (with the exception of the auto body
repair and paint shop) as East Town, using 10 of the
11 men in the East Town work force. When Del Spit-
zer visited the agency early in August 1970, in con-
nection with family plans for buying the business, he
told mechanic John Hall that the Spitzers planned to
buy the agency, and would need good mechanics.
When Hall suggested that he keep all the East Town
mechanics, Spitzer replied that he had checked on
them, found they were good men, and "I want every
man to stay on the job, and we will carry on as usu-
al."
On the evening of September 4, 1970, shortly after
Respondent had consummated the purchase of assets
from East Town, John and Del Spitzer assembled
and talked to the employees at the agency. Del Spit-
zer explained the family operations in developing
dealer franchises , and said the Spitzers had taken
over the Chrysler-Plymouth franchise there. He an-
nounced that the employees would receive extra pay
in their paychecks coming out that day. He also de-
scribed the Spitzer hospital benefit plan, saying it
was better than the plan which the men already had
from the Union; he said Respondent would pay one-
half of the hospital insurance premiums, as well as
one-half of their uniform expenses , and would give
them six paid holidays a year, and a week of paid
vacation after a year of service. At the close of his
remarks, Spitzer asked for questions, but there were
none from the men, nor was there any discussion of
the Union or its current benefits. Union Steward
Andy Parks reported the Spitzer remarks at once to
SPITZER AKRON, INC. 23
Ramnytz, business agent of the Union, who said he
would contact Respondent about a contract. Ram-
nytz visited the agency on September 9, and told
Alan Spitzer, Norman Hamilton, an officer of Spitzer
Management, Inc., and Service Manager Richard
Wolfe that the Union represented the employees and
wanted a contract. Spitzer said that, after his talk
with the men on September 4, he doubted very much
that the East Town employees wanted to "continue
with the Union," and suggested that the Union
should have a Board election, and, if the employees
indicated they wanted the Union, he would be glad
to negotiate a contract with it.
We find that when Respondent took over the busi-
ness on September 4 it had completed hiring its work
force, which consisted of approximately 10 employ-
ees, substantially all of whom had formerly worked
for East Town. Under the teaching of Burns, Respon-
dent had a bargaining obligation as a successor to
East Town. The Respondent's position on that date
was akin to that of an employer confronted with a
newly selected bargaining representative. It was not
free thereafter to establish or change conditions or
employment for unit employees without bargaining
with the Union.'
Moreover, from the facts detailed above, it is ap-
parent that as of September 4 Respondent had plan-
ned to and had, indeed, retained substantially all of
the employees in the unit and at such time "it was
appropriate to have him initially consult with the em-
ployees' bargaining representative before he fixe[d]
terms." As noted, the Union made its first bargaining
demand when its representative visited the agency on
September 9, stating that the Union represented the
employees and wanted a contract. Thus, it is clear
that Respondent planned to, and did, retain virtually
all of its predecessor's employees in the unit, and that
these employees were represented by the Union and
constituted a majority of the unit both before and
after the transfer of ownership.
In its memorandum, the Company contends that
the second major issue is whether Respondent failed
to bargain in good faith by requesting that the Union
seek a Board-conducted election. In this regard, the
Board is mindful that under the holding of Joy Silk
Mills, Inc. v. N.L.R.B., 185 F.2d 732 (C.A.D.C.,
1950), cert. denied 341 U.S. 914 (1951), an employer
may refuse to bargain and insist on a representation
election when motivated by a good-faith doubt as to
the union's majority status . The question whether
that doubt is a bona fide one is examined in light of
all the facts and circumstances relating to the case.
After another review of the record, we find no ob-
5 Ranch - Way, Inc, 203 NLRB 911 (1973).
jective facts to support the Company's asserted
doubt of majority. Mere passage of time since the
certification and the possibility of employee turnover
in the interim provide no reasonable basis for doub-
ting the Union's continued majority. On the con-
trary, recognition of the bargaining representative
over a number of years and execution of bargaining
agreements by two successive operators of the dealer-
ship, without challenge, support rather than rebut the
presumption of continuing majority status. The
Union was not required to reestablish its majority
through a Board-conducted election on the proffer of
new authorization cards, and no adverse inference
may be drawn from its failure to do so.
Further, the Company's unilateral changes on Sep-
tember 4 and the failure of the employees to protest
them as a derogation of the Union do not provide a
reasonable good-faith basis for doubting the Union's
majority. We agree with the Administrative Law
Judge that mere silence of unit employees about the
Union or their adherence to it when hearing wage
raises and other increased benefits announced for the
first time is an equivocal circumstance which falls far
short of any reasonable indication that the employ-
ees no longer desired union representation; even if
that inference could be justified on any theory, any
disaffection of the employees at that point could well
be attributed to the coercive effects of a sudden uni-
lateral grant of increased wages and benefits which
violated both Section 8(a)(5) and (1) of the Act.
Moreover, the record affirmatively shows the em-
ployees' adherence to the Union and the Company's
awareness of their support. Thus, in the week before
the Company's refusal to bargain and the resulting
strike, Service Manager Wolfe referred to the opera-
tion as a "union shop," whereupon the employees
responded that if they did not get a "union contract"
they would "hit the bricks." Also, testimony of
Union Steward Andy Parks shows that about Sep-
tember 13 or 14 Sales Manager Guy announced to
Parks that he was going to discharge two unit em-
ployees because they could not do their work. He
asked Parks for his comment, and Parks replied he
(Guy) had a right to discharge anyone he wanted to
at any time, but that Parks would have to report it to
the business agent of the Union and "You can take it
from there." Neither employee was discharged. Fi-
nally, immediately after the Company's refusal to
bargain, the employees voted to strike, and 10 out of
a unit of 12 or 13 employees joined the strike and
walked the picket line. When Business Agent Ram-
nytz met with President Spitzer after the onset of the
strike and again urged recognition of the Union, as-
serting that the employees still wanted it to represent
them, Spitzer did not question the Union's majority,
24 DECISIONS OF NATIONAL LABOR RELATIONS BOARD
but merely expressed the view that the employees did
not need a union . Accordingly , we find the
Respondent's "alleged `good faith ' doubt of the
union's majority representation" is without the sup-
port of any objective circumstances.
The Company 's memorandum states the third ma-
jor issue for consideration concerns the matter of re-
instatement and entitlement to backpay . We have re-
viewed the record in light of the Company 's position
and we reaffirm the remedy provided in our original
Decision and Order.
On March 26, 1971 , the Union notified the Com-
pany , by letter , that all 10 strikers , who were named
in the letter , offered unconditionally to return to
work . The Company subsequently sent a letter to all
the strikers , requesting that they report in person.
When eight of the strikers reported to Alan Spitzer,
Spitzer told them that he was unable to interview
them that night without the presence of the service
director . Arrangements were made to interview the
reporting strikers when they appeared for picket duty
the following day. In subsequent interviews, Alan
Spitzer announced that the strikers would have to
make out new employee application forms before
they could be hired , since they were considered new
employees. The strikers rejected Spitzer 's condition
that they return to work as newly hired employees
and continued the strike . Thereafter , union counsel
received a letter from the Company 's attorney stating
that the strikers were not being considered as new
employees , and that the Company wanted them to
fill out the employment forms merely to determine
on what date they would be available to return to
work . Subsequently , two employees returned to
work.
As we earlier found and as the circuit court earlier
agreed, there is no indication that unconditional of-
fers of reinstatement were ever made to the other
eight strikers . Our Order requires the Company to
offer each striker to whom it has not made an uncon-
ditional offer of reinstatement immediate and full re-
instatement to his former job or , if that job no longer
exists , to a substantially equivalent position, and to
make whole all its employees who went on strike for
any loss of earnings they have suffered from the time
of their unconditional application for work on
March 26, 1971 , until such time as the Company un-
conditionally offers them reinstatement. According-
ly, we reaffirm the findings , conclusions , and remedy
provided in our original Decision and Order.