Jackson Farmers, Inc.

JACKSON FARMERS, INC. Jackson Farmers, Inc. (Formerly known as Farmers Union Co-Operative Business Association) and American Federation of Grain Millers, AFL-CIO. Case 17-CA-4078-2 October 31, 1970 DECISION AND ORDER BY MEMBERS FANNING, BROWN, AND JENKINS On May 6, 1970, Trial Examiner John M. Dyer issued his Decision in the above-entitled proceeding, finding that Respondent had engaged in and was engaging in certain unfair labor practices alleged in the complaint and recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Decision. Thereafter, the Respondent filed exceptions to the Decision and a supporting brief, and the Charging Party filed cross-exceptions to the 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. The Board has reviewed the rulings of the Trial Examiner made at 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 briefs, and the entire record in this case, and hereby adopts the findings, conclusions, and recommendations i of the Trial Examiner. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the Recommend- ed Order of the Trial Examiner, and hereby orders that the Respondent, Jackson Farmers, Inc. (formerly known as Farmers Union Co-Operative Business Association), Holton, Kansas, its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order. 1 The Charging Party has excepted to the failure of the Trial Examiner to recommend a remedy which would make it whole for the amount of money it has lost in fees, dues, and legal expenses as a result of Respondent's refusals to bargain We deem it inappropriate in this case to depart from existing policy with respect to remedial orders in cases involving 8(a)(5) violations and therefore find no merit in said exception See Monroe Auto Equipment Company, 164 NLRB 1051 TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE 337 JOHN M. DYER, Trial Examiner: On September 17, 1969,1 the American Federation of Grain Millers, AFL-CIO, herein called the Union, filed the charge in this case alleging that Jackson Farmers, Inc., formerly known as Farmers Union Co-operative Business Association, and herein called Respondent, or the Company, violated Section 8(a)(1) and (5) of the Act by abolishing a unit position and terminating the employment of Jacob Schuetz. On November 25, the Regional Director issued a complaint alleging that Respondent violated Section 8(a)(5) and (1) by unilaterally and without notice or an opportunity for bargaining and in derrogation of the Union's rights abolishing a unit position and subcontracting such unit work after giving Jacob Schuetz notice, on July 21, that he would be discharged on September 1. Respondent's duty to bargain with the Union is premised on the fact that the Union, in Case 17-RC-5851, was chosen as the majority representative of an appropriate unit of Respondent's employees in an election held December 31, 1968, and thereafter on January 15 certified by the Regional Director as the collective-bargaining representative for the following unit: All production and maintenance employees of the Respondent at its Holton, Denison, Mayetta, and Valley Falls, Kansas, locations, including service station employees, tankmen, truck drivers, mechanics, regular part-time employees, and regular seasonal employees, but excluding office clerical employees, temporary employees and professional employees, guards, and supervisors within the meaning of the Act. Respondent filed an answer on December 3, admitting the filing and service of the charge , the facts of, and conclusions drawn from , the commerce data, the status of the Union, and the appropriateness of the unit . Respondent denied the validity of the election and the certification and that it had subcontracted unit work or discharged Schuetz without bargaining, or providing an opportunity for such. At the hearing of this matter on January 20, 1970, in Holton, Kansas, Respondent amended its answer and admitted that on or about August 15, it unilaterally and without notification to the Union contracted out the hauling of feed and supplies and that such contract took effect on September 1. It further admitted that such work had been performed by Schuetz whom it discharged on September 1. In essence Respondent admitted the facts premised as violative in this complaint but dented that it violated the Act standing on its position that the Union was not properly elected and certified as the collective -bargain- ing agent and that it has no duty to bargain with the Union. Respondent's defense here is essentially its position and defense which the Board rejected in 178 NLRB No. 56. That case is a straight refusal to meet and bargain with the Union following its certification in Case 17 -RC-5851 and in a companion case for another unit . As to the instant unit, I Unless otherwise stated the events herein took place during 1969. 186 NLRB No. 53 338 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Respondent's position was that the unit contains seasonal employees and that the election should be delayed until employment was at its peak. The Regional Director rejected that contention and the election was held as noted above and the Union certified. After Respondent refused to meet and bargain charges were filed, a complaint issued, and the matter went to Trial Examiner Schneider on a Motion for Summary Judgment which he granted. The Board affirmed his findings of 8(a)(5) and (1) violations and the matter is presently before the Tenth Circuit Court of Appeals for review and enforcement. In addition to the validity of the election and certification Respondent presents two other contentions: (1) that it was economically motivated in subcontracting the work done by Schuetz and discharging him and should not have to reinstate him, and (2) that it offered Schuetz a substantially equivalent job which he refused. In addition to these questions the Union raised an issue as to proper remedy and requested particular remedial action. On the entire record in this case including my evaluation of the reliability of the witnesses based on the evidence received and my observation of their demeanor, I make the following: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT AND THE LABOR ORGANIZATION INVOLVED Respondent is a Kansas corporation which operates grain elevators, a feed mill, petroleum bulk plant and service stations, a fertilizer plant, and a store at various locations in Kansas with its principal location and place of business at Holton. Respondent annually sells and distributes products valued in excess of $500,000 and annually receives goods valued in excess of $50,000 directly from points outside of the State of Kansas. Respondent admits and I find that it is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. Respondent admits and I find that the Union is a labor organization within the meaning of Section 2(5) of the Act. II. THE UNFAIR LABOR PRACTICES A. Background, Undisputed Facts, and Resolutions As noted above Respondent admits the facts on which the complaint is based but denies that it has violated the Act asserting the invalidity of the underlying certification which it is testing in another case presently before the Tenth Circuit Court of Appeals. As the matter is presently constituted, I have no alternative but to accept the Board's decision in 178 NLRB No. 56 that the certification in Case 17-RC-5851 is valid and that Respondent has violated Section 8(a)(5) of the Act by refusing to bargain with the Union herein for that unit of employees. With that as the foundation it follows that Respondent, by unilaterally and without bargaining with, or giving notice to the Union, terminating a unit position, discharging the incumbent of that position, and subcon- tracting that unit work to an independent contractor, has again violated Section 8(a)(5) and (1) of the Act, even though Respondent's actions are arguably economically motivated. The principal question then becomes whether I should order that job reinstituted and Schuetz reemployed. Respondent contends that its action was economically motivated and that no such order should be granted, or if granted, that I should find that Schuetz, by declining what it terms a substantially similar job, has forfeited any right to reinstatement at Respondent. In support of Respondent's arguments, its general manager, Charles Robert Kinast, testified that just before he became general manager on November 1, 1968, an audit was made of Respondent's business and showed that Respondent was losing approximately $52,000 for the fiscal year which ended the following July 1. Kinast's job was to reduce the losses. He first revised the bookkeeping procedures to update them and to pinpoint operations so they could be scrutinized. The system was changed around June 1. He also made some equipment changes which helped to reduce the amount of part-time help needed. He testified that in the spring of 1969, he checked into the trucking operations and using 2 or 3 weeks' figures for the 1968 International truck used by Schuetz to bring goods from Kansas City and to haul grain and feed, and comparing that information against a rough figure given him by someone as to the cost for hauling, he came to the conclusion that it would be simpler and cheaper to contract out the work done by Schuetz. Thereafter Kinast contacted various companies and came to an agreement with Reaser Trucking Company to provide the services. Reaser is an individual proprietorship whose principal operation was hauling cattle to the markets in Kansas City and other places. This contract provided Reaser with a cargo on the return trip. Respondent offered in evidence its Exhibit 2, which it testified was a summary of the tonnage hauled by Schuetz from January 1 through August 31 and included Schuetz' salary, the amounts paid toward his social security, retirement benefits, and company life insurance, operation- al truck expenses plus licenses and taxes, depreciation on the truck and grain bed, etc. This exhibit was prepared just prior to the hearing of this case and for use in this hearing, although Kinast at first denied that was its purpose. Respondent said that after Schuetz was discharged it sold for salvage an old truck which theretofore had been used occasionally and kept and thereafter occasionally used the 1968 International, and a 1962 GMC truck, both of which had a 7-ton capacity. Respondent's Exhibit 3 is the contract between Respon- dent and Reaser Trucking dated August 15, 1969, effective from September 1 of that year for a 1-year period. It is terminable on 30 days' notice by either party. The contract provides an "approved" rate of $4 per ton to and from St. Joseph and $5 a ton to and from Kansas City. According to the testimony the word "approved" means rates approved by the Interstate Commerce Commission. In testifying about its (later rejected) Exhibit 4, which was a compilation of the amounts of goods hauled and payments made to Reaser Trucking for the 4-month period of September 1 to December 31, Kinast said the document showed only one instance of Reaser's hauling items JACKSON FARMERS, INC. 339 between Respondent's facilities. This movement could have occurred over several days but was covered by only one bill and amounted to about 7 percent of the total volume that Reaser hauled. Kinast, without citing any figures, said the amount was only about 10 percent less than what Schuetz would have hauled between facilities. Kinast admitted that Respondent had others (apparently part-time help) haul goods between its facilities. In completing Respondent's financial picture, it was stipulated that the auditor's report showed that Respondent lost $58,346.88 for the fiscal year which ended on June 30. This means that Kinast apparently was able to effect economies in the 8 months he was general manager so that only some $6,000 more debt was accumulated over the amount facing him when he took over Respondent's operations. To Respondent's economic justification arguments, General Counsel and the Union argued that Respondent had not considered all the factors in weighing the economics of Schuetz' job. As examples it was pointed out that in establishing its ex post facto justification, Respon- dent did not consider the value of Schuetz' services when he worked at the various facilities in addition to his truckdriving duties; Respondent included the costs of licenses, taxes, and depreciation on the 1968 International truck in figuring the expenses for Schuetz but did not include or weigh those amounts which are still current expenses while the same truck is used on a part-time basis, and in truth still constitutes a company expense which could be figured in derogation of the Reaser contract for comparison figures. To Respondent's claim that it would have to purchase a third truck to replace the one it junked, General Counsel's response is that the 1968 and the 1962 trucks, according to Respondent's testimony, are only used part time and the use may aggregate less than 50 percent use for one truck. If Respondent's testimony is true, then the 1968 truck could be used full time and the 1962 truck could handle all of the part-time work and still not be fully utilized so that the purchase of a third truck would appear unwarranted. Further, Respondent is still using part-time employees to haul goods between facilities and at least a part of that work (10 percent of the total according to Respondent's estimates) was work formerly performed by Schuetz, which is not accounted for or considered by Respondent in its post mortem cost justification. Respondent has presented a one-sided picture in attempting to justify its actions in terminating Schuetz and contracting with Reaser Trucking. Its claims, from the arguments and points raised by General Counsel and the Union, seem overstated and not balanced. But the problem here is that Respondent by its unilateral action kept the Union from raising these points and arguments in a bargaining session and frustrated any attempt to come to some understanding and agreement and perhaps save this work and Schuetz' job. In a reasoned discussion other factors might have emerged and another or other solutions might have been achieved. But these possibilities have been forestalled by Respondent's refusal to bargain with the Union over this or any other matter. Considering all these factors, it does not appear that Respondent would be put to any serious disadvantage if the driving work were restored to the unit and Schuetz reinstated. The contract between Reaser and Respondent is terminable on 30 days' notice. Respondent still has the 1968 truck which is now only in part-time use, and from Respondent's own testimony it would not appear necessary for Respondent to purchase any other equipment to reinstitute this service since the 1962 truck would still be available for part-time use. It seems apparent that the proper course is to restore the status quo by ordering reinstitution of the unit driving work and the reinstatement of Schuetz for that job so that the parties can then proceed to bargain in good faith about this matter and come to a reasoned determination. Respondent would resist the reinstatement of Schuetz saying that it offered him a substantially similar job which he refused. Apparently by "substantially similar" Respon- dent refers only to pay rate since the job it offered Schuetz was working in a feed mill at another location. The evidence showed that Schuetz originally took inside work with Respondent only on the promise that he would be made a truckdriver. He was a truckdriver for over 10 years with Respondent, maintaining his home near St. Louis, Missouri. One of the side benefits, both to Respondent and Schuetz, was that Schuetz took his truck home and then was ready to pick up materials early in St. Louis and haul them to Respondent's Kansas facilities. Schuetz testified he also has "hay-fever" which would preclude his working in a feed mill and he was sure General Manager Kinast was aware of this condition. The Board provides for reinstatement to a "substantially similar" position only if the original job has been eliminated. Since I have found above that the termination of Schuetz and the elimination of his job was the result of Respondent's unfair labor practice in not bargaining about the matter, there is no reason for Schuetz to accept or to have accepted a "substantially similar" position which was in fact not "substantially similar." I will therefore order that the unit work be reinstituted and that Schuetz be offered employment at his position as a truckdnver. B. The Union's Further Remedial Claims The Union requests that it be made whole for the lost dues and initiation fees which have not accrued to it since there is no contract between the Union and Respondent owing to Respondent's refusal to meet and bargain with it. This request is based on the Union's position that it had informed the employees that it would not make any such charges until there was a contract between the parties. The Union also claims that it incurred unnecessary expenses in having its counsel prepare for and come to the hearing in this matter and that such hearing was really unnecessary after Respondent amended its answer and in effect admitted the complaint allegations . The Union attributes much of Respondent's conduct, including its conduct in this case, to a plan or desire to weaken the Union by causing it to expend sums of money which are not being recouped from proper sources, which in this case would be the members being serviced at Respondent. The Union states that if Respondent had bargained from the inception of its duty to do so, as it is now being required to bargain, the Union would have been in a position where it was 340 DECISIONS OF NATIONAL LABOR RELATIONS BOARD collecting dues and initiation fees and would not have been put to the expense of counsel fees, travel expenses, etc., for the prosecution of either the first or the second case and that by its unfair labor practices Respondent has caused specific losses to the Union. Contentions regarding lost dues and initiation fees and for reimbursement of legal expenses in 8(a)(5) situations have been made in a number of cases presently pending before the Board, without resolution by it on these matters as of this time. Since these requests involve "policy making" by the Board, I feel it is proper to pass these requests on to the Board for its considered decision. III. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent set forth in section II, above, and therein found to constitute unfair labor practices in violation of Section 8(a)(5) and (1) of the Act, occurring in connection with Respondent's business operations as set forth in section I, above, have a close, intimate, and substantial relationship to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow of commerce. IV. THE REMEDY Having found that Respondent engaged in the unfair labor practices set forth above, I recommend that it cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act as follows: Respondent, since on or about July 21, 1969, has at all times since then refused, and still refuses, to bargain with the Union in good faith as the representative of its employees in an appropriate unit, in regard to Respon- dent's decision to discontinue certain unit work, subcon- tract it, and discharge the employee who was then performing such work.2 I therefore recommend that Respondent terminate its contract with Reaser Trucking Company, Inc., reinstitute the unit trucking work formerly done by Jacob Schuetz, and reemploy Jacob Schuetz to perform such work. If Respondent still wishes to explore the economics of the situation with a view to terminating this unit work, Respondent will then enter into collective bargaining in good faith with the Union in regard thereto. I further recommend that Respondent reinstate Jacob Schuetz to his former position as a truckdriver with all seniority and other rights and privileges due him and make him whole for any loss of pay he has suffered by reason of Respondent's discharge of him on September 1, 1969, until the date of reinstatement, less any net interim earnings. Backpay is to be computed on a quarterly basis in the manner established by the Board in F. W. Woolworth Company, 90 NLRB 289, with interest at the rate of 6 percent per annum to be computed in the manner set forth in Isis Plumbing & Heating Co., 138 NLRB 716. I further 2 The conclusions in this case and the remedy for the unfair labor practices found herein are not in derogation of the conclusion that Respondent refused to bargain and the remedies therefor in the prior Board case 178 NLRB No. 56, but rather are in addition to the remedies and conclusions therein. 3 In the event no exceptions are filed as provided by Section 102.46 of recommend that Respondent make available to the Board, upon request, payroll and other records in order to facilitate checking the amounts of backpay due and the rights of Jacob Schuetz. Having found that Respondent has refused to bargain with the Union in regard to its employees' jobs and other work-related terms and understanding that Respondent is in the position now of attempting to modernize its operations, I am concerned that Respondent may violate some of its employees' rights by not bargaining with the Union in regard to any work changes or eliminations it may wish to make. I therefore recommend that Respondent be enjoined from acting in the same or a similar manner to its actions in this case. On the basis of the foregoing findings and the entire record, I make the following: CONCLUSIONS OF LAW 1. Jackson Farmers, Inc. (formerly known as Farmers Union Co-operative Business Association), is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. American Federation of Grain Millers, AFL-CIO, is a labor organization within the meaning of Section 2(5) of the Act. 3. All production and maintenance employees of the Respondent at its Holton, Denison, Mayetta, and Valley Falls, Kansas, locations, including service station employ- ees, tankmen, truckdrivers, mechanics, regular part-time employees, and regular seasonal employees, but excluding office clerical employees, temporary employees, and professional employees, guards, and supervisors within the meaning of the Act, constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. At all times since January 15, 1969, and particularly on and since July 21, 1969, the Union has been, and is now, the exclusive representative of the employees in the said unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 5. Respondent by refusing to bargain in good faith with the Union, which is the exclusive representative of its employees in the appropriate unit stated above, in regard to discontinuing unit work, subcontracting it, and discharging an employee on and after July 21, 1969, has engaged in and is engaging in unfair labor practices affecting commerce within the meaning of Sections 8(aX5) and (1) and 2(6) and (7) of the Act. RECOMMENDED ORDERS On the basis of the foregoing findings of fact and conclusions of law, and upon the entire record in this case considered as a whole, it is recommended that Jackson Farmers, Inc. (formerly known as Farmers Union Co- the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, recommendations, and Recommended Order herein shall, as provided in Section 102.48 of the Rules and Regulations, be adopted by the Board and become its findings , conclusions, and order, and all objections thereto shall be deemed waived for all purposes. JACKSON FARMERS, INC. 341 operative Business Association), of Holton, Kansas, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively in good faith concerning unit work and the working conditions of unit employees, rates of pay, hours of employment, and other terms and conditions of employment, with American Federation of Grain Millers, AFL-CIO, as the exclusive representative of the employees in the appropriate unit described in the section above entitled Conclusions of Law. (b) Discontinuing unit work, subcontracting it, and discharging or laying off unit employees without bargaining or offering to bargain concerning these matters with American Federation of Grain Millers, AFL-CIO. 2. Take the following affirmative action which is necessary to effectuate the policies of the Act. (a) Upon request bargain collectively in good faith with the above-named Union as the exclusive representative of all employees in the appropriate unit concerning employ- ees' working conditions, unit work, or any Respondent desires or plans to change or eliminate unit work. (b) Offer Jacob Schuetz reinstatement in accordance with the recommendations set forth in the section of this decision entitled "The Remedy." (c) Make Jacob Schuetz whole for any loss of pay he may have suffered by reason of Respondent's refusal to bargain concerning his job, in accordance with the recommenda- tion set forth in the section of this decision entitled "The Remedy." (d) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports and all other records necessary to analyze the amount of backpay due Jacob Schuetz as set forth in the section of this decision entitled "The Remedy." (e) Post at Holton, Kansas, and its other facilities and plants, copies of the attached notice marked "Appendix." 4 Copies of said notice, on forms provided by the Regional Director for Region 17, after being duly signed by Respondent's representative, shall be posted by Respon- dent immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said notices are not altered, defaced, or covered by any other material. (f) Notify the Regional Director for Region 17, in writing, within 20 days from the receipt of this Decision, what steps have been taken to comply herewith.5 4 In the event that the Board's 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 be changed to read "POSTED PURSUANT TO A JUDGMENT OF THE UNITED STATES COURT OF APPEALS ENFORCING AN ORDER OF THE NATIONAL LABOR RELATIONS BOARD " 5 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 has taken to comply herewith " APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government After a trial in which the Company, the Union, and the General Counsel of the National Labor Relations Board participated and offered evidence, the National Labor Relations Board has found that we violated the law and has ordered us to post this notice and we intend to carry out the order of the Board and abide by the following: WE WILL reinstate Jacob Schuetz to his position as truckdriver and reinstitute the trucking operation which he formerly served and WE WILL make him whole for any loss of pay which he suffered as a result of our decision to discontinue that work. WE WILL bargain collectively in good faith upon request with the American Federation of Grain Millers, AFL-CIO, as the exclusive representative of all employees in the bargaining unit described below, with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment, including any desires we have to change unit work, and, if an understanding is reached, we will sign a contract containing such understanding. The bargaining unit is: All production and maintenance employees at our Holton, Denison, Mayetta, and Valley Falls, Kansas, locations, including service station em- ployees, tankmen, truck drivers, mechanics, regular part-time employees, and regular seasonal employees, but excluding office clerical employ- ees, temporary employees and professional em- ployees, guards and supervisors within the meaning of the Act. All our employees are free to become or remain union members. JACKSON FARMERS, INC. (Employer) Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. 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. Any questions concerning this notice or compliance with its provisions may be directed to the Board's Office, 610 Federal Building, 601 E. 12th Street, Kansas City, Missouri 64106, Telephone 816-374-5181.