Makela Welding, Inc.

964 DECISIONS OF NATIONAL LABOR RELATIONS BOARD APPENDIX NOTICE TO ALL EMPLOYEES Pursuant to the Recommended Order of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Rela- tions Act, as amended, we hereby notify our employees that: WE WILL upon request, bargain collectively with International Ladies' Gar- ment Workers' Union, AFL-CIO, as the bargaining representative of all employees in the bargaining unit described below with respect to rates of pay, wages, hours of employment, and other conditions of employment and, if an understanding is reached, embody such understanding in a signed statement. The bargaining unit is: All our production and maintenance employees, including shipping employees, but excluding all guards and supervisors as defined in the Act. WE WILL NOT threaten employees with loss of economic benefits or other reprisals if they join the above-mentioned Union or if said Union succeeds in representing our employees. WE WILL NOT solicit employees to withdraw from said Union or circulate a written request among them to withdraw their union authorization cards. WE WILL NOT threaten to bust the said Union. WE WILL NOT coercively interrogate our employees as to their union mem- bership, sympathies, or desires. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees in the exercise of rights guaranteed to them by Section 7 of the Act. All our employees are free to become or remain, or to refrain from becoming or remaining, members of said Union or any other labor organization. PHIL-MODES, INC., Employer. Dated------------------- By------------------------------------------- (Representative) (Title) BERLIN COAT MANUFACTURING CO., Employer. Dated------------------- By------------------------------------------- (Representative ) (Title) This notice must remain posted for 60 consecutive days from the date of posting, and must not be altered , defaced, or covered by any other material. If employees have any question concerning this notice or compliance with its provisions, they may communicate directly with the Board's Regional Office, Sixth Floor, Meacham Building, 110 West Fifth Street, Fort Worth, Texas 76102, Tele- phone 335-2145. Makela Welding, Inc., Kemp Welding, Inc. and International Union, United Automobile, Aerospace and Agricultural Im- plement Workers of America (UAW), AFL-CIO. Case 30-CA- 265. June 22, 1966 DECISION AND ORDER On March 1, 1966, Trial Examiner Frederick U. Reel issued his Decision in the above-entitled proceeding, finding that the Respond- ents had engaged in certain unfair labor practices and recommend- ing that they cease and desist therefrom and take certain affirmative 159 NLRB No. 93. MAKELA WELDING, INC. 965 action, as set -forth in the - attached Trial Examiner's' Decision. Thereafter, the Respondents filed exceptions to the Trial Examiner's Decision and a supporting brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its powers in connection with this case to a three-member panel [Chairman McCulloch and Members Brown and Zagoria]. The Board has reviewed the rulings of the Trial Examiner made t the hearing and finds that no prejudicial error was committed. The rulings are hereby affirmed. The Board has considered the Trial Examiner's Decision, the exceptions and brief, and the entire rec- ord in this case, and hereby adopts the findings,' conclusions, and recommendations of the Trial Examiner. [The Board adopted the Trial Examiner's Recommended' Order.] ' The Trial Examiner found, and we agree , that Respondent Kemp Welding violated Section 8 ( a) (5) of the Act by its refusal to bargain with the Union . As noted in the Trial Examiner's Decision , Eino Kemppalnen , the owner of Kemp, and the former plant manager, as well as an officer and director of llakela, from which he purchased the busi- ness, admitted that he knew , as early as July 15 or 16 , 1965 , that a majority of the em- ployees had joined the Union . Additionally , the record discloses that on several occasions, -after Kemppainen purchased the business , he questioned prospective employees as to how they "felt about the mess down there ," and stated that "he wanted no more trouble down there," that if the Union did "get in " he could not compete with other subcontractors, and that a union might force him out of business Also , as an agent of'Makela, Kemp- painen had refused to reinstate the strikers upon their unconditional offer to return to work under prestrike conditions , and later , as the owner of Kemp , discriminatorily refused -to reinstate striker Fallon , discriminatorily delayed the reemployment of striker Kiiskila, and granted wage increases to former Makela employees without bargaining with the Union In view of Kempainen's knowledge of and participation in these unfair labor practices , we find without merit Kemp 's contention that it*had a good-faith doubt of the Union's majority . Joy Silk 111118, Inc v . N.L R.B , 185 F 2d 732 (C A D.C ), cert. denied -341 U. S. 914. TRIAL EXAMINER'S DECISION - STATEMENT OF THE CASE This proceeding, heard before Trial Examiner Frederick U. Reel, at Baraga, Michigan, on December 7 and 8, 1965,1 pursuant to a charge filed the preceding .August 24 and a complaint issued October 19, presents primarily questions as to whether Makela Welding, Inc., violated Section 8(a)(3) and (1) of the Act by ,discharging employees for union or concerted activity, and whether Kemp Weld- ing, Inc., is a successor to Makela Welding, Inc., so that bargaining authorizations -executed by employees of Makela are sufficient to establish a bargaining obligation on the part of Kemp. Upon the entire record in the case 2 and after due consideration of the briefs filed by the Respondents and by General Counsel , I make the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENTS AND THE LABOR ORGANIZATION INVOLVED Both Makela Welding, Inc., and Kemp Welding, Inc., herein called Makela -Welding and Kemp , respectively, are Michigan corporations engaged at Baraga at 1 Except as otherwise noted all dates herein refer to the year 1965. 2 The transcript of testimony is hereby corrected at page 99, line 1, to substitute "Eino" -for "I know," and at page 100, line 25, to substitute "borrowing" for "barring." 966 DECISIONS OF NATIONAL LABOR RELATIONS BOARD times material here in fabricating steel component parts, valued annually in excess of $50,000, which are sold to a local manufacturer, which in turn annually ships over $50,000 worth of finished products to points outside the State. On these facts I find that both Makela Welding and Kemp were engaged in operations "affecting commerce" within the meaning of Section 2(6) and (7) of the Act. The pleadings establish, and I find that the Charging Party, herein called the Union, is a labor organization within the meaning of the Act. II. THE UNFAIR LABOR PRACTICES A. Background and events leading to the strike of July 8, 1965 For some years prior to the events here in question, one George W. Makela had operated one of.a number of welding businesses in Baraga, supplying parts to Petti- bone of Michigan, Inc., a local manufacturer which lets such jobs on contract, after competitive bidding, to the local welders. George Makela had originally oper- ated as an individual proprietor, but in 1962 after suffering a cerebral hemorrhage which prevented his carrying on the business in his former manner, George W. Makela formed a corporation, herein called Makela Welding, in which he, his wife, and his son held 90 percent of the stock. The remaining 10 percent was held by Eino Kemppainen, who had been manager of the shop even prior to George W. Makela's illness,' and who then became an officer and director of the corporation as well as the man in sole charge of the shop. George W. Makela, although suffer- ing from difficulties of speech and movement as the result of his seizure, recovered sufficiently to participate in board meetings held in his home which was also his office. Kemppainen in 1964 expressed a desire to purchase George W. Makela's interest in the business but the matter was dropped, and early in 1965 Kemppainen acquired an option on some real estate in contemplation of opening his own business. About June 24, 1965, three employees, John Fallon, Walter Kiiskila, and Earl Lampinen came to Kemppainen and, making it clear that they were speaking on behalf of all the employees, asked him for a pay raise for all. Kemppainen replied that the Company could not afford it, and the three men said they would talk to him about it again on July 1. On that date, Fallon and Lampinen again spoke to Kemppainen about a raise for all the men, and he again said that the Company "couldn't" do it at that time. On that occasion they told Kemppainen that the men would "walk out" if not given a raise Again on July 7, about 2 p.m., Fallon and Lampinen saw Kemppainen, asking on behalf of all the men for a raise, and Kemppainen again said that the Company could not grant one. They then told Kemppainen that the men would walk out the next morning at 9 a.m. On July 8, the men reported for work at their customary 7 a.m. time but at 9 a.m., at the time of their regular "coffee break," they all punched out and left together. B. Kemppainen discharges 18 strikers and offers raises to the rest, who decline the offer and join the Union The strike resulted in a complete shutdown of Makela Welding's productive operations. On Saturday, July 10, Kemppainen sent for Lampinen to discuss the possibility of ending the strike. At their meeting that day, Kemppainen said he was prepared to terminate 18 of 47 employees and give a 5-cent-per-hour raise to the others. Kemppainen told Lampinen that the cutback would be accomplished by eliminating the 6- to 9-mnan night shift, which the Company had been operating for several months on which it had paid a 10-cent shift differential. Lampinen expressed himself as not dissatisfied with the plan, and agreed to discuss the matter with the men. That same day, Saturday, July 10, and without receiving further word from Lampinen, Kemppainen sent letters to 18 men, stating that "Due to a cut-back in our production we must terminate your employment with us as of this date." The 18 men to whom these letters were sent included a number of the junior- most employees in point of service Also included in the discharge were several less junior employees, whose inclusion (so Kemppainen explained on the witness stand) was the result of his dissatisfaction with their work or their attendance. Likewise numbered among the 18 were John Fallon and Walter Kiiskila, who, together with Lampinen, had formed the committee which initiated the wage dis- cussion with Kemppainen some weeks before. They were included, so Kemppainen testified, because they had expressed dissatisfaction with their wages on other, MAKELA WELDING, INC. 967 occasions and had-suggested they could do better elsewhere. Further light on their inclusion in the 18 discharges is shed by subsequent events, discussed below. The strikers did not return to work on July 12. Lampinen reported to them that morning what Kemppainen proposed, and the men were not satisfied to return to work on that basis. That evening the men met in Houghton, a nearby community, and agreed not to return to work "until everybody was called back" or "if a lay- off was necessary, they'd be laid off according to seniority." On this occasion, 28 of the men signed cards designating the Union as bargaining representative. These ,cards were turned over to Union Representative Horn at the meeting on July 12; he received 11 more cards in the mail on or about July 14. Horn on July 13 dispatched two letters to Makela Welding, one stating that the Union represented a majority of the employees and desired to enter into bargaining negotiations, and the other stating that all the employees on strike were ready to return to work on the same conditions under which they walked out. Kemppainen, who had heard that most of the men joined the Union on July 12 in Houghton, turned Horn's letters over to counsel and no reply was ever made thereto. C. Coercive statements of young George Makela George L. Makela, son of the principal owner of Makela Welding, Inc., was employed by the corporation as an office clerk. In addition to being the son of the principal stockholder, the younger Makela, aged 23 or 24, was himself a stock- holder in the corporation, and a member of the board of directors thereof.3 Under these circumstances, the employees would have good cause to believe that state- ments of the younger Makela as to labor policy and matters relating thereto reflected official company views, and Makela Welding is therefore legally responsi- ble for his conduct described below. N.L.R.B. v. Solo Cup Co., 237 F.2d 521, 523-524 (C.A. 8); N.L.R.B. v. Des Moines Foods, Inc., 296 F.2d 285, 286-288 (C.A. 8), and cases cited therein. On the evening of July 12, before the meeting in Houghton, young Makela was at the home of employee Walter Remali. This, it will be recalled, was the day on which 18 men received their termination notices. According to employee Albert Stein, one of the discharged employees, he also stopped at Remali's house early that evening, at a time when young Makela and the Remalis were present. Stein's testimony, which is uncontradicted and which I credit, continues: Q. And what do you recall Mr. Makela Jr. saying at that time, and what do you recall saying? A. Well, we were talking about the walkout and everything, and he told me at that time that I wasn't the only one that was getting laid off, that they were getting rid of John Fallon. And I asked him why they were getting rid of John Fallon. And he said they were getting rid of the trouble maker. He said he was a trouble maker. And they were getting rid of the trouble maker. Q. And what else, if anything, do you recall Mr. Makela Jr. saying about the discharge? Do you recall anything else being said about a lesson? A. Oh, that-yes, that we weren't running the place, that they were going to teach us a lesson, that was the-his exact words, about teaching us a lesson. Stein, further testified on cross-examination Q. Mr. Fallon was the only one, as you say, he designated as a trouble maker? A. Yes, because he designated Mr. Fallon right out. TRIAL EXAMINER: Did he say he was going to teach Mr. Fallon a lesson? The WITNESS: He said he was going to teach all the trouble makers a lesson. He called Mr. Fallon a trouble maker. He said he was going to, teach the trouble makers a lesson. Mrs. Remali, whose testimony is likewise uncontradicted and is credited, testified to a conversation between her husband and young Makela at the Remali home that evening. Describing young Makela as "quite perturbed," she continued. He said that he had trouble in the shop and would Walt come back to work. And Walt said it wasn't up to him. And he made the statement that he had 9 George's parents and Kemppainen were the other stockholders, and the other members of the board. Kemppainen held 10 percent, and the Makela family held 90 percent, of the stock 968 DECISIONS OF NATIONAL LABOR RELATIONS BOARD had trouble and trouble makers in the shop. And he didn't feel that Walt was one of them. Q. What names, if any, do you recall- Mr. Makela mentioning specifically in this conversation? A. I only recall one. Probably because I know him. The others I don't know. I don't recall the names. John Fallon. Q. And what do you recall Mr. Makela saying about John Fallon in this conversation? A. Well, he, started to say that if he did get rid of some of the men, perhaps his problems would be solved, and Walt kind of cut him short. And he said it was no place to discuss the thing. Q. Did he refer to Mr. Fallon as a trouble maker? A. Yes, sir. Later that evening Mrs. Remali accompanied the younger Makela and his wife to a nearby tavern. Mrs. Remali's testimony continues: Q. Do you recall Mr. Makela making a statement about getting rid of trouble makers in the shop? A. Yes. Q. Did he make such a statement? A. Yes. Q. Do you recall what he said? A. Well, he said that if he could get rid of the trouble makers in the shop, then perhaps the shop would run better, that the rest of the men would be satisfied. The next morning July 13, Fallon, on learning from Stein of young' Makela's comments the preceding evening, approached the latter and said:- What the hell is this stuff, you going around saying that I'm a trouble maker? And he said-he said, "Well, you were one of the guys that came into the office." And I said, Well, certainly I was. But I said there there were two others besides me, too. He said, "Well, they're going to get theirs, too. D. Kemppainen purchases the business from Makela, discharges the rest of Makeia's employees, and reopens the plant, rehiring the employees at a raise in pay The plant remained closed as the men ignored Kemppainen's offer of an increase for some coupled with the 18 discharges, and he in turn ignored the Union's bar- gaining request and its offer, on behalf of all the men, to return to work on the basis of prestrike conditions. After receipt of the Union's letters however, Kemp- painen and the Makela family resumed negotiations, long since abandoned, for the sale of the business to Kemppainen. About July 17 agreement was reached under which Kemppainen purchased the business for $25,000, payable in weekly install- ments of $100 commencing the following August, and assumption of indebtedness to the small business administration and to a local bank, from which Makela Weld- ing had borrowed $46,000. The assets transferred included the real and personal property, and all funds and accounts receivable as of July 1, 1965. This agree- ment was memorialized in minutes of Makela Welding, dated July 24. To com- plete this transaction, Kemppainen together with his wife and daughter formed a new corporation, Kemp Welding, Inc. Articles of incorporation were filed with the State authorities on or about July 17, and the new corporation formally came into existence on August 2. On Thursday, July 22, Kemppainen as an officer of Makela Welding sent letters to the remaining Makela employees (those who had not received the July 10 let- ter), advising each addressee of the sale of the Company, and that the addressee's "status as an employee is hereby terminated." The following Tuesday, July 27, Kemppainen, acting as head of the new business, reopened the shop and resumed work on the orders suspended as of the walkout on July 8. His initial crew con- sisted of 14 employees, and before the end of the week he added five more. The first week in August, -five more employees were hired, and on Monday, August 9, Kemppainen hired Kiiskila. John Fallon, however, was not rehired. On two occa- sions Douglas Sarri, who was foreman under both owners, said that Fallon would not be called back to work. On July 27 Sarri so indicated, to Lampinen, who at MAKELA WELDING, INC. 969' that time declined an offer to come back. Sarri made a similar comment to Kiiskila in mid-August. By the time of the hearing Kemppainen had 28 employees .4 Of the 28 Makela Welding employees hired by Kemp, each of them received a raise of at least 5 cents per houi over his Makela Welding pay upon being hired (several received a 10- or 15-cent raise and one was raised 20 cents), and with three exceptions all who were hired prior to October 25 received at least one raise of at least 5 cents per hour between the date they were hired by Kemp and Novem- ber 1; most of those received more than one such raise. E. Relations between Kemppainen and the Union As noted above, the Union in mid-July wrote two letters to Makela Welding,- which Kemppainen received and turned over to counsel, but to which no reply was made. The Union thereupon filed a representation-petition with the Board, claim- ing to represent the Makela Welding employees. On August 2, counsel for Makela- Welding wrote the Board's Regional Office, with a copy to the Union, stating that Makela Welding had ceased operations, was selling to Kemp, and would be dis- solved. The Union thereupon withdrew its representation petition, and on August 24 filed charges, naming both Makela Welding and Kemp. On September 16, the Union sent two letters to Kemp, one requesting recognition as bargaining representative of the employees, and the other complaining over Kemp's refusal to hire former employees of Makela Welding. Kemppainen replied' that his was a new company with no obligation to hire Makela Welding's former employees, and that he doubted the Union's majority claim. When the Union replied offering a card check, Kemppainen responded that cards signed while the men were employees of Makela Welding did not apply to Kemp. Kemppainen testified that he was aware on July 15 or 16 that a majority of the men had signed union cards on July 12 in Houghton. After the tiansfer of the business, Kemppainen on several occasions discussed the Union with prospective employees. He asked Kiiskila, before rehiring him, how he "felt about the mess down there," adding that "He [Kemppainen] wanted no more trouble down there,"' and that if the Union did "get in," he could not compete with other subcontractors. Kemppainen also asked Anttonen, when the latter applied for work, what he thought about the walkout and what he thought about the Union. On various occasions Kemppainen expressed the view that advent of the Union might force him out of business. F. Concluding findings Unraveling this somewhat tangled skein of events, we start with the walkout of July 8, plainly an economic strike. It follows under long-settled law that the strik- ers who had not been replaced, and who unconditicnally applied for reinstatement via the Union's letter of about July 13, received on or about July 15, were entitled' to reinstatement, and that the failure to reinstate them violated Section 8(a)(1) of the Acts At least with respect to the 29 men not sent termination letters on July 10, Makela Welding violated the Act by its failure to reinstate them on their application. Moreover, Kemppainen, who was in charge of the shop, knew as of the time he received the Union's letter on or about July 15 that the men had joined the Union His ignoring of the Union's demand for recognition and bargaining, particularly when coupled with the unfair labor practice of refusing to reinstate the strikers, violated Section 8(a)(5) and (1) of the Act. See the host of cases estab- lishing that an employer who, following a bargaining demand, commits unfair labor practices tending to prevent a fair election and to destroy a union's majority status cannot be 'heard to assert a "good faith doubt" of majority which may in such circumstances be established by authorization cards. 4 Between July 27 and the date of the hearing Kemp had 39 different men on its payroll, but 11 had left by the latter date. Of the 39, all but 11 had been employees of Makela Welding. Of the 11 , only 3 were hired prior to September 28, namely Gerald Silvala, Paul Peterson, and Clayton Manninen, hired August 14, 18, and September 1, respec- tively. Of the former Makela employees hired, only Karvonen, hired August 17, Willis Maki, hired September 17, and Lahti, hired November 17, were added after the hiring of non-Makela employees. 5 As found below the discharge notices sent Fallon and Kiiskila were discriminatorily motivated. I *do not find, however, that the unfair labor practice thereby committed' prolonged the strike , which ended the day after the notices were received 970 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The status of the 18 men sent discharge notices on July 10 is more complicated. I find that two of the men, Fallon and Kiiskila, were included in that list because of their participation in the concerted activity which culminated in the strike of July 8. They, together with Lampinen, constituted the committee which called on Kemppainen; Lampinen, however, had later expressed himself as satisfied with Kemppainen's proposed disposition of the problem. Although Kemppainen on the witness stand attempted to explain their inclusion in the list on the basis of their previously expressed dissatisfaction , with their wages, I am satisfied that their , role in the strike was, at the very least, a substantially contributing factor. Cf. N.L.R.B. v. Electric Steam Radiator Corporation, 321 F.2d 733, 738 (C A. 6), see also N.L.R.B. v. Great Eastern Color Lithographic Corp., 309 F.2d 352, 353 (C.A. 2), cert. denied 373 U.S. 950; Local No. 152, aff/w International Brotherhood of Teamsters V. N.L.R B., 343 F.2d 307, 308-309 (C.A.D.C.). In making this find- ing I am, of course , strongly influenced by the statements attributed to the younger Makela, and undenied , that after the discharge letters were sent he observed that they were getting rid of troublemakers (note the plural!), that Fallon was a troublemaker, that the Company was "going to teach the trouble- makers a lesson," and that not only Fallon but also Kiiskila and Lampinen were "going to get theirs , too." It should also be noted that Kemppainen, who had an important role in selecting the men to be terminated, apparently main- tained hostility to Fallon after forming the new corporation (see Foreman Sarri's repeated comment that Fallon would not be hired, although uncontradicted testi- mony esablishes Fallon's high degree of competency), and pointedly inquired into Kuskila's attitude before rehiring him, stating that "he wanted no more trouble down'there." The termination of Fallon' and Kuskila' was 'therefore in reprisal for their having engaged in a concerted activity protected by Section 7, and violated Section 8(a)(1) of the Act. The remaining 16 terminated on July 12, however, were not discriminatorily selected So far as their employer was concerned, their conceited activity was no different from that of the the 29 not terminated. General Counsel argues that but for the protected concerted activity, these men would not have been discharged. This, of course, is true. But Makela Welding argues that an employer, faced with a demand for a wage increase, may lawfully find the wherewithal to meet the demand by reducing his payroll elsewhere and otherwise econom•zing. This is likewise true. Makela Welding, of course, was under no duty to bargain with the Union on July 10, when Kemppainen sent out the termination notices. General Counsel in his brief suggests, in support of his claim that the discharge notices were unlawful, that the men at the time were represented by the Fallon-Kiiskila- Lampinen committee, and that under Section 2(5) of the Act this was a "labor organization with, which 'Makela Welding had to bargain before engaging in a mass layoff and discontinuing night work. Under this theory Kemppainen's notice to Lampinen would not constitute bargaining, paiticularly as action was taken before Lampinen could bring a reply But this theory, whatever it may have to commend it, suffers the fatal defect of not being fairly embraced by the pleadings which do not allege and failure to bargain prior to the advent of the Union. If the 29 nondischarged sti ikers had accepted the offer and returned to work, I should find some difficulty in following the General Counsel's contention that the Employer had not met an economic demand with a legitimate economic accom- modation. But, under the facts as they actually developed here, I reach the result contended for by General Counsel for the following reasons: When the Union offered to return all strikers to work under prestrike terms, the Employer, as found above, was under a legal duty to reinstate at least the 29 nondischarged strikers. The remaining 18, including the 2 discrimmatees, were at the very least in the category of applicants for employment. The Employer ignored, and hence rejected, their application. But inasmuch as all the employees were willing to work on pre- strike terms, and by Kemppainen's own testimony "there was plenty of work in the shop," it seems fair to infer, and I do. that the reason for not going back to the status existing before the strike (i e., taking all the employees back at prestrike terms) was that the men had walked out and now had chosen the Union as their bargaining representative. Both the walkout and the choice of the Union, however, are activities protected by the Act, and cannot furnish a valid ground for not taking back or rehiring all the employees, including those sent discharge letters. To be sure, Kemppainen testified that he had found the night shift unprofitable. But in the first place, only six to nine men worked at night, and, second, enough work was in the shop for the entire crew (day and night) to do at the time of the walk- MAKELA WELDING, INC. 971 out, so that any plans the Employer might later have made for eliminating night work would not have been invoked at that time but for the walkout. Note may also be taken of the younger Makela's remark to Stein "that we weren't running the place, that they were going to teach us a lesson," and of Kemppainen's expressed distaste for having a union in the shop. I therefore conclude that with respect to the 18 men discharged by the letters of July 10, Makela Welding not only discrim- inatorily included Fallon and Kiiskila, but also violated Section 8(a)(1) and (3) when it failed to reemploy all 18 of them, on their, application, and that, it was motivated in this refusal by the concerted and union activity in which the men had engaged. Turning now to Kemppainen's purchase of the business, I find that this was a bona fide transaction on his part. Nevertheless, under well-settled law, the Union, which had been the lawfully selected bargaining agent of the Makela Welding employees, continued to be the representative of the employees of the new corpora- tion. See, e.g., N.L.R.B. v. Cotten and Colman d/b/a Kiddie Kover Manufactur- ing Company, 105 F.2d 179, 183 (C.A. 6); N.L.R.B. v. Hoppes Manufacturing Com- pany, 170 F 2d 962, 964 (C.A 6); N L.R B. v. Downtown Bakery Corp, 330 F.2d '921, 925 (C.A 6), see also N.L.R B. v. Auto Ventshade, Inc., 276 F.2d 303, 304 (C.A. 5); N.L.R.B. v. Lunder Shoe Corp., d/b/a Bruce Shoe Co., 211 F.2d 284, 286 (C.A. 1); N.L.R.B. v. Albert Armato and Wire & Sheet Metal Specialty Co., 199 F.2d 800, 803 (CA. 7). The fact that here the change in ownership worked no change in supervision as Kemppamen and Sarri continued in charge merely reinforces the conclusion which would be reached in any event by the essential continuity of the operation. To be sure, the Union had never been "certified," but this is an immaterial fact (cf United Mine Workers of America v. Arkansas Oak Flooring Co., 351 U.S. 62, 71-72), as Kemppainen was not only aware of its major- ity status, but had committed unfair labor practices (e.g. refusal to reinstate strik- ers) which precluded his raising any claim of good-faith doubt of majority. Kemp's refusal to bargain with the Union, and its actions in granting wage increases without bargaining were therefore in violation of Section 8(a)(5) and (1) of the Act. With respect to the hiring of employees for Kemp, the record shows that of the 10 Makela Welding employees hired in 1962 or before who were on the payroll at the time of the strike, all but Lampinen, Fallon, and Kiiskila were -hired by Kemp on July 27 or 28. Lampinen declined a job, but, for reasons indicated above, I find that the refusal to hire Fallon and the delay to August 9 in the hiring of Kuskila reflected Kemppamen's disapproval of their exercise of their statutory rights to engage in union and concerted activity, and hence violated Section 8(a) (1) and (3). With respect to the other former Makela Welding employees, however, I am inclined to find no violation of the Act in Kemp's failure to hire them, or in hiring them belatedly. Nothing in their union or concerted activity distinguishes them from those hired the first day. Kemppainen was now the owner with his own money invested, and when he contemplated this venture before the labor problems. arose, he had expected to operate on a smaller scale than his predecessor. As a matter of strict logic, it would have been more orderly for Kemppainen in his new capacity to have opened the shop with its former complement, and to have bar- gained with the Union about the order of any reduction in force. But in the absence of any showing of discrimination (except as to Fallon and Kiiskila) I am reluctant to find that the bargaining violation carries in its wake an order of rein- statement and backpay to all the former Makela Welding employees. Such a result would border on the unrealistic and is not necessary to effectuate the pur- poses of the Act. Similarly, the discharge notices of July 22 to the remaining Makela Welding employees were unlawful only because of the. requirement to bar- gain with the Union over the effect of the sale on the employees.6 But this viola- tion, under all the circumstances, imposes no further liability on Makela Welding than it already bears for the unlawful refusal to reinstate described above. Finally, I find that young Makela's threats to get rid of "troublemakers" are attributable to Makela Welding and were violative of Section 8(a)(1), and that Kemppainen's interrogation of prospective employees as to how they felt about the Union constituted violations of Section 8(a)(1) on the part of Kemp. 6 General Counsel relies on N.L R.B. v. Savoy Laundry, Inc., 327 F.2d 370- (CA. 2), in arguing that the Makelas were motivated by antiunion considerations in selling the business But see Textile Workers v. Darlington Mfg. Co., 380 U.S. 263, 273-274, and distinguishing Savoy at footnote 19. 972 DECISIONS OF NATIONAL LABOR RELATIONS BOARD In summary, in addition to the Section 8(a)(1) violations just mentioned, I find that both Makela Welding and Kemp violated Section 8(a)(5) and ( 1) by refusing to bargain with the Union, that Makela Welding violated Section 8 (a)(1) by its refusal to reinstate the 29 economic strikers who had not received the discharge letters of July 10, that it violated Section 8(a)(1) by including Fallon and Kiiskila in the group receiving those letters, that it violated Section 8 (a)(1) and (3) by failing to reemploy the 18 men to whom it had sent discharge letters , and that Kemp violated Section 8(a)(3) and ( 1) by its failure to hire Fallon and its delay in hiring Kiiskila. Although the matter is not free from doubt, I incline to the view that under existing case law, Kemp shoud be held legally responsible for remedying the unfair labor practices committed by Makela Welding, to the extent that Makela Welding fails to do so . In plainer terms, if Makela Welding does not make whole the employees it unlawfully discharged, refused to reinstate , or rehire, Kemp must make them whole. In so holding, I rely primarily on N.L.R.B. v. New Madrid Manufacturing Company and Harold Jones, d/b/a Jones Manufacturing Company, 215 F.2d 908, 913-915 (C.A. 8), see also N.L.R.B. v. Fred P. Weissman Co., 170 F.2d 952, 954 (C.A 6), cert. denied 336 U.S. 972; NL.R.B. v. Thomas Pavan, Ji., t/a Silver Spring Transit Company and/or Suburban Transit Company , 237 F.2d 373, 375 (C.A. 4); N.L.R.B. v. Tempest Shirt Manufacturing Company, 285 F.2d 1, 4-5 (C.A. 5); Gibbs Shipyards, Inc. v. N.L.R.B., 333 F.2d 459, 462 (C.A. 5); cf. M. Eskin & Son, 148 NLRB 1022, 1029-33.7 CONCLUSIONS OF LAW 1. By refusing to recognize and bargain with the Union, and (in the case of Kemp ) by changing wage rates without bargaining with the Union , both Makela Welding and Kemp engaged in unfair labor practices affecting commerce within the meaning of Sections 8(a)(5) and ( 1) and 2(6) and (7) of the Act. 2. By refusing to reinstate the undischarged striking employees on their uncon- ditional application on or about July 15, 1965, and by refusing on that date to rehire the remaining discharged strikers , Makela Welding engaged in unfair labor practices affecting commerce within the meaning of Section 8(a)(1) and (3) and Section 2(6) and (7) of the Act. 3. By discharging John Fallon and Walter Kiiskila on July 10, 1965, Makela Welding engaged in an unfair labor practice affecting commerce within the meaning of Sections 8(a) (1) and 2(6) and (7) of the Act. 4. By failing to hire John Fallon, and by delaying the hiring of Walter Kiiskila, because of their concerted and union activities , Kemp engaged in unfair labor 7 Note that in New Madrid , supra, the case closest in point, which contains a thought- ful discussion of the matter, the court did not have the benefit of argument against carrying .over the liability ; In Weissman, supra, the court observed that "the order was prospective In Its nature" ; and Tempest, supra, Parran, supra, and Gibbs, supra, are all dis- cussed and distinguished in Trial Examiner Maller's decision in Eskni, supra, adopted by the 'Board . In Eskin, the decision was influenced by the fact that the predecessor com- pany continued in business and could offer reinstatement, but so here , for the predecessor company has assets ($100 a week for 250 weeks ) with which to meet the liability imposed on it here. Strict logic would seem to lead to Kemp ' s nonliability . Kemppainen, to be sure, played a leading role in the unfair labor practices of Makela Welding, but only as agent; and if that business had simply ceased, he would not be personally liable for the backpay. His new corporation continues the business, but there is no showing that he expressly or impliedly assumed liabilities other than the indebtedness to the bank and to the Small Business Administration . Only backpay is Involved , not continuing employ- ment, a circumstance which tends to lessen , but not to obviate, the considerations of public policy which , as New Madrid teaches, must underlie imposing liability on Kemp The Board's orders, it is true , run to offending corporations and their "successors , agents, and assigns," but as cases like New Madrid, emphasize, use of this rubric sheds no light on the problem ( see Regal Knitwear Company v. NLR.B , 324 US. 9 , 15). The Board's cryptic holding In Gibbs Corporation and Gibbs Shipyards, Inc , 142 NLRB 1204, 1203, is explained In Eakin, at 1032 . Finally, N.L.R.B. v. Herman Brothers Pet Supply, Inc, 325 F.2d 68 ( C.A. 6), turns on a finding that the transfers there were not bona fide, a circumstance lacking here . I therefore fall back on New Madrid, particularly on boldface paragraphs 4, 7, 8, and 10 , to hold Kemp liable , but guided by the court's approach there, and by N.L.R.B. v. Lexington Electric Products Co., 'Inc., 283 F.2d 54,- 57-58 (C.A. 3), cert. denied 365 U.S. 845, 1 would make it "secondarily " liable. MAKELA WELDING, INC. ' 973 practices affecting commerce within the meaning of Section 8(a)(1) and (3) and Section 2(6) and (7) of the Act. 5. By interrogating applicants for employment as to their union sympathies (in the case of Kemp), and by threatening reprisals for concerted activities (in the case of Makela Welding), both Kemp and Makela Welding have engaged in further unfair labor practices affecting commerce within the meaning of Section 8(a) (1) and Section 2(6) and (7) of the Act. THE REMEDY Kemp, the "going" corporation, should be ordered to cease and desist from its :unfair labor practices, to bargain with the Union upon request, to offer employment to Fallon, and to make Fallon and Kiiskila whole, in accordance with the formulas set forth in F. W. Woolworth Company, 90 NLRB 289, and Isis Plumbing & Heat- ing Co., 138 NLRB 716, for losses suffeied as a result of Kemp's discrimination against them on and after July 27, 1965.8 In addition Kemp should be ordered to post notices, both its own and those executed on behalf of Makela Welding. Finally, to the extent Makela Welding fails to do so, Kemp should assume Makela Welding's backpay obligation, described in the following paragraph. Cf. N.L.R.B. v. Lexington Electric Products Co. Inc., 283 F.2d 54, 57-58 (C.A. 3), cert. denied 365 U.S. 845. Makela Welding should make whole all its employees for wages lost between -July 16, the day after Makela received their unconditional application for reinstate- ment, and July 26, the last day before the plant reopened under Kemp. Backpay for this period should be computed in accordance with the customary formula set forth in Crossett Lumber Company, 8 NLRB 440 (described in Seven-Up, supra, see also Phelps Dodge, 313 U.S. 177, 197 ff.), with interest computed as in Isis, supra. In addition, Makela Welding should execute appropriate notices for posting at its former premises. The cease-and-desist order as to Makela Welding will necessarily be phrased in hypothetical terms, dependent on its going back into :business. Upon the foregoing findings of fact and conclusions of law, and upon the entire -record in the case, I recommend, pursuant to Section 10(c) of the Act, issuance of the following: ORDER A. Makela Welding, Inc., its officers, agents, successors, and assigns, shall: - 1. In the event it resumes operations, cease and desist from: (a) Discharging or otherwise discriminating against employees for engaging in .concerted or union activity protected by Section 7. (b) Threatening reprisals against employees for engaging in activities protected .by Section 7. (c) Refusing to bargain with the labor organization representing a majority of its employees in an appropriate bargaining unit. (d) In any other mariner interfering with, restraining, or coercing its employees in the exercise of their rights under Section 7 of the Act. 2. Take the following action designed to effectuate the policies of the Act. (a) Make whole each of its employees, in the manner set forth in the portion of the Trial Examiner's Decision entitled "The Remedy," for losses suffered as a result ,of the failure of Makela Welding to reinstate or rehire the employee for the period from July 16 to July 26, 1965. (b) Execute copies of the attached notice marked "Appendix A," 9 and furnish ,executed copies thereof to Kemp' Welding, Inc., for posting at Kemp's place of business. Copies of this notice will be furnished by the Regional Director for Region 30. 8 The Woolworth, supra, formula was approved in Seven-Up Bottling Company of Miami, Inc., 344 U.S. 344, and the Isis formula in Philip Carey Manufacturing Company, 331-F.2d 720, 729-731 (C.A. 6). I add this note of explanation to assist counsel in a geographic area where Board decisions are not readily available. 9In the event that this Recommended Order is adopted by the Board, the words "a Decision and Order" shall be substituted for the words "the Recommended Order of a Trial Examiner" In the notice. In the further event that the Board's Order is enforced by a decree of a ;United States Court of Appeals, the words "a Decree of the United States Court of Appeals, Enforcing an Order" shall be substituted for the words "a Decision and Order." 974 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (c) Notify the Regional Director for Region 30, in writing, within 20 days from the date of receipt of this Decision what steps Respondent Makela Welding, Inc., has taken to comply herewith.io B. Kemp Welding, Inc., its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to hire or otherwise discriminating against employees because they engaged in union activity or concerted activity for mutual aid or protection. (b) Interrogating employees or applicants for employment as to their union sympathies. (c) Refusing to recognize or bargain with International Union , United Auto- mobile, Aerospace and Agricultural Implement Workers of America (UAW), AFL- CIO, as representative of the employees in the stipulated appropriate unit consisting of "All production and maintenance employees , excluding office clerical employees, salesmen, buyers, guards and professional employees and supervisors , as defined in the Act." (d) In any other manner, interfering with, restraining, or coercing its employees in the exercise of their rights under Section 7 of the Act. 2. Take the following affirmative action designed to effectuate the policies of the Act: (a) Upon request, bargain collectively with the above-named Union as the statutory representative of the employees in the above described unit. (b) Offer employment to John Fallon , substantially equivalent to that he had previously held with Makela Welding, Inc., at a rate of pay which fairly reflects wage increases given other former employees of that corporation now employed by Kemp, and make him whole, in the manner prescribed in the portion of the Trial Examiner's Decision entitled "The Remedy," for losses suffered as a result of the refusal to hire him on and after July 27, 1965. (c) Notify Fallon if presently serving in the Armed Forces of the United States of his right to full reinstatement upon application in accordance with the Selective Service Act and the Universal Military Training and Service Act, as amended, after discharge from the Armed Forces. (d) Make whole Walter Kiiskila in the manner described in the above-mentioned remedy section , for losses he suffered as a result of the failure to hire him. between July 27 and August 9, 1965. (e) To the extent that Makela Welding, Inc., has failed to make whole the employees as prescribed in section A, 2, (a), of this Order , make said employees whole in the manner there prescribed. (f) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records , social security payment records, time- cards, personnel records and reports, and all other records , including records in its possession of Makela Welding, Inc., necessary to analyze the amount of backpay due under the terms of this Recommended Order. (g) Post at its plant at Baraga, Michigan , copies of the attached notice marked "Appendix B." 11 Copies of said notice to be furnished by the Regional Director for Region 30, shall , after being duly signed by an authorized representative of Kemp, be posted immediately upon receipt thereof, and be maintained by it for a period of 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted . Reasonable steps shall be taken by Kemp to insure that said notices are not altered , defaced, or covered by any other material. (h) Similarly post and maintain for the same period, and immediately adjacent to the notices just described , the notices furnished by Makela Welding, Inc., pur- suant to section A, 2, (b), of this Recommended Order. (i) Notify the Regional Director for Region 30, in writing, within 20 days from receipt of this Decision, what steps Respondent Kemp Welding, Inc , has taken to comply herewith." "In the event that this Recommended Order is, adopted by the Board, this provision shall be modified to read • "Notify said Regional Director, in writing, within 10 days from the date of this Order, what steps Respondent Makela Welding, Inc., has taken to comply herewith." u See footnote 9, supra. 1 See footnote 10, supra. MAKELA WELDING, INC. 975 APPENDIX A NOTICE TO ALL EMPLOYEES Pursuant to- a Recommended Order of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Rela- tions Act, as amended, we hereby notify our former employees that: WE WILL pay backpay to each of them for wages lost between July 16, 1965, when they abandoned their strike, and July 26, 1965, when we went out of business. In the event we resume business: WE WILL NOT discriminate, or threaten to discriminate against any employee for having engaged in union or concerted activity. WE WILL bargain with any labor organization which has been designated as their bargaining agent by a majority of our employees. MAKELA WELDING, INC., Employer. Dated------------------- By------------------------------------------- (Representative) (Title) This notice must remain posted for 60 consecutive days from the date of posting, and must not be altered, defaced, or covered by any other material. If employees have any question concerning this notice or compliance with its provisions, they may communicate directly with the Board's Regional Office, Room 230, 744 North Fourth Street, Milwaukee, Wisconsin 53203, Telephone 272-8600, Extension 3866. APPENDIX B NOTICE TO ALL EMPLOYEES Pursuant to a Recommended Order of a Trial Examiner of the National Labor Relations Board, and in order to effectuate the policies of the National Labor Rela- tions Act, as amended, we hereby notify our employees that. WE WILL NOT refuse to hire or otherwise discriminate against employees because they have engaged in concerted or union activity. WE WILL NOT inquire into the union sympathies of applicants for employ- ment or of employees. WE WILL NOT in any other mannei interfere with our employees' right to form, join, or assist a labor organization or engage in other concerted activity. WE WILL recognize and bargain with International Union, United Automo- bile, Aerospace and Agricultural Implement Workers of America (UAW), AFI CIO, as the bargaining representative of our employees. WE WILL offer employment to John Fallon, and give him and Walter Kiiskila backpay for losses suffered as the result of our failure to hire them on July 27, 1965. WE WILL, to the extent Makela Welding, Inc , does not do so, give backpay to employees of that company for wages lost between July 16 and 26, 1965. KEMP WELDING, INC, Employe,. Dated------------------- By------------------------------------------- (Representative) (Title) NOTE.-We will notify John Fallon if presently serving in the Armed Forces of the United States of his right to full reinstatement upon application in accordance with the Selective Service Act and the Universal Military Training and Service Act, as amended, after discharge from the Armed Forces This notice must remain posted for 60 consecutive days from the date of post- ing, and must not be altered, defaced, or covered by any other material. If employees have any question concerning this notice or compliance with its provisions, they may communicate directly with the Board's Regional Office, Room 230, 744 North Fourth Street, Milwaukee, Wisconsin 53203, Telephone 272-8600, Extension 3866.