Southline System Services, Inc.

SOUTHLINE SYSTEM SERVICES 449 Southline System Services, Inc., and Southline Wallace, Inc.' and Retail, Wholesale and Depart- ment Store Union, AFL-CIO. Case 16-CA-4307 July 27, 1972 DECISION AND ORDER BY CHAIRMAN MILLER AND MEMBERS FANNING AND JENKINS filed thereto by Southline Systems Services, Inc. and Southline Wallace, Inc.,' herein called the Respondent.2 The issues raised by the pleadings relate to whether Respondent violated Section 8(a)(1), (3), and (5) of the National Labor Relations Act, as amended, by certain conduct to be detailed hereinafter. Briefs have been filed by the General Counsel and the Respondent which have been duly considered .3 Upon the entire record made in this proceeding, including my observation of the witnesses who testified on the stand, I hereby make the following: On March 9, 1972, Trial Examiner Max Rosenberg issued the attached Decision in this proceeding. Thereafter, the General Counsel filed exceptions and a supporting brief, and Respondent filed an answer- ing brief. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the Trial Examiner's Decision in light of the exceptions and briefs and has decided to affirm the Trial Examiner's rulings, findings,2 and conclusions3 and to adopt his recommended Order. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Trial Examiner and hereby orders that the complaint herein be, and it hereby is, dismissed in its entirety. i The complaint was amended at the hearing to delete C Wallace Industries, Inc , as a Respondent Party herein 8 The General Counsel has excepted to certain credibility findings made by the Trial Examiner It is the Board's established policy not to overrule a Trial Examiner's resolutions with respect to credibility unless the clear preponderance of all of the relevant evidence convinces us that the resolutions were incorrect Standard Dry Wall Products, Inc, 91 NLRB 544, enfd 188 F 2d 362 (C.A 3) We have carefully examined the record and find no basis for reversing his findings. 3 We agree, for the reasons set forth by the Trial Examiner in his Decision, that Respondent is not a successor of U S.I F. Tower Corpora- tion Triangle Maintenance Corporation, 194 NLRB No 85 TRIAL EXAMINER'S DECISION STATEMENT OF THE CASE MAx ROSENBERG, Trial Examiner: This case was tried before me in Dallas, Texas, on August 10 and 11, 1971, on an amended complaint filed by the General Counsel of the National Labor Relations Board and an amended answer i At the hearing, the parties amended their respective pleadings to delete reference to C. Wallace Industries, Inc., as a party Respondent herein. 2 The complaint, which issued on June 25, 1971, is based upon charges filed and served on Southline Wallace, Inc. on March 24, 1971, and amended charges filed and served on Southlme System Services, Inc, C Wallace Industries, Inc, and Southline Wallace , Inc, on June 18, 1971 FINDINGS OF FACT AND CONCLUSIONS 1. BUSINESS OF THE EMPLOYER Southline System Services, Inc., herein called Southline, is a Texas corporation with its principal office and place of business in Dallas, where it is engaged in performing maintenance work on heating and cooling systems and performing janitorial services for offices and related buildings. Southline Wallace, Inc., herein called Wallace, is a Texas corporation with its principal office and place of business in Dallas, where it installs, repairs, maintains, and services plumbing, heating, cooling, ventilating, and sewage systems. During the annual period material to this proceeding, Southline and Wallace, which constitute a single, integrated enterprise, received goods and materials valued in excess of $50,000 which were transported to their places of business in Texas directly from States of the United States other than the State of Texas. The complaint alleges, the answer admits, and I find that said companies constitute a single employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED It is undisputed and I find that Retail, Wholesale and Department Store Union, AFL-CIO, herein called the Union, is a labor organization within the meaning of Section 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES The complaint alleges that Respondent violated Section 8(a)(1) of the Act on or about February 17, 1971,4 by threatening its employees with discharge because they joined the Union and selected it as their collective- bargaining agent. The complaint further charges that Respondent offended the provisions of Section 8(a)(3) by refusing to reemploy Herman Baxley, Elizabeth Gay Gibson, Gene Denton, W. D. Evans, Benzel Fullwood, Armond Wallace Greenbon, W. A. Loche, Jr., Richard L. Mervin, Robert L. Potts, Leland Stanford, and Betty J. Wright on March 25 because they joined the Union, engaged in other protected, concerted activities, and chose the Union as their exclusive bargaining agent. Finally, the 3 By postheanng letter, Respondent moved that I reopen the record for the purpose of receiving Resp Exh. 6 which counsel inadvertently omitted introducing into evidence at the trial Objecting only to its relevancy, the General Counsel does not oppose the receipt of the exhibit Accordingly, it is hereby made a part of the record. 4 Unless otherwise indicated, all dates herein fall in 1971 198 NLRB No. 71 450 DECISIONS OF NATIONAL LABOR RELATIONS BOARD complaint asserts that Respondent ran afoul of Section 8(a)(5) of the statute when, on and after March 24, it refused to recognize and bargain with the Union as the exclusive representative of its employees. Respondent, for its part, denies the commission of any unfair labor practices. It is undisputed and I find that, prior to 1967, an entity known as Ling Temco Vought owned, operated, and maintained an office building in downtown Dallas, Texas, known as the LTV Tower. Pursuant to a Board-conducted election in 1966, the United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) received a certification from the Board as the collective- bargaining representative of all service and maintenance employees, who were employed by Ling Temco Vought, excluding guards, watchmen, and supervisors as defined in the Act. In 1967, the unit employees, by a private poll, voted to transfer their allegiance to the Union. In the same year, U.S.I.F. Tower Corporation, herein called U.S.I.F., purchased the building and assumed the obligation of recognizing and bargaining with the Union regarding the service and maintenance personnel. During a 4-year span, U.S.I.F. and the Union negotiated three labor contracts covering those employees, the last of which was scheduled to expire on March 24. In early January, Respondent was invited by U.S.I.F. to submit a bid, along with other companies, with a view to taking over the total mechanical operations at the LTV Tower.5 On January 25, Respondent entered its bid. The following day, while the Union and U.S.I.F. were bargain- ing over a new agreement, Respondent announced to the Union that it was planning to subcontract the maintenance work. By letter dated February 15, V. Scott Kneese, the attorney for U.S.I.F., informed James Q. Stewart, the Union's International representative, that: At the January 26, 1971 meeting, the company advised you of a contemplated subcontracting of the work presently being done by bargaining unit employees. We discussed that the company had not reached a decision as to whether to have a contractor take over such functions or whether to continue such functions itself. However, the company had received bids from several contractors and we advised you that it appeared it would be more economical to have a contractor perform such work. The company opened this matter for bargaining and the union requested that the company advise it of its decision as soon as possible and that the parties would be spinning their wheels to negotiate until a decision was reached. It was agreed to schedule another meeting as soon as a decision could be reached. At our meeting held February 10, 1971, you were advised that while the company had determined that it would be best to use a contractor to perform the bargaining unit work, the actual contractor had not been selected. On behalf of the union, you requested that as soon as the company reached a decision as to which contractor would be awarded the work, that we advise you so that you might contact the new employer. In this regard, on behalf of our client, U.S.I.F. Tower Corporation, we hereby notify you that the decision has been reached to utilize the services of Southline Wallace, Inc., 2224 Summer, P. O. Box 5386, Dallas, Texas 75222. Southline Wallace, Inc.'s telephone number is 742-7693 and should you desire to contact such company, the appropriate person would be Mr. B. K. Hoyle, General Manager. Again we emphasize the company's willingness to bargain concerning all facets of this contracting situation and should you desire further information or wish to discuss the matter further with us, please do not hesitate to advise the undersigned. Upon receiving this intelligence, Stewart contacted Hoyle to schedule a meeting to discuss recognition of the Union and contract negotiations with Respondent after the existing agreement with U.S.I.F. expired on March 24. This meeting was conducted on February 26. At the outset of the session, Stewart requested that Respondent recognize the Union as the exclusive agent of the unit employees and negotiate a labor contract covering their terms and conditons of employment. According to the testimony of Stewart, Hoyle replied that "he did not have a signed contract [with U.S.I.F.] as of that time, but he expected to get one in the next few days. And that the purpose of contracting out the work was to get rid of the Union, and that he could not accomplish that if he bargained with the Union. And that he did not intend to recognize the Union or employ any of the people that were working at that time in the LTV Tower bargaining unit." Hoyle then recounted that "he had assumed a contract in Houston a few years back where he kept one Union man, a plumber in that unit, and that fellow had succeeded in organizing the rest of them, and it took him a year to bust the Union out, and he dust didn't want to go through that again." Stewart exhorted Hoyle "to consider all of these employees for employment with Southline Wallace, and pointed out that they had been there in most cases a number of years, had considerable seniority and they were skilled people." Hoyle replied that "he had employees that he had been interviewing and hired to run that building when he assumed the contract. That he would take over at midnight on March 24th, and he would have his own crew." In his testimony, Hoyle confirmed that Stewart request- ed recognition and bargaining rights at the February 26 session, that Stewart insisted Respondent employ all of U.S.I.F.'s maintenance personnel, and that Hoyle declined recognition and refused to hire the Union's members on the ground that Respondent already had hired a cadre of employees to perform the work. When questioned as to whether any mention was made during this conversation about a firm in Houston where it took him a year to rid himself of a union, Hoyle replied that "I guess I should have kept my mouth shut at that point, it is brought out now, but I did say this, that before I came with our company now that I had heard of a company in Houston who had employed one union plumber and within a year they were full of union. And it took them quite a while to get that all straightened out." Hoyle testified without As indicated above, Respondent is engaged exclusively in providing maintenance subcontracts with building operators in the Dallas area. s maintenance services for commercial building operators It has several SOUTHLINE SYSTEM SERVICES 451 contradiction and I find that the labor organization in fact became ensconsed as the collective representative of that company's maintenance complement and that Respondent subsequently purchased that corporate entity. When asked specifically whether he used the words "it took a year to bust the union out," Hoyle answered, "I did not say that. I may have said it took a year to do this, that, or the other, but I specifically-I have been thinking about that this morning-did not use those words." Finally, when queried as to whether he stated that the sole purpose for subcontracting was to eliminate the Union, Hoyle respond- ed, "Again, I did not take notes. I cannot recall my exact words, but to the best of my kniowledge I did not say exactly those, that it was designed to get the union out of the building, no." I am hard-pressed to fathom how the General Counsel can seriously maintain that Hoyle's utterances at the February 26 meeting evinced an illegal attitude of discrimination against the employees in the maintenance unit or threatened them with loss of job security because they embraced the Union as their bargaining agent. With respect to Stewart's accusation that Hoyle stated that the purpose of the portented subcontract was designed to rid U.S.I.F. of the Union, I would note that the General Counsel has not charged that company with any violation of the Act in its subcontracting negotiations with Respon- dent, nor has Respondent been charged with entering into those negotiations with U.S.I.F. in order to remove the Union as the collective agent of the unit employees. Moreover, with regard to Hoyle's comments about the employer in Houston, it is undisputed and I find that the labor organization there involved succeeded as the bar- gaining agent of the employees and, so far as appears on this record, Respondent purchased that business and has lawfully dealt with that union. In sum, I find that, at the. February 26 meeting, Hoyle informed Stewart that the former declined to recognize and bargain with the Union on the grounds that Respondent had not yet received a contract award from U.S.I.F., that the Union did not then represent any of Respondent's employees, and that Respondent had already procured its own work comple- ment to man thejob. Continuing the narrative, on March 3, Stewart dis- patched a letter to Attorney Kneese which recited that "Since receiving your letter dated February 15, 1971, the Union has met with Mr. B. K. Hoyle, General Manager of Southline Wallace, Inc. Hoyle advises us that at this time he does not have a contract to operate the U.S.I.F. Tower Corporation, Dallas, Texas. The Union is therefore requesting that you meet with us on Friday, March 12, 1971 at 2: 00 p.m. to resume our negotiations ." So far as appears on this record, this meeting apparently was never convened. Thereafter, on March 23, Stewart wrote to Hoyle to report that the Union had been informed that Respondent was scheduled to assume a maintenance contract at the LTV Tower effective March 25. In this letter, Stewart stated that "The Union is therefore requesting that you bargain with [the Union as] the certified bargaining representative for the employees who perform this work. We are requesting a bargaining session to be held Friday, March 26, 1971 at 10:00 a.m. at Federal Mediation and Conciliation Service . . . . Please advise the Union if the date , time and place is agreeable to you." Without awaiting a reply, on March 24 the Union filed the original charge in this proceeding. On the same day, Attorney Kneese sent a letter to Stewart summarizing the results of the negotiations between U.S.I.F. and the Union regarding the termination of the collective agreement on March 24 . These proposals, to which Stewart agreed, provided that, as a result of their termination by U.S.I.F., that company would pay the unit employees accumulated sick leave, vacation benefits , and severance pay. At the stroke of midnight on March 24, all of the individuals employed by U.S.I.F. were paid off and terminated. On the morning of March 25, the Union established a picket line in front of the LTV Tower with signs protesting that Respondent was "unfair" to the Union. On March 26, Hoyle for the first time contacted his counsel, Attorney W. Randolph Elliott. Elliott advised his client that the latter could not legally recognize or bargain with the Union because that labor organization did not represent any of Respondent's employees. Hoyle relayed this advice to Stewart, who retorted "we would settle it at the courthouse." This comment impelled Hoyle to again communicate with Elliott and a meeting was set for later that day. During the meeting, Stewart announced to Hoyle and Elliott that the Union would terminate the strike and order all striking members to report for employment with Respondent. Hoyle replied that Respondent would consid- er the individuals for employment , but cautioned that he could not foretell how many openings existed. Hoyle added that, in the event that he could not immediately absorb all the strikers, the remainder would be placed on a preferential hiring list . In consequence of this colloquy, Stewart mailed a letter to Hoyle on March 31 announcing that the Union had decided to abandon the strike , effective immediately, and that it had instructed all strikers to report for work with Respondent on April 1. The letter closed with the request that all striking employees be reinstated, reemployed, and/or considered for employment to their former or substantially equivalent positions. On the same day, Attorney Elliott wrote to Stewart that: Southline is willing to consider for employment each and every one of the subject individuals who makes application for employment at Southline's offices ... . Southline will consider these individuals on the basis of their qualifications and previous experience and the other standard criteria which it applies to prospective employees. At present, there are a limited number of openings for new employees. Therefore, even if all of the subject individuals are otherwise qualified and willing to accept employment, it may not be possible for Southline to offer all of them an immediate position. These individuals will be considered for employment on the same basis as' all other applicants, and the application of any individual who does not secure an immediate position will be retained on Southline's waiting list and said individuals will be offered employment when additional positions become availa- ble. Commencing on April 1, the Respondent undertook to 452 DECISIONS OF NATIONAL LABOR RELATIONS BOARD interview the applicants for employment. At most, four were thereafter employed at the LTV Tower, others were placed on a preferential hiring list, and still others declined to seek work with Respondent. The General Counsel views this case as "one of classic successorship" and contends that, since the "employing industry" remained the same under Respondent's aegis, and since other traditional "successorship" features were evident, Respondent was under a statutory duty to recognize and bargain with the Union over the terms and conditions of employment for the unit personnel employed by U.S.I.F. He further argues that, because Respondent, as a successor to U.S.I.F., did not retain the latter's maintenance complement, it thereby discriminated in regard to the hire and tenure of employment of those employees inasmuch as its failure to retain them was prompted solely by their adherence to the Union. Finally, he asserts that Respondent illegally threatened the then- existing maintenance unit by Hoyle's statements to Stewart on February 26. In my opinion, the facts here presented draw a portrait entirely different from that of the usual successorship case. In Southland Manufacturing Corp.,6 the'Board noted that, in making a determination as to whether a "new employer" is actually a "successor," consideration must be given to whether or not "there has been a continuity of the corpus and operation of the business as an enterprise `in the employing industry' as disclosed," inter alia, "by some essential elements of a substantial continuity in the work force The facts, as heretofore found, fail to establish one of the most significant elements in a successorship; namely, a substantial continuity in the work force. Respondent engages exclusively in providing main- tenance services for commercial building operators and has several maintenance subcontracts to perform such services in the Dallas area. It is undisputed that, as early as February 26 when Hoyle met with Stewart, approximately a month before Respondent undertook the subcontract, Hoyle told Stewart that the former "had employees that he had been interviewing and hired to run that building when he assumed the contract. That he would take over at midnight on March 24th, and he would have his own crew." When Respondent took over the maintenance operations on the evening of March 24, not a single employee utilized had been an employee of U.S.I.F. I have heretofore found that, during their conversation on February 26, Hoyle did not inform Stewart that the contemplated subcontract was designed to remove the Union from the representation picture and that Hoyle did not state that he had been instrumental in defeating another labor organization in Houston in light of the uncontroverted evidence that Respondent bought out the Houston enterprise and continued to deal with that union. Following the subcontract on April 1, Respondent inter- viewed the former employees of U.S.I.F. and, at best, hired four of them for work at the LTV Tower. So far as appears on this record, the employment of these four individuals did not afford the Union a majority status among Respondent's work complement at the building. In short, I am convinced and conclude that Respondent was not a successor of U.S.I.F. when it undertook the subcontract on March 24 and that U.S.I.F.'s employees did not become the employees of Respondent on that date. I therefore conclude that Respondent did not violate Section 8(a)(5) of the Act by refusing to recognize and bargain with the Union on and after March 24. I also conclude that Respondent did not offend the provisions of Section 8(a)(3) by refusing to employ Baxley, Gibson, Denton, Evans, Fullwood, Greenbon, Loche, Jr., Mervin, Potts, Stanford, or Wright on that date. Finally, I conclude and find that Respondent did not violate Section 8(a)(1) by Hoyle's statements to Stewart on February 26. I shall therefore recommend that the complaint be dismissed in its entirety. RECOMMENDED ORDER IT IS HEREBY RECOMMENDED that the complaint herein be, and it hereby is, dismissed in its entirety. 6 186 NLRB No I1 1 , TXD sec. III, A