Stateside Shipyard and Marina, Inc.

516 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Marion Simcox, Trustee of Wagner Shipyard and Marina, Inc., and Stateside Service, Inc. d/b/a Stateside Shipyard and Marina, Inc. and SIU De Puerto Rico afdiada a Seafarers International Union, Atlantic, Gulf, Lakes and Inland Waters District, AFL-CIO. Case 24-CA-2523 September 19, 1969 DECISION AND ORDER BY CHAIRMAN MCCULLOCH AND MEMBERS FANNING AND JENKINS On. January 8, 1969, Trial Examiner Alvin Lieberman issued his Decision in the above-entitled proceeding. finding that Respondent Stateside Service. Inc. d/b/a Stateside Shipyard and Marina, Inc. (herein referred to as Stateside) had engaged in and was engaging in certain unfair labor practices and recommending that it cease and desist therefrom and take certain affirmative action, as set forth in the attached Trial Examiner's Decision. He further found that Respondent Marion Simcox, Trustee of Wagner Shipyard and Marina. Inc. (herein referred to as Simcox) had not engaged in certain other unfair labor practices alleged in the complaint and recommended that such allegations be dismissed. Thereafter, the General Counsel and the SIU. the Charging Party herein, filed exceptions to the Decision and supporting briefs, and the Respondents filed a memorandum in support of the Trial Examiner's Decision.' 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 of the Trial Examiner with the following modifications. Respondent Simcox is charged with violating Section 8(a)(5) of the Act by taking certain actions without consulting with the Union, during a period in which Simcox was serving as the court-appointed trustee of Wagner Shipyard and Marina, Inc., an employer formerly in a collective-bargaining 'Subsequently , the Charging Party filed a motion in which it asked the Board to consider alleged admissions in certain eviction proceedings instituted by Stateside subsequent to the hearing in this case Respondents filed an answer to the motion which did not direuly challenge the proffer of documents made by the Charging Party, but rather sought to draw support for Respondent's own position from the documents submitted While the Board's Rules and Regulations and Statements of Procedure, Series 8, as amended, make no provision for such posthearing submissions of evidence, the Respondents have expressed no strong opposition to the proffer, and we shall grant the motion relationship with the Union. Simcox is charged with a further violation of Section 8(a)(5) by refusing to honor a Union request for bargaining during the period of his trusteeship. Respondent Stateside, a corporation wholly owned by Simcox and his wife, is alleged in the complaint to be the successor employer to trustee Simcox and thus to be responsible for remedying any violations of Section 8(a)(5) committed by Simcox. Respondent Stateside is also alleged to have violated Section 8(a)(2) of the Act, by lending certain unlawful assistance to Employees' Executive Committee of Stateside Service. Inc., an employee organization. The Trial Examiner found that Respondent Simcox had not violated Section 8(a)(5) and that, accordingly, Respondent Stateside had no remedial liability as a successor. He also found that Respondent Stateside had, as charged, violated Section 8(a)(2) by its dealings with the Employees' Executive Committee, and he recommended that Stateside be ordered to terminate its bargaining relationship with the Committee. Respondent Stateside has filed no exceptions to the 8(a)(2) findings and conclusions, and we shall adopt them pro forma and issue an order in accordance with the Trial Examiner's recommendations. With respect to the Trial Examiner's recommended dismissal of the 8(a)(5) allegation, the General Counsel and the Charging Party have filed exceptions, and we shall discuss these below, after the following summary of the evidence. Wagner Shipyard and Marina. Inc.. was a Puerto Rican corporation engaged in the building. repair, and storage of boats and boating equipment. The Union was the recognized bargaining representative of Wagner's employees and, at all material times herein, was a party to a collective-bargaining contract with Wagner. Captain Wagner had operated the business at a substantial loss for 6 or 7 years prior to 1967. Wagner's major creditors were Banco Credito Ahorra Ponceno and the Puerto Rico Industrial Development Company (hereinafter respectively called Banco and PRIDCO). Banco appears to be a private financial institution, and PRIDCO is a government agency. Both were apparently more interested in finding a successful operator of the shipyard and marina than in simply regaining possession of the assets, upon which they held a mortgage. During the summer of 1967, conditions at Wagner's business had seriously deteriorated. During that year, apparently three firms. including Respondent Stateside (Respondent Simcox is coow,ner. with his wife, and president of Stateside) indicated a desire to purchase Wagner's business, and consulted Banco and PRIDCO for this purpose. Banco and PRIDCO, wishing to continue Wagner's operations, recommended that Simcox hire an economic consultant for advice as to the possibility of rehabilitating Wagner's business and making it 178 NLRBNo 85 STATESIDE SHIPYARD AND MARINA, INC. successful. While the consultant essentially made a study for Simcox, he also studied Simcox's financial and operational abilities for the financial institutions. The result of the study was a recommendation to Simcox that he purchase Wagner's assets and lease, and a recommendation that Banco and PRIDCO give preference to Simcox upon foreclosure of the Wagner mortgage. On August 11, Simcox was appointed receiver of the assets, and he secured possession of the shipyard and marina on that day or on August 14, the following Monday. Subsequently, on August 16. 1967. as a result of the foreclosure proceeding, Simcox was made a court-appointed trustee "to continue the operation of the business, maintaining the property and avoiding the alleged damages [which the Court believed might stem prom closing of the property]." The court order states further that Simcox "shall have all the powers and obligations inherent upon his position, including such as . .. hiring necessary personnel . . . discharging employees. . . . and all other powers and obligations incidental to the administration of a business of that nature, Apparently, the employees of Wagner worked until August 16, finishing .ip a ship then in the shipyard, and were discharged on that day at Simcox's instruction that, after Captain Wagner and his men finished the ship, they should leave the shipyard. Wagner paid his employees off when the work was completed. On the day of, or the day before, the above discharge, Simcox brought in two employees from Stateside, Simcox's own operation, to start cleaning and refurbishing Wagner's facilities. About 2 or 3 weeks after becoming trustee, Simcox leased part of the premises to Stateside, which continued the rehabilitation begun by Simcox and began partial operation of the premises. Subsequently, in about mid-September 1967, Stateside began operating the total facility, including the shipyard and marina, under lease from trustee Simcox. eventually using from 20 to 60 employees, some of whom were transferred from Stateside's old plant. Apparently. Stateside's major business prior to its lease and purchase (discussed below) of Wagner's facilities was the repair and overhaul of motors. After Stateside took over the entire yard and marina, it operated at Wagner a motor shop, electric shop, machine shop, welding shop, and the marina railway. It appears that the work now done by Stateside at the Wagner yard is probably little different from that which Wagner's employees had been doing. Stateside, at its original location, had about eight employees; all of these eventually came to the Wagner installation as Stateside took over. In addition. as Stateside increased production at the former Wagner facilities, the general manager hired new employees by way of advertisements in the general labor market. There is testimony that, on occasion, the employee complement went as high as 517 60 employees. On about November 30. 1967, the Union made its sole request for bargaining , by a telegram addressed to "Stateside Service Inc." The request asked that the bargaining agreement be honored and referred to certain "problems" arising under the agreement because of the discharge of employees and other causes. Respondent Simcox replied that he had been operating the shipyard by order of the court , that he had no control over the discharge of the former employees, and that the Union would be notified when the court determined the case. The Union made no subsequent request that trustee Simcox should bargain with it . Neither Simcox nor Stateside had ever contacted the Union about any event which had taken place since the foreclosure, although Simcox had been aware of the Union's bargaining rights at the Wagner firm. In January 1968, Banco and PRIDCO purchased the assets at the foreclosure sale. About March 15, 1968, Respondent Stateside purchased the assets from the two creditors and apparently continued to operate substantially as had Wagner, except for the size of the employee complement . At no time were Wagner 's employees (except perhaps one supervisor) hired by Simcox or Stateside , despite occasional visits to the business by a few employees to search for work. The complaint alleges- ( 1) that Simcox , as trustee, was a successor employer to Wagner; (2) that trustee Simcox's termination of Wagner's employees, without notice to, or consultation with. the Union, was a violation of Section 8(a)(5); (3) that trustee Simcox's actions of discontinuing operation of the shipyard and leasing it to Stateside, without notice to, or consultation with, the Union, was violative of 8(a )( 5); (4) that trustee Simcox's refusal to honor the Union 's request , made on or about November 30, 1967. to, in the language of the complaint . "discuss some of the problems which had arisen out of the mass discharge of the employees when he took possession of the yard as trustee .. . and also problems arising out of the existence of the contract executed by the Union with Wagner Shipyard ..." was violative of 8(a )( 5); and ( 5) that Respondent Stateside has been, since March 1968, the successor employer of the business formerly operated by Wagner Shipyard, and that , as such, Stateside is responsible for the foregoing alleged unfair labor practices committed by Simeox while acting as trustee. It might be noted that the complaint does not allege that Respondent Stateside became a successor employer in the sense that the Union continued to have a right to represent Stateside's new and expanded complement of employees ; nor does the complaint allege any independent unfair practices by Stateside. but rather alleges only that Stateside, as a successor, is responsible for remedying Simcox's alleged violations. Cf. Perma Vinyl Corp., 164 NLRB No. 119, enfd . 398 F . 2d 544 (C.A. 5). 518 DECISIONS OF NATIONAL LABOR RELATIONS BOARD The Trial Examiner found that neither of the Respondents- Simcox as trustee or Stateside- was a successor employer, since neither hired a work force in which Wagner's employees constituted a majority of the appropriate unit The Trial Examiner further found that, assuming arguendo that Simcox, as trustee, was a legal successor to Wagner, as contended by the General Counsel, Simcox would step into Wagner's shoes vis-a-vis the Union: and, under the "management rights" clause of the Wagner-SIU contract. Simcox would have had the right, without consulting the Union, to decide the extent to which his business should operate or be shut down.' Thus, the Trial Examiner reasoned that, under the contract, Simcox had the complete right to shut down for repairs and, in the process, discharge the entire work force without bargaining with the Union. In addition, according to the Trial Examiner, Simcox's decision to lease the premises to Stateside, without consulting the Union, would not violate 8(a)(5) since it was an act which, if it had been done by Wagner, would have put Wagner completely out of business. and, under the Trial Examiner's reading of N.L R B. v. Darlington Manufacturing Co., 380 U.S. 263, and Ozark Trailers, Incorporated, 161 NLRB 561, an employer need not discuss such a decision with a union before implementing it. The General Counsel and the Union contend that Respondent Simcox. upon becoming trustee, became the employer of Wagner's enterprise. including the employees working prior to the August 16 discharge. that Simcox, as trustee, had a duty to consult the Union about his decisions to discharge the employees and subsequently to lease the premises to Stateside, and about problems relating to the collective-bargaining agreement; and that Respondent Stateside is Simcox's successor and alter ego and is thereby sublect to remedy the 8(a)(5) violations committed by Simcox. Respondents Simcox and Stateside contend that they are not successors, as they did not continue the employing industry, and that no violations or remedial responsibility may be charged to either of them. We agree with the General Counsel that the Trial Examiner erred in applying traditional tests of successorship to the determination of whether trustee Simcox was obliged to bargain with the Union under Section 8(a)(5). In normal arms-length transfers of business between unrelated sellers and purchasers, where the issue is whether the new employer has a prospective duty to bargain with the union recognised by the predecessor employer, we have looked to whether the "employing industry" remains substantially the same after the transfer. Johnson Ready-Mix C'o., 142 NLRB 437; Tallakson That clause provides, in relevant part "The management of the yard. including . the extent to which the locations covered by this agreement shall operate or be shutdown shall be solely and exclusively the prerogatives of the Company Ford, Inc., 171 NLRB No. 67: Thomas Cadillac. 170 NLRB No. 92. cert. denied 396 U.S. 889. Howev er. the question of successorship for purposes of a future bargaining obligation, in the sense of a "new" employer succeeding an "old" employer, is not raised by the present complaint. The complaint, rather, alleges that by virtue of his appointment as trustee of Wagner's property, Respondent Simcox became an alter ego of Wagner, a successor in law vis-a-vis the Union, with rights against and duties to the Union coterminous with those of Wagner. We think the theory of the complaint is. in this case, sound In his capacity as trustee, Simcox became guardian of Wagner's assets, with full authority to continue the operation of the business and to exercise all powers necessary to the administration of that business. Section 2(1) of the Act defines the word "person," as used in the statute. to include "trustees, trustees in bankruptcy, or receivers," and Section 2(2) defines an employer" as including "any person acting as an agent of an employer, directly or indirectly." [Emphasis supplied. It seems clear from these provisions that Congress has not foreclosed the Board from exercising jurisdiction over trustees such as Simcox. See N.L R.B. v W.C. Bachelder, 120 F.2d 574 (C.A. 7). And, on the evidence in the present case, it seems similarly clear that when Simcox became trustee of the Wagner assets, he also became Wagner's legal successor for purposes of collective bargaining, and by operation of* law was hound to honor any bargaining obligations owed by Wagner to the Union and privileged to assert any claims or defenses which Wagner might have asserted. The predicate of the complaint is that Simcox's status as trustee was that of "temporary custodian" of Wagner's business, and we believe that it may properly be so characterized. It therefore becomes unnecessary to comment upon the validity of the Trial Examiner's conclusion that, by application of the traditional criteria of successorship, a finding of successorship would he improper in the circumstances of this case. Despite our disagreement with the Trial Examiner as to the disposition of the threshold question of successorship, however, we concur in his ultimate conclusion that all of the 8(a)(5) allegations should be dismissed. As we have earlier noted. for purposes of alternative analysis after resolving the initial issue against the General Counsel. the Trial Examiner made a working assumption that Simcox-as-trustee was required to bargain in Wagner's stead. Having made such an assumption, he traced out its implications, and he decided that even if such a requirement had indeed devolved upon Simcox, the trustee had not violated Section 8(a)(5) in any of the particulars charged in the complaint. For the reasons given hereafter, we agree in result, if not in rationale. As previously described, the complaint alleges that Simcox, as trustee, violated a duty to confer STATESIDE SHIPYARD AND MARINA. INC. 519 with the Union which represented Wagner's employees before taking the action of terminating those employees on or about August 16, 1967. We agree with the Trial Examiner's opinion that, under the "management rights" clause of the bargaining agreement, footnote 2. supra. Wagner could have effected such a closure and consequent termination of employees unilaterally, without violating Section 8(a)(5), and that Wagner', trustee is equally entitled to invoke the Union's contractual waiver of consultation embodied in this clause. Any hiring done following the temporary closing, with the exception of some cleanup men, was done by Respondent Stateside, and the complaint contains no allegation that such unilateral hiring constituted an independent unfair labor practice by Stateside. The complaint further alleges that Sinicox violated Section 8(a)(5) by. unilaterally and without notice to the Union, discontinuing operation of the shipyard and leasing it to Respondent Stateside. The Trial Examiner thought that if Wagner had engaged in such conduct, it would have been effectively putting itself out of business, and he was of the belief. based on his analysis of rV L.R.B. v. Darlington Manufacturing Co.. 380 U.S. 263. and Ozark Trailers, Inc., 161 NLRB 561, that an employer is not required to bargain with an incumbent union about a decision to terminate his business. In our opinion, however, the same "management rights" clause which authorized Wagner (and therefore the trustee) to discontinue the employment of the working force without consultation with the Union also authorized Wagner (and the trustee) to lease the premises without conferring with the Union. In our view, therefore, it is unnecessary here to consider the extent of an employer's statutory duty to bargain with a union about his decision to cease operation of his business permanently. The final violation of Section 8(a)(5) complained of relates to an alleged failure by trustee Simcox to honor a request made by the Union on November 30, 1967. asking Simcox to, in the language of the complaint, ... "discuss some of the problems which had arisen out of the mass discharge of the employees when he took possession of the yard as trustee . . and also problems arising out of the existence of the contract executed by the Union with Wagner Shipyard." The Union's telegram in evidence, however, is addressed not to trustee Slmcox, but to "State Side Service Inc.," and the body of the telegram appears to confirm that the Union was making its demands upon Respondent Stateside and not upon Simcox qua trustee. The telegram states: We hereby request you to honor the outstanding collective bargaining agreement in effect with Warner shipyard and marine and meet with us on Monday December 4 at 9:30 A.M. or Tuesday December 5 9:30 A.M in our offices in 1313 Fernandez Juncos Ave second floor Santurce P R in reference to the above and to solve federal other important and urgente problem among other the mass discharge of union member the moneys due to the union and warefare and check off dues. Please confirm by telegram. (Verbatim.) Judging from the addressee and the content of the telegram, the implication is that the Union was asking Respondent Stateside, not trustee Simcox, to both honor the existing collective-bargaining agreement and to repair past failures to abide by the contract and to comply with statutory obligations. Simcox's reply informing the Union that he had been operating the yard under court order drew no response from the Union. Whether Respondent Stateside owed any independent bargaining obligations to the Union as a result of the eventual transfer of the business to it is not before us, for the complaint alleges no separate violations on the part of Stateside. What the complaint does allege is that trustee Simcox refused to honor a specific request for bargaining about the effects of his actions in regard to the transfer of the business, and we hold that the telegram was an inadequate instrument for making such a request and did not constitute, for present purposes, a proper application to Simcox in his capacity as trustee. We conclude that the Trial Examiner's recommended findings that the 8(a)(5) allegations against Respondents Simcox and Stateside be dismissed and that the 8(a)(2) allegations against Stateside he upheld should be adopted. While we modify his Conclusion of Law 5 to conform with our determination that Simcox, as trustee, was a successor to Wagner Shipyard, we shall otherwise order Respondent Stateside to comply only with the Trial Examiner's Recommended Order. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby adopts as its Order the Recommended Order of the Trial Examiner, and hereby orders that Respondent, Stateside Service Inc , d/b/a Stateside Shipyard and Marina. inc.. San Juan, Puerto Rico, its officers, agents, successors, and assigns, shall take the action set forth in the Trial Examiner's Recommended Order. TRIAL EXAMINER'S DECISION ALyiN LiEBFRMAN , Trial Examiner . The trial in this proceeding , with all parties represented , was held before me in Hato Rey. Puerto Rico, on August 15, 16, and 19, 1968. upon a complaint of the General Counsel' dated 'lhe complaint was issued on a charge and an amended charge filed. respectively, on February 21 and June 10, 1968, by SiU de Puerto Rn.o aliliada a Seafarers International Union, Atlanta , Gulf, Lakes and Inland Waters District, Ai•L-CIO. 520 DECISIONS OF NATIONAL LABOR RELATIONS BOARD June 18, 1968, and Respondents' point answer.' In general, the issues litigated were whether Respondent Simcox violated Section 8(a)(5) and (1) of the National Labor Relations Act, as amended (herein called the Act); and whether the corporate Respondent (herein called Stateside)' violated Section 8(a)(2) and (1) of the Act. Particularly, the questions for decision are as follows: 1. Is either Respondent a successor' to Wagner Shipyard and Marina , Inc. (herein called Wagner Sh ipyard)9 2. Did Respondent Simcox violate Section 8(a)(5) and (I) of the Act by not notifying SIU de Puerto Rico afiliada a Seafarers' International Union, Atlantic, Gulf, Lakes and Inland Waters District, AFL-CIO (herein subsequently called SIU) of, or consulting with it concerning, the termination of the services of employees of Wagner Shipyard' 3. Did Respondent Simcox violate Section 8(a)(5) and (1) of the Act by not notifying SIU of, or consulting with it concerning, the leasing of the facilities and equipment of Wagner Shipyard to Respondent Stateside? 4 Did Respondent Simcox violate Section 8(a)(5) and (1) of the Act by not complying with SIU's specific request for bargaining with respect to the termination of the employment of Wagner Shipyard's employees and other matters having a relationship to the collective-bargaining contract between SIU and Wagner Shipyard? 5. Is Respondent Stateside responsible for any unfair labor practice committed by Respondent Simcox? 6. Did Respondent Stateside violate Section 8(a)(2) and (1) of the Act in connection with its dealings with its employees and a committee which they chose to represent them, now known as Employees' Executive Committee of Stateside Service, Inc. (herein called the Committee), named in this proceeding as the party to the contract') Upon the entire record,` upon my observation of the witnesses and their demeanor while testifying,` and upon careful consideration of the arguments made and the briefs submitted by the General Counsel and Respondents, I make the following. FINDINGS OF FACT 1. JURISDICTION Respondent Stateside and Wagner Shipyard, both Puerto Rican corporations, are the entrepreneurial entities involved in this proceeding. Before September 1967, in which month its only plant, including all its machinery, was leased in its entirety to respondent Stateside,' Wagner Shipyard was engaged at Isla Grande, Puerto Rico, in building and repairing ships and in operating a marina. Since becoming the lessee of the premises formerly occupied by Wagner Shipyard, Respondent Stateside has, like Wagner Shipyard, conducted a shipbuilding and ship-repair business there and has also operated a marina. During 1966, the last full calendar year prior to the year in which the violations of Section 8(a)(5) of the Act set forth in the complaint are alleged to have occurred, Wagner Shipyard purchased and received in Puerto Rico materials valued at about $50,000 from suppliers located in various States of the United States In 1967 respondent Stateside purchased and received in Puerto Rico materials and equipment valued at more than S50,000 which originated outside of Puerto Rico. On the foregoing I find that Wagner Shipyard was, and Respondent Stateside is, engaged in commerce within the meaning of the Act. I further find that the assertion of jurisdiction over this matter by the National Labor Relations Board (herein called the Board) is warranted. Montex Drilling Cornpani', 122 NLRB 139. 140; Siemons Mailing Service, 122 NLRB 81, 85; Cantera Providencia, 111 NLRB 848. II. THE LABOR ORGANIZATIONS INVOLVED SIU and the Committee are labor organiLations within the meaning of the Act Ill. THE ALLEGED UNFAIR LABOR PRACTICES A. Introduction 'During the trail the complaint was amended to set forth the corporate Respondent's name as it appears in the caption The complaint was further amended by adding the words "of Stateside Service, Inc" after the word "Committee" in paragraph III, and by substituting the following sentence for the first sentence of paragraph VIII "On or about March 15, 1968 the Respondent Stateside Service purchased from Wagner's creditors, Fomento and Banco Credito y Ahora Ponceno, all the assets of the Wagner Shipyard " Also during the trial amendments were made in the answer Paragraphs 3 and 5 were amended so as to admit, respectively, paragraphs LLB and III of the complaint Before resting the General Counsel moved to conform the complaint to the proof by substituting the following sentence for the first sentence of paragraph VI "During the month of September 1967 Respondent Simcox decided under court order of the Superior Court of Puerto Rico to continue the operations of Wagner Shipyard and to lease the shipyard facilities and equipment to the Respondent Stateside Service, of which he is the sole owner and operator " After due deliberation I have concluded that that motion, on which decision was reserved, should be, and the same hereby is, denied 'Respondent Simcox is the president of Respondent Stateside 'Unless otherwise noted, when used in this Decision, "successor" and related words will be deemed to have the special technical meanings attributed to them in the field of labor management relations law See, in this connection , address by John H Fanning, Member, National Labor Relations Board, 1967 Texas Bar Convention (1967 Lab Rel Yearbook 284, 286). and Banta, Labor Obligations of Successor Employers . 36 Geo Wash L Rev 215 (1967) 'Issued simultaneously is a separate order correcting the stenographic transcript of this proceeding in several respects `Several witnesses who appeared in this proceeding were examined through an interpreter, Ana M Forsyth , who was duly sworn to serve in that capacity The complaint issued in this case contains two seemingly unconnected branches. The first deals with alleged violations of Section 8(a)(5) of the Act by Respondent Simcox The second relates to claimed unfair labor practices within the meaning of Section 8(a)(2) by Respondent Stateside.' Briefly, the first branch of this case concerns itself with events which followed the institution of a foreclosure suit against Wagner Shipyard in which Respondent Simcox was appointed trustee. Among these, the complaint alleges, was the termination of the services of employees of Wagner Shipyard by Respondent Stmcox; his discontinuance of Wagner Shipyard's operations; his leasing of Wagner Shipyard's facilities and equipment to Respondent Stateside, all without notifying, or consulting with, SIU. the collective-bargaining representative of 'The details of the leasing of this property and the part played in it by Respondent Simcox will be developed below 'In pertinent part the sections of the Act alleged to have been violated provide. Sec 8 (a) It shall be an unfair labor practice for an employer - (2) to dominate or interfere with the formation or administration of any labor organization or contribute financial or other support to (5) to refuse to bargain collectively with the representatives of his employees . STATESIDE SHIPYARD AND MARINA, INC. Wagner Shipyard's employees, and Respondent Simcox's subsequent refusal to meet with SIU pursuant to its request. Claiming that Respondents are Wagner Shipyard's successors, the General Counsel argues that Respondent Simcox was obligated, as such a successor, to discuss with SIU his discontinuance of the operations of Wagner Shipyard and the services of its employees, as well as the leasing of its premises to Respondent Stateside By not performing this duty and by refusing to meet with SIU in accordance with its specific request, the General Counsel maintains that Respondent Simcox violated Section 8(a)(5) of the Act. The position of Respondents is that they are not Wagner Shipyard's successors. They further argue that no bargaining obligation survived Wagner Shipyard's going out of business, which, they urge, was the end result of the institution of the foreclosure action. In broad outline the second branch of this case concerns itself with the manner in which Respondent Stateside dealt with its employees and the committee which they chose to he their collective-bargaining representative. In this regard. the complaint alleges, and the General Counsel argues, that Respondent Stateside violated Section 8(a)(2) of the Act by "instigat[ing] and urg[ing]" its employees to organize the Committee; by permitting its supervisors to participate in the Committee's business: and by negotiating a collective-bargaining agreement on behalf of its employees with the Committee, which included supervisors among its membership and "negotiators." Respondent Stateside and the Committee' deny the allegations of the complaint dealing with the claimed violation of Section 8(a)(2) of the Act by Respondent Stateside. Both contend.1' affirmatively, that the Committee is a bona fide labor organization, that Respondent Stateside had no part in its organization, and, in effect, that the dealings between Respondent Stateside and the Committee were conducted at arm's length. B. Facts and Conclusions Concerning the Relationship of Wagner Shipyard, Respondent Simcox, and Respondent Stateside to Each Other Wagner Shipyard" was incorporated in about 1957 In 1963 it borrowed substantial sums of money from Puerto Rico Industrial Development Company and Banco Credito V Ahorro Ponceno (herein respectively called PRIDCO and Banco) on promissory notes payable in monthly installments over a period of years These notes were secured by a mortgage on Wagner Shipyard's property Wagner Shipyard having lallen into default in making payments as required by its notes. PRIDCO and Banco instituted an action on August 11, 1967, to foreclose the mortgage which they held. Immediately upon filing suit an order was issued attaching the property which was the subject of the proceeding and naming Respondent Stmcox as receiver of the attached property. Several days later, on 'The Committee filed an answer and participated in the trial "All parties waived oral argument at the conclusion of the trial The Committee did not submit a brief and Respondents' brief does not deal with respondent Stateside' s alleged violation of See 8 (a)(2) of the Act Accordingly, the positions of Respondent Stateside and the Committee are gleaned from their answers , opening statements, and the evidence they adduced "The business of Wagner Shipyard , it will be remembered, consisted of building and repairing ships and in operating a marina 521 August 16,Respondent Simcox was designated to serve as trustee of Wagner Shipyard 's business On the same day, by direction of Respondent Stmcox, Wagner Shipyard's place of business was closed , except for that portion which was used as a marina , and its employees , then numbering seven, exclusive of an office worker, were paid off. None was ever thereafter employed by Respondent Stmcox. In this connection , the complaint does not allege that the termination of the services of Wagner Shipyard 's employees or Respondent Simcox's failure to rehire them constituted violations of Section 8(a)(3) of the Act At the time of its closing much of Wagner Shipyard's machinery and equipment was in a state of disrepair and the yard and buildings were in need of refurbishment Accordingly, for the next 2 or 3 weeks, Respondent Simcox undertook no ship-repair work . Instead he began, in this period, to clean the premises and restore its machinery and equipment . The employees hired by Respondent Simcox for this purpose were not on the payroll of Wagner Shipyard when it was closed on August 16. Early in September 1967 Respondent Simcox, as Wagner Shipyard 's trustee , leased its premises , machinery, and equipment to Respondent Stateside . Respondent Stateside continued the rehabilitation work begun by Respondent Simcox. Upon its substantial completion in mid-September the property once again came into use as a shipyard; this time, however , under the operation of Respondent Stateside. Respondent Simcox is the president of Respondent Stateside , and lie and his wife are its sole stockholders. Originally, respondent Stateside was engaged in San Juan, Puerto Rico. in the business of repairing electric motors. Upon becoming the lessee of the premises formerly occupied by Wagner Shipyard, Respondent Stateside transferred the employees who had been working in its San Juan repair shop to its newly leased location In addition to these employees Respondent Stateside hired others as the need arose . Except for one person, however, Respondent Stateside did not at any time after becoming lessee employ any of the people who formerly worked for Wagner Shipyard On January 31, 1968, in accordance with the judgment entered in the foreclosure suit against Wagner Shipyard the mortgaged property was offered for sale. PRIDCO and Banco , the plaintiffs in the action , being the only bidders, the property was sold to them. After the sale respondent Stateside continued to occupy the premises as a tenant until March 15, 1968, on which date it became the owner by purchase from PRIDCO and Banco. As noted, the General Counsel contends that Respondents are successors to Wagner Shipyard Respondents take a contrary position Whether one employer is another's successor turns upon the continuation of what has come to be known as '=the General Counsel also makes the argument, on brief, that respondent Simcox is "an alter ego of Stateside', that Respondent Stateside purchased Wagner Shipyard 's business with knowledge of Respondent Simcox's conduct during his tenure as its trustee , and that, therefore, Respondent Stateside "should be held to respond for the unlawful conduct of Siincox while he was Trustee of the business " I agree that Respondent Simcox is Respondent Stateside 's alter ego I also agree that Respondent Stateside is liable for whatever violations of the Act Respondent Simcox may have committed However, my agreement with the General Counsel in these respects avails him nothing in siew of my conclusion , as will be set forth below in detail, that Respondent Stmcox did not engage in the unfair labor practices alleged in the complaint 522 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the "employing industry."" In determining whether the "employing industry" has continued, the Board relies on several factors. As aptly summarized by John H Fanning, a member of the Board, in an address delivered on July 7, 1967, to the State Bar of Texas (Labor Law Section)," they are- (1) Whether there has been a substantial continuity of the same business operations; (2) Whether the new employer uses the same plant: (3) Whether he has the same or substantially the same work force; (4) Whether the same jobs exist under the same working conditions; (5) Whether he employs the same supervisors: (6) Whether he uses the same machinery, equipment, and methods of production. and (7) Whether he manufactures the same product or offers the same services. Consideration here can be centered on the third criterion mentioned by Mr. Fanning In virtually all cases in which a second employer has been held to be a successor of the first it has had "the same or substantially the same work force" as the first." In Johnson Ready Mix Co . 142 NLRB 437. 441. the Board made plain the stress it places on the element here under consideration in determining successorship issues. Supporting its decision that the respondent there, which purchased the business of Missouri Valley Ready Mix Concrete Co., Inc , was Missouri's successor the Board stated. Moreover, and most significantly, a majority of the employees in the unit . were formerly Missouri employees . . . performing the same functions they had performed for Missouri, and are directly supervised by former Missouri supervisors Conversely, when the second employer has not taken over a substantial number of the first's employees. the second is not deemed to be the first's successor Federal Electric Corporation, 167 NLRB No. 63, and NL.R.B. v. John Stepp's Friendly Ford, Inc., 338 F.2d 833, 836 (C.A. 9). typify this situation.16 The teaching of Federal Electric and Stepp's does not apply where the failure of the purchaser of an enterprise to hire the seller's employees has been held to be a violation of Section 8(a)(3) of the Act." In such a case the purchaser is considered to be the seller's successor even though he has not put any of the seller's employees to work. The rationale underlying this conclusion is that the "Probably the earliest enunciation of the "employing industry " concept appears in N L R B v. Cotten , et a! . etc . 105 F 2d 179, 182-183 (C A 6) "1967 Lab Re( Yearbook 284, 286 "Sec, for example , John Wiley & Sons, Inc v Livingston , etc, 376 U S 543, 545-546, 551, N L R B v Tempest Shirt Manufacturing Company, Inc. 285 F 2d 1, 4 (C A 5), N L R B v Auto Venishade, Inc., 276 F 2d 303, 305, 307 (C A 5), N L R B v Lunder Shoe Corp , etc . 211 F 2d 284, 287 (C A 1), N L R B v Blair Quarries . Inc . 152 F 2d 25, 26 (C A. 4), General Electric Compani•. 173 NLRB No. 83. Vallevdate Packers Inc. etc , 162 NLRB No 139, enfd 402 F 2d 768 (C A 5), Overrate Transportation Company, 157 NLRB 1185, 1189, enfd 372 F 2d 765 (C A 4). and Chemrock Corporation, 151 NLRB 1074, 1078 "In Stepp's, which the Board cited with approval in Federal Electric. the court denied enforcement to a bargaining order, covering a unit of salesmen, which was dependent upon the Board's finding that Stepp's was the successor to Westward Motors, Inc., whose assets it bought (141 NLRB 1065, 1071) Although a majority of its employees in other categories formerly worked for Westward, Stepp's hired only three of Westward's salesmen , who constituted a minority of Stepp 's sales force Because of the small number of Westward's salesmen carried over by Stepp's the court concluded that as to them there was no successorship Cf, however, Chemrock Corporation , 151 NLRB 1074, 1078-80 wrongfully discharged employees are entitled to reinstatement by the purchaser to the jobs they held with the seller "W"ith such reinstatement ... continuity in the identity of the work force may be presumed to follow," thereby establishing the purchaser's successorship. K. B & J. Young's Super Markets, Inc. v.N L.R.B., 377 F 2d 463, 465 (C.A. 9), cert. denied 389 U.S. 841. 1 have found that Respondent Simcox did not employ any people who had worked for Wagner Shipyard; that Respondent Stateside employed only one;" and that the paying off of the employees of Wagner Shipyard is not alleged in the complaint as constituting an unfair labor practice within the meaning of Section 8(a)(3) of the Act. Accordingly, I conclude, in the light of the foregoing principles, that neither Respondent is a successor of Wagner Shipyard. I will, therefore, recommend that paragraphs IVB and VIII of the complaint be dismissed. C. Facts Concerning the Alleged Violations of Section 8(a)(5) of the Act by Respondent Simcox Wagner Shipyard's employees were represented by SIU and covered by a collective-bargaining agreement This agreement, executed in 1966, was to remain in force for 3 years. Among other things, it provides, in an article entitled "Management Rights," that the "management of the yard, including . . . the right to decide . . . the extent to which the locations covered by this agreement shall operate or be shutdown . . shall be solely and exclusively the prerogatives of [Wagner Shipyard]... .11 19 As already noted, on August 16, 1967, upon Respondent Simcox's instructions Wagner Shipyard's operations were discontinued. its premises closed for repairs, and its employees paid off. Early in September 1967 Respondent Simcox leased Wagner Shipyard's premises. machinery. and equipment to Respondent Stateside. Although Respondent Simcox knew that SIU represented Wagner Shipyard's employees, he did all of these things without. as the complaint sets forth. "notice to . . or consultations with" SIU. In addition, as the complaint further sets forth, Respondent Simcox refused to comply with a specific request by SIU for a conference to discuss problems including those "which had arisen out of his mass discharge of [Wagner Shipyard's] employees." D. Contentions and Concluding Findings Concerning the Alleged Violations of Section 8(aX5) of the Act by Respondent Simcox Premised upon a claim that Respondent Simcox is a successor to Wagner Shipyard, the General Counsel argues that his not having notified, or consulted, SIU as to paying off Wagner Shipyard's employees, discontinuing its operations, closing its yard, leasing its premises to Respondent Stateside, and his failing to meet with SIU pursuant to its request constituted violations of Section 8(a)(5) of the Act The short answer to this argument is that, as I have found, Respondent Simcox is not a "in pertinent part this section provides See 8 (a ) It shall be an unfair labor practice for an employer--- (3) by discrimination in regard to hire or tenure of employment to encourage or discourage membership in any labor -orgameation "It will be remembered that on August 16, 1967, when its premises were closed, Wagner Shipyard employed seven people "Art IV, of the contract between Wagner Shipyard and SIU, received in evidence as G C Exh 6 STATESIDE SHIPYARD AND MARINA, INC. successor to Wagner Shipyard This being so, there is no basis for concluding that Respondent Simcox violated Section 8(a)(5) in any respect. Although I have concluded that Respondent Simcox is not Wagner Shipyard's successor, I will assume for the purpose of further discussion, insofar as this branch of this case is concerned, that I had come to a contrary conclusion. In my opinion. however, this would still be of no avail to the General Counsel. "[T]he obligation to bargain of a prior employer devolves upon his successor "2° As the successor, arguendo, to Wagner Shipyard Respondent Simcox's duty to bargain with SIU must, therefore. be measured by what Wagner Shipyard's similar obligation would have been had Wagner Shipyard done what Respondent Simcox did The first situation to be considered , in this regard, is the closing of Wagner Shipyard's premises for repairs, which was necessarily accompanied by the discontinuance of Wagner Shipyard's regular business and the paying off of its employees. In view of the "Management Rights" provision of the agreement between Wagner Shipyard and SIU,=' Wagner Shipyard could have done all this without being required to bargain with SIU. Shell Oil Company, 149 NLRB 283. 286-287, 289. Inasmuch as Wagner would have been under no duty to bargain with SIU concerning the closing of its premises for repairs with its resultant concomitants, including what the complaint describes as the "mass discharge of . . . employees," no bargaining obligation in this regard "devolve[d] upon [Respondent Simcox] its [']successor[']." The remaining situation respecting this phase of the case dealt with by the complaint is the leasing of Wagner Shipyard's facilities to Respondent Stateside by Respondent Simcox without bargaining with SIU. Whether this constitutes a violation of Section 8(a)(5) of the Act by . Respondent Simcox again depends upon whether Wagner Shipyard would have been required to bargain with SIU had it, rather than Respondent Simcox, its "successor." been the lessor. The resolution of this issue, in turn, hinges upon the nature of the transaction. Was it merely a lease, or was it something more final insofar as Wagner Shipyard, the "lessor," was concerned? Wagner Shipyard's only place of business was, as I have already found, its shipyard and marina located at Isla Grande. Puerto Rico After the lease of this property to Respondent Stateside, Wagner Shipyard, insofar as the record discloses, did not transfer its operations to another location, nor did it go into any other business. In the circumstances of this case, therefore, if Wagner Shipyard had been the lessor of its yard and marina at Isla Grande, it would have been Wagner Shipyard's ultimate act. In short, Wagner Shipyard would have put itself completely out of business. In N.L R.B v. Darlington Manufacturing Co., et al., 380 U.S. 263, 273-274, 275, the Supreme Court held "that when an employer closes his entire business, even if the liquidation is motivated by vindictiveness toward the union, such action is not an unfair labor practice." It was also held , in Darlington , that a discriminatory partial closing of a business would be violative of the Act. "Cruse Motors. inc.. 105 NLRB 242, 247 "This provision, it will be remembered , states that the "management of the yard, including the right to decide . the extent to which the locations covered by this agreement shall operate or be shutdown . shall be solely and exclusively the prerogatives of [Wagner Shipyard] . " 523 In New York Mirror. etc , 151 NLRB 834, 838, decided before the issuance of the Supreme Court's opinion in Darlington. the Board rejected a "contention that an employer's decision to terminate an entire operation . is outside the scope of mandatory bargaining." To the same effect, see also Apex Linen Service of Columbus, Inc , 151 NLRB 305, 306, 308; and -tieiderman, et al, etc.. 140 NLRB 678, 681, both of which, like New York Mirror, were decided before Darlington However, my attention has been called to no case decided by the Board after Darlington in which this principle was either reaffirmed or specifically set aside Although the Board has, apparently, issued no decisions on this issue since Darlington, it has not been silent in this area. In Ozark Trailers, Incorporated, et al. 161 NLRB 561, 564-565, the Board considered whether Darlington bore on a situation involving a partial closing of a business without bargaining. In deciding that Darlington was not relevant to this issue, the Board stated In these circumstances we must view the closing of the Ozark plant only as a partial closing of the Respondents' enterprise, and not a complete going out of business by the Respondents. Thus, we arc not here confronted with the question whether a decision to go out of business completely is a mandatory subject of bargaining under Section 8(a)(5) of the Act. Accordingly, we need not, and do not, determine the impact on that question of the Supreme Court's holding in N.L R.B v. Darlington Manufacturing Corp , 380 U S 263 It is sufficient to note that the holding cannot be relevant to the issue before us which involves Respondents' duty to bargain about the partial closing of their business We perceise nothing in that portion of the Darlington decision dealing with the discriminatory partial closing of a business which suggests the inapplicability of the collective-bargaining requirement of the Act to Respondents' decision to close down the Ozark plant. Indeed, as the Darlington decision affirms the propriety of the application of Section 8(a)(3) to a partial closing of a business, it would be anomalous to find that Section 8(a)(5) is without governing authority in such situations. We therefore find that the Darlington decision does not require dismissal of the complaint. and that the question of whether the Respondents violated the Act in unilaterally determining to close down the Ozark plant must be decided in the light of considerations set forth in the Supreme Court's decision in the Fibreboard /Fibreboard Paper Products Corp v. rV L.R.B , 379 U.S. 203] case. [Footnotes omitted.] As can be seen from the penultimate sentence of the foregoing quotation from Ozark the Board concluded that because the Supreme Court in Darlington held that Section 8(a)(3) of the Act could with "propriety" be applied "to a partial closing of a business" it would be an anomaly, in such a situation, to hold that Section 8(a)(5) did not also apply. It would seem, therefore, by a parity of reasoning, that because, as Darlington teaches, Section 8(a)(3) is not applicable to the closing of an entire business neither is Section 8(a)(5). On this basis it is my opinion that there is no bargaining requirement attendant upon the complete termination of an enterprise. Accordingly, had Wagner Shipyard, mstead of Respondent Simcox, been the lessor of its premises, thereby putting itself completely out of business, it would not have been required to bargain with SIU. This being so, no bargaining obligation, in this respect, "devolve[d] upon [Respondent Simcox.] its [']successor[']." 524 DECISIONS OF NATIONAL LABOR RELATIONS BOARD In sum, I conclude that Respondent Simcox did not violate Section 8(a)(5) of the Act in the manner alleged in the complaint. I will, therefore, recommend that paragraphs V, VI, VII, X, and the relating portions of paragraph XII of the complaint be dismissed. suggested by Respondent Stateside's president. was signed by him and each member of the committee chosen by the employees It was then ratified by all the employees at a meeting which Coll attended :s E. Facts Concerning the Alleged Violations of Section 8(a)(2) of the Act by Respondent Stateside" Victor A. Coll, who appeared in this proceeding as counsel for both Respondents, has been Respondent Stateside's lawyer for about 5 years He has also represented other business entities in which Respondent Simcox had an interest, including Simcox Refrigeration Company (herein called Refrigeration). The facts relating to this branch of the case involve Coll's dealings with Respondent Stateside's employees and a committee which they formed to serve as their collective-bargaining representative This committee appears later to have become known as Employees' Exectuve Committee of Stateside Service, Inc." In about mid-January 1968 Coll, at the invitation of an employee who had first ascertained that he was a lawyer, attended a meeting of employees of Respondent Stateside, Some of the employees present asked Coll whether they could form or join a union. Coll answered that the "same thing happened" at Refrigeration, whose employees had joined SIU Coll then read and explained to the employees the provisions of the contract between Refrigeration and SIU 24 Upon the completion of the reading the employees expressed a desire to have a similar contract with Respondent Stateside and asked Coll to prepare one. Coll agreed and stated that he would prepare a contract in draft form and discuss its provisions with the employees at a subsequent time. About a week or two later Coll returned to Respondent Stateside's premises with a tentative collective-bargaining agreement. In the interim the employees had chosen a committee to represent them and Coll reviewed his draft with Its members. A final draft, including changes suggested by the committee. was then prepared by Coll which he said he would submit to Respondent Stateside's president. Although at all times material to this proceeding Coll was Respondent Stateside's lawyer, he was also, as he stated, "acting as an adviser" to Respondent Stateside's employees in connection with the preparation of the proposed collective-bargaining agreement and Its submission to Respondent Stateside. Having done that, Coll made it clear to the committee representing the employees, as one of its members testified, that "he could not help [the employees] any more because he was the lawyer for the firm." On February 23, 1968, the draft agreement prepared by Coll, which by this time contained some amendments "As I noted in the introductory portion of this Decision, this branch of the case seems to have no relationship to the one dealing with Respondent Simcox's alleged violations of Scc 8(a)(5) of the Act "Employees' Executive Committee of Stateside Service. Inc . which for short I have called , and will from time to time continue to call, the Committee, has already been found to be a labor organization it was such, as will appear, even before it adopted its name "Coll, who represented Refrigeration in its collective-bargaining negotiations with SIU, testified that although he was not "in the habit of carrying labor contracts around with" him, the contract in question "happened to be" among a "mess of papers" which had accumulated in "back ol" his automobile F Contentions and Concluding Findings Concerning the Alleged Violations of Section 8(a)(2) of the Act by Respondent Stateside Respondent Stateside has denied that it violated Section 8(a)(2) of the Act in connection with its relationship to the Committee. Its principal contention. in this regard, seems to be that it dealt with the Committee at arm's length." Thus, in his opening statement, Coll stated that when respondent Stateside learned that its employees were desirous of becoming `'organized" he "explained to them what their rights were . . and they themselves afterwards formed a onion, had a meeting and submitted the contract, and we read it and discussed it and signed it." The evidence, however, shows that Respondent Stateside did much more than that. Its lawyer, Coll, met with its employees, advised them in the formulation of their bargaining position, prepared their proposed collective agreement, and, on their behalf, submitted it to Respondent Stateside. In this manner Respondent Stateside, through Coll, was, in essence, sitting on both sides of the bargaining table. Conduct of this nature falls within the proscription of Section 8(a)(2) of the Act. Powers Regulator Company. etc v. N L R B., 355 F.2d 506, 508 (C.A. 7). N L R B v Stow Manufacturing Co , 217 F.2d 900, 904 (C A 2), cert. denied 348 U S. 964. Respondent Stateside further violated Section 8(a)(2) by Coll's attendance at the meeting at which its employees ratified the collective-bargaining contract executed by Respondent Stateside and the committee chosen by its employees Nitro Super Market, Inc , 161 NLRB 505, 506, 516. Accordingly, I conclude that by the manner in which it dealt with the committee representing its employees, by entering into a collective-bargaining agreement with that committee, and by its lawyer's attendance at a meeting at which its employees ratified the agreement, Respondent Stateside engaged in unfair labor practices within the meaning of Section 8(a)(2) and (1) of the Act. "My findings as to this phase of the case are based upon G C Exh 9, in evidence , and a synthesis of the testimony given by Coll, respondent Stmcox, and Victor Rmcon, an executive member of the Committee A different and perhaps more damaging version, insofar as respondent Stateside is concerned, of the events here under consideration appears in a memorandum, initialed by Coll, prepared by a Field Examiner on the staff of the General Counsel on March 5, 1968, in evidence as G C Exh 8 Coll testified with respect to this document that when the Field Examiner asked him "in a conversational way about what took place" he "explained the whole situation in a general way." Coll further testified that although he signed the memorandum he "didn't read it word by word ", that it was "not the truth", and that it "is a misstating or misunderstanding of what [he] told" the employees of respondent Stateside when he first met with them Nor an experienced lawyer, such as Coll obviously is, to attempt to explain away in this manner a document which he signed is, indeed , to rely upon a broken reed Be that as it may, and despite my not being impressed with Coll's explanation, I have not based any finding upon the contents of G C Lxh 8 "As I have already noted, the Committee submitted no brief, and the brief submitted on behalf of Respondent Stateside does not discuss its alleged violation of Sec 8(a)(2) of the Act. STATESIDE SHIPYARD AND MARINA, INC. 525 IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMLRCE The activities of Respondent Stateside to the extent found violative of the Act occurring in connection with its operations set forth in section 1, 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. V. THE REMEDY Having found that Respondent Stateside engaged in unfair labor practices within the meaning of Section 8(a)(2) and (1) of the Act, my Recommended Order will direct it to cease and desist therefrom and to take such affirmative action as will effectuate the purpose of the Act. In this connection, as suggested by the General Counsel in his brief, my Recommended Order, among other things, will require Respondent Stateside to withdraw recognition from the Committee and to cease giving effect to the contract executed by it and the committee chosen by its employees. Upon the basis of the foregoing findings of fact and upon the entire record in this case, I make the following. CONCLUSIONS OF LAW 1. Respondent Stateside is an employer within the meaning of Section 2(2) of the Act and is engaged in commerce within the meaning of Section 2(6) of the Act. 2. Wagner Shipyard was an employer within the meaning of Section 2(2) of the Act and was engaged in commerce within the meaning of Section 2(6) of the Act. 3. SIU is a labor organization within the meaning of Section 2(5) of the Act. 4. The Committee is, and before adopting the name by which it is now known was, a labor organization within the meaning of Section 2(5) of the Act. 5. Neither Respondent Simcox nor Respondent Stateside is a successor of Wagner Shipyard. 6. Respondent Simcox did not engage in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. 7. By the conduct set forth in sections III. E and III, F of this Decision, Respondent Stateside has engaged in and is engaging in unfair labor practices within the meaning of Section 8(a)(2) and (1) of the Act. 8. The unfair labor practices engaged in by Respondent Stateside, as set forth in Conclusion of Law 7, above, affect commerce within the meaning of Section 2(6) and (7) of the Act_ Upon the foregoing findings of fact, conclusions of law, and upon the entire record in this case, I hereby issue the following: RECOMMENDED ORDER Stateside Service, Inc., d/b/a Stateside Shipyard and Marina, Inc.. its officers, agents, successors, and assigns. shall: 1 Cease and desist from: (a) Recognizing Employees' Executive Committee of Stateside Service, Inc., as the collective-bargaining representative of any of its employees for the purpose of dealing with that labor organization concerning grievances, labor disputes, wages, rates of pay, hours of employment, or any other term or condition of employment, unless and until Employees' Executive Committee of Stateside Service, Inc., shall have been duly certified by the National Labor Relations Board as the exclusive collective-bargaining representative of its employees in an appropriate unit. (b) Maintaining or giving any force or effect to its agreement executed on February 23, 1968, with the committee representing its employees, now known as Employees' Executive Committee of Stateside Service, Inc., or to any modification, extension, supplement, or renewal thereof, or to any superseding agreement, or to any other contract, agreement, or understanding entered into with Employees' Executive Committee of Stateside Service, Inc., unless and until Employees' Executive Committee of Stateside Service, Inc., shall have been duly certified by the National Labor Relations Board; provided, however, that nothing herein shall be construed to require Respondent Stateside Service, Inc., to vary or abandon any wage, hour, seniority, or other substantive feature of its relations with its employees which respondent Stateside Service, Inc., has established in the performance of the above-mentioned agreement to the prejudice of any rights or privileges acquired under that agreement by any of its employees. (c) In any like or related manner interfering with, restraining, or coercing employees in the exercise of their right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of' their own choosing, or to engage in other concerted activities for the purpose of collective-bargaining or other mutual aid or protection as guaranteed in Section 7 of the National Labor Relations Act, as amended, or to refrain from any or all such activities, except to the extent that such right may be affected by any agreement requiring membership in a labor organization as a condition of employment in conformity with Section 8(a)(3) of said Act. 2. Take the following affirmative action, which it is found will effectuate the policies of the National Labor Relations Act, as amended: (a) Withdraw and withhold all recognition from Employees' Executive Committee of Stateside Service, Inc., as the collective-bargaining representative of any of its employees for the purpose of dealing with that labor organization concerning grievances, labor disputes, wages, rates of pay, hours of employment, or any other term or condition of employment, unless and until Employees' Executive Committee of Stateside Service, Inc., shall have been duly certified by the National Labor Relations Board. (b) Post at its premises copies of the attached notice marked "Appendix."27 Copies of said notice, and copies of Spanish translations thereof, on forms provided by the Regional Director for Region 24, after being duly signed by an authorized representative of Respondent Stateside Service, Inc., shall be posted by said respondent 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 Stateside Service, Inc., to insure that said notices are not altered, defaced, or covered by any other material. "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 Appeals Enforcing an Order" shall be substituted for the words "a Decision and Order " 526 DECISIONS OF NATIONAL LABOR RELATIONS BOARD (c) Notify said Regional Director, in writing, within 20 days from the receipt of this Decision , what steps Respondent Stateside Service, Inc., has taken to comply herew ith. 28 IT IS FUWIHPR ORDERED that paragraphs IVB, V, V1,VlI, VIII, X, and the relating portions of paragraph X11, as well as such other paragraphs of the complaint which allege unfair labor practices not specifically found herein be, and the same hereby are, dismissed. "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 Stateside Service, Inc 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 National Labor Relations Act, as amended, we hereby notify our employees that. After a trial in which all parties had an opportunity to present their evidence, it has been found that we violated the law by committing unfair labor practices in connection with the way in which we dealt with Employees' Executive Committee of Stateside Service, Inc. Accordingly, we post this notice and we will keep the promises that we make in this notice. WE WILL Nor recognize, or have anything to do with, Employees' Executive Committee of Stateside Service, Inc., as your union unless and until a majority of you, in a fair secret election held by the National Labor Relations Board, choose that Committee to be your union for the purpose of dealing with us on your behalf as to wages, hours, working condition,,, and other matters affecting your lob WE WIt L stop giving effect to the contract that we and the Committee signed on February 23,1968. WE WIT. L NOT again comply with this contract unless and until a majority of you in a fair secret election held by the National Labor Relations Board choose Employees' Executive Committee of Stateside Service, Inc., to be your union. However, WE ARE NOT required to change any wages, hours, or working conditions which we have established as a result of our contract with that Committee, if such a change will be to your disadvantage or hurt you in any way. WE WILL No7 do anything like we did in connection with our dealings with Employees' Executive Committee of Stateside Service, Inc., which will interfere with, restrain, or coerce you in the exercise of any rights guaranteed to you by the National Labor Relations Act. In this regard, WF WII.L respect your rights to self-organization, to form, join, or assist any union, to bargain collectively through any union or representative of your choice as to wages, hours of work, and any other term or condition of employment. You also have the right, which WE \Vii L also respect, to refrain from doing so. STATESIDF SERVICE, INC., D/B/A STATESIDE SHIPYARD AND MARINA, 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 Boards Regional Office, 7th Floor, Pan Am Building, 255 Ponce de Leon Avenue, Hato Rey, Puerto Rico 00919, Telephone 809-765-0404, Extension 225.