Morgan Products, Inc.

MORGAN PRODUCTS, INC. Morgan Products, Inc., Successor and Alter Ego to Hargrett's Machine Products, Inc. and Lovel Hall and United Steelworkers of America , AFL-CIO. Cases 7-CA-6294 and 7-CA-6355 June 21, 1968 DECISION AND ORDER BY CHAIRMAN MCCULLOCH AND MEMBERS FANNING AND BROWN On March 19, 1968, Trial Examiner Robert Cohn issued his Decision in the above-entitled proceeding, finding that the Respondent had en- gaged in and was engaging in certain unfair labor practices and recommending that it cease and de- sist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Deci- sion . The Trial Examiner also found that the Respondent had not engaged in other unfair labor practices alleged in the complaint. Thereafter, the Respondent and the Charging Parties filed excep- tions to the Decision and supporting briefs, the General Counsel filed cross-exceptions and a brief in support thereof, and the Respondent filed an an- swering brief to the Charging Parties' exceptions and the General Counsel's cross-exceptions. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its 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 the case, and hereby adopts the findings, conclusions,' and recommenda- tions 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 Recom- mended Order of the Trial Examiner and hereby orders that that the Respondent, Morgan Products, ' Although the facts create a suspicion that the Respondent may have been unlawfully motivated in failing to recall employee Lovel Hall, we agree with the Trial Examiner that the record does not establish that the Respondent 's action as to her violated Section 8(a)(3) However, in reaching our decision herein , we do not rely on the production records compiled and submitted by the Respondent. 95 Inc., Wyandotte, Michigan, its officers, agents, suc- cessors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order. TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE ROBERT COHN, Trial Examiner: These con- solidated proceedings, brought under Section 10(b) of the National Labor Relations Act, as amended (herein called the Act), were heard at Detroit, Michigan, on January 16 and 17, 1968. The con- solidated complaint was issued on December 13, 1967,1 based upon charges filed by an individual (Lovel Hall) on September 29, and by United Steelworkers of America, AFL-CIO (herein called the Union), dated October 17, subsequently amended December 11. The complaint alleges, in substance, that Morgan Products, Inc. (herein called Morgan Products or Respondent) as succes- sor and alter ego to Hargrett's Machine Products, Inc. (herein called Hargrett's), violated Section 8(a)(5) of the Act by refusing to bargain with the Union which had theretofore been the exclusive bargaining representative of Hargrett's employees in an appropriate unit. The complaint also alleged that the Respondent violated Section 8(a)(3) of the Act by laying off and thereafter failing and refusing to recall five employees of Hargrett's, and that Respondent independently violated Section 8(a)(1) of the Act by making certain threatening and in- timidatory remarks to employees respecting their membership in and sympathies toward the Union. By its duly filed answer, as supplemented by pretri- al proceedings in accordance with the rules and regulations of the National Labor Relations Board, Respondent admitted to certain jurisdictional and background allegations in the complaint, but de- nied the commission of any unfair labor practices. It was specifically denied that Morgan Products, Inc., is the successor to and alter ego of Hargrett's Machine Products, Inc. Upon the entire record in the case,' including full consideration of the posthearing briefs filed with me by counsel for the General Counsel and counsel for the Respondent, and from my observation of the demeanor of the witnesses while testifying, I make the following: ' All dates hereinafter refer to the calendar year 1967, unless otherwise specified. 2 Subsequent to the hearing, the Trial Examiner submitted to the parties proposed corrections to the transcript An objection to one such proposed correction was filed by Respondent . General Counsel concurred in the Trial Examiner's proposals, and suggested one additional correction to which no objection was filed. After due consideration , the Respondent's objection is overruled, and it is hereby ordered that the transcript be cor- rected in accordance with the said proposals. 172 NLRB No. 15 96 DECISIONS OF NATIONAL LABOR RELATIONS BOARD FINDINGS OF FACT I. JURISDICTIONAL FINDINGS; THE LABOR ORGANIZATION INVOLVED The complaint alleges, and the answer admits, that at all times material until on or about June 24, Hargrett's was a Michigan corporation maintaining its only office and place of business on Mulberry Street in the city of Wyandotte, Michigan, where it was engaged in the manufacture, sale, and distribu- tion of aircraft and/or industrial machine products. The parties stipulated that during the annual period prior to June 1967, Hargrett's, in the course and conduct of its operations, purchased goods valued in excess of $50,000 from points directly outside the State of Michigan. During the same period, Hargrett's sold and delivered products valued in ex- cess of $50,000 directly to customers located out- side the State of Michigan. It was further stipulated that subsequent to June 24, the Respondent, Mor- gan Products, Inc., on a projected basis, will purchase goods valued in excess of $50,000 from points located directly outside the State of Michigan. Based upon the foregoing admitted and stipulated facts, I find that Hargrett's and Morgan Products are employers engaged in commerce within the meaning of Section 2(6) and (7) of the Act, and that it will effectuate the policies of the Act for the Board to assert jurisdiction herein. The complaint alleges, the answer admits, and I find that the Union is, and has been at all times material herein , a labor organization within the meaning of Section 2(5) of the Act. II. THE UNFAIR LABOR PRACTICES A. Background As previously noted, prior to its ceasing of opera- tions on June 24, Hargrett's was engaged in the operation of a machine shop at 242 Mulberry Street, in the city of Wyandotte, Michigan. Until his death on June 28, 1960, Wilson Hargrett was the principal owner and president of the Company.3 Edward A. Morgan, Jr., a nephew of Wilson Hargrett, worked at the Company as a toolmaker and group leader during Wilson Hargrett's lifetime. Upon the latter's death, Morgan became president and general manager of the Company. He also served (along with two other men)' as a coexecutor of Wilson Hargrett's estate, which included the business of the corporation as a principal part. Thus, the operation of the business was subject to The record reflects that there was one other minority stockholder (Tri- al) who owned 22 percent of the business during Wilson Hargrett's lifetime However, after the latter's death, his estate acquired Trial's shares in 1966. One of these men was subsequently killed in an automobile accident ° Sales were actually handled by an outside agency called Manet Cor- poration the surveillance of the probate court. It should be noted also that Morgan possessed a contingent in- terest in the estate of Wilson Hargrett. That is, Wil- son Hargrett had one or more brothers and sisters, Edward Morgan, Jr., being the son of one of the latter. The will left Wilson Hargrett's assets to his widow for life with a remainder to his brothers and sisters, the children of whom would succeed to the interest of their parent should that parent predecease the widow. Thus, from June 28, 1960, until June 23, 1967, Hargrett's operated with Morgan as its chief execu- tive officer. In this capacity, Morgan managed and supervised every aspect of the operation including production, payroll, labor and personnel relations, purchasing, financing, and sales.' The Company utilized machinery and equipment characteristic of a machine shop such as screw machines, milling machines, drilling equipment, and punch presses. During the latter years of its existence, Hargrett's employed approximately 28 production employees, both male and female, who were employed in job classifications endemic to such operation (see list attached to the collective-bargaining agreement, G.C. Exh. 2).1 As noted above, Hargrett's was engaged in the manufacture and sale of small industrial products, primarily small aircraft parts. In the production of these parts, the principal materials utilized were aluminum, stainless steel, and carbon steel. The main suppliers of these materials were Carpenter Steel Company, Jones and Laughlin Steel Corpora- tion, Universal Cyclops Company, and several others. The principal customers were General Elec- tric Company, Continental Aviation Company, and Lycoming Aviation Corporation, in that order. From 1962 until on or about April 26, 1967, Morgan was also chief executive officer of another machine shop operation in the city of Wyandotte named V-Industrial Power, Inc. (herein referred to as V-Industrial).' That corporation manufactured and sold small industrial parts and engines, and was, to some extent, in competition with Hargrett's. Prior to 1965, V-Industrial operated from a plant located at 972 Adelaide Street in Wyandotte; how- ever, from 1965 until 1967, the Company operated out of Morgan's garage, doing only approximately $6,000 to $12,000 business annually. This did not include rentals of machinery by V-Industrial to Hargrett's, which amounted to $1,000 per month. On or about April 26, 1967, the corporate name of V-Industrial was amended to read Morgan Products, Inc., with Edward Morgan continuing as chief executive officer and sole stockholder. On I It was alleged in the complaint , and admitted by answer, that all production and maintenance employees, including truckdrivers, at Hargrett's, but excluding office clerical employees, guards and supervisors constitute an appropriate unit for bargaining within the meaning of Section 9(b) of the Act. ' Prior to April 1965, Morgan was 60 percent owner of the Company; subsequent to that time he was sole owner MORGAN PRODUCTS, INC 97 June 24, 1967, the said Morgan Products, Inc., purchased the assets of Hargrett 's, under circum- stances which will be more fully detailed hereinafter. B. Labor Relations History at Hargrett's Following an election conducted by the Board, the Union was, on or about December 5, 1963, cer- tified as the exclusive bargaining representative of the employees employed by Hargrett's in the aforesaid unit. On January 28, 1964, the parties concluded a collective-bargaining agreement which, under its terms, continued in effect until midnight on January 31, 1967.8 On or about the latter date, the parties agreed to extend the terms of such collective-bargaining agreement on a day- to-day basis. Thus, it remained in effect until Hargrett's ceased operations on June 24, 1967. In about December 1966, a petition was filed by one Fred Bowerman, a group leader, seeking decer- tification of the Union as the employees' represen- tative (Case 7-RD-690). After hearing, the Re- gional Director for Region 7, on January 31, 1967, issued his Decision and Order in that case dismissing the petition on the ground that said Bowerman was a supervisor within the meaning of the Act and, therefore, may not file such a peti- tion.9 Following the dismissal of the decertification petition, Hargrett's did, on or about February 1, file an "RM" petition seeking an election among the production and maintenance employees of the Company. Such an election was conducted by the Board pursuant to a Stipulation for Certification Upon Consent Election, on or about February 27. The Union won the election, but certification was withheld because, on or about March 5, Hargrett's filed objections to said election. On or about June 22, the Board overruled Hargrett's objections to the election and the Union was certified as the exclu- sive collective-bargaining representative for the production and maintenance employees of Hargrett's. Based upon the foregoing factual recitation, all of which is alleged in the complaint and admitted in the Respondent's answer, I find and conclude that the Union has been at all times since on or about December 5, 1963, the exclusive collective-bar- gaining representative of the production and main- tenance employees at Hargrett's in an appropriate unit. C. The Closing of Hargrett's; the Opening of the 13th Street Plant of Morgan Products As previously pointed out, after the death of Wil- son Hargrett, the business known as Hargrett's Machine Products, Inc., went into his estate and thus became subject to the supervision of the probate court. According to the testimony of Mor- gan, which is undenied on the record, the court, in either 1965 or early 1966, appointed a guardian ad litem whose function was to analyze and make recommendations respecting the investments of the estate . Subsequently, the guardian ad litem recom- mended to the court that the business was too high a risk for the estate, and therefore should be sold. It was also recommended that because of Morgan's conflict of interest, i.e., his ownership of V-Industri- al, that he be asked to resign as a coexecutor of the estate. Both recommendations were accepted by the court, and the latter, in about December 1966, issued an order simultaneously accepting Morgan's resignation as an executor and directing the sale of the business. Thereafter, in March, the remaining executor, one Hoelzle, submitted a method of sale which was approved by the court. Accordingly, Hoelzle, and his attorney Bernard Zinn, com- menced advertising the sale of the business through real estate brokers and in the Wall Street Journal in May. On June 7, Attorney Zinn, by letter, apprised prospective purchasers of more detailed informa- tion concerning the proposed sale, noting, among other things, that the board of directors of Hargrett's had fixed Saturday, June 24, 1967, as the time limit for accepting offers to purchase.1° On June 22, Morgan submitted his offer to purchase the assets of Hargrett's (G.C. Exh. 3(a)), which offer was accepted on June 24 by the board of directors of Hargrett's,11 which consisted, at that time, of Attorney Zinn, one Walt Hickey, and Mor- gan. The board of directors of Morgan Products consisted of Morgan, his wife, and one John R. McInerney, secretary of the corporation. Morgan testified that he planned and com- menced building the plant on 13th Street in June 1966, on land owned by himself and his wife. (The 13th Street plant is located approximately I mile from the Mulberry Street location of Hargrett's.) The building on 13th Street was finished in May 1967. During that month, Morgan utilized several part-time employees, who were on the payroll of Hargrett's for the purpose of painting and cleaning up the 13th Street plant. That is, these employees worked at the 13th Street plant while they were "punched in" at Hargrett's. This occurred six or eight times during this period. " See G C. Exh 2. B See G.C. Exh. 4 10 See G C. Exh 3(c). " It is noted at this juncture that although Zinn and Hoelzle attempted to sell Hargrett 's as a going concern, as indicated by the introduction to his letter of June 7 (and as testified to by Morgan ), Morgan merely purchased the assets of the corporation including equipment , land and buildings, ac- counts receivable, and inventories 364-126 O-LT - 73 - pt. 1 - 8 98 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Approximately 2 weeks prior to the sale, Morgan caused to be mailed to all the employees of Hargrett's, applications for employment at Morgan Products. On June 23, Morgan advised all em- ployees of Hargrett's, by telegram delivered to their home, that they were being laid off and not to re- port for work until further notice. On Monday, June 26, he employed approximately 12 to 15 former Hargrett's employees for the purpose of moving and setting up equipment and machinery. Morgan testified that, with the exception of one or two pieces, all of the machinery which was bought from Hargrett's was cleaned, painted, and installed in the 13th Street building. It is to be recalled that some of the machinery was leased to Hargrett's by V-Industrial, which was owned by Morgan. After the move, Hargrett's machinery constituted about 35-40 percent of Respondent's equipment. It was necessary for Morgan to acquire additional equip- ment since the 13th Street plant was larger than Mulberry Street (13,600 square feet as compared to 4,000 square feet). It was approximately the latter part of July that the 13th Street plant commenced production. It was at that time, and continuing for the next several months, that Morgan commenced offering the remainder of the laid-off Hargrett's employees (ex- cepting the five alleged discriminatees herein) em- ployment. However, Morgan also employed in- dividuals who had not previously been employees of Hargrett's, and concedely did not utilize the seniority provisions of the preexisting contract between Hargrett's and the Union.12 Morgan testified that there are approximately 28 employees presently working at Morgan Products of which about 20 are former Hargrett's employees. D. Analysis and Concluding Findings Respecting Alleged Refusal to Bargain The critical issue on this aspect of the case, as Respondent recognizes (Resp. br., p. 2), is whether the Respondent is the same "employing industry" as Hargrett's Machine Products, Inc.13 The United States Court of Appeals for the Fifth Circuit in N.L.R.B. v. Auto Ventshade, Inc., 276 F.2d 303 at 304, explicated the basic rationale as follows: Section 8(a) of the Act makes it an unfair labor practice to refuse to bargain in good faith with the certified representative of the em- ployees. National Labor Relations Board v. Fant Milling Co., 1959, 360 U.S. 301, 79 S. Ct. 1179, 3 L.E d.2d 1243. This obligation to bar- gain binds a successor employer. A mere change in ownership is not so unusual a cir- cumstance as to affect the certification. Na- tional Labor Relations Board v. Alamo White Truck Service, supra; National Labor Relations Board v. Armato, 7 Cir., 1952, 199 F.2d 800. The crucial question in determining if the cer- tification is binding on the successor employer is whether the employing industry remains es- sentially the same after the transfer of owner- ship. An examination of the facts in the record herein compels an affirmative answer to the statement of the issue . Thus, the facts abundantly establish that after the move, the nature and function of the em- ployment enterprise remained the same: the products produced are substantially similar to those manufactured at Hargrett's; substantially the same types of machinery and equipment are utilized by substantially the same employees performing the same job functions as had been performed at the prior location; the materials utilized to make the end products and the customers served by Respon- dent are substantially similar to those of Hargrett 's;14 and , finally, the basic employment relationship between management and employees remains the same.15 Thus, Morgan, as chief execu- tive officer and production manager, retains his position and continues to make all important deci- sions regarding labor relations policies as well as management policies relating to production, sales, and financing. Even lower supervision (excepting Bowerman) was moved from Hargrett's to Respon- dent, and performs substantially the same func- tions. Respondent argues that the foregoing considera- tions are not determinative since it operates at a different location with different vendor identifica- tion numbers, federal employer identification num- bers, and Michigan employer account numbers from these of Hargrett's. However, these dif- ferences are relatively inconsequential and without significance (see N.L.R.B. v. Auto Ventshade, 276 F.2d 303). "It can now be considered settled that if the transfer of assets and employees from one em- ployer to another leaves intact the identity of the employing enterprise, then the former's duty to recognize and bargain with an incumbent union devolves upon the latter as `successor employer. 11116 '= It is conceded by Respondent that although the Union demanded bar- gaining in September and October 1967, Respondent failed and refused to bargain with it taking the position that "it had no obligation to bargain" since it was neither a successor to nor an alter ego of Hargrett's. However, there is scant evidence in the record that Respondent unilaterally altered working conditions The most that can be stated is that Respondent tightened up on some plant rules particularly respecting the use by em- ployees of the telephone '® See N L R B v. Colten et al, d/b/a Kiddie Kover Manufacturing Com. pany, 105 F 2d 179 (C.A. 6) "General Electric Company, the foremost customer of Hargrett's (65 percent of sales ) remained the principal customer of Respondent 1i See , e.g., N L.R B v Fred P Weissman Co, 170 F 2d 952, 954 (C.A 6), cert denied 336 U.S. 972, Paul Stevens, Receiver of Carolina Scenic Stages, a corporation , et al., 109 NLRB 86, 107 16 Overnite Transportation Company v N L R.B , 372 F 2d 765, 767 (C A 4). MORGAN PRODUCTS, INC. 99 Respondent relies on a recent case of the Boards' dismissing the complaint because of failure to prove successorship . However, that case is factually distinguishable from the case at bar, the Board stat- ing: We deem it highly significant that Respon- dent here did not purchase a business, but purchased for addition to its already existing business the equipment utilized as a small part of the overall Isaacson operation. This is not a case in which the buyer assumes control of the seller's business and later decided to move it elsewhere. In the cited case, Northwest Galvanizing purchased Isaacson's galvanizing operation and equipment, and Isaacson discontinued its galvanizing division. After an initial period, Northwest ultimately merged and integrated the Isaacson operation within its own large operation. The whole transac- tion involved only a minority of Isaacson's em- ployees and, after the transfer, the former Isaacson employees represented only 20 percent of the respondent's employees engaged in the galvanizing business. The Board thus "view[ed] the transaction as an addition to Respondent's existing business rather than a continuance of the seller's operation." In the instant case , on the other hand, prior to the acquistion of Hargrett's assets, the Respondent was a mere shell of an operation, operating out of Mor- gan's garage, and leasing practically all of its equip- ment to Hargrett's. Here the record amply supports a finding (deemed necessary to a finding of succes- sorship) "that the purchase-sale transaction was merely a change in the ownership of an existing and continuing business operation."s Accordingly, based upon all of the foregoing, I find the Respondent to be the same "employing en- terprise" as Hargrett's, and therefore under a clear duty to recognize and bargain with the Union as the certified representative of its employees in an ap- propriate unit.'9 By its refusal to do so, it violated Section 8(a)(5) and (1) of the Act. E. The Alleged Section 8(a)(3) Violations As previously noted, Morgan, on or about June 23, sent all employees of Hargrett's notices of in- definite layoff due to the closing of Hargrett's. However, he commenced recalling some of the em- ployees (mostly male) to the 13th Street plant of Respondent the following Monday, June 26, for the 17 Northwest Galvanizing Co, 168 NLRB 26. 11 Northwest Galvanizing Company, supra, section III, penultimate para- graph 19 In view of the foregoing finding, I deem it unnecessary to consider and make a further finding as to whether the Respondent is the "alter ego" of Hargrett's. Respondent acknowledges in its brief (p 2) that if it be found a successor , it is responsible for any unfair labor practices of Hargrett's Machine Products , Inc., thereby rendering a finding of "alter ego" super- fluous to the circumstances of the instant case . See, e.g., Perma Vinyl Cor- poration, et al., 164 NLRB 968. purpose of moving the machinery, painting and cleaning the building, etc. In latter July, when he started getting back into production, Morgan com- menced hiring more employees, recalling former Hargrett's employees as well as hiring outsiders until he reached the present complement of 28. The complaint alleges that five female employees (Lovel Hall, Opal Rushing, Evelyn Musico, Sharon Miskovic, and Jewel Riffle) were laid off on or about June 24, and thereafter not recalled to the 13th Street plant for discriminatory reasons. Respondent avers that these employees were not employed because of their unsatisfactory records at Hargrett's and not because of any reasons con- nected with their asserted union activities. Lovel Hall had been an employee of Hargrett's since May 1963. Her principal job was milling machine operator, but she could also perform other operations in the plant. There is no question but that from the beginning, she was one of the most ardent advocates of the Union in the plant. She was on both the bargaining and the grievance commit- tees and, when the petition for decertification of the Union was filed in December 1966, she circu- lated a counterpetition to keep the Union in the plant. Several witnesses for the General Counsel testified credibly that on several occasions at the lunch table they heard the second shift leader, Bowerman , point to Hall and say "there sits the Union; when she goes the Union goes. 1120 In her performance as an employee, it appears that Hall's record was something less than satisfac- tory. Company records reflect that hers was the lowest compared with other employees, of average hours worked per week during the first 6 months of 1967; and her production was second lowest, being surpassed only by that of another alleged dis- criminatee, Rushing. Hall admitted receiving in December 1966, a disciplinary letter for absentee- ism. She filed a grievance concerning this letter, and a meeting was held with company representa- tives; however, the grievance was apparently dropped by the Union and the letter remained in ef- fect. Hall also testified that Union Representative Harcas told her that Morgan had complained to him on at least one occasion about Hall's produc- tion. With respect to the issue of union animus, there is evidence in the record upon which I may and do hereby find that Morgan was opposed to a union in his plant. Indeed, he candidly acknowledged that 10 At the hearing, General Counsel amended the complaint to allege that Bowerman was a supervisor within the meaning of the Act This was denied by the Respondent. I deem it unnecessary to detail evidence and make a finding on this issue since it is clear that the above-quoted declaration does not constitute an independent violation of Section 8(a)(I) but merely recognizes Hall's preeminence in union activities in the plant However, as previously noted, there is substantial evidence from other sources in the record upon which to base such a finding Further, a finding that Bower- man was a supervisor would not ipso facto impute to Morgan (who made the decision not to recall Hall) antiunion motives. 100 DECISIONS OF NATIONAL LABOR RELATIONS BOARD on several occasions he told his brother-in-law, Hiram Self, in conversations at their respective homes, that "I didn't feel a shop our size had any business having a union , but I made no statement that I would not take the Union." He also conceded that in a conversation with Lovel Hall he made the statement "I did not want a union but I didn 't state I wasn 't going to take them." The foregoing admis- sions certainly establish Morgan 's predisposition against the Union . However, such predisposition is clearly protected by Section 8(c) of the Act; something more is required to establish a Section 8(a)(3) violation , i.e., "discrimination ... to en- courage or discourage membership in any labor or- ganization." It is elemental that this means treating employees who are union advocates differently from those employees who do not support the Union. The evidence on this score is overwhelmingly against the General Counsel. In the first place , the collective-bargaining agree- ment between the Union and Hargrett's contained a union-security clause which required all employees, as a condition of employment , to acquire and main- tain membership in the Union following the 31st day of their employment. There is no evidence in the record that this provision of the contract was not complied with; accordingly, I may only assume that all employees in the unit were members of the Union at the time of the closing of Hargrett's. Nevertheless, as previously noted, 20 of Morgan Product's 28 production employees were recalled by Morgan after production commenced.21 Moreover, the evidence shows that Morgan not only hired rank-and-file employees, but also re- called all former union officials at Hargrett's with the sole exception of Lovel Hall. Thus, Margaret Kapanowski , who was the chief union steward and participated with Lovel Hall in grievance commit- tee sessions with management , was recalled in July. William Kirksey, the other member of the Union's grievance committee was one of the first employees hired at the 13th Street plant . Blaine McDougall, Thelma Hockett, and Fran Ludwig, all former Hargrett's employees and members of the union committee, were subsequently hired at Morgan Products. All of this evidence certainly indicates that whatever Morgan 's subjective opinion was vis- a-vis the Union, it was not implemented by failing 11 Morgan testified that some of the former employees voluntarily refused to come to work at Morgan Products. " It is further noted that the Respondent also hired Lurlie Hall, who is re- lated by marriage to Lovel Hall " In making this finding I have considered the testimony of Union Representative Harcas who testified that in a conversation he had with Morgan in November 1966, the latter stated that he (Morgan ) had no use at the new plant for those employees who were giving him trouble, men- tioning Hall "because of her union activities " Subsequently, Harcas clarified such testimony by stating that Morgan referred to "those who talked more union than they worked " Clearly , the fact that Hall's low to employ former union leaders after the move.22 I find and conclude, based upon a consideration of all of the foregoing , that the General Counsel failed to prove by substantial evidence that the Respondent violated Section 8(a)(3) in laying off and failing to recall Lovel Hall.23 Opal Rushing was not recalled to work at the 13th Street plant because , Respondent asserts, dur- ing the previous year at Hargrett 's she had received an excessive number of telephone calls and per- sonal visits at work for which she had received both oral and written reprimands . This is undenied by Rushing. Rushing held no office or position with the Union during her employment at Hargrett 's, although she ran unsuccessfully for a union office in 1964. She conceded signing the decertification petition in December 1966. She also signed a grievance, the nature, date , and resolution of which is undisclosed by the record. In view of her lack of prominence in union af- fairs, the unrebutted evidence of legitimate cause for the refusal to recall , and the fact, as noted above, of the Respondent 's recall of several Hargrett's employees who were officers and ad- vocates of the Union , I find and conclude that General Counsel failed to prove by a preponde- rance of the evidence that the Respondent failed and refused to recall Rushing in violation of Section 8(a)(3) of the Act.24 Evelyn Musico, Sharon Miskovic, and Jewel Riffle may be considered together since neither was a union official or otherwise outstanding in union af- fairs. The most that the record shows in this respect is that Miskovic and Riffle expressed prounion sym- pathies and delight with the union victory in February by shouting "yippee" at the announce- ment of the union victory . However, this was in a group of other employees not identified in the record, and the evidence is not substantial that Morgan was even aware of this expression of emo- tion . In view of these circumstances, considered with the factors noted above , i.e., that Respondent in fact recalled a majority of the union members at Hargrett's as well as a number of union officials, I am constrained to find and conclude that General Counsel did not prove a prima facie case of dis- crimination with regard to these three alleged dis- production was caused by her union talk and other activities does not im- munize her from appropriate disciplinary action _' Rushing testified that in a telephone conversation with Morgan in June, in which she requested employment, he responded that he was not taking "any of the troublemakers back ." After a leading question by the General Counsel , she testified that Morgan said that he was not taking "anyone for the Union" back . However, subsequently in her testimony, Rushing recanted , stating that the word "union" was not mentioned by Morgan in the telephone conversation but rather was mentioned in a con- versation she had with Morgan while employed at Hargrett 's in which the latter told her that "under no circumstances was he taking the Union [to the new plant] " MORGAN PRODUCTS, INC. 101 criminatees. I will therefore recommend that the complaint be dismissed as to them.25 F. The Alleged Section 8(a)(1) Violations The complaint alleges, in essence , that in May and early June, Morgan advised employees at Hargrett's that he would not take union adherents to the new plant and threatened that if anyone was suspected of organizing for a union at the new plant, that employee would be terminated. Lovel Hall testified that upon her return from sick leave on or about May 4, she had a long con- versation with Morgan most of which involved the Union . She stated that Morgan opined that "a union was no good in a small plant but it was a good thing in large plants . When he was moving his plant, he had no one to teach [sic ] him about the union whatsoever, any union person . . . . He said the first one that he suspected being a union person that he would get rid of them ." Hall testified to another conversation with Morgan in May, in which Morgan told her that he was building his own plant and planned to move there but that "he wasn't tak- ing anybody that was union with him." Morgan ad- mitted telling Lovel Hall of his plans to move the business and that he did not want the Union but de- nied stating that he had no intention of taking the Union or union workers to his place of business or that he would fire any employee suspected of being a union adherent. As previously noted, Morgan conceded telling several employees that he did not think unions worked well in small shops, and that he did not want a union in his shop . I have found such state- ments to be protected by Section 8(c) of the Act. It seems highly unlikely that Morgan would go further and make the threatening and unlawful statements attributed to him by Hall under the particular cir- cumstances . Thus, Morgan knew that Hall was an active union official who would certainly report such a statement to higher officials . Moreover, as previously pointed out, the collective-bargaining agreement required all employees to become union members so that any employee of Hargrett's rehired by Respondent was almost certain to be a union member. Finally, as the record shows, Mor- gan did, in fact, recall many union members as well as union officials. Accordingly, I do not credit Hall's version of the conversation and find that no violation of Section 8(a)(1) of the Act occurred with respect to her conversations with Morgan.26 On the other hand, Margaret Kapanowski, who impressed me as an honest and forthright witness, related a conversation with Morgan during the period immediately prior to the closing of Hargrett's. She stated that Morgan told of his plans for the new facility but that he did not want the Union there and that "if the Union was over there, he wouldn't open the shop."27 These assertions, which are undenied on the record, clearly are threatening and intimidatory of employee rights protected by Section 7 of the Act. As such, the constitute a violation of Section 8(a)(1). I so find.2 III. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of the Respondent set forth above, occurring in connection with the interstate opera- tions of the Respondent, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes burdening and obstructing commerce and the free flow thereof. IV. THE REMEDY Having found that the Respondent has engaged in unfair labor practices, I will recommend that it cease and desist therefrom and take certain affir- mative action designed to effectuate the policies of the Act. It having been found that the Respondent has refused to bargain collectively as required by the Act with the chosen representative of its em- ployees, it will be recommended that it bargain col- lectively and in good faith, upon request, with the S6 In the event that any reviewing authority does not concur in the foregoing finding , it may be stated that the Respondent proffered legiti- mate, unrebutted reasons for refusal to recall the three . Thus, with respect to Miskovic, Morgan stated that the reason for refusal to recall was absen- teeism , involvement in a production slowdown, and general clown-antics in the plant . Miskovic admitted that she agreed with Love] Hall to produce only a certain number of pieces per hour , although she attempted to ex- plain such conduct by asserting that " that was as many as you could get out anyway " Musico was not recalled because she broke a die on one occasion and on two other occasions she placed a piece in the die upside down or backwards . Riffle was involved in the agreement to limit production Counsel for the General Counsel, in his brief, requests the Trial Ex- aminer to take official notice of Case 7-RM-61 I, for the purpose of show- ing that the tally of ballots in the February election showed that the Union won by the narrow margin of four votes Counsel argues . "the Employer must have believed that he needed to get rid of five union adherents in order to swing the majority in his favor." However, aside from the fact that this is no more than plausible conjecture , it is also to be noted that Respon- dent did not question the majority status of the Union after the move, but contended there was no duty to recognize the Union because of the change in ownership and location of the business " I have heretofore found Opal Rushing to be an unreliable witness, ac- cordingly, I find no violation of Section 8(a)(1) as a result of any conversa- tion she testified she had with Morgan. " This conversation took place in the presence of one Fran Ludwig, who was not called as a witness. This is apparently the same person referred to in the testimony of Musico who stated in a prehearing affidavit "what I don't understand is that Morgan rehired Fran Ludwig [a union organizer] and Margaret Kapanowski [ active union stewardess] despite their union as- sociations." R" A final allegation of violation of Section 8(a)(1) contained in the com- plaint alleges that some time in July, Morgan advised nonrecalled em- ployees that they were not being recalled because they had been active on behalf of the Union and had been sympathetic thereto . I have previously discussed the evidence with respect to this allegation as testified by Opal Rushing and have found that her testimony did not sustain this contention Accordingly, I will recommend that the complaint be dismissed with respect thereto 102 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Union as the exclusive representative of its em- ployees in the aforesaid appropriate unit. It will also be recommended that the Respondent cease and desist from , in any like or related manner, infringing upon the rights of the employees guaranteed in Section 7 of the Act. Upon the basis of the foregoing findings of fact, and upon the entire record in the case , I make the following: CONCLUSIONS OF LAW 1. Respondent is engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. All production and maintenance employees, including truckdrivers, of Respondent employed at its 13th Street, Wyandotte, Michigan, plant, exclu- sive of office clerical employees, guards, and super- visors as defined in the Act, constitute a unit ap- propriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. At all times material herein, the Union has been the exclusive collective-bargaining representa- tive of the employees in the aforesaid unit within the meaning of Section 9(a) of the Act. 5. By refusing to bargain with the Union upon request concerning the terms and conditions of em- ployment of its employees in the aforesaid bargain- ing unit, the Respondent has engaged in and is en- gaging in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. 6. By interfering with , restraining , and coercing employees in the exercise of rights guaranteed in Section 7 of the Act, the Respondent has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 7. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. RECOMMENDED ORDER Morgan Products, Inc., its officers, agents, suc- cessors, and assigns, shall: 1. Cease and desist from: (a) Refusing to bargain collectively with United Steelworkers of America, AFL-CIO, as the exclu- sive bargaining representative of all production and maintenance employees, including truckdrivers, employed at its Wyandotte, Michigan, plant, exclu- sive of office clerical employees, guards and super- visors as defined in the Act. (b) Threatening employees that it would close its plant if the Union were selected as their collec- tive-bargaining representative. (c) In any like or related manner interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form labor organizations, to join or assist the above- named or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mu- tual aid or protection, or to refrain from any or all such activities except to the bxtent that such rights may be affected by an agreement requiring mem- bership in a labor organization as authorized in Sec- ticn 8(a)(3) of the Act. 2. Take the following affirmative action which will effectuate the policies of the Act: (a) Upon request, bargain collectively with United Steelworkers of America, AFL-CIO, as the exclusive representative of all employees in the aforesaid appropriate unit, with respect to rates of pay, wages, hours of employment, or other condi- tions of employment, and, if an understanding is reached, embody such understanding in a signed agreement. (b) Post at its plant in Wyandotte, Michigan, co- pies of the attached notice marked "Appendix."29 Copies of said notice, on forms provided by the Re- gional Director for Region 7, shall be posted by the Respondent, after being signed by the Respondent's representative, immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to its employees are customarily posted. Reasonable steps shall be taken by the Respondent to insure that said notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director for Region 7, in writing, within 20 days from the receipt of this Decision , what steps Respondent has taken to comply herewith." IT IS FURTHER RECOMMENDED that the complaint in these proceedings be dismissed in all respects save those on which unfair labor practices have been found. 29 In 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 Ap- peals Enforcing an Order" shall be substituted for the words "a Decision and Order " '" 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 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 Na- tional Labor Relations Act, as amended, we hereby notify our employees that: MORGAN PRODUCTS, INC. 103 WE WILL NOT refuse to bargain collectively with United Steelworkers of America, AFL-CIO, as the exclusive representative of the employees in the bargaining unit described below. WE WILL NOT threaten to close the plant if you select the above -named Union as your col- lective-bargaining representative. WE WILL NOT in any like or related manner interfere with, restrain , or coerce you in the exercise of your right to self-organization, to form labor organizations , to join or assist the above-named Union , or any other labor or- ganization , to bargain collectively through the representatives of your own choosing, and to engage in any other concerted activities for the purposes of collective bargaining or other mu- tual aid or protection , or to refrain from any and all such activities. WE WILL, upon request, bargain collectively with the above-named Union as the exclusive representative of all the employees in the ap- propriate unit, with respect to rates of pay, wages, hours of employment , and other condi- tions of employment, and if an understanding is reached, embody such understanding in a signed agreement. The bargaining unit is: All production and maintenance em- ployees, including truckdrivers, employed by Morgan Products, Inc., at its Wyan- dotte, Michigan, plant, excluding all office clerical employees, guards and supervisors as defined in the Act. MORGAN PRODUCTS, INC. (Employer) Dated By (Representative ) (Title) This notice must remain posted for 60 consecu- tive 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, 500 Book Building, 1249 Washington Bou- levard, Detroit, Michigan 48226, Telephone 226-3200.