Swift Independent Packing Co.

National Labor Relations Board - Board Decisions

Dec 16, 1994

315 N.L.R.B. 774 (N.L.R.B. 1994)

774
315 NLRB No. 109
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 Member Cohen took no part in the consideration of this case.
2 The Respondent has excepted to some of the judge’s credibility
findings. The Board’s established policy is not to overrule an admin-
istrative law judge’s credibility resolutions unless the clear prepon-
derance of all the relevant evidence convinces us that they are incor-
rect. Standard Dry Wall Products, 91 NLRB 544 (1950), enfd. 188
F.2d 362 (3d Cir. 1951). We have carefully examined the record and
find no basis for reversing the findings.
Additionally, the Respondent asserts that the judge’s findings are
a result of bias and prejudice. After a careful examination of the en-
tire record, we are satisfied that this allegation is without merit.
1 At the hearing, for reasons stated on the record, the Respondent’s
motion to dismiss was granted as to Swift Independent Corporation
and New Sipco, Inc. (G.C. Exh. 1(vv).) Although the settlement
agreement referred to in this proceeding covered these firms as well,
as shall be discussed infra, their obligation has been discharged in
full, untouched by any meaningful dispute. On the other hand, the
instant compliance specification arises from a discreet unfair labor
practice finding and a concommitant remedial order addressed only
to Swift Independent Packing Company (SIPCO). 289 NLRB at 429,
432. Except for this firm, there is neither allegation, tenable theory,
nor persuasive evidence that would warrant imposition of any further
monetary liability on any other entity in this proceeding. Consistent
therewith, the above caption has been amended to reflect deletion of
Swift Independent Corporation and New Sipco, Inc.
2 289 NLRB 423.
3 The specification names 23 former Tampa sales employees. Ac-
tually, the initial denial of transfer options affected 27 employees in
that unit. However, four later accepted transfer to SIPCO’s plant in
National Stockyards, Illinois, and suffered no loss of pay or benefits.
Accordingly, they have been excluded from this compliance speci-
fication.
4 Errors in the transcript have been noted and corrected.
Swift Independent Packing Company and United
Food and Commercial Workers International
Union, AFL–CIO. Case 13–CA–21274–S
December 16, 1994
DECISION AND ORDER
BY CHAIRMAN GOULD AND MEMBERS STEPHENS,
DEVANEY, AND BROWNING
On June 30, 1992, Administrative Law Judge Joel
A. Harmatz issued the attached decision. The Respond-
ent filed exceptions and a supporting brief and the
General Counsel filed a brief in response to the Re-
spondent’s exceptions.
The Board1 has considered the decision and the
record in light of the exceptions and briefs and has de-
cided to affirm the judge’s rulings, findings,2 and con-
clusions and to adopt the recommended Order.
ORDER
The National Labor Relations Board adopts the rec-
ommended Order of the administrative law judge and
orders that the Respondent, Swift Independent Packing
Company, Chicago, Illinois, its officers, agents, succes-
sors, and assigns, shall take the action set forth in the
Order.
Linda McCormick, Esq., for the General Counsel.
William H. Bruckner, Charles E. Sykes, Judith Sadler, Esqs.
(Bruckner & Sykes), of Houston, Texas, for the Respond-
ent.
SUPPLEMENTAL DECISION
JOEL A. HARMATZ, Administrative Law Judge. On June
29, 1988, the National Labor Relations Board issued a Deci-
sion and Order, directing the Respondent, inter alia, to make
whole all unit employees at the Respondent1 Swift Independ-
ent Packing Company’s Tampa, Florida meat sales facility
for losses sustained by reason of the Respondent’s reduction
of the full range of transfer opportunities available under a
subsisting collective-bargaining agreement—conduct deemed
by the Board to have violated Section 8(a)(5) and (1) of the
Act.2 On December 23, 1988, the Respondent also referred
to as SIPCO, entered a settlement stipulation, through which
it agreed, inter alia, that it would pay all the backpay, if any,
determined by the National Labor Relations Board to be due
and owing to the Tampa employees under the terms of said
Order.
Being unable to agree on the amount of backpay, the Re-
gional Director for Region 13 on April 12, 1991, issued a
compliance specification and notice of hearing, which, as
later amended, set forth the General Counsel’s claim on be-
half of each claimant.3 Thereafter, the Respondent filed an
answer which declared affirmatively that no backpay is due.
Pursuant thereto, a hearing was conducted before me on
February 24, 25, 26, and 27, 1991, in Tampa, Florida. Fol-
lowing close thereof, briefs were submitted on behalf of the
General Counsel and the Respondent.4
A. Overview
On July 8, 1981, SIPCO closed its meat sales operation in
Tampa, Florida. The governing collective-bargaining agree-
ment endeavored in various ways to cushion the impact of
the associated loss of jobs. Central to the instant controversy
is a provision granting the affected employees the right to
transfer ‘‘to another plant covered by this Agreement.’’
SIPCO declined to permit the employees to exercise transfer
rights to locations operated by other corporate entities, in-
cluding its wholly owned subsidiary, New Sipco, Inc., even
though these independent firms were covered by that agree-
ment. In this connection, on June 29, 1988, the Board issued
a Decision and Order concluding that:
Respondent SIPCO violated Section 8(a)(5) and (1) by
failing to provide the unit employees in the Tampa,
Florida facility the full range of transfer opportunities
set forth in the master agreement.
Having so found, the Board ordered, inter alia, that the Re-
spondent SIPCO take the following affirmative action:
Make whole all unit employees of the Tampa, Florida
facility for any losses they may have suffered as a re-
sult of the Respondent’s denial of the full range of
transfer opportunities provided for in the 1979-1982
master collective-bargaining agreement . . . with inter-
est.
775SWIFT INDEPENDENT PACKING CO.
5 See G.C. Exh. 4; R. Exh. 7.
6 The latter refused to comply, and this aspect of the proceeding
was contested in the Seventh Circuit Court of Appeals. On October
6, 1989, the court remanded that sector of the case for further con-
sideration by the Board. See Esmark, Inc. v. NLRB, 887 F.2d 739.
Following additional hearing before Judge William F. Jacobs, he
issued a decision dismissing the afore-described 8(a)(1), (3), and (5)
allegations in their entirety. Exceptions to that decision are now
pending before the Board.
7 G.C. Exh. 1(cc).
8 This facility is not to be confused with the Tampa sales unit. It
is a meat processing facility. At the time of the Tampa sales closure,
the processing unit was operated by separate corporate entity; name-
ly, Swift & Company. At all times material, the Tampa processing
unit remained open. To avoid confusion, it is referred to as ‘‘Tampa
(PROC).’’
9 When the Tampa sales unit was closed, New Sipco, Inc., a whol-
ly owned subsidiary of SIPCO, operated the facilities at Guymon
and Moultrie. Both plants were closed temporarily on April 17,
1980. When reopened a month later, the master agreement was not
applied to either location, a factor that might have influenced Tampa
sales employees to exercise their options elsewhere.
10 The unit covered, however, did not consist of a single com-
prehensive unit of all Swift & Company employees, but, instead, the
Union was recognized as exclusive agent in separate units. However,
the governing terms were set forth in this single, master agreement.
These matters later became the subject of an informal
Board settlement. Thus, on December 21, 1988, the Board
authorized the General Counsel to accept an adjustment of
the above unfair labor practice in accord with a proposal au-
thored by SIPCO. (R. Exh. 7.) By virtue thereof, the latter
agreed to comply with its remedial obligation and to redress
Tampa sales employees for denied transfer rights, as follows:
100% backpay, if any, for the Tampa employees as
may be determined by the NLRB.5
Parenthetically, it is noted that SIPCO was one of several
of respondents named in the unfair labor practice case. How-
ever, all the parties charged were not involved in the settle-
ment agreement. Thus, there was no resolution of entirely
distinct violations of Section 8(a)(1), (3), and (5), pertaining
to employees at Guymon, Oklahoma, and Moultrie, Georgia
plants insofar as attributed to certain other parties; namely,
Esmark, Inc. and Swift & Company.6 The Board found also
implicated SIPCO, Swift Independent Corp., and New Sipco,
Inc., in these violations. In their case, however, liability was
discharged in the settlement agreement through a notice
mailing and payment of a liquidated sum. Thus, in this latter
regard, the settlement had broader reach than the Tampa
sales unit. However, at Tampa, with the exception of SIPCO,
the 8(a)(5) allegation founded on transfer rights was dis-
missed as to all other Respondents (Esmark, Inc., Swift &
Company, Swift Independent Corp, and New Sipco, Inc.).
Therefore, the sole remaining issue under that allegation per-
tains to the backpay obligation, if any, to Tampa employees,
assumed by SIPCO under that accommodation.
The compliance specification seeks backpay from July 8,
1981, the date of closing of the Tampa sales unit, to Decem-
ber 3, 1988, when agreement was reached under the afore-
described settlement agreement.7 It identifies 23 former em-
ployees of the Tampa meat sales operation, each of whom
on a timely basis, sought to implement their contractual
transfer rights to one of the following plants:
St. Charles, Illinois
Omaha, Nebraska
Tampa (PROC), Florida.8
All are deemed eligible by the compliance specification for
backpay on the assumption that the collective-bargaining
agreement provided transfer rights to these locations.
The Respondent takes issue with this premise on two
counts. First, it is argued that the Board did not intend this
result. In this regard, the defense centers on the fact that,
when closed, the Tampa sales operation was owned and op-
erated by SIPCO. However, at that time, the plants at St.
Charles, Omaha, and Tampa (PROC) were owned and oper-
ated by Swift & Co. It is argued that SIPCO and Swift &
Co. are distinct corporate entities, that the Board dismissed
as to the latter, and therefore any construction of the contract
assuming that SIPCO had an obligation to honor transfer op-
tions to Swift & Co. plants would offend the corporate sepa-
rateness of the two firms and entail an improper disregard of
the corporate veil—a result that the Board could not have in-
tended.
The Respondent insists that the collective-bargaining
agreement as enforced by the Board imposed an obligation
on SIPCO only with respect to plants within its corporate
bailiwick, namely, the Guymon and Moultrie locations. If
meritorious, no backpay would ensue, for as the Respondent
correctly observes, the options exercised by these individuals
were confined to the plants of Swift & Co.9
In the alternative, the Respondent challenges the settlement
agreement as enterred under an understanding that SIPCO in-
curred liability only to those Tampa sales employees who
opted for transfer to New Sipco, Inc.’s plants at Guymon,
Oklahoma, or Moultrie, Georgia, or if not, that the settlement
is unenforcable since entered under a material mistake of
fact. Alternatively, the Respondent contends that in no event
are those who later opted for retirement or severance pay eli-
gible for backpay. Beyond that, the Respondent does not dis-
pute the formula set forth in the specification for determining
gross backpay. However, at least in its answers to the speci-
fication, issues are raised as to the net amounts due, such as
the quality of the search by certain claimants for alternative
employment.
B. Defenses Pertaining to Corporate Independence
1. The emergence of corporate independence
As indicated, the Board’s Order and its award of backpay
derive from a provision of a master collective-bargaining
agreement which conferred transfer rights to any plant cov-
ered by the contract. Thus, comprehension of the various po-
sitions of the parties requires some understanding of the
scope of the contract as of its effective date, September 1,
1979, and during the balance of its term. The Respondent’s
contentions focus on what transpired in that timeframe.
On execution of the contract, there was no proprietary dis-
tinction between any of the covered plants, all of which were
owned and operated by Swift & Company, the latter being
the sole corporate signatory to the master agreement.10
776 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
11 Esmark was created by Swift & Company in April 1973 as a
holding company with no production capability. All plants were
owned and operated by Esmark’s wholly owned subsidiaries, includ-
ing Swift & Company.
12 This firm is also referred to as the new Swift & Co.
13 The Respondent now contends that contractual transfer options
could be exercised to the Guymon and Moultrie plants operated by
its wholly owned subsidiary, New Sipco, Inc. At this stage, the new
Swift & Company was identically postured to that firm, in the sense
that it was a wholly owned subsidiary of SIPCO. Consistent with the
Respondent’s reasoning, if transfer rights to Swift & Company plants
were to be avoided, further action would be required to sever that
firm from SIPCO’s proprietary control.
14 As stated by Judge Cudahy, on behalf of the Seventh Circuit
Court of Appeals, Sipco, the owner of the fresh meat division is not
a ‘‘new’’ company. Instead, it is an old company, dating back to the
19th century, which merely gave away its name and a large number
of its operations.’’ (Emphasis added.) Esmark, Inc. v. NLRB, 887
F.2d 739, 743 fn. 2 (7th Cir. 1989).
Hence, at that time, no limitation of the type now sought by
the Respondent could be placed on the ‘‘range of transfer op-
portunities provided for in the 1979–1982 master collective-
bargaining agreement.’’ In short, on September 1, 1979, that
provision was not shadowed by any corporate separateness.
All plants, including Tampa sales, Tampa (PROC), St.
Charles, Omaha, Guymon, and Moultrie, were harbored
under a single entrepreneurial roof, namely, Swift & Com-
pany.
The Respondent’s claim of corporate independence rests
on midterm changes which, in its view, reduced the enforce-
able ‘‘range of transfer opportunities.’’ From the inception of
that agreement, Swift & Company, a signatory thereto, was
a wholly owned subsidiary of Esmark.11 It operated a num-
ber of plants throughout the country which were assigned to
either its separate fresh meats and processed meats divisions.
All were within bargaining units covered by the master col-
lective-bargaining agreement.
During the term of the 1979–1982 master agreement,
Esmark sought to divest itself of Swift & Company’s fresh
meat operations. In furtherance of this plan, on June 26,
1980, Esmark determined that this division would be
transfered by Swift & Company to a distinct corporation,
which then would be sold.
The initial step in this transaction, took place on Septem-
ber 3, 1980, when Swift & Company, created a new subsidi-
ary called Transitory Food Processors. On October 21, 1980,
Swift & Company transferred all of its assets to Transitory,
except the fresh meat division. On October 24, 1980, Swift
& Company’s name was changed to SIPCO. Also effective
October 24, the name of Transitory was changed to Swift &
Co.12
By virtue of these transactions and name changes, as of
that date SIPCO became the repository for the remaining
fresh meat operations, including the Tampa sales operation
and the Guymon and Moultrie plants. The new Swift & Co.,
which remained a subsidiary of SIPCO, owned and operated
the meat processing division, including the processing facili-
ties at Tampa (PROC), Omaha, and St. Charles.13
The separation of the new Swift & Company from
SIPCO—still a wholly owned subsidiary of Esmark—was ac-
complished by a transaction which, while perfectly legiti-
mate, apparently lacked supporting consideration. Thus, on
October 27, 1980, SIPCO declared a dividend of all of the
stock of Swift & Co., giving control and ownership of the
meat processing operation to Esmark.14
At this point, Esmark owned the stock of both SIPCO and
the new Swift and Co. These firms continued separately to
honor the master collective-bargaining agreement.
Esmark intended to rid itself of SIPCO through a public
stock offering. To accomplish this, additional steps were nec-
essary. First, on January 26, 1981, Swift Independent Cor-
poration (SIC) was established. On February 23, Esmark and
SIC entered an agreement whereby SIC purchased all of
SIPCO’s stock from Esmark in exchange for a promissory
note for $100 million. Later, on April 21, SIC’s stock was
transferred back to Esmark with a $35 million promissory
note payable by SIC to Esmark, for which Esmark surren-
dered SIC’s original $100 million note. At this juncture,
Esmark held all of SIC’s stock, SIC held all of SIPCO’s
stock, and SIPCO owned the fresh meat operation. Esmark,
beginning on April 22, through public sale, divested itself of
65 percent of SIC’s stock, retaining a 35-percent interest.
The final step related to the Guymon and Moultrie plants.
Both had been closed on April 17, 1981. It was intended that
they be reopened under aegis of a new corporation. Thus,
SIPCO created a new wholly owned subsidiary, New Sipco,
Inc. Later in April 1981, the Guymon and Moultrie plants
were transferred to New Sipco, Inc. As indicated previously,
once reopened in May 1981, New Sipco, Inc., did not apply
the master agreement to either plant.
This structural reorganization, culminating in the public
sale of SIC, the owner of SIPCO, provides the crucial foun-
dation for the defense that the master agreement imposed no
obligation on SIPCO in connection with Swift plants, and
hence it is not liable for any backpay that might have inured
from assertion of transfer rights to the Tampa (PROC),
Omaha, and St. Charles facilities.
2. The scope of compensable transfer rights
a. The settlement agreement
The Respondent insists that the settlement agreement em-
bodied no intention to compensate employees who exercised
transfer options to plants other than Guymon and Moultrie.
This position draws its essence from a legal interpretation of
SIPCO’s liability allegedly held by Attorney Charles Sykes,
who was not involved in the proceeding until the settlement
stages. Consistent with his observations, it is a fact that
Guymon and Moultrie were the only plants operated subject
to the Respondent’s control when the 23 named claimants at-
tempted to exercise transfer options. Sykes also asserts that
the settlement agreement did not contemplate compensation
for those who sought jobs at Swift & Co. plants, as no con-
tractual transfer opportunities existed to these locations.
To even think of maintaining this position successfully, the
Respondent must establish an all-party understanding held
prior to execution of the settlement agreement in consonance
with Sykes’ analysis. This possibility is confronted initially
by the fact that his settlement proposal, on its face, is with-
out limitation in its declaration that SIPCO assumed an obli-
gation to provide ‘‘100 percent backpay, if any, for the
Tampa employees as may be determined by the NLRB.’’
In the main, the Respondent’s position rests on self-serv-
ing and a highly selective interpretation of two documents,
777SWIFT INDEPENDENT PACKING CO.
15 R. Exh. 46.
16 G.C. Exh. 11.
17 R. Exh. 39.
18 In connection with the backpay negotiations affecting the
Guymon and Moultrie plants, pursuant to Sykes’ suggestion, the
Union sent a research auditor, Howard Foreman, to the latter’s office
to examine SIPCO’s books and records. This occurred on October
Continued
whose focus, in turn, pertains to different facets of this com-
plicated proceeding and related actions before the Board and
other forums. Thus, it is argued that an understanding in ac-
cord with its interpretation was manifested by the Union and
the Board well before either party registered any formal
claim that transfer rights to plants other than Guymon and
Moultrie were compensable.
To substantiate union assent, the Respondent’s posthearing
brief points to a memo, dated November 20, 1989, about a
year after the agreement was adopted. The document osten-
sibly forwarded by the Union’s vice president, Frank R.
Dininger, to Tampa sales employees.15 The Respondent con-
tends that Dininger’s message evidenced the latter’s under-
standing that the contractual transfer rights were limited to
Guymon and Moultrie. The view is without merit. Apart
from the fact that there is no indication that Dininger, his
memo, or his understandings were part of the settlement
process, the content of this memo is hardly reflective of con-
cession. The document, from SIPCO’s point of view, at best,
is ambiguous, for it describes the litigation as based on at-
tempts to avoid transfer rights ‘‘under a master agreement at
Swift or SIPCO plants in Moultrie, Georgia, and Guymon,
Oklahoma. [Emphasis added.]’’ Considering the fact that the
8(a)(1), (3), and (5) findings based on closedowns at
Moultrie and Guymon presented the most notorious issues in
controversy at the time, it is not suprising that Dininger men-
tioned these plants specifically. However, his objectives, in-
sofar as discernible, did not require an exhaustive listing of
the plants awarded transfer rights by the contract. In this
context, he did include a specific reference to ‘‘Swift,’’
thereby eliminating any need to elaborate by itemizing each
and every Swift plant within the spectrum of legitimate
transfer rights. The absence of such a listing was not tanta-
mount to concession that transfer rights were not viable at
Swift plants.
As against the General Counsel, the Respondent points to
Regional Director Elizabeth Kinney’s letter to Esmark, dated
March 28, 1989.16 This document pertains to Esmark’s obli-
gation under the Board’s Order. Esmark had no remedial in-
terest in the settlement’s adjustment of the transfer issue.
Consistent therewith, this document does not address the
rights of Tampa sales employees, but on its face is limited
to SIPCO’s shared responsibility with Esmark and others for
the illegal closedowns at Moultrie and Guymon. The Re-
spondent borders on desperation when it claims that this cor-
respondence acknowledges that ‘‘it was pretty clear to every-
one . . . that no backpay was due the former Tampa em-
ployees.’’
Beyond the writings penned by Kinney and Dininger the
Respondent cites, no other documents are referred to in its
brief to support its understanding of the parties’ intent. In-
stead, the defense turns to heavy reliance on parol testimony
by Attorney Sykes. In this regard, prior to the hearing,
Sykes, on November 27, 1990, in a letter to Associate Gen-
eral Counsel Robert A. Allen, stated:
I cannot accept your conclusion relative to Tampa.
When I settled this case with Paul Spielberg and Bob
Funk, they both asked me about Tampa. My response
was the same in both cases. I told them that no backpay
was due as it was my understanding that none of the
Tampa employees, had sought to transfer to Moultrie or
Guymon, but if they had, we would pay backpay to any
Tampa employee who has been refused a transfer to
Moultrie or Guymon. I am as clear on this point as I
was on the three million being treated as interest. I
agreed to pay backpay, if any only to Tampa employees
who were denied transfer rights to Guymon and
Moultrie, nothing more. [Emphasis added.]
On December 7, 1990, Sykes wrote John W. Peck, an
NLRB compliance supervisor, as follows:
I have repeatedly said prior to, during and after the set-
tlement, SIPCO will pay the Tampa employees backpay
who were denied transfer to Moultrie and Guymon.
That has always been our position.17
Unfortunately, his testimony as to his dealings with the
parties prior to execution of the settlement was not so clear.
He could not swear that he mentioned or even discussed any
such limitation verbally or in writing with Paul Spielberg. He
does barely suggest that on one occasion such a comment
was made to union officials. Thus, Sykes avers that this took
place at union headquarters on October 4, 1988. The meeting
was attended by the International Union’s general counsel,
George Murphy, its associate general counsel, Robert Funk,
and a regional vice president, Roger Clark. His testimony as
to what was said is limited to the following colloquy with
his co-counsel on direct examination:
Q. What else was discussed at that meeting?
A. Well, we talked about the fact that it was the
Tampa portion of the case and that if there was any
back pay for anybody that we had refused to transfer
to Guymon and Moultrie we would give them a hun-
dred cents on the dollar whatever it was.
I didn’t think it was anybody. But if it was we’d pay
them a hundred cents on the dollar.
And then I told them that—we went on the next
point, that that would be . . . the end of our—extin-
guish our obligations . . . and they comply with the re-
medial order.
Even were I to believe Sykes, this passing expression—con-
veyed to only one party—was too vague to establish mutual-
ity. There was no specific declaration that those who sought
transfer elsewhere would be excluded. His references to
Guymon and Moultrie were not accompanied by explanation.
He does not suggest that he expressly solicited union assent
to any limitation on backpay, or that it was given. Finally,
Sykes did not aver that the union attorneys waived any right
to resolve within the dispute-resolution terms of his settle-
ment proposal, any dispute as to the contractual validity of
transfer options to plants owned and operated by Swift &
Co.18
778 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
25 and 26, 1988. Sykes admits that he understood that Foreman was
simply an ‘‘accountant’’ who held no authority with respect to the
then in progress settlement discussions. On direct examination,
Sykes testified that Foreman asked for the Tampa records, where-
upon Sykes allegedly responded that there was no backpay at
Tampa. Foreman asked why. Sykes claims that he ‘‘gave’’ him a
copy of General Counsel’s Exhibit 23, a document reflecting that all
Tampa transfer options were effected with respect to Swift plants.
As might be expected, Foreman allegedly replied, ‘‘well I don’t
know about that.’’ According to Sykes, Foreman went on to state
that if he had any questions about Tampa, he would get back to
Sykes. He never did. On cross-examination, Sykes testified that the
Tampa issue was raised by himself, not Foreman. As I understand
his testimony, he showed Foreman a piece of paper with ‘‘a big
zero.’’ Sykes’ testimony in this respect was not denied, but I have
my doubts as to whether Tampa was mentioned. I find it difficult
to believe that Sykes would have been more demonstrative with this
subordinate than he was with union attorneys and at least one high
level official. In contrast with his alleged specificity with Foreman,
Sykes admitted that, only a few months later, in January 1989, when
he received a formal request for Tampa data from Nancy J. Harris,
an NLRB compliance officer, there was no denial of liability, but
he simply directed a paralegal to compile and submit the informa-
tion. (G.C. Exh. 9.) Later, on October 30, 1989, pursuant to a re-
quest from Marge Peck, another NLRB compliance officer, Sykes
supplied additional Tampa payroll records. (G.C. Exh. 12.)
19 Funk testified, without contradiction, that Sykes stated during
the initial meeting at union headquarters in the fall of 1988 that he
‘‘had to make the settlement with the NLRB . . . .’’ Indeed, any
attorney practicing before the Board would know this to be the case.
Whatever, the source, Attorney Sykes certainly was aware that no
agreement would be binding without Board approval. His original
handwritten proposal specifically stated that the adjustment was so
conditioned. (G.C. Exh. 2.) In his followup proposal, prepared after
Board attorneys signified that they could not recommend that the
Board accept the original sum offered for Guymon and Moultrie em-
ployees, Sykes stated, ‘‘I would appreciate your referring this offer
of settlement to the NLRB for their consideration and review.’’
(G.C. Exh. 4.) Sykes obviously was aware that formation of an
agreement required full disclosure of all terms to the Board, and that
the obligations embodied in the written proposal, once accepted,
could not be altered by uncommunicated matters. Yet, no evidence
was presented through Sykes, nor from any other source suggesting
that any Board agent was informed prior to December 1988 of any
limitation on the formula set forth in the final proposal.
20 R. Exh. 23.
21 R. Exh. 8.
22 R. Exh. 15. Sykes replied to this letter on November 27, 1990,
again appealing that the moneys not be distributed to Guymon and
Moultrie discriminatees until the Tampa dispute is resolved. G.C.
Exh. 18. However, as stated in the Allen letter that distribution was
already in progress.
23 R. Exh. 5.
24 G.C. Exh. 19.
Apart from the vagaries in his testimony, whatever Sykes’
personal view, he neglected to incorporate any such quali-
fication in the settlement agreement, electing instead to leave
this and any other dispute concerning the scope of his cli-
ent’s liability to ‘‘be determined by the NLRB.’’ Moreover,
the testimony bearing on the conversation does not establish
to my satisfaction, that anyone within earshot would have as-
sumed that Sykes agreed to this formula only because he la-
bored under a mistake as to his client’s liability. Instead, at
best from SIPCO’s point of view, it was a lawyer talking
about his interpretation of past events, a position that would
later be tested under the procedure he had proposed that very
day. In any event, that which transpired at union head-
quarters that day was not witnessed by any representative of
the Board, and Sykes should have known that anything said
on that occasion could not bind later.19
While there is no evidence of assent to Attorney Sykes’
alleged interpretation of the contract, the Board’s Order or
the settlement, the Respondent raises several collateral
grounds or factors which in its view compels acceptance of
that interpretation. Initially, it is observed that the Board dis-
tributed $3 million in liquidated sums to Guymon and
Moultrie discriminatees with knowledge as to ‘‘material dis-
putes over the settlement agreement.’’ Having done so, it is
argued that the Board is foreclosed from contesting SIPCO’s
view. There is no question that representatives of the General
Counsel, on November 5, 1990, began distributing these
funds, together with a copy of the notice,20 to said
discriminatees with knowledge of the issue affecting the
Tampa sales employees, and in the face of an admonition by
Sykes conveyed in his letter dated September 21, 1990.
Through that document, Sykes forwarded the signed notices,
while stating that he had done so ‘‘only with the express un-
derstanding and reservation that such execution shall be of
no force and effect unless the matters raised in my August
16, 1990 are resolved satisfactorily.’’21
By letter of November 20, 1990, over signature of Robert
E. Allen, Associate General Counsel, Division of Enforce-
ment Litigation, Attorney Sykes was informed of disagree-
ment with SIPCO’s interpretation concerning the entitlement
of Tampa sales employees. As for Guymon and Moultrie
discriminatees, the letter stated:
[Y]ou will be pleased to hear that the General Counsel
has decided to treat as interest the money paid by your
clients pursuant to the settlement. Accordingly, the
agency is in the process of distributing the money to
the discriminatees without deductions of any kind.22
Contrary to the Respondent, the attempt by Sykes on Sep-
tember 21, 1990, to dictate conditions on the handling of
those moneys was tantamount to a unilateral alteration of the
scope of the settlement. The checks covering this sum had
been in the hands of the Region since December 26, 1988,
at least a year prior to any insinuation by the Respondent to
the Board or its agents that no backpay was due the Tampa
sales employees.23 This payment was totally unaffected by
any such controversy, and its distribution was deferred appar-
ently because of a question as to whether it should be con-
sidered ‘‘interest only.’’ Notwithstanding Attorney Sykes’ at-
tempt to head off the distribution, once the General Counsel
acceded to SIPCO’s position in that regard,24 there was no
bar to implementation of that separable provision. For the
payment was in consideration for the Board’s agreement to
release SIC, SIPCO, and New Sipco from major remedial di-
rectives that stemmed from the 8(a)(1), (3), and (5) findings.
It was limited to employees in the Guymon and Moultrie
units, was derived from entirely distinct unfair labor prac-
tices, and discharged a remedial obligation, which was totally
lacking in relationship to any conduct or allegations pertain-
ing to the Tampa unit. Thus, the distribution pertained to a
separate part of the case, with separate consequences for a
different class of employees and Respondents. The Tampa
sales employees were not benefited by this action, and the
General Counsel had done nothing, irreparable or otherwise,
779SWIFT INDEPENDENT PACKING CO.
25 At the hearing Attorney Sykes declared that, ‘‘Washington never
contemplated for a minute that these Tampa employees had transfer
rights to Omaha, St. Charles, and Tampa . . . . It was only like a
year and a half after the settlement, maybe even longer, a year and
three quarters after the settlement.’’ His assumption was not founded
on any affirmative declaration on the part of the Board or any of
its agents.
26 G.C. Exh. 13. This argument would also foreclose the exercise
of transfer rights to Moultrie and Guymon, for the same finding was
made by the Board as between SIPCO and New Sipco. On July 8,
1981, when the Tampa sales unit was closed, these plants were
owned by New Sipco. Moreover, Darch’s position seeks to under-
mine the Board’s finding. On the record before the Board, all op-
tions were exercised to plants of Swift & Co. Thus, were Darch cor-
rect, no substantial evidence would exist supporting the Board’s
finding that SIPCO unlawfully denied any contractual transfer bene-
fits. In this light, the Board agents had no reason to accede to
Darch’s position.
27 The examination of Sykes and certain documentation placed in
the record on behalf of SIPCO suggests that the Board had a duty
to inform SIPCO that it was claiming backpay on the basis of trans-
fer options to Swift plants. It is clear, however, that during the pe-
riod prior to August 16, 1990, the parties were primarily concerned
Continued
to compromise SIPCO’s rights with respect to these employ-
ees.
Moreover, the Government’s action in this respect was in-
offensive to the terms selected by the parties to accommodate
the rights of Tampa employees. Sykes’ interpretation that
Swift plants were out of bounds under the master collective-
bargaining agreement, like any other potential conflict, was
certainly within the realm of possibility when the parties en-
tered their settlement. All such issues were relegated, ex-
pressly and without qualification, for resolution by the
Board. Self-help, through an attempt to thwart performance
of separable terms, was not an ancillary feature of that proc-
ess. Having adopted a mechanism for dispute resolution,
each side expressly protected itself against an attempt by one
party to renounce all obligations simply by raising an inter-
pretation unacceptable to the other as to any part. Accord-
ingly, the distribution of the $3 million to Guymon and
Moultrie employees legally was consistent with that formula-
tion, and beyond the control of SIPCO and its counsel.
The Respondent also seeks to nullify the settlement agree-
ment as predicated on a mutual mistake of fact. It does not
assert, however, that it was victimized by any form of im-
proper representation, nor is there substantial proof that it
was disadvantaged deliberately by a party with superior
knowledge. In this regard, having examined the references
offered, it is concluded that the evidence does not substan-
tiate that the Union or the General Counsel held to the view
or even sensed that the settlement agreement foreclosed
backpay for those who opted for transfer to Tampa (PROC),
Omaha, or St. Charles.25 Cf. Orlandi v. Goodell, 760 F.2d
78, 80 (4th Cir. 1985); U.S. v. Fowler, 913 F.2d 1382, 1389
(9th Cir. 1990). In other words, there is no evidence that the
mistake, if any, was in the mind of anyone, prior to Decem-
ber 1988, or for that matter, thereafter, with the possible ex-
ception of Attorney Sykes. Cf. Rice v. Truckline Gas Co.,
323 F.2d 394, 396 (7th Cir. 1963); Hashway v. Ciba-Geigy
Corp., 755 F.2d 209, 211 (1st Cir. 1985). As a skilled attor-
ney, if he held the view he now espouses, he should have
preserved it in the agreement. Instead, the terms he proposed
did not define his client’s obligation as he allegedly under-
stood it, but merely established a method for resolving any
conflict that might exist as to that obligation. His choice of
terms was not inherently suggestive that he did not intend the
consequences of his own language or that he held a reason-
able belief that the agreement was other than as he proposed.
In these circumstances, the agreement was not so frail as to
be subject to rescission because one party held an interpreta-
tion not communicated by the agreement. Having proposed,
without further qualification, to leave any and all backpay
disputes to the Board’s determination, Attorney Sykes bound
his client to the risk that his underlying legal interpretation
might be rejected.
Finally, I take note of the General Counsel’s assertion that
the attempt by Attorney Sykes to limit the scope of the
Tampa settlement was afterthought and nonexistent until
1990. There is ample room to suspect that this might have
been the case. He made no unequivocal statement prior to
execution of the settlement agreement that, due to corporate
separateness, backpay for Tampa employees would not ex-
tend to Swift & Co. plants. Interestingly enough, it was
Esmark, Inc., a separate corporate entity with no actual or
potential liability to the Tampa sales employees, through its
attorney, Douglas A. Darch, that first made this argument.
Thus, Darch, by letter to Region 7, dated December 29,
1989, stated:
It is Esmark’s position that none of the employees at
the Tampa sales unit are entitled to backpay. The rea-
son is none attempted to transfer to other SIPCO Mas-
ter Agreement plants and were denied that right.
. . . .
[Darch refers to a stipulation indicating that all
Tampa sales transfer options were exercised with re-
spect to plants of Swift & Co.]
. . . .
The General Counsel’s theory regarding the transfer
issue was that Swift & Co. and SIPCO were a single
employer, or a joint employer or an alter ego. Con-
sequently . . . SIPCO was obligated to offer transfer
opportunities to its Tampa sales unit employees and
Swift & Co. was obligated to permit those transfers.
Thus, the denial of the twenty-seven employees’ trans-
fer requests would have been unlawful only if Swift &
Co. were a single/joint employer or alter ego to SIPCO.
Since the NLRB held Swift & Co. is not and was not
a joint/single employer or alter ego of SIPCO, the de-
nial of transfer requests to Swift & Co. plants was not
unlawful.
No other individuals requested a transfer, but was
denied his/her request. See General Counsel Exhibit
No. 383 (stipulation). Accordingly, Esmark submits
there is no backpay due and owing to any individual on
the payroll at SIPCO’s Tampa sales unit.26
Sykes did not advance any such argument to any agent of
the Board until the summer of 1990. Thus, in October 1989,
a Board agent assigned to Region 7, Marge Peck, by tele-
phone requested information concerning the Tampa case
from Sykes. He provided the data on October 30, 1989.
There was no mention that Tampa transfer rights were non-
compensable.27
780 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
with negotiations and collateral litigation pertaining exclusively to
the discriminatees at Guymon and Moultrie. During that time frame,
on two occasions, Board agents requested, and under the good of-
fices of Attorney Sykes, were provided information concerning
Tampa employees. In any event, there was neither need, nor oppor-
tunity for any Board agent to take issue with Sykes’ interpretation
until apprised of its existence.
28 G.C. Exh. 14.
29 Attorney Sykes testified that he did not read this letter because
it was in an envelope within a carton containing payroll records that,
according to his direction, was returned to the client without exam-
ination. He replied only after receiving a Board agent’s followup let-
ter dated August 13, 1990. (G.C. Exh. 15.)
30 G.C. Exh. 16. Sykes was informed on September 19, 1990, that
his letter had been forwarded to headquarters in Washington, D.C.,
for a response. (R. Exh. 20.) In addition, Sykes was directed at that
time to forward signed notices for mailing to the Moultrie and
Guymon discriminatees.
31 Sykes testified that he had been involved with SIPCO since Sep-
tember 1987. He relates that he reviewed Judge Jacobs’ decision in
the underlying unfair labor practice case, together with exceptions
filed by the Union, and concluded that the dismissal as to SIPCO
was wrong and feared it would be reversed. It is the sense of his
testimony that, prior to the Board’s reversal of Judge Jacobs, he un-
successfully counseled SIPCO to seek a settlement. As Attorney
Sykes had anticipated, on June 29, 1988, Judge Jacobs was in fact
reversed by the Board. By letter dated July 7, 1988, Sykes notified
the Union that he had been retained ‘‘to represent Swift Independent
Packing Company relative to settling, if possible, the above case.’’
R. Exh. 24.
32 In his testimony, Sykes states that prior to October 4, 1988,
rough estimates made in his office suggested that $12.5 million
could be due to former employees at these locations. The General
Counsel’s estimates were more in the neighborhood of $8 million.
(R. Exh. 2.)
On July 2, 1990, the Respondent was advised by letter of
settlement calculations made on behalf of employees at
Guymon, Moultrie, and at the Tampa sales unit.28 On August
16, 1990,29 Attorney Sykes replied as follows:
[T]he Tampa back pay calculations are wrong and to-
tally unacceptable. Mr. Darch’s letter of December 29,
1989, to you accurately sets forth our view. No back
pay is due to any Tampa employees as none of them
sought transfer to Guymon or Moultrie, which were the
only two plants where SIPCO failed to apply the master
agreement. To claim that the Tampa employees had
transfer rights in August of 1981 to Swift & Co. plants,
a separate company who was dismissed from the com-
plaint by the Board, is, simply put, incorrect.
SIPCO will not pay back pay to its former Tampa
employees who sought to transfer to Swift & Co.
plants, a totally separate and distinct employer, who
was dismissed from the case. SIPCO only failed to
apply the master agreement to Guymon and Moultrie.
It would have been a legal impossibility for SIPCO to
apply the agreement to Swift & Co. plants. I think you
will find the UCFW concurs in this position. How can
we transfer people to plants we neither own or con-
trol?30
Attorney Sykes claims that he was so worked up in drafting
this document that there was ‘‘steam coming off the paper.’’
Yet, in advancing his argument, he simply asserts that ‘‘I
think’’ the Union would ‘‘concur.’’ Nowhere does he state
that either the Board or the Union, directly or indirectly, had
ever communicated an assent to that view. The pattern con-
tinued in Sykes’ memo to Union Attorney Robert Funk,
dated August 16, 1990. In that document Sykes advised that
no backpay would be paid to any Tampa employee ‘‘unless
he was denied a transfer to a SIPCO master contract plant.’’
In making his point, Sykes articulated his position as a cor-
rect legal interpretation, but nowhere states that the matter
had been broached prior to settlement. (R. Exh. 3.) If Attor-
ney Sykes held any understanding that he had exacted union
or Board assent to his view, he certainly would have taken
these occasions to stress the point.
Ultimately, he did so, but by letter of November 27, 1990.
At that juncture, Sykes attempted to firm up his position by
stating that ‘‘I told them [the Union and Board] that no back-
pay was due as it was my understanding that none of the
Tampa employees, had sought to transfer to Moultrie or
Guymon.’’ This representation would turn out to be broader
than his testimony. Thus, nowhere does he testify to ever, in
timely fashion, having raised the issue with any representa-
tive of the Board. In this respect, concern arises as to why,
if Sykes had been candid with the Union on this point, he
would not have disclosed his position to the Board. In the
final analysis, any assumption that Sykes honestly held the
view that the Union accepted his position, would necessarily
excuse the unlikely behavior of this experienced labor attor-
ney in electing to leave the matter open, rather than put it
to rest with specific terminology in his own settlement pro-
posals.
Consistent with the doubt is my suspicion concerning
Sykes’ testimony that he mentioned his position to the Union
before execution of the settlement. Attorney Funk denied that
this was the case. There is no question that prior to Decem-
ber 1988, Sykes was a vigorous protagonist of settlement on
behalf of the SIPCO group (SIPCO, SIC, and New Sipco,
Inc.).31 He, surely, would have been sensitive to the possibil-
ity that this effort would fall on its face on suggestion that
no backpay had accrued under the Tampa finding. It was
fully within probability that any revelation along that line
would produce an immediate barrage from those who would
have known that the Board acted on evidence that transfers
were exercised only to plants of Swift & Co., and that, in
July 1981, when transfer options were exercised, the master
agreement had not been withheld at Guymon or Moultrie. At
the same time, having admittedly read the briefs in the unfair
practice proceeding, Sykes would have been alerted to the
fact that the proponents of the complaint never acknowl-
edged such a limitation, but consistently claimed that con-
tractual transfer provision applied to all plants covered by the
master agreement in general, and to the Swift plants in par-
ticular. Having succeeded in securing reversal of Judge Ja-
cobs on that issue, their would be no apparent reason to sus-
pect that either the General Counsel or the Charging Party
would yield the fruits of this effort by accepting any settle-
ment that would nullify the rights of Tampa employees while
merely obtaining a fraction of the backpay due to
discriminatees at Guymon and Moultrie.32
On the foregoing it is concluded that the settlement ap-
proved by the Board on December 22, 1988, was a binding
and enforceable agreement, which incorporated no mutual
understanding as to the scope of SIPCO’s backpay obligation
781SWIFT INDEPENDENT PACKING CO.
33 I do not agree with the General Counsel that SIPCO’s position
in this respect is negated ‘‘on the face’’ of the Board’s decision and
‘‘without reference to extrinsic evidence.’’ To prove the point, coun-
sel for the General Counsel goes to great lengths to remove from
context observations by the Board and then to editorialize them into
specific findings. Had the Board made such findings, their truly
would have been no basis for the Respondent’s contention. However,
as matters stand, were I to adopt the General Counsel’s view it sure-
ly would produce instant reversal. The fact of the matter is that the
Board reversed Judge Jacobs on the issue of whether the the master
agreement was binding on SIPCO, and on finding that it was, did
not engage in any direct analysis of the scope of the contract, nor
provide specific guidance as to how, with dismissal of Swift &
Company, SIPCO was obligated under the contract to effect transfers
outside its corporate realm. Contrary to the General Counsel, the
Board made no concrete finding—so clear as to dispense with any
need for interpretation—that SIPCO breached the master agreement
when it denied transfer to ‘‘Swift & Co. facilities.’’ Instead, resolu-
tion of the issue requires exhaustive reference to extrinsic evidence
and reason.
34 There was no evidence that transfers were sought to Guymon
or Moultrie. At times material, this was understood by the parties.
Thus, in its brief to the Board, p. 42, counsel for the General Coun-
sel signaled that the case was in this posture, asserting that : ‘‘[B]y
denying the Tampa employees the right to transfer to Swift plants
covered by the Master Agreement, Respondents unilaterally changed
the transfer provisions in violation of Section 8(a)(5) and (1) of the
Act.’’ Moreover, well after the Board’s decision, Attorney Sykes in
a letter to the Regional Office dated August 16, 1990, stated ‘‘No
backpay is due to any Tampa employees as none of them sought
transfer to Guymon or Moultrie . . . .’’ G.C. Exh. 16.
35 Attorney Sykes, who claims to have studied certain briefs filed
with the Board and the Board’s decision prior to the settlement pro-
posal, knew or should have known that this contention was a matter
of record in the underlying case.
to the Tampa sales employees, but as stated on its face, rel-
egated any such issue to determination by the Board.
b. The scope of the Board’s unfair labor
practice finding
The Respondent reasons that the Board could not have in-
tended its remedy to reach plants of the new Swift & Co.
There can be no question that SIPCO was the sole target of
the Board’s findings:
‘‘We . . . find that Respondent SIPCO violated Section
8(a)(5) and (1) by failing to provide the unit employees
in the Tampa, Florida facility the full range of transfer
opportunities set forth in the master agreement.’’ As the
record does not establish that any of the remaining Re-
spondents played any direct role in this conduct, we
shall dismiss the allegation with respect to the remain-
ing Respondents.
The Board did not question that, as of May 11, 1981,
when SIPCO declined to recognize the full range of transfer
rights, SIPCO and the new Swift & Company were sepa-
rately owned and managed, and for all intents and purposes
were separate corporate entities. Moreover, the Board made
no finding that SIPCO and Swift & Company constituted a
single/joint employer or alter egos. Against this background,
the Respondent argues that, by limiting its finding to SIPCO,
and directing it alone to ‘‘implement the full range of trans-
fer opportunities,’’ the Board did not contemplate that
SIPCO would hold any obligation with respect to plants of
other entities, including those of Swift & Co.
The Board’s intention must be gleaned from the violation
found.33 It is beyond dispute that SIPCO was deemed to
have unilaterally repudiated the transfer rights set forth in ar-
ticle 77 of the master contract. The only evidence bearing on
the Board’s understanding of constituent elements within the
‘‘full range of transfer opportunities’’ is evident from the
facts supportive of this finding, summarized at 289 NLRB at
432:
[I]n August 1981, SIPCO’s Tampa sales unit facility
was closed. The Tampa employees, who were covered
by the master agreement, were permitted to transfer to
SIPCO facilities also operating under the master agree-
ment but were not permitted to transfer to Moultrie,
Guymon or any Swift & Co. facilities. The provisions
of the master agreement permitted transfer to any plant
under the master agreement whenever a plant closed.
289 NLRB at 427.
Thus, Moultrie, Guymon, and Swift & Co. facilities were the
only locations mentioned by the Board to which transfer
rights were denied. Consistent with other findings by the
Board, as of May 11, 1981, all such facilities were covered
by the master agreement. While the Board did not specifi-
cally conclude that the 8(a)(5) violation was based on trans-
fers denied to Swift plants, it could not have found other-
wise. There was no evidence that transfer preferences were
rejected elsewhere. Thus, the parties stipulated in the under-
lying unfair labor practice case that transfer elections were
denied only to Swift & Co. facilities, with 11 Tampa meat
sales employees initially having been refused transfer to
Tampa (PROC), 10 to St. Charles, and 6 to Omaha. (G.C.
Exh. 23.)34 Thus, if as the Respondent argues, contractual
transfer rights could not be exercised with respect to those
locations, the Board knowingly found a violation and issued
a make whole order in the face of undisputed evidence that
that the transfer rights were legitimately denied.
In essence, the Respondent’s contention amounts to a col-
lateral challenge to the merits of the Board’s unfair labor
practice finding. As counsel for the General Counsel ob-
serves, the argument that SIPCO could not apply article 77
to the Swift plants ‘‘is precisely the argument considered by
the Board and rejected.’’ While the Board did not expressly
do so, its decision cannot be read any other way. Thus, the
8(a)(5) allegation was initially dismissed by Judge Jacobs on
grounds that, as a mere ‘‘successor’’ to Swift & Co., SIPCO
was not bound by the master agreement. The General Coun-
sel took exception. Defense attorneys countered with the pre-
cise argument made here, namely, that article 77 could not
have been violated by SIPCO’s failure to honor transfers to
Swift plants. Thus, in an answering brief filed on behalf of
SIPCO and others, the Board was specifically admonished
that ‘‘[SIPCO] . . . . certainly could not apply the Master
Agreement at Swift units, as it had no control over Swift’s
operations . . .’’ and therefore SIPCO ‘‘did not violate the
Act by not permitting Tampa employees to transfer to Swift
facilities.’’35
The Board rejected this position sub silentio. It reversed
Judge Jacobs’ dismissal, but invoked no legal theory or rea-
soning that altered the corporate separateness of SIPCO and
782 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
36 Considered in light of the Respondent’s position that contractual
transfer rights extended to Guymon and Moultrie plants, it might be
said that the above argument proves too much. For, Guymon and
Moultrie, as of May 11, 1981, were also in the hands of a separate
entity. Thus, as indicated above, in late April 1981, these plants
were transferred to New Sipco, Inc. The Board, as in the case of
Swift & Co. dismissed as to New Sipco, Inc. There was no finding
that SIPCO and New Sipco, Inc. were single/joint employers or alter
egos. Hence as the Respondent’s argument goes, the Board would
be equally powerless to compel implementation of transfer rights at
Guymon and Moultrie.
37 There is no merit in the Respondent’s contention that the 1980–
1981 corporate reorganization fractured the collective-bargaining
unit, thus, precluding the exercise of transfer rights between food
processing operations (Swift & Co.) and fresh meat operations
(SIPCO). Here again, the Respondent is contesting the substantiality
of a Board finding. In any event, article 77 did not contemplate the
exercise of rights within a single bargaining unit. The 1979–1982
master collective-bargaining agreement did not cover a single
multiplant unit, but as found by the Board, at the time of its execu-
tion, ‘‘employees were represented by the Union in separate units
designated in and covered by one master agreement.’’ 289 NLRB at
423. This is confirmed by the answer filed on August 21, 1981, by
SIPCO et al. in the underlying unfair labor practice case where it
conceded that the master agreement covered 19 meat packing plants
and 7 sales processing units, each being a separate appropriate unit.
38 One soft spot in the Board’s remedial package appears in its di-
rective that SIPCO:
(a) On request, implement the full range of transfer opportunities
provided for in the 1979-1982 master collective-bargaining
agreement with the United Food and Commercial Workers Inter-
national Union, AFL–CIO, for employees in the . . . appropriate
unit.
Obviously, SIPCO could not require Swift & Co. to honor a trans-
fer option exercised by any of its employees. Nevertheless, this pro-
vision, did not totally lack utility. For, it is entirely possible that this
was a calculated step by the Board, fully aware of implications of
its otherwise timeless backpay remedy, to encourage SIPCO to seek
an accomodation through which Swift & Co. might voluntarily rec-
ognize transfer rights under the umbrella of the master agreement.
39 In this respect, the Board ordered SIPCO to:
(b) Make whole all unit employees of the Tampa, Florida facil-
ity for any loses they may have suffered as a result of the Re-
spondent’s denial of the full range of transfer opportunities pro-
vided for in the 1979–1982 master collective-bargaining agree-
ment.
40 SIPCO alone, during the term of the collective-bargaining agree-
ment and on October 27, 1980, through dividend, ceded to Esmark
its ownership of the new Swift & Company. In taking that step,
SIPCO surrendered control over the latter’s plants. As stated by
Judge Cudahy, ‘‘[SIPCO] is an old Company dating to the 19th cen-
Swift & Co., or for that matter, New Sipco, Inc.36 Instead,
SIPCO was deemed bound to the 1979–1982 master agree-
ment in consequence of a ‘‘stock sale,’’ a concept that did
not intrude on corporate separateness, as would have been
the case were the Board to have viewed them as a single em-
ployer or alter ego. Thus, the Board although alerted to the
corporate distinctions, found the violation anyway, and did
so in the face of evidence that Tampa sales employees had
opted for transfer only to Swift & Company plants. It is ap-
parent therefore that SIPCO’s present contention is not mate-
rially different from that made previously to the Board in its
behalf and implicitly rejected. Accordingly, as it is not with-
in my authority to review findings by the Board in a compli-
ance or any other type proceeding, the Respondent’s position
is not maintainable at this level.
In any event, the separate entity theory would not appear
to offer an avenue for escape from article 77 of the 1979–
1982 master contract, or a basis for effective challenge to the
Board’s unfair labor practice finding. That agreement did not
limit employees to intraunit transfers, but sanctioned them
between bargaining units at all locations covered by the con-
tract.37 In this regard, Section 77(a) thereof provides that:
[A]n eligible employee has the right to be transferred
from the plant at which he is employed to another plant
covered by this Agreement where such an employee is
subject to being permanently separated from the service
. . . .
SIPCO’s nominal predecessor, known prior to October
1980 as Swift & Company, was the entity signatory to that
agreement. It was executed by Swift & Company with full
knowledge that all its employees were covered, whether as-
signed to the fresh meat or processed meat operations. The
midterm, corporate reorganization that separated these firms
did not alter the basic contractual formula for interunit exer-
cise of transfer rights. Indeed, as of May 11, 1981, Swift &
Company had not repudiated and was still honoring the con-
tract at its plants, including St. Charles, Omaha, and Tampa
(PROC).
The Board’s finding that the stock sale did not curtail
SIPCO’s obligations under the contract, as a reality, meant
that each in its own name was bound, hence tying the knot
on an ongoing, enforceable contractual undertaking between
both firms to extend reciprocal transfer rights to employees
in the separate bargaining units of the other, irrespective of
corporate status. In other words, the Board’s conclusion was
the equivalent of a scenario in which two independent firms
knowingly sign a single contract covering separate bargain-
ing units, but providing integrated benefits. Their separate-
ness would not impede the enforceability of their agreement.
Consistent with the foregoing, because SIPCO rejected the
elections for transfer to Swift & Co. plants, the desires of the
Tampa employees were frustrated at that point, interdicting
any reaction from Swift & Co. Thus, the latter engaged in
no illegal conduct and dismissal of the allegation against it
was required. However, that fact did not render the Board
powerless to enforce the collective-bargaining agreement
against SIPCO, the offending party.
For these reasons, the Board’s failure to implicate Swift &
Co. did not alleviate losses sustained by the victims of
SIPCO’s unlawful refusal to bargain.38 The propriety of the
Board’s directive that they be made whole is valid on its
own footing and is enforceable without disruption of the cor-
porate veil.39 Thus, SIPCO violated the contract and its re-
medial obligation is unaffected by the fact that another cor-
porate entity failed to join in the breach. The impairment of
those contractual rights, as they would later mature in 1981,
was subject to monetary redress by SIPCO alone, without ne-
cessity for findings of illegality by Esmark, New Sipco,
Swift & Company, Swift Independent Corporation, or any
other firm. In passing, it is noted that the Respondent’s posi-
tion also raises question as to whether its obligation to reim-
burse ought be lessened by complications of its own doing.
For, it was SIPCO itself that engaged in the corporate give
away that, under its theory of the case, curtailed the spectrum
of contractual transfer options.40
783SWIFT INDEPENDENT PACKING CO.
tury, which merely gave away its name and a large number of its
operations.’’(Emphasis added.) 887 F.2d at 743 fn. 2. Absent this
gesture, the Respondent would be in no position to distinguish be-
tween the plants of Swift & Co. and those of New Sipco, Inc., and
hardly could claim that it was powerless to comply with any aspect
of the Board’s Order. Thus, any impossibility of performance was
created by the SIPCO itself—a step taken when, pursuant to the con-
tract in effect at the time, it had a putative obligation to permit the
exercise of transfers to meat processing operations.
41 While it is unnecessary to the result, I give no weight to testi-
mony of Robert Funk, a union attorney, that the Union’s position
throughout the litigation has been that when claimants in this pro-
ceeding elected to receive severance pay or to accept retirement,
they did so ‘‘under protest.’’ Attorney Funk was not involved in the
underlying litigation, and the foundation for his testimony is not es-
tablished on this record.
42 The various specifications issued in this proceeding do not arise
under any 8(a)(3) violation, and hence the continuing reference to
the claimants as ‘‘discriminatees’’ is taken as an inadvertent mis-
nomer.
In any event, even if there were a material flaw in the un-
fair labor practice finding, SIPCO’s election to execute the
settlement, rather than to contest the Order, entailed an ac-
ceptance of the Board’s findings and remedy and was cura-
tive in all respects. Nothing in the settlement agreement re-
opened the merits of the Board’s unfair labor practice find-
ing.
c. Specific limitations on contractual transfer rights
The Respondent also argues that the 23 claimants lost eli-
gibility for backpay by accepting severance pay or retirement
as contemplated by article 77(j) of the governing collective-
bargaining agreement, which provides as follows:
An employe’s [sic] rights of transfer under this Sec-
tion shall terminate in the following circumstances:
. . . .
(2) Upon acceptance of severance pay.
(3) Upon retirement under the terms of the Pension
Plan.
Of the claimants, four (Davies, Frain, Gardner, and Jenkins)
retired under the terms of the pension plan, and 18 others
(Cowell, Crews, Clayton, DeBerardinis, Fitzgerald, Freitas,
Hargrove, Hobgood, McFadden, McNeal, Merrill, Morgan,
Morrell, Murray, Radford, Simmons, Springer, and Swindal)
accepted severance pay.
The Respondent observes that ‘‘[n]ot a scintilla of evi-
dence was introduced to show how a person can retire under
the pension plan or accept severance pay and still qualify
. . . to be considered for a transfer.’’ It having been estab-
lished that each of these individuals took steps to exercise an
article 77(A) transfer on a timely basis, the burden was on
the Respondent to show that retirement and transfer, as ap-
propriate, was selected for reasons unrelated to the unlawful
denial of their first preference. As matters now stand, the
record merely establishes that SIPCO’s failure to provide
these employees ‘‘the full range of transfer opportunities’’41
forced the latter to accept lesser forms of remuneration or
nothing at all—a ‘‘Hobson’s choice’’ which falls well short
of achieving the remedial ends contemplated by the Act. The
compliance specification properly treats the severance pay
and retirement contributions as a set off to gross backpay.
Beyond the foregoing, the Respondent observes that article
77 sets forth a variety of eligibility requirements and con-
tends that no backpay is due and owing because the General
Counsel failed to adduce evidence that each claimant com-
plied with such criteria. On the contrary, if in fact any of
these individuals were disqualified, the burden was on the
Respondent not only to raise the specific ground in its an-
swer, but to substantiate the noncompliance with persuasive
evidence. The General Counsel’s obligation with respect to
gross backpay need not dispel every conceivable defense that
might be raised against individual claimants.
C. Pension Credits
In addition to lost wages, the General Counsel argues that
the discriminatees are entitled ‘‘to additional pension credit
entitlement as part of the gross backpay owing to the Tampa
claimants.’’ Insofar as discernable on this record, the claim
was not communicated to the Respondent until December 6,
1991, when SIPCO was served with a second amended com-
pliance specification, dated December 6, 1991. It is described
in two paragraphs thereof, which, in material part state:
III
(b) . . . . [E]ach of the discriminatees were participants
in the Esmark Inc./Swift & Company Pension Plan for
Non-Salaried Employees. The amount of a participant’s
pension is calculated by multiplying the individual’s
credited service by the amount specified in the Master
Collective Bargaining Agreement. Pursuant to the Pen-
sion Plan, entitlement to such pension vests after 10
years of credited service. Thus, each discriminatee, who
was denied the full range of transfer opportunities to a
plant covered by the Master Agreement is entitled to
have his credited service and/or pension amount cor-
rected by the number of years he would have continued
in the employ of the Respondent during the backpay
period.
VIII
Summarizing the facts . . . specified above, the obliga-
tion of the Respondent to make whole the discrim-
inatees under the Board Order will be discharged by
payment to the employees named below the amounts
set opposite their names, plus interest accrued to the
date of payment . . . and by crediting the discriminatees
service date by the number of months/years from Au-
gust 7, 1981 to . . . the date of the Settlement Agree-
ment and adjusting the individual discriminatee’s an-
nual pension where appropriate.42
In its answer, the Respondent, insofar as material, stated
as follows:
Respondent specifically denies all allegations of para-
graph III(b) and states that no employee of SIPCO, Inc.
remained a participant of the Esmark, Inc./Swift &
Company Pension Plan for Non-Salaried employees.
Paragraph III(b) of the Second Amended Specification did
not appear until almost 3 years following Board acceptance
of the settlement agreement on December 21, 1988. It bears
784 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
43 This belated shift in the General Counsel’s premise was far from
surprising. The original language was totally defective. Consistent
with the Respondent’s answer, SIPCO, as of August 8, 1981, had
no influence over the Esmark/Swift pension plan. As stated by Judge
Jacobs at 289 NLRB at 450:
Since April 1981 and the public sale, none of the Esmark pen-
sion boards nor any Esmark employee has had anything to do
with any pension plan covering SIC, SIPCO, or New Sipco em-
ployees. [Emphasis added.]
At 289 NLRB 427, the Board concluded ‘‘Esmark no longer plays
any role in the . . . pension plans, of SIPCO or New Sipco . . . .’’
Paragraph VIII did not seek monetary compensation for pension
losses, but, rather, the enhancement of pension benefits through cred-
its under the Esmark Inc./Swift & Company Pension Plan Plan itself.
Absent any attempt to implead Esmark or any of its wholly owned
subsidiaries, the Board could not require these separate entities to
give force and effect to pension credits awarded to SIPCO personnel.
44 As indicated by me at the hearing, this claim supports an ac-
crued liability which is undefinable since its costs will not be deter-
minable until death of the last surviving claimant.
45 The settlement agreement’s cutoff date also seems inconsistent
with any intention to compensate employees for lost pensions. Thus,
to curtail liability as of the date the accomodation was entered is
consistent with settlement practices where recovery of lost wages is
all that is contemplated. Such a cutoff is arbitrary and illogical when
applied to lost pension benefits.
46 In its answer, SIPCO asserted that the backpay entitlement of
Fritz should have been terminated on May 21, 1982, when he volun-
tarily quit his employment at SIPCO’s Glenwood, Iowa plant. Fritz
initially requested transfer to a Swift plant in Chicago, Illinois. It
was only after that option was denied unlawfully that he chose Glen-
wood. Fritz testified that he left his job at Glenwood because of per-
sonal problems stemming from the fact that his wife and four chil-
dren remained in St. Petersburg, Florida. He insists that his family
would have accompanied him to Chicago where relocation would
have been eased by the fact that both he and his wife had relatives
in Detroit, Michigan, which was close enough for periodic visits.
The Respondent, in its posthearing brief, has failed to raise any
question as to the veracity of Fritz, or to furnish a basis for conclud-
ing that he terminated his employment at Glenwood for reasons that
all the earmarks of afterthought and constituted an attempt to
expand the scope of the settlement agreement years after the
intentions embodied there had crystalized. Thus, when the
original specification issued on April 12, 1991, there was no
claim for pension credits. This, despite the exhaustive oppor-
tunity to research and investigate just what was due under
the 1988 settlement agreement. Indeed, once raised, the claim
for pension credits was given so little attention that it re-
quired radical surgery at the hearing. Thus, paragraph III (b)
was amended on February 27, 1992, over the Respondent’s
objection, well after the General Counsel had rested, to re-
flect that the claimants ‘‘were participants in Swift Independ-
ent Packing Company Non-salaried Pension Plan.’’ This cor-
rected an allegation which as originally drafted was so ill-
reasoned that, in combination with paragraph VIII, it laid
claim to pension credits under a pension plan in which
SIPCO employees did not participate, and which was admin-
istered by corporate entities other than SIPCO.43
Moreover, the new claim was pursued in such haste that
it was unaccompanied by attempt to identify the incremental
amount by which each claimant’s pension should have been
increased during the backpay period or to liquidate the Re-
spondent’s liability in this respect. In the General Counsel’s
posthearing brief it is stated that: ‘‘All the information nec-
essary for calculating the pension credit adjustment is already
in the record, and it would not be necessary to reopen it.’’
Why then, during the 3 years since the parameters for this
proceeding had been set, had the General Counsel failed to
complete the task?
The claim for pension credits is also at odds with a rea-
soned interpretation of the intentions underlying the settle-
ment.44 The settlement agreement was a compromise that
supplanted the Board’s Order. Having entered that agree-
ment, the claimable relief is governed by that document,
rather than the Board Order or any term of art customarily
used in formal Board remedies. The parties entered an ad-
justment, which the Board approved, using the term ‘‘back-
pay,’’ rather than ‘‘make whole,’’ and in doing so, fixed the
standard by their own choice of terminology. Thus, it is of
no moment that ‘‘backpay’’ and ‘‘make whole’’ are routinely
considered synonomous and all-embracing where a party
contests the scope of a Board order. See, e.g., Rainbow
Tours, 280 NLRB 166, 185 (1986). On the facts at hand, it
is inconceivable that anyone negotiating this settlement on
behalf of the Board expected recovery beyond lost wages and
accrued interest. The formula agreed to is consistent with
that end. Thus, the policies of the Act hardly would be vindi-
cated through a settlement formulation which discriminates
against the beneficiaries of an 8(a)(3) finding by providing
less in their case than that provided others whose entitlement
derives from some lesser offense. Here the Board was will-
ing to settle the Section 8(a)(1), (3), and (5) violations at
Moultrie and Guymon on the basis of an interest only pay-
ment, which, in its entirety, was based on a compromise of
lost wages only. Compliance Officer Marge Peck acknowl-
edged that the discriminatees at those locations also lost re-
tirement credits. Yet, neither the Union, nor the General
Counsel held out any concern for their losses. The Union and
the General Counsel neither sought, nor obtained more at
Tampa. I find that just as in the case of the discriminatees
at Guymon and Moultrie, the focus of the parties at Tampa
was on lost wages, and that it would be contrived and totally
unjust to construe the settlement agreement as embodying in-
tention on either side that SIPCO ‘‘make whole’’ the Tampa
employees in every conceivable sense.45 I find that the settle-
ment agreement included no provision requiring SIPCO to
compensate the claimants for lost pension benefits.
ORDER
The Respondent, SIPCO, Chicago, Illinois, its officers,
agents, successors, and assigns, shall make whole the em-
ployees named below by paying them the liquidated sums in-
dicated below, plus interest in the matter prescribed in New
Horizons for the Retarded, 283 NLRB 1173 (1987), less tax
withholdings required by Federal and local laws.
John D. Cowell $62,797
Willie Crews 123,943
James Davies 40,523
Clayton Dean 20,613
Anthony DeBernardinis 12,873
Donald Fitzgerald 13,955
Roland Frain 38,279
Joseph Freitas 138,978
Lester A. Fritz46 17,090
785SWIFT INDEPENDENT PACKING CO.
were either unreasonable or unrelated to the unlawful refusal to
honor his request for transfer to Chicago. I find that Fritz backpay
entitlement was not tolled when he returned to Florida and quit his
job at Glenwood, Iowa.
Elton R. Gardner 16,947
Lynn Hargrove 42,054
Bill Hobgood 30,971
Donald Jenkins 29,832
George McFadden 38,337
Bernie McNeal 59,087
Sherwood L. Merrill 53,193
Jose Morejon 113,567
Robert R. Morrell 20,139
Frank H. Murray 65,253
Elbert L. Radford 123,002
Bruce Simmons 54,351
Russell Springer 46,698
Paul Swindal 17,549