Talaco Communications, Inc.

National Labor Relations Board - Board Decisions

Jul 16, 1996

321 N.L.R.B. 762 (N.L.R.B. 1996)

762
321 NLRB No. 107
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
Talaco Communications, Inc. and Communications
Workers of America, Local 1109, AFL–CIO.
Case 29–CA–18123
July 16, 1996
DECISION AND ORDER
BY CHAIRMAN GOULD AND MEMBERS BROWNING
AND FOX
Upon a charge filed by Communications Workers of
America, Local 1109, AFL–CIO (the Union) on April
12, 1994, the General Counsel of the National Labor
Relations Board issued a complaint on May 27, 1994,
against Talaco Communications, Inc. (the Respondent),
alleging that it has violated Section 8(a)(5) and (1) of
the National Labor Relations Act. By letter dated Au-
gust 20, 1994, the Respondent failed specifically to
admit, deny, or explain any of the allegations in the
complaint, but stated that the Respondent could not
pay its bills because it was ‘‘not getting paid by var-
ious vendors’’ for the work it had done for them. By
letter dated March 13, 1996, counsel for the General
Counsel informed the Respondent that its August 20,
1994 letter did not qualify as an answer, and advised
the Respondent that unless the Respondent filed an an-
swer by April 1, 1996, a Motion for Summary Judg-
ment would be filed.
On April 22, 1996, the General Counsel filed a Mo-
tion for Summary Judgment. On April 24, 1996, the
Board issued an order transferring the proceeding to
the Board and a Notice to Show Cause why the motion
should not be granted. The Respondent filed no re-
sponse. The allegations in the motion are therefore un-
disputed.
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
Ruling on Motion for Summary Judgment
Section 102.20 of the Board’s Rules and Regulations
provides that an answer to a complaint shall specifi-
cally admit, deny, or explain each of the facts alleged
in the complaint unless the respondent is without
knowledge, in which case it shall so state. Section
102.20 further provides that ‘‘any allegation in the
complaint not specifically denied or explained in an
answer filed . . . shall be deemed to be admitted to
be true and shall be so found by the Board.’’
The Respondent’s August 20, 1994 letter does not
constitute an adequate answer to the complaint. Al-
though it asserts that the Respondent’s inability to pay
its bills was caused by the failure of its vendors to pay
it for work done for them, the letter does not specifi-
cally admit, deny, or explain each of the allegations in
the complaint. The Respondent’s defense is one of
economic necessity. It is well established that Section
8(a)(5) and (1) and Section 8(d) prohibit an employer
that is a party to a collective-bargaining agreement
from modifying the terms and conditions of employ-
ment established by that agreement without obtaining
the consent of the union. Nick Robilotto, Inc., 292
NLRB 1279 (1989). Here, the Respondent has
breached its collective-bargaining agreement with the
Union. An employer’s claim that it is financially un-
able to make the required payments, even if proven,
does not constitute an adequate defense to an allega-
tion that the employer has violated Section 8(a)(5) and
(1) by failing to abide by a provision of a collective-
bargaining agreement. Demun Market, 314 NLRB 714
(1994); Zimmerman Painting & Decorating, 302
NLRB 856, 857 (1991). Therefore, the Respondent’s
letter has raised no issues warranting a hearing.
In the absence of good cause being shown for the
failure to file an adequate answer, and in the absence
of any material issues warranting a hearing, we grant
the General Counsel’s Motion for Summary Judgment.
On the entire record, the Board makes the following
FINDINGS OF FACT
I. JURISDICTION
The Respondent, a New York corporation, with its
principal office and place of business located at 163
Bay 31st Street, Brooklyn, New York, has been en-
gaged in providing installation of telephone system
services. During the year preceding the issuance of the
complaint, the Respondent, in the course and conduct
of its business operations, performed services valued in
excess of $50,000 directly for various enterprises lo-
cated in States other than the State of New York. We
find that the Respondent is an employer engaged in
commerce within the meaning of Section 2(2), (6), and
(7) of the Act and that the Union is a labor organiza-
tion within the meaning of Section 2(5) of the Act.
II. ALLEGED UNFAIR LABOR PRACTICES
A. The Unit and the Union’s Representative
Status
The following employees of the Respondent con-
stitute a unit appropriate for collective-bargaining pur-
poses within the meaning of Section 9(b) of the Act:
All full-time and regular part-time employees em-
ployed in the States of New York, New Jersey &
Connecticut excluding clerical employees, guards
and supervisors as defined by the National Labor
Relations Act, as amended.
At all material times, the Union has been the des-
ignated exclusive collective-bargaining representative
of the unit employees, and has been recognized as
such representative by the Respondent. Recognition
has been embodied in successive collective-bargaining
763TALACO COMMUNICATIONS, INC.
1 J. R. Simplot Co., 311 NLRB 572 (1993); Bethlehem Steel Co.,
136 NLRB 1500 (1962), enfd. in relevant part 320 F.2d 615 (3d Cir.
1963), cert. denied 375 U.S. 984 (1964).
2 Independent Stave Co., 248 NLRB 219, 221 (1980).
agreements, the most recent of which was effective by
its terms for the period from December 19, 1990,
through December 18, 1993. At all material times, the
Union, by virtue of Section 9(a) of the Act, has been,
and is, the exclusive representative of the employees in
the unit for the purpose of collective bargaining with
respect to rates of pay, wages, hours of employment,
and other terms and conditions of employment.
B. The Refusal to Bargain
The collective-bargaining agreement described above
contains, inter alia, provisions which require that the
Respondent make periodic monthly contributions to the
Union’s Pension and Welfare Funds (Funds) on behalf
of its unit employees, and union-security and dues-
checkoff provisions which require that the Respondent
deduct dues from the wages of its unit employees upon
written authorization from the employees and remit the
checked off dues each month to the Union. The peri-
odic contributions to the Funds and the dues are due
and payable on a monthly basis not later than 20 days
after the end of the preceding month during which they
accrued.
From about November 20, 1993, until an unknown
date in May 1994, the Respondent unilaterally failed
and refused to make its monthly contributions to the
Funds for November 1993, in a timely manner, as re-
quired by the terms of the collective-bargaining agree-
ment. Since about November 20, 1993, the Respondent
has unilaterally ceased making and has continued to
fail and refuse to make its monthly contributions to the
Funds as required by the collective-bargaining agree-
ment.
Since about December 1, 1993, the Respondent has
continued to deduct monthly dues from the paychecks
of its unit employees, but has failed to remit those
dues to the Union. Until December 18, 1993, the Re-
spondent engaged in this conduct without the Union’s
consent. We find that by failing to remit the checked
off dues to the Union from December 1–18, 1993, the
Respondent has violated Section 8(a)(5) and (1) of the
Act.
By this conduct, the Respondent has refused to bar-
gain collectively and in good faith with the exclusive
collective-bargaining representative of its employees,
and has interfered with, restrained, and coerced its em-
ployees in the exercise of their Section 7 rights, and
has thereby been engaging in unfair labor practices
within the meaning of Section 8(a)(5) and (1) of the
Act.
C. The Postcontract Expiration Dues-checkoff
Violation
After the collective-bargaining agreement expired on
December 18, 1993, the Respondent continued to de-
duct monthly union dues from the paychecks of unit
employees, but failed to remit those dues to the Union.
Although it is well settled that an employer’s obliga-
tion to abide by the terms of a dues-checkoff provision
ceases with the expiration of the contract and the em-
ployer is no longer obligated to honor the employees’
checkoff authorizations,1 once the respondent honors
the employees’ checkoff authorizations and deducts the
dues from the employees’ paychecks it is not entitled
to keep the checked off dues for itself.2 Rather, if the
sums are deducted by the employer pursuant to valid
checkoff authorizations that have not expired or been
revoked, those sums represent dues to which the union
is entitled. By signing checkoff authorizations, the em-
ployees have expressed their desire to have certain
sums deducted from their paychecks and paid by the
employer to a labor organization. By such action the
employees have exercised their Section 7 rights to join
and assist a labor organization. We find that an em-
ployer interferes with, restrains, or coerces employees
in the exercise of their Section 7 rights to join and as-
sist a labor organization in violation of Section 8(a)(1)
of the Act where, as here, it retains for itself dues that
it checked off from employees’ paychecks after the ex-
piration of a collective-bargaining agreement. Thus, if
the sums deducted from the employees’ paychecks
after December 18, 1993, were deducted pursuant to
valid, unexpired, and unrevoked checkoff authoriza-
tions, the Respondent’s failure to remit those sums to
the Union in accordance with the expressed wishes of
the employees violated Section 8(a)(1) of the Act.
Similarly, if the employees’ checkoff authorizations
expired or were revoked after the expiration of the col-
lective-bargaining agreement, the Respondent’s contin-
ued deduction and retention of the checked off sums
and failure to return those sums to the employees vio-
lated Section 8(a)(1). Because the complaint does not
specifically allege that the dues were deducted pursu-
ant to valid, unexpired, and unrevoked employee
checkoff authorizations, it is unknown whether the em-
ployees’ checkoff authorizations expired at the expira-
tion of the collective-bargaining agreement. Accord-
ingly, we leave to the compliance stage of this pro-
ceeding the determination of whether the sums de-
ducted and retained by the Respondent in violation of
Section 8(a)(1) after the expiration of the collective-
bargaining agreement were deducted pursuant to valid
checkoff authorizations that were not expired or re-
voked. If the dues were deducted pursuant to valid
checkoff authorizations that have not expired or been
revoked, the checked off sums shall be remitted to the
Union as set forth in the remedy section of this deci-
sion. If the dues were deducted pursuant to checkoff
764 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
3 To the extent that an employee has made personal contributions
to a fund that are accepted by the fund in lieu of the employer’s
delinquent contributions during the period of the delinquency, the
Respondent will reimburse the employee, but the amount of such re-
imbursement will constitute a setoff to the amount that the Respond-
ent otherwise owes the fund.
4 The Order conforms to the new standard language recently set
forth in Indian Hills Care Center, 321 NLRB 144 (1996).
authorizations which have expired or been revoked,
those sums shall be returned to the employees.
CONCLUSIONS OF LAW
1. By failing to make contractually required monthly
contributions to the Union’s Pension and Welfare
Funds, and by failing to remit checked off union dues
to the Union prior to expiration of the collective-bar-
gaining agreement, the Respondent has engaged in un-
fair labor practices affecting commerce within the
meaning of Section 8(a)(5) and (1) and Section 2(6)
and (7) of the Act.
2. By failing to remit checked off union dues to the
Union and/or the employees after expiration of the col-
lective-bargaining agreement, the Respondent has en-
gaged in unfair labor practices affecting commerce
within the meaning of Section 8(a)(1) and Section 2(6)
and (7) of the Act.
REMEDY
Having found that the Respondent has engaged in
certain unfair labor practices, we shall order it to cease
and desist and to take certain affirmative action de-
signed to effectuate the policies of the Act.
Specifically, having found that the Respondent has
violated Section 8(a)(5) and (1) by failing to remit to
the Union dues that were deducted from the pay of
unit employees before the expiration of the collective-
bargaining agreement, we shall order the Respondent
to remit such withheld dues to the Union as required
by the agreement, with interest as prescribed in New
Horizons for the Retarded, 283 NLRB 1173 (1987).
Having found that the Respondent has violated Section
8(a)(1) by retaining for itself dues deducted from the
pay of unit employees after the expiration of the col-
lective-bargaining agreement, the Respondent shall be
ordered to remit those sums to the Union, provided
that the dues were deducted pursuant to valid, unex-
pired, and unrevoked dues-checkoff authorizations. If
the dues were deducted pursuant to checkoff authoriza-
tions which had expired or been revoked, the Respond-
ent shall return the withheld dues to the employees,
with interest as prescribed in New Horizons for the Re-
tarded, supra.
Having found that the Respondent has violated Sec-
tion 8(a)(5) and (1) by failing to make contractually re-
quired contributions to the Union’s Pension and Wel-
fare Funds, we shall order the Respondent to make
whole its unit employees by making all such delin-
quent contributions, including any additional amounts
due the funds in accordance with Merryweather Opti-
cal Co., 240 NLRB 1213, 1216 fn. 7 (1979). In addi-
tion, the Respondent shall reimburse unit employees
for any expenses ensuing from its failure to make the
required contributions, as set forth in Kraft Plumbing
& Heating, 252 NLRB 891 fn. 2 (1980), enfd. 661
F.2d 940 (9th Cir. 1981), such amounts to be com-
puted in the manner set forth in Ogle Protection Serv-
ice, 183 NLRB 682 (1970), enfd. 444 F.2d 502 (6th
Cir. 1971), with interest as prescribed in New Horizons
for the Retarded, supra.3
ORDER4
The National Labor Relations Board orders that the
Respondent, Talaco Communications, Inc., Brooklyn,
New York, its officers, agents, successors, and assigns,
shall
1. Cease and desist from
(a) Refusing to bargain with the Union as the exclu-
sive collective-bargaining representative of the unit
employees by failing and refusing to remit to the
Union dues checked off pursuant to valid checkoff au-
thorizations prior to the expiration of the collective-
bargaining agreement, and to make required contribu-
tions to the Union’s Pension and Welfare Funds.
(b) Interfering with, restraining, or coercing its em-
ployees in the exercise of their rights to join and assist
a labor organization, by failing to remit to the Union
dues checked off after the expiration of the collective-
bargaining agreement, if the dues were deducted pursu-
ant to employees’ valid, unexpired and unrevoked
checkoff authorizations, or by failing to return to the
employees dues checked off after the expiration of the
collective-bargaining agreement, if the dues were de-
ducted pursuant to employees’ checkoff authorizations
which had expired or been revoked.
(c) In any like or related manner interfering with, re-
straining, or coercing employees in the exercise of the
rights guaranteed them by Section 7 of the Act.
2. Take the following affirmative action necessary to
effectuate the policies of the Act.
(a) Remit to the Union all dues it deducted from
employees’ pay pursuant to valid dues-checkoff au-
thorizations prior to the expiration of the collective-
bargaining agreement, in the manner set forth in the
remedy section of the decision.
(b) Remit to the Union, or to the employees, as de-
termined at the compliance stage of this proceeding, all
dues it deducted from employees’ pay after the expira-
tion of the collective-bargaining agreement, in the
manner set forth in the remedy section of the decision.
(c) Remit the delinquent Pension and Welfare Fund
contributions, including any additional amounts due the
Funds, and reimburse the unit employees for any ex-
penses ensuing from the Respondent’s failure to make
765TALACO COMMUNICATIONS, INC.
5 If this Order is enforced by a judgment of a United States court
of appeals, the words in the notice reading ‘‘Posted by Order of the
National Labor Relations Board’’ shall read ‘‘Posted Pursuant to a
Judgment of the United States Court of Appeals Enforcing an Order
of the National Labor Relations Board.’’
the required payments, in the manner set forth in the
remedy section of the decision.
(d) On request, bargain with Communications Work-
ers of America, Local 1109, AFL–CIO as the exclusive
collective-bargaining representative of the employees
in the following appropriate unit:
All full-time and regular part-time employees em-
ployed in the States of New York, New Jersey &
Connecticut excluding clerical employees, guards
and supervisors as defined by the National Labor
Relations Act, as amended.
(e) Preserve and, within 14 days of a request, make
available to the Board or its agents for examination
and copying, all payroll records, social security pay-
ment records, timecards, personnel records and reports,
and all other records necessary to analyze the amount
of backpay due under the terms of this Order.
(f) Within 14 days after service by the Region, post
at its facility in Brooklyn, New York, copies of the at-
tached notice marked ‘‘Appendix.’’5 Copies of the no-
tice, on forms provided by the Regional Director for
Region 29, after being signed by the Respondent’s au-
thorized representative, shall be posted by the Re-
spondent and maintained for 60 consecutive days in
conspicuous places including all places where notices
to employees are customarily posted. Reasonable steps
shall be taken by the Respondent to ensure that the no-
tices are not altered, defaced, or covered by any other
material. In the event that, during the pendency of
these proceedings, the Respondent has gone out of
business or closed the facility involved in these pro-
ceedings, the Respondent shall duplicate and mail, at
its own expense, a copy of the notice to all current
employees and former employees employed by the Re-
spondent at any time since April 12, 1994.
(g) Within 21 days after service by the Region, file
with the Regional Director a sworn certification of a
responsible official on a form provided by the Region
attesting to the steps that the Respondent has taken to
comply.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
NATIONAL LABOR RELATIONS BOARD
An Agency of the United States Government
The National Labor Relations Board has found that we
violated the National Labor Relations Act and has or-
dered us to post and abide by this notice.
WE WILL NOT refuse to bargain with the Union as
the exclusive collective-bargaining representative of
our unit employees by failing and refusing to remit to
the Union dues we deducted pursuant to valid checkoff
authorizations prior to the expiration of the collective-
bargaining agreement, and to remit required contribu-
tions to the Union’s Pension and Welfare Funds.
WE WILL NOT interfere with, restrain, or coerce you
in the exercise of your rights to join and assist a labor
organization, by failing to remit to the Union dues
checked off after the expiration of the collective-bar-
gaining agreement, if the dues were deducted pursuant
to the employees’ valid, unexpired, and unrevoked
checkoff authorizations, or by failing to return to the
employees dues checked off after the expiration of the
collective-bargaining agreement, if the dues were de-
ducted pursuant to employees’ checkoff authorizations
which had expired or been revoked.
WE WILL NOT in any like or related manner interfere
with, restrain, or coerce you in the exercise of the
rights guaranteed you by Section 7 of the Act.
WE WILL remit to the Union all dues we deducted
from the employees’ pay pursuant to valid dues-check-
off authorizations prior to the expiration of the collec-
tive-bargaining agreement, with interest.
WE WILL remit to the Union, or to the employees,
as determined at the compliance stage of this proceed-
ing, all dues we deducted from employees’ pay after
the expiration of the collective-bargaining agreement,
with interest.
WE WILL remit the delinquent Pension and Welfare
Fund contributions, including any additional amounts
due the Funds, and WE WILL reimburse the unit em-
ployees for any expenses ensuing from our failure to
make the required payments, with interest.
WE WILL, on request, bargain with Communications
Workers of America, Local 1109, AFL–CIO as the ex-
clusive collective-bargaining representative of the em-
ployees in the following appropriate unit:
All full-time and regular part-time employees em-
ployed in the States of New York, New Jersey &
Connecticut excluding clerical employees, guards
and supervisors as defined by the National Labor
Relations Act, as amended.
TALACO COMMUNICATIONS, INC.