International Offset Corp.

854 DECISIONS OF NATIONAL LABOR RELATIONS BOARD International Offset Corp.; International Offset of Long Island Inc.; All Island Litho Corp.; Morel Litho of Long Island Inc . and Henry Becker, Individually and as Agent and Representative of the said Corporations and Graphic Arts International Union, Local 119 B, New York, AFL-CIO; Local 1, Amalgamated Lithographers of America, AFL-CIO and National Industrial and Profession- al Employees Union, Party to the Contract. Cases 29-CA-30 10 and 29-CA-3016 May 23, 1974 DECISION AND ORDER BY CHAIRMAN MILLER AND MEMBERS KENNEDY AND PENELLO On September 28, 1973, Administrative Law Judge Samuel M. Singer issued the attached Decision in this proceeding. Thereafter, the General Counsel and Respondents filed separate exceptions to the Admin- istrative Law Judge's Decision, each with a support- ing brief, and Charging Party, Graphic Arts Interna- tional Union, Local 119, B, New York, AFL-CIO (hereinafter referred to as Local 119) filed a "letter in lieu of exceptions and 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 attached Decision in light of the exceptions and briefs and has decided to affirm the rulings, findings,' and conclusions of the Administrative Law Judge only to the extent consistent herewith. 1. Our major disagreement with the Administra- tive Law Judge goes to his finding that International violated Section 8(a)(5) and (1) of the Act. The charges and the complaint expressly allege violations of Section 8(a)(1), (2), (3), and (5) on the theory that Respondent International had not in fact terminated its printing and bindery business but had continued it at another location as Morel; and, that, in any event, International and Morel constituted a single employer within the meaning of the Act. The complaint asserted that International's actions were i General Counsel and Charging Party Local 119 have excepted to certain credibility findings made by the Administrative Law Judge. It is the Board's established policy not to overrule an Administrative Law Judge's resolutions with respect to credibility unless the clear preponderance of all of the relevant evidence convinces us that the resolutions are incorrect. Standard Dry Wall Products, Inc, 91 NLRB 544, enfd 188 F.2d 362 (C.A 3, 1951) We have carefully examined the record and find no basis for reversing his findings. Respondents have excepted to the Administrative Law Judge's finding in his jurisdictional statement that Respondent Henry Becker was the manager and operator of Morel Litho of Long Island as being an error in the transcription Consistent with other portions of the Administrative Law taken to avoid its bargaining obligations to Local 119 anti to Local 1, Amalgamated Lithographers of America, AFL-CIO (hereinafter referred to as Local 1); that the layoff of employees at International was part of that unlawful scheme; and that Respondents assisted in the establishment of the National Indus- trial and Professional Employees Union (hereinafter referred to as NIPEU) at Morel. The Administrative Law Judge dismissed all allegations based on the theory that Morel was International's alter ego and further found that Morel was not International's successor. We adopt those findings. The Administrative Law Judge felt compelled, however, to find a nonalleged violation of Section 8(a)(5) and (1). In his view, the facts established that International failed to fulfill its duty to notify the Unions and to bargain about its decision to shutdown, albeit economically motivated, which resulted in the termination of unit employees, and about the effects of such decision on them. Conceding that the complaint did not allege an 8(a)(5) violation on these grounds, he justified finding this violation by reasoning that it fell within the scope of the pleadings, as it was "not unrelated" to the violations alleged in the complaint and that its resolution involved no more than the examination of record facts which were, in his view, "fully devel- oped" and "substantially undisputed" under a different "legal theory." In agreement with Respondents' contention,2 we conclude that the 8(a)(5) findings of the Administra- tive Law Judge cannot stand. Nothing in the complaint's allegations or in the presentation of General Counsel's "case" put International on notice that it might be held answerable for a refusal to bargain about its decision to terminate operations and/or the effects of that decision. The complaint does not allege that Respondent has failed to notify Locals 119 and I of its asset liquidation and contemplated discontinuance, or that it had failed to bargain about that decision or about the effects on its employees of its decision to discontinue operations. All the allegations were predicated on the alter ego theory noted above. Nor is there a "catch-all" 8(a)(5) allegation in the complaint. Although General Counsel amended the complaint during the hearing, Judge's Decision and with the record, we find, rather, that Becker was the manager and operator of All Island Litho Corp and correct the Decision accordingly We refer, as the Administrative Law Judge did, to International Offset Corp, International Offset of Long Island Inc., and All Island Litho Corp, collectively, as "International." 2 Respondents have excepted to the Administrative Law Judge's findings with respect to the 8(a)(5) violation on the grounds that (1) International was denied due process as it was not put on notice of this issue , (2) the facts do not allow the conclusion reached by the Administrative Law Judge; and (3) even if International did violate Sec. 8(a)(5) such violation was merely "technical" and does not warrant a remedial order. 210 NLRB No. 140 INTERNATIONAL OFFSET CORP. 855 the amendment related solely to the 8(a)(2) allega- tion. Furthermore, nothing in General Counsel's brief to the Administrative Law Judge argued a violation on the basis of International's failure to notify and bargain with Local 119 and Local I about its decision to shutdown and about the effects of that decision on employees. In the context of both the complaint and the manner in which General Counsel litigated the case, it is difficult to see how Interna- tional, as it was defending itself against a charge that it was still in existence under a different name, could have anticipated that it also had to defend itself against charges that it had violated the Act in several respects when it terminated its existence.3 But, even if we were to find that portions of General Counsel's inquiry of witnesses at the hearing suggested the possibility that an 8(a)(5) and (1) violation might be found on the grounds relied on by the Administrative Law Judge, the facts as developed during litigation fall short of establishing such a violation.4 It may be true that International gave no formal advance notice to either Local 119 or Local 1. But it is also true that both Unions had adequate information from which they must inevitably have been aware of International's intent to close its operations. The evidence affirmatively establishes that the Unions knew about International's succes- sive sales of machinery and the financial adversity which impelled such sales, and that they knew of the successive layoffs which commenced in January 1972.5 Agents of both Unions had heard from employees about transfers of machinery in 1971, again in May 1972, and finally on unspecified dates in July and August 1972, by which time a substantial portion of International's operating equipment had been physically moved to Morel's premises. Both Unions knew, from advertisements International had placed in newspapers and from conversations their agents had with Becker, that International had put up assets for sale. There is no evidence that either Union objected to the sale decision or that either Union sought to make any bargaining proposals on the matter at any time. 3 Kingwood Mining Company, 210 NLRB No 139, Amcon International (nc, 205 NLRB No 157, N L R B v United Aircraft Corp, 490 F 2d 1105 (C A 2) 4 Kingwood Mining Company, supra 5 The number of unit employees in International's bindery operation (all Island, represented by Local 119) fell from 10-12 employees in January (all dates are 1972 unless otherwise indicated) to 6 in March and 5 in July. All those employed on July 20 were permanently laid off on that date In the printing unit (represented by Local 1), there were 30 employees in January, 20 in June, and 6 in July In December the remaining six were permanently laid off Local Is contiact provides, inter aba, that if there is sustained unemployment "the Employer agrees to meet promptly with the Union upon notification that there is sustained unemployment and to cooperate with the Union in reaching an agreement on the ways to eliminate unemployment Local 119's contract provides in pertinent part that a Furthermore, although the record reveals that the Unions knew or should have known at least by July 1972 that a shutdown was imminent, there is no evidence that either requested or proposed to bargain over the effects on employees.6 The only position the Unions took vis-a-vis International was, rather, that the transactions which resulted in large scale transfer of machinery to Morel were not actual "sales" but represented International's relocation of its plant and work. The failure of both Local 119 and Local I to seek bargaining over International's decision and its effects on employees forecloses a finding of an 8(a)(5) violation.? As neither Local 119 nor Local I requested bargaining, International's willingness to bargain has never been tested and, having never been tested, International's conduct may not be found violative of the Acts Accordingly, we shall dismiss the complaint against Respondents International Offset Corp., Internation- al Offset of Long Island Inc., All Island Litho Corp., and Henry Becker. 2. The Administrative Law Judge also found that Respondent Morel violated Section 8(a)(2) and (1) of the Act by interfering with the formation and establishment of NIPEU and by granting NIPEU support and assistance. No exceptions have been taken to that finding. General Counsel, however, has excepted to the Administrative Law Judge's failure to find specifically in his conclusions of law and recommended Order that Morel, through certain conduct on the part of its manager, Leonard Burlakoff, additionally violated Section 8(a)(1) and (2) of the Act. In agreement with General Counsel, we find that Burlakoff's statement to George Shacklady, who was then employed at International and a member of Local 119, that he (Burlakoff) "was going to open a shop" and had a job for him if "he wasn't interested in the Union," constituted a violation of Section 8(a)(1),9 as did Burlakoff's reply, "You don't work here" to a question by Morel employee Robert Morebeck concerning the conse- specified union representative "must be notified of all layoffs " Nothing in the record suggests that International did not fulfill its contractual obligations in these regards 6 The Unions may have felt that various provisions of their respective contracts were adequate protection for their members' interests Alterna- tively, they may have been overly optimistic in their theory that Morel was International's alter ego 7 N L R B v Spun-fee Corporation and the James Textile Corporation, 385 F 2d 379 (C A ?), and U S Lingerie Corporation, 170 NLRB 750, 752 See also White Consolidated Industries, Inc, 154 NLRB 1593 8 Southern California Stationers, Wallace Printing Co, 162 NLRB 1617, 1546, Times Publishing Company, 72 NLRB 676, 683 9 Cf Tucson Ramada Caterers, Inc, 154 NLRB 571, 574-575 As noted in the Administrative Law Judge's Decision, Shacklady reached an agreement with Burlakoff to work at Morel. 856 DECISIONS OF NATIONAL LABOR RELATIONS BOARD quences of an employee's failure to sign a member- ship card for NIPEU.10 In the case of Shacklady, Burlakoff's statement made it clear that the former person would not be hired at Morel unless he abandoned his support or membership for Local 119. Similarly, Burlakoff's response to Morebeck consti- tuted a threat to discharge employees at Morel who refused to sign membership cards for NIPEU, a union that Morel had unlawfully assisted to become the bargaining agent for its employees. Accordingly, we shall modify the recommended Order to include the above violations in addition to those found by the Administrative Law Judge. CONCLUSIONS OF LAW 1. International and Morel are each employers within the meaning of the Act. 2. Local 1, Local 119, and NIPEU are labor organizations within the meaning of the Act. 3. Local 1 and Local 119 were, until Internation- al's discontinuance of production, each exclusive bargaining representatives, respectively, of Interna- tional's lithographic and bindery employees in appropriate units described in paragraph 11 of the complaint. 4. Respondents have not violated Section 8(a)(1), (3), and (5) of the Act by discontinuing operations under the name International, laying off Internation- al employees as a result of such actions, and continuing International operations at another loca- tion as successor or alter ego under the name Morel. 5. Morel violated Section 8(a)(1) and (2) of the Act by interfering with the formation and establish- ment of NIPEU at its plant, and by granting NIPEU support and assistance, by entering into a collective agreement with union-security and dues-fees check- off clauses and by threatening employee Robert Morebeck with discharge unless he joined and/or remained a member of said labor organization. 6. Morel violated Section 8(a)(1) by telling prospective employee George Shacklady he would not be hired unless he abandoned his membership and activities on behalf of Local 119. 7. The unfair labor practices enumerated in paragraphs 5 and 6 above affect commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY Having found that Respondent Morel has violated Section 8(a)(2) and (1) of the Act, we shall adopt the recommended Order of the Administrative Law Judge as it relates to Morel. We shall further order Morel to cease and desist from contributing support to NIPEU by threatening employees unless they join and/or remain members of NIPEU and from telling prospective employees they will not be hired unless they abandon their membership and activities in any other labor organization. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby orders that the Respondent, Morel Litho of Long Island Inc., Farmingdale, New York, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Unlawfully interfering with, assisting, encourag- ing, or supporting National Industrial and Profes- sional Employees Union, or any successor thereto, or any other labor organization of its employees. (b) Recognizing or negotiating with the above- named labor organization, or any successor thereto, as the representative of its employees, unless and until it shall hereafter be certified by the National Labor Relations Board as the exclusive representa- tive of such employees. (c) Giving effect to any agreement with the said labor organization, unless and until it shall have been certified in the manner stated above, provided that nothing herein shall authorize Respondent to cancel or withdraw any benefit thereunder. (d) Threatening employees with discharge unless they join and/or retain membership in said labor organization. (e) Telling prospective employees they will not be hired unless such prospective employees abandon their membership and activities on behalf of Graphic Arts International Union, Local 119 B, New York, AFL-CIO, or any other labor organization. (f) In any like or related manner interfering with, restraining, or coercing employees in the exercise of their rights under Section 7 of the Act. 2. Take the following affirmative actions found necessary to effectuate the policies of the Act: (a) Withdraw and withhold recognition from National Industrial and Professional Employees Union as the representative of its employees for the purpose of dealing with Respondent concerning any term and condition of employment, unless and until said labor organization is certified by the National Labor Relations Board. (b) Reimburse employees for all dues and fees paid to said labor organization which were withheld from their pay or otherwise paid on their behalf by Respondent to that labor organization, in the 10 Clement Brothers Company, Inc., 165 NLRB 698, 705-707, enfd. 407 NIPEU card at the time he asked his question F.2d 1027 (C A 5). It is irrelevant that Morebeck had already signed an INTERNATIONAL OFFSET CORP. 857 manner set forth in the Remedy section of the Administrative Law Judge's Decision. (c) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary or useful in checking compliance with this Order. (d) Post at its plant in Farmingdale, New York, copies of the attached notice marked "Appendix." I I Copies of said notice, on forms provided by the Regional Director for Region 29, after being duly signed by Respondent's authorized representative, shall be posted by 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 to insure that said notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director for Region 29, in writing, within 20 days from the date of this Order, what steps the Respondent has taken to comply herewith. IT IS FURTHER ORDERED that the complaint in all other respects be, and it hereby is, dismissed. 11 In the event that this Order is enforced by a Judgment of a United States Court of Appeals, the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." named labor organization by threatening employees with discharge unless they join and/or retain membership in the above-named labor organization as a condition of continued employment. WE WILL NOT tell prospective employees that their employment is conditioned on their abandonment of membership and activities on behalf of Graphic Arts International Union, Local 119 B, New York, AFL-CIO, or any other labor organization. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees in the exercise of their rights to self-organization , to join or assist Graphic Arts International Union, Local 119 B, New York, AFL-CIO, or Amalgamated Lithographers of America, AFL-CIO, or any other labor organization , to bargain collectively through representatives of their own choosing, or to engage in other concerted activities for the purpose of collec- tive bargaining or other mutual aid or protection, or to refrain from any or all such activities , except to the extent that such right may be affected by an agreement requiring membership in a labor organiza- tion as a condition of employment as authorized by Section 8(a)(3) of the Act. MOREL LITHO OF LONG ISLAND INC. (Employer) APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL no longer recognize or negotiate with National Industrial and Professional Employees Union as the representative of any of our employees for the purpose , in whole or in part, of dealing with or discussing any terms or conditions of employ- ment, unless and until said labor organization shall be certified by the National Labor Relations Board as the exclusive representative of such employees. WE WILL NOT give effect to any contract we have with the above-named labor organization, unless and until it shall have been certified in the manner stated above; we are not, however, canceling or withdraw- ing any benefit contained in any such agreement. WE WILL reimburse our employees for any dues and fees paid to the above-named labor organization under our collective agreement with it, which has been found to be unlawful. WE WILL NOT contribute support to the above- Dated By (Representative) (Title) This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or compli- ance with its provisions may be directed to the Board's Office, 16 Court Street, Fourth Floor, Brooklyn, New York 11241, Telephone 212- 596-3535. DECISION SAMUEL M. SINGER, Administrative Law Judge: This case was heard before me in Brooklyn, New York, on various dates between April 9 and June 28, 1973, pursuant to charges filed on August 31 and September 1, 1972, and consolidated complaint issued on November 30, 1972. The complaint alleges that Respondents violated Section 8(a)(1), (2), (3), and (5) of the National Labor Relations Act. All parties appeared and were afforded full opportuni- ty to be heard, to examine and cross-examine witnesses, 858 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and to present oral argument. A brief was received from General Counsel only. Upon the entire record' and my observation of the testimonial demeanor of the witnesses, I make the following: FINDINGS AND CONCLUSIONS 1. BUSINESS OF RESPONDENT The complaint alleges, and at the hearing Respondents admitted, that during all times here material International Offset Corp., International Offset of Long Island Inc., and All Island Litho Corp. were New York corporations; that all three have been affiliated businesses, with common officers, ownership, and directors; that they constituted a "single integrated business enterprise" in which the directors and officers formulated and administered a common labor policy affecting their employees; that during the year preceding issuance of the complaint they provided printing and bindery services, purchasing and receiving goods and materials valued in excess of $50,000 from points outside New York State; and that, as a single employer, they have been engaged in commerce within the meaning of the Act. I so find. The complaint also alleges, and at the hearing Respon- dents admitted, that since about April 26, 1972, Respon- dent Morel Litho of Long Island Inc. has been a New York corporation; that since about June 1, 1972, it has been engaged in bindery and related services; that it has an annual outflow of goods and materials in interstate commerce valued in excess of $50,000; and that it is an employer engaged in commerce within the meaning of the Act. I so find. The record establishes, and I find, that Respondent Becker at all times here material has been the president and dominant owner of International Offset Corp. and International Offset of Long Island Inc.; that he has been the manager and operator of Morel Litho of Long Island; and that he has been an agent and representative of all said corporations, acting on their behalf. I so find. I find and conclude that assertion of jurisdiction herein is appropriate and proper. II. LABOR ORGANIZATIONS INVOLVED The complaint alleges, and Respondents admit, that Charging Parties ("Local 1" and "Local 119") and Party to the Contract ("NIPEU") are labor organizations within the meaning of the Act. III. ALLEGED UNFAIR LABOR PRACTICES A. The Issues2 The basic issues presented by the complaint and here considered are: 1. Whether International discontinued operations and I Transcript corrected by my Order, on notice, dated August 28, 1973 At the hearing Respondents did not oppose General Counsel's motion to amend the caption in the complaint so as to show the full name of Local 119 as it appears in the caption of this Decision That motion is hereby granted, it being clear that the identity of the labor organization is in no way affected by the name change 2 As already noted, International Offset Corp , International Offset of continued them at another location as a successor or alter ego under the name Morel, in order to avoid bargaining with Charging Parties, the statutory bargaining representa- tives of International's employees, in violation of Section 8(a)(5) and (1) of the Act. 2. Whether Respondents violated Section 8(a)(3) and (1) of the Act by laying off seven employees as a result of International's discontinuance of operations. 3. Whether Respondents violated Section 8(a)(2) and (1) of the Act by assisting in the establishment of NIPEU at Morel and entering into a collective agreement with union-security and fees-dues-checkoff provisions. B. International's Operations 1. Contractual relations and managerial hierarchy International has had longstanding contractual relations with Charging Parties-since May 1964 with Local I (representing the lithographic and printing production employees) and since July 1967 with Local 119 (represent- ing the binding, shipping, and receiving employees). The last collective agreement with Local I covered May 1970-April 1973 and that with Local 119 the January 1971-December 1973 period. As already noted, Respon- dent Henry Becker was the dominant officer and operator of International. Harry Dickran was plant manager or superintendent working under Becker. Leonard Burlakoff, who entered International's employ as salesman and assistant to Dickran in October 1971, succeeded Dickran and became second in command at International when the latter left in March or April 1972. Burlakoff, who previously had been in business, brought with him machinery, including a printing press and stitching, cutting, and folding machines, which were put to use at International; he also brought in former customers and accounts.3 Jim Leone was International's pressman or printing foreman and Salvatore Dovi was binding ("work- ing") foreman. 2. Discontinuance of bindery (All Island) operations International President Becker testified credibly that his business was "really starting to go downward and downward" in 1971. Among the factors contributing to the deteriorating condition were business losses due to custom- er bankruptcies. Defaulting on payments due on machinery secured by Gibraltar Factors Corp., Becker sought and obtained repeated payment extensions in 1971 and 1972. Checks, including those for wages, frequently "bounced." By July 1972, International was in arrears thousands of dollars on welfare and pension payments under its collective agreements with Local 1 and Local 119-$3000 to $4000 to Local 1 and $24,000 to $25,000 to Local 119. Long Island Inc., and All Island Litho Corp (All Island) admittedly constituted a single employer within the meaning of the Act They will hereafter usually be referred to collectively as "International " 3 According to Burlakoff, the printing (Webb) press, originally bought for $200,000 was still worth $50,000 in 1972 As plant superintendent Burlakoff directed and assigned work and handled grievances He received a flat $500 weekly salary INTERNATIONAL OFFSET CORP. 859 Both unions had sued International and at least one of the two obtained a judgment against it.4 Seeking to curtail expenses, Becker steadily reduced his workforce-from 10 to 12 bindery employees (i.e. All Island employees and Local 119 members) in the begin- ning of 1972 to about six in March and five in May and June; and from over 30 printing employees (i.e. Interna- tional Offset and Local 1 members) in the beginning of 1972, to 20 in June and 6 in July. For over a year prior to July 1972, Becker had been advertising sale of equipment. In May 1972, International sold some to Beaumont Offset Corp. a company formed by International's former supervisors Dickran and Leone. Earlier (in the end of 1971), Becker sold his building at 115 Schmitt Boulevard to relieve the "overbearing ... pressure" of creditors, particularly Gibraltar, in order to make payments. By July 1972, Becker was "financially drained" and "was going around borrowing monies to make payrolls." It reached the point that when he called Local I to furnish him help (pressmen), Becker was told that "it ... is hard to get people" to work for International because "word is around that [International] pay[s] by check" which was risky in view of the Company's "many financial difficulties." With the writing on the wall, Becker held periodic meetings with supervisors well before July 1972 to discuss his financial plight and their precarious job security. As already noted, two of his supervisors (Dickran and Leone) already left by March or April 1972. Becker testified that around April, Burlakoff asked him whether he was interested in selling some of his equipment to a company being formed in which he (Burlakoff) had an interest. Becker said that he was, welcoming the prospect of being taken "off the hook of making [further] payments" to Gibraltar. As hereafter detailed, Becker and Burlakoff subsequently arranged for the new company (Morel Litho of Long Island) to assume International's obligations to Gibraltar Becker also accepted Burlakoff's offer to ultimately "broker" his work at the new company; 5 and agreed that Burlakoff could remain with International while helping organize the new company. By July 20, 1972, International (i.e. All Island) ceased all bindery work. On that date, International laid off its last five employees, all named in the complaint (Bonelli, Dovi, Herrera, Shacklady, and Van Orden); the two additional employees named in the complaint were laid off earlier 4 General Counsel's witness, Herrera, one of the alleged discriminatorily laid-off employees and a Local 119 member, testified that Becker on several occasions told her and another employee that the "union was bleeding him dry," at one point adding that he also said that he "would have to move or else try and get rid of them " Becker denied the remarks attnbuted to him As in other instances (see e.g, infra, fns 10 and 15), Herrera was vague and indefinite as to the circumstances under which the alleged incidents occurred, and no other witness attributed any antiunion statements whatsoever to Becker I do not credit Herrera's testimony on this point 5 A broker is a "middleman" who does not himself produce (i e , pnnt) jobs obtained from customers See infra, sec D, 1 8 Shacklady and Van Orden accepted while Herrera did not Melenchuk was hired in the week ending August 29, 1972, when she was brought in by Van Orden The three not offered positions (Bonelli Dovi, and Rizzuti) did not apply for jobs with Morel 7 The foregoing findings as to International's operations and bindery (All Island) shutdown are based largely on Becker's credited testimony and, in part, on documentary evidence Becker impressed me as an essentially credible witness Much of his testimony in this proceeding was undisputed -Melenchuk in the week of March 7 and Rizzuti in the week ending May 9, 1972. As hereafter noted, Burlakoff, at that time International plant manager and active in the new company (Morel) he established, had offered positions to three of the seven employees-two of them accepting the offers .6 Although discontinuing bindery operations in July, Becker continued to do some printing until December 1972 or January 1973, when he gave this up also, terminated the employees still on his payroll, and became a full-time "broker" (see fn. 5, supra ); during this period (July-De- cember 1972), Becker contracted out all of his bindery and some of his printing work to Morel and others. As a broker subsequent to December 1972, Becker operated Interna- tional as a purely "selling company," using no equipment and employing no one.7 C. Morel's Operations 1. Formation of Morel Morel, the new company heretofore referred to, was incorporated on April 26, 1972. Its certificate of incorpora- tion, filed by Attorney Suchoff,8 indicates that Morel's business situated two blocks from International (220 Sherwood Avenue, Farmingdale, N.Y.) was to be "substan- tially similar" to that of International (i.e., printing and bindery work). Morel's records show that 200 shares of stock were authorized-100 to be held by Clyde Washing- ton and another 100 by his brother, George. Burlakoff testified that after he learned of Becker's financial problems he broached the subject of going into business to the Washington brothers. According to Burlakoff, he told them that he would himself become a "partner," but if he could not do so (for financial reasons), he would help set them up in business. Leonard Burlakoff and his father (Attorney Bernard Burlakoff) have known the Washingtons for some 15 years. The Washingtons had done various chores for the Burlakoffs and formerly had worked for Leonard and his uncle before Leonard came to Internationals After Leonard Burlakoff joined Interna- tional, the Washingtons installed the equipment Leonard had brought with him, including the large and imposing Webb press (the size of a "building [or] house") which took "at least, a month by itself" to reassemble and install.io or corroborated by documentary evidence Suchoff had been International's attorney. Burlakoff, who played the leading role in Morel's formation and arranged for his retention, got to know Suchoff while international manager. 9 According to Leonard Burlakoff, Clyde Washington was his "top man" when he operated his bindery (L B Leonard, Inc) and "knows how to do everything" in the business, including setting up machines His brother, George, had worked under Clyde, performing various chores, including making deliveries 10 1 do not credit testimony adduced by General Counsel that the Washingtons had also performed driving and shipping work for Becker (i e, International) The testimony of Herrera, upon which General Counsel relies, is too vague and indefinite to justify a finding based thereon. According to Herrera , she saw the Washingtons perform such work "on occasion," "apparently five or six , seven times" for "a day or two, a few hours " I credit Becker's testimony (consistent with that of the Washingtons, and in part supported by General Counsel's witness, Shacklady) that the Washingtons had never been on international's payroll and were on international premises only when they moved Burlakofrs equipment when (Continued) 860 DECISIONS OF NATIONAL LABOR RELATIONS BOARD According to Leonard Burlakoff, the Washingtons had previously expressed interest in going into business. In April 1972, the Burlakoffs discussed with the Washingtons the details of setting up the printing and bindery shop. They told the Washingtons that they now had a "good chance to get into something and make .. . some money." The Washingtons agreed, stating that each could put up $10,000, $5,000 of which was to be borrowed by each from friends and relatives. Burlakoff indicated that he himself could not invest cash at that particular time because his money was tied up in a real estate venture, but that he would contribute his machinery then on Interna- tional's premises.ii Attorney Burlakoff (Leonard's father) then raised an additional $30,000 through a Lester Joffe, owner of a camera shop to whom he had in the past allegedly recommended other investments. To "safeguard" his interest Joffe took the lease of the new corporation (Morel) at 220 Sherwood Avenue (two blocks from International) in the name of his camera shop and paid the security required by the lease. Morel's general journal shows capital stock investment of $110,000 broken down as follows: Clyde and George Washington-4 10,000 cash for each; Joffe $30,000 cash; and Leonard Burlakoff-$60,000 for equipment. No stock was issued to Joffe or Burlakoff in return for their investments. Morel commenced production in June 1972. By June 20, it had a full complement of employees. 2. The roles of the Washingtons, Joffe, and Burlakoff in Morel a. The Washington As already indicated, the Washington brothers are the sole stockholders of Morel, each also a corporate officer. Clyde testified that he supervises the "majority" of the bindery employees, sets up machines and operates them 8 or 9 hours a day, and occasionally drives a truck when no one else is available. He spends "very little" time in the office, mostly 1 hour a day to rest. According to Respondent's payroll records, Clyde's weekly earnings in June 1972 ranged from $250 to $377.50-the equivalent of $5 an hour depending on the number of hours worked; his earnings in July ranged between $165 and $290, also at the $5 hourly rate. The payroll records for October 1972 show continued hourly earnings at $5 an hour ($200 for a 40- hour week) plus overtime earnings at time and a half. George Washington testified, "I'm the shipping clerk. I take care of all the shipping and the trucking." He also testified that he sometimes operates machines and drives a truck; and that he once hired a truckdriver. Like his brother (Clyde), he signs checks for Morel. Although claiming that he and Clyde received no overtime because the business "belongs" to them, Morel's payroll records for October 1972 show otherwise (Resp. Exh. 8) and Clyde admitted that both brothers receive overtime pay. Accord- ing to company records, George's weekly "regular" earnings in June and July 1972 ranged between $167.27 and $269.79, an average of about $3.08 an hour; in October Burlakoff arrived at International and, again later, when that equipment and others purchased by Morel were shipped to Morel pursuant to International's contractual arrangement with Morel (infra, sec D 3). 1972, he was paid $125 for a 40-hour week plus time and a half for overtime. As hereafter shown (sec. E), neither of the Washingtons participated in the bargaining negotiations between Morel and NIPEU, the labor organization with which the Company entered into a collective agreement. Nor are they familiar with key provisions of the agreement. b. Joffe As already indicated (sec. C, 1), Lester Joffe arranged to take the Morel lease in his name as security for his $30,000 investment. Joffe indicated that although he has no "specific role" in Morel, he "oversee[s] the accounts receivable" to see that "the company is functioning financially." He spends two or three evenings a week at Morel (totaling 10 hours), reviewing books and records. According to Joffe , he has nothing to do with the bookkeeping and signs no checks . Although testifying that he receives a weekly $ 150 "salary," he was unsure what it was supposed to cover , stating "I guess it would be partial [payment] against the [$30,000] investment and partial against time that I put into the place ." He went on to testify, "It was never discussed as to what goes towards investment and what goes towards salary. I could say it's probably a 50-50 ratio." Morel's payroll records do not reflect any "salary" payments to Joffe. c. Burlakoff As already noted, Leonard Burlakoff, International's plant manager, played a leading role in the establishment and operation of Morel. It was Burlakoff who interested the Washingtons in Morel, arranged for its incorporation, and proposed to Becker the transfer of International equipment to Morel as well as conversion of International from a producing (manufacturing) plant to a purely selling ("broker") entity. He admittedly solicited International employees to work for Morel-among them bindery employees Herrera, Shacklady, Van Orden, and Tony Mule; and clericals such as Julie Fritz. As Burlakoff testified, he told Morel employees that "something might be going soon, stick with me and I will see if I can get you set." When Herrera, whom he solicited twice, asked if the new company would be a "union shop," Burlakoff replied "yes, but not [Local] 119," indicating that she "would be required to join" another union. To Shacklady he said that he "was going to open up a shop" and had a job for him if he "wasn't interested in the Union." Describing his comprehensive role in Morel, Burlakoff testified, "mine [responsibility] is bringing in customers, making sure the machinery runs, seeing salesmen in my office . . . suppliers . . . anything conducted with regular phases of business...." From -the very beginning of Morel's operations, he assumed overall charge of the plant-directing, scheduling, and assigning work to per- sonnel-even to the Washingtons, the corporate owners. He interviews and hires job applicants-"regulars" and part-timers-"most or all" applicants having gone through it At the hearing Burlakoff stated that he still hoped sometime in the future to "become a partner." INTERNATIONAL OFFSET CORP. 861 his office. He authorizes overtime and time off. As Burlakoff testified, he already functioned as Morel's "manager" when production commenced in June 1972. He also testified that "in the very beginning when [the Washingtons ] were getting set [he] signed some checks .. . [as he ] was trying to bring in suppliers so they could get credit." He spent half of his 8-hour day at International and half at Morel, often putting in "extra" hours at the latter. Burlakoff remained on International's payroll through the week ending September 26, 1972, when he went on the Morel payroll continuing to draw the same $500 weekly salary at Morel that he drew at Internation- al.12 D. Relationship Between International and Morel 1. Becker's contacts with Morel As previously noted (sec. B, 1), after International closed its bindery (i.e., All Island) on July 20, 1972, it continued printing operations, contracting out its bindery and some of its printing work; and after completely discontinuing printing operations in about December 1972, International acted as a "broker," contracting out all work (printing and bindery). "Brokering," a common calling in the printing industry, entails basically soliciting orders from customers, placing them with a printing firm, and realizing markups without having to handle production. While in full operation, International itself had dealt with brokers- among them Beaumont Offset, set up by two former International foremen (Dickran and Leone) who left International when the latter's financial problems became apparent (supra, sec. B, 2).13 Becker testified that in "brokering" he places his orders "wherever it's best fitted for [him" ]-nammg in addition to Morel , Bob Bernstein, Miniature Folding, and Avalon. And while Morel does a good deal of work for Becker (i.e., International), it also produces for and deals with other brokers (e.g., Karl Thal Advertising and Carlin Offset). As a broker, Becker periodically visits the plant with which he does business to see to it that the work is performed properly. Thus, he would visit Morel three or four times weekly. He examines samples and, if not satisfied, has the work done over. After securing from Morel the price of a job he will often telephone his 12 As indicated, the bulk of the above findings relating to Burlakofrs extensive role in the formative months of Morel are based on Burlakofrs own testimony and admissions. At a late stage in the hearing, when recalled to testify on behalf of Respondent, Burlakoff sought to minimize his role in Morel Thus, he contradicted his earlier testimony that he already was Morel manager in July 1972, claiming he was only "an advisor." When pressed by General Counsel, he described his position as "advisor manager," contending it was "the same thing." He also sought to minimize the time he spent on Morel business during regular hours when he was supposed to attend to International business, this time indicating that he never had "a basic 8-hour day" and had worked as many as 13 or 15 hours a day When reminded that he previously testified that he spent half of his regular 8-hour day at each of the two locations, Burlakoff retorted, "possibly, if you have it in the record which 8 hours, from 12 to 8 at night or 8 to 4 " Burlakoff impressed me as a less than forthright witness in testifying on this and many other matters, including, for example, the activities of the Washingtons at Morel-to whom he strived to attribute roles and responsibilities that even they did not claim or expressly demed having Furthermore, Burlakoff often was argumentative, at times display- ing outright hostility I credit his testimony only to the extent it is customer to ascertain if he will pay a sufficiently high price to cover Morel's charge. General Counsel relies on several incidents to demon- strate Becker's involvement in Morel's operations. While the record shows close cooperation between International during its initial operational stage, I credit the testimony of Becker that he neither hired employees for Morel nor directed or instructed employees in performing work for Morel. Thus, as to employee Moreback, Becker testified credibly that based on Burlakoff's recommendation he hired him in June 1972 with the understanding that he would work for International for only a short period until Moreback could be used by Morel; Moreback left International after several days to work for Morel (as originally intended) at higher pay.14 Employee Herrera's testimony that in August (after her July 20 layoff and return from vacation) Becker offered her employment with Morel is confusing and not credited; why Herrera should have gone in to see Becker for the Morel job when, as she admitted, it was Burlakoff who had asked her to see him about the job after returning from vacation, is difficult to comprehend.15 That Becker, as employee Jerry DeCicco testified, once obtained a "blanket" (i.e., a part) for a press used by DeCicco at Morel, was satisfactorily explained by the fact (testified to by Becker and Burlakoff) that the machine, one of many International had sold Morel (infra, sec. D, 3), needed the part to put it in working order. Finally, I do not credit employee Konon's testimony that he had once complained to Becker about nonpayment of overtime. I cannot believe that Konon, who admittedly saw Becker only "once in a while" and spoke to him no other time, would have approached Becker to check upon the claimed wage deficiency; Konon (who worked only a short time for Morel) may have mistaken Becker for someone else. I credit Becker's denial of the incident; his denial is supported by General Counsel's witness Accardi, who worked for Morel for a much longer period (from Morel's inception in June 1972 to the time of the hearing, June 1973) that payment discrepancies were taken up with Burlakoff, not Becker. Accardi further testified that at no time during his employment at Morel had Becker given him orders or directions of any kind whatsoever. uncontradicted, or corroborated by other credited witnesses, or it consti- tutes an admission, or rings true and appears inherently probable 13 The foremen would go out "to get their own accounts" and international would fill the orders of their customers Beaumont, in fact, temporarily used international 's address (a not unusual practice for a broker in the graphic arts) until it obtained its own quarters and purchased its own equipment (including some from International ) to operate a plant. 14 Becker's account of the hiring corresponds to that of Burlakoff and is not inconsistent with Moreback's version According to Moreback, he reported to Morel in early July as directed by Burlakoff, but was picked up by the "boss" (i e, Becker, Burlakofrs superior at international). As expected, Becker told him that his supervisors would be Burlakoff (then International's plant manager) and Tony Mule (then international's press foreman) 15 Herrera testified that in addition to Burlakofrs personal request to see him about the Morel Job, Employee Shacklady also told her that Burlakoff had a job for her I have previously noted my reservations about Herrera's reliability as a witness (supra, fns. 4 and 10), although I have not altogether ignored her testimony As between Becker and Herrera, I prefer crediting Becker. 862 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 2. Customers and suppliers It is stipulated that Morel's accounts receivable from its inception (June 1972) through January 1973 shows the following customers and credits: International Offset $66,526.30 Carlin Graphics 25,263.00 Quick-Eez Printing 13,636.00 Eastern Infants Wear 7,797.00 Melrose Yarn 7,015.00 Of the four companies other than International, all except Quick-Eez had been customers of International. General Counsel conceded that in contrast to the five customers Morel had dealt with in the 6- or 7-month period covered by the stipulation, International's books indicate that International had as many as 142 customers from "August 19, 1972 through the present [March or April 1973]." It was also stipulated that Morel's accounts payable from June 1972 through February 1973 show purchases of supplies in the amount of $134,210, of which $78,389 represents purchases from firms who had also sold to International; and that International's accounts payable from August 1972 "to the present" show purchases of $600,000, of which $150,000 represents purchases from suppliers who have also sold to Morel. Only 26 or 27 of International's 200 suppliers "were common" to Morel and International. 3. Machinery and equipment As noted (supra, sec. B, 2), in April 1972, Burlakoff, aware of Becker' financial problems, offered to buy International equipment for the new company (Morel) he contemplated organizing. On June 1, 1972, International sold Morel bindery and printing equipment (press, folding, cutting, stitchi g, as and other machines) and office equipment. Although the bill of sale recited a nominal $100 consideration, the parties evaluated the equipment at $125,000 and posted that value on their books and records. This was also the amount International at that time (June 1972) owed to Gibraltar Corporation which held a security interest in its machinery and equipment. International retained other machinery with which it continued to operate its printing business until December 1972 or January 1973. On September 5, 1972, International and Morel executed an agreement with Gibraltar under which Morel assumed International's $125,000 debt to Gibraltar, Morel also entered into an agreement with Gibraltar whereunder Morel recognized Gibraltar's security interest in the acquired machinery and equipment. International remains liable on the debt in case Morel defaults. The record shows. that it was Leonard Burlakoff who negotiated the assumption agreement with International and Gibraltar; that Clyde Washington (Morel's president) 16 It will be recalled that International continued to operate the punting business after the bindery shut down on July 20, 1972 17 Although Morel's payroll records for July and October 1972 show the number of employees to range between some 27 to 48, Burlakoff testified that the "regular" (full-time) production employees between July 1972 and January 1973 ranged only between seven and nine. The July and October signed it at Burlakoff's suggestion; and that Washington had come to the final meeting of Gibraltar on the instruction of Attorney Burlakoff (Leonard's father). Morel has purchased no equipment or supplies from International other than that covered by the assumption agreement-except on one "emergency" when Becker supplied Morel with $600 worth of paper to run a job. Morel purchased a small amount of machinery from two other firms-$20,375 worth from Teaneck Chemical and a lesser amount ("a couple of hundred dollars" worth) from another. As previously noted, Burlakoff had contributed machinery brought with him to International for which he was credited $60,000 by Morel in the form of capital investment. The International machinery and fixtures acquired by Morel, some of which took weeks to dismantle and assemble, were moved over several months (June to September). George Washington who with his Brother Clyde moved the bulk of the machinery, testified that it was Burlakoff who directed the move. The switchboard obtained from International was moved in July or August. Becker testified credibly that when Morel purchased the International machinery in June it was agreed that it could make use of the equipment on International's premises until physically removed to Morel. As a result, Morel "shuffled people back and forth" the two locations, two blocks apart, and International and Morel employees frequently worked on identical equipment, sometimes side by side, between June and September 1972.16 Earlier in 1973 when International had sold some equipment to Beaumont (owned by two former International foremen (supra, In. 13), it, too, was authorized to use the equipment on International premises prior to its removal. Further- more, according to Becker, it was not unusual for a bindery or printing shop in need of machinery (due to a machine breakdown, for example) to borrow the needed machinery from another employer in the area. 4. Personnel Morel's records demonstrate that at the inception of its operations, the week ending June 6, 1972, it had two production employees (McMillian and Merrion) on its payroll in addition to the two Washington brothers. The number of employees increased to seven and nine in the weeks ending June 13 and 20, and remained constant at around these figures in succeeding months through January 1973.17 The July 25 payroll for the first time includes former International employees who were immediately before laid off or terminated-two bindery (All Island) production employees in the unit represented by Local 119 (Shacklady and Van Orden); a press foreman (Tony Mule), a managerial employee not in any bargaining unit ; and two clericals (Julie Fritz and Barbara Hurwitz), similarly excluded from either of the two bargaining units (bindery payroll sheets include managerial, clerical, and part-time casual employees (all excluded from the bargaining unit)-the latter (mostly high school and college students performing unskilled bindery work) accounting for as many as 30 or 40 a week in summer months Like the "regulars." part-timers have at times used Morel equipment at International prior to removal of the equipment to Morel (see supra, sec D, 3) INTERNATIONAL OFFSET CORP. employees represented by Local 119 and pressmen by Local 1) at International. All had been with International until July 18 or 20 and continued to perform at Morel substantially the same type of work as previously at International. Thus, Fritz works at the switchboard and Hurwitz in the office.18 Mule directs, hires, and fires employees. Van Orden is a "working" forelady, overseeing bindery table work, including the work of casual or temporary employees. Finally, George Shacklady is a bindery paper cutter. 19 The record shows that Morel also hired production employees who at one time previously worked for International, although not immediately preceding their hire. Among them is Melenchuk, an alleged discriminatee here (supra, sec. B, 2). An International bindery employee doing general table work, Melenchuk was laid off by International in the week ending March 7, 1972 (more than 4 months before the bindery shutdown) and was hired by Burlakoff for Morel in the week ending August 29, 1972, apparently on Floorlady Van Orden's recommendation. Other Morel employees, who at one time had worked for International (but not preceding their hire at Morel) were Tortosa, Moreback, McMillian, and Nassau. Nonproduction employees hired by Morel, but long after Morel began operations, were Lucille Heintz, an office girl with International until January 14, 1972, and employed in similar capacity by Morel in October 1972; and Leonard Friedman, Becker's brother-in-law and International's "office man" (or "office manager"), hired in the same capacity by Morel at the end of 1972. E. Establishment of NIPEU at Morel In early June 1972, shortly before Morel began full-scale operations, Burlakoff and Foreman Tony Mule met with job applicants outside the Morel premises . Burlakoff spoke to them in a group and in individual interviews about the wages and working conditions Morel was offering. Jerry ' Fritz, who had worked for International for 4 or 5 years, continued to do some chores for Becker while employed at Morel Thus, she has picked up undelivered International mail at the post office (on her way home) since October and November 1972, when International no longer employed office help. 19 The documentary and credited evidence does not support General Counsel's position (br p. 16) that George Shacklady was on Morel's payroll in the week ending July 4 While Morel's July 1972 payroll records (Resp. Exh. 8, submitted pursuant to agreement at the end of the hearing) shows an "L. Shacklady" on the payroll for the weeks ending July 4, 11, and 18, it is not until the week ending July 25 that a "G. Shacklady" appears along with an "L. Shacklady." I do not credit Shacklady's testimony to the extent that it implies that because he was requested to work at International while on Morel payroll (shifting "back and forth" for 3 weeks), this implies an interchange of employment, I have already found (supra, sec. D, 3) that Morel employees were necessarily "shuffled . . back and forth" the two locations as a result of an understanding , reached when Morel purchased International machinery in June 1972, that Morel could make full use of all sold equipment until physically removed from International. Nor do I credit Shacklady's testimony that when Becker terminated him at International around July 20, 1972, Becker told him he was "being put on Morel's payroll " Shacklady's testimony as to the substance and timing of Becker 's alleged statement is confusing and self-contradictory and his recollection 863 DeCicco testified credibly that he told the men they were "going to have a union" in the shop.20 On Saturday, June 17, Burlakoff "passed the word around" that a union representative was coming to speak to the men and told them to meet the union representative in the stripping department. Present at the meeting-in addition to the union representative (NIPEU President Hafter) and production employees-were management representatives Burlakoff, the Washington brothers, and Tony Mule. Hafter told them about his union's "benefits" and dues; and distributed NIPEU cards providing for membership, bargaining-representative designation, and dues-checkoff authorization. Six employees21 then signed the cards and handed them to Dora Merrion after Burlakoff announced that "Dora [Merrion ] will collect the cards and she will be shop steward." A seventh employee (Accardi), who could not make the meeting, went to the plant later that day (June 17) and asked Burlakoff where he could obtain a union card. Burlakoff said that Dora Merrion, the "shop steward," handled the cards, took Accardi over to her, and told Merrion, "I have a new man starting Monday. He wants a union card to fill out." Accardi then completed the card. Morel's payroll record for the week ending June 20, lists two employees (Janssen, Tortosa) in addition to the seven' card signers.22 On the same day (June 17, 1972), NIPEU President Hafter met with Burlakoff. Clyde Washington testified that Burlakoff made the decision to recognize NIPEU because that labor organization *'sounded like a good union." After a 45-minute discussion Hafter and Burlakoff agreed to the terms of a collective agreement. Neither Clyde nor George Washington participated in the discussion.23 Around July 1, Hafter returned with a draft of the agreement, signed by Hafter for NIPEU. Burlakoff assured Clyde Washington that "everything was all right" and Washington signed the thereof is poor. On cross-examination he admitted that in his first pre- hearing affidavit (October 13, 1972), Becker only said that "All Island Litho was being closed down" and that Becker "didn't need [him ] anymore " He also testified that it was Burlakoff, not Becker, who offered him the job at Morel with the remark that he (Burlakoff) "was opening another shop". and that he had come "to an agreement" with Burlakoff to work at Morel even before Becker talked to him about his layoff 20 Burlakoff denied that he or anyone else uttered the word "union." I have already noted my reservations concerning Burlakofrs reliability as a witness (supra, fn. 12, see also infra, fns. 24 and 25). Accardi, the only other witness testifying on this specific point, stated that while he remembered Burlakoff mentioning "something" to the effect that "if you want a union, go get a union" he could not recall him stating "directly" to him or to anyone else that the men were "going to have a union " 21 Jerry and Gerard DeCicco, Konon, Merrion, McMillian, and Forte. 22 The findings relating to the June 17 meeting are based primarily on the mutually corroborative testimony of employees Jerry DeCicco and Konon 23 While Clyde Washington testified that Joffe (investor in Morel, supra, sec. C, 1) also participated, Burlakoff did not so testify At one point. Clyde Washington testified that his brother (George) also participated , but the brother expressly disclaimed participation 864 DECISIONS OF NATIONAL LABOR RELATIONS BOARD agreement in his capacity as Morel president. Morel and NIPEU thereafter maintained and enforced the agree- ment.24 Under the collective agreement, scheduled to run from July 1, 1972, to February 28, 1975, Morel recognizes NIPEU as the exclusive representative of all production and maintenance employees (i.e., pressmen and bindery employees). The union-security clause stipulates that all employees, members at the time of contract execution, must remain members in good standing during the term of the agreement and other (new) employees must join the union after 30 days employment. Under the fees-dues- checkoff clause, Morel must, on written employee authori- zation, remit to NIPEU initiation fees and monthly dues. In conformity with this clause, Morel has since July 1972 deducted dues and fees from wages and remitted them to NIPEU. Clyde and George Washington also joined the Union and Morel has likewise (since July) remitted the dues on their behalf.25 On July 8 or 15, 1972, NIPEU President Hafter held a second meeting with the Morel employees. Burlakoff testified that he gave Hafter permission to conduct this meeting on company premises to permit him to explain to the employees the welfare and hospitalization benefits. He also testified that he told NIPEU steward Dora Merrion that Hafter "wanted all the workers" at the meeting. Hafter spoke to the employees on these subjects and distributed forms for these programs. Employee Moreback, who started to work for Morel in July 1972, testified credibly that after Steward Merrion gave him a NIPEU card he asked Burlakoff what would happen if he did not sign the card. Burlakoff said that if he did not sign "You don't work here." Another time in July, Moreback asked Burlakoff "what is the union for"; Burlakoff answered, "to keep other unions out of here." F. Morel's Failure and Refusal to Recognize and Bargain with Charging Parties 1. Local 119 After receiving reports from Local 119 members that International was going to open a new plant, Local 119 President Hellman spoke to Becker and Burlakoff several 24 The findings as to the consummation of the collective agreement are based on the testimony of Burlakoff and Clyde Washington, but only to the extent indicated . Both gave detailed and varied versions, much of which contradictory and palpably incredible . (See, e.g., Clyde Washington's testimony concerning the circumstances leading to the signing of the agreement, e.g., whether or not Burlakoff explained its terms to Washington before he signed it ; whether the agreement was discussed with Hafter before the latter personally handed it to Burlakoff or whether it was mailed to Morel for signature without any discussion ; and how and when changes appearing on the contract were agreed to and initialed before signing. At one point Burlakoff made the incredible statement that Washington, who obviously knew little about collective agreements, had read the draft agreement and before "I [Burlakoff J said it was okay, next thing I knew, he signed it." Burlakoff's testimony at a late stage in the hearing (as witness for Respondent) that after Hafter confronted him with signed cards he consulted his father (an attorney specializing in criminal law) to check if 'tc could legally recognize NIPEU, is an afterthought ; he made no suet' ir. _I in earlier testimony when called as an adverse witness by General mot, se 25 While Burlakoff testified that "we had to argue" with NIPEU President Hafter to take the Washington brothers into the ,i%on so that they could get hospitalization benefits. Hafter testified that um "made them times. Becker repeatedly denied the reports, claiming that he was only selling equipment to the new plant (Morel). On one occasion (in August), when Hellman told Becker about a report that "Morel was one and the same [as) All Island" and claimed that the new plant "was covered under our [Local 1191 contract," Becker again disclaimed ownership of Morel, stating that "Burlakoff and others" owned it 26 Burlakoff's responses to Hellman's requests for a contract covering Morel were less forthright. Thus, when Hellman, accompanied by another Local 119 representa- tive (Ruggerio), visited the plant in August and told Burlakoff that he regarded Morel to be "part of .. . International," Burlakoff admonished that the Union representatives had no right to be in the plant, accusing them of "trespassing."27 Later, Burlakoff telephoned Hellman and said he "would consider running the plant under the contract" between Local 119 and All Island (i.e., International) since he "realized [Morel] needed the experienced help that 119 could provide." Several days afterward (in late August), Burlakoff reassured Hellman that he needed the services of skilled Local 119 members. When Hellman asked what would happen "to this other union" in the Morel plant (i.e., NIPEU), Burlakoff said, "My father brought them in and they will be able to get rid of them the same way he brought them in." Hellman and Burlakoff then arranged to meet with Burlakoff's father (Attorney Bernard Burlakoff), but Leonard Burlakoff subsequently called off the meeting, stating that "we have changed our mind." 2. Local 1 On July 12, 1972, Local 1 Business Agent Casino went to the Morel plant and spoke to Burlakoff and Press Foreman Mule. When Casino stated that he wanted a contract to cover the lithographic production employees in the shop, Burlakoff said they should discuss this matter later. Casino then inquired about a sign posted in the plant to the effect that it was a union shop under NIPEU. Burlakoff said that union was "basically for the kids" and others in the bindery. When Casino demanded a contract, claiming it was Becker's shop, Burlakoff denied this, saying that he (Burlakoff) was "the owner with a silent partner"-adding that Becker "had nothing to do" with Morel, except that join [in July 1972 J because they were working in the production end" and, therefore, "had to become members of the union. " 2e The last-described incident took place at Morel where Becker went to prevail upon Hellman to settle Local 119's welfare and pension claims (supra, sec. B, 2); Hellman took the position that the "monies [were I owed" to the funds administering the program and the matter was out of his jurisdiction. 27 According to Hellman, during this visit he saw Clyde Washington (10 or 15 years ago a Local 119 member) operating a cutting machine and working with several girls (part-timers) on "the same" printed material Hellman allegedly saw the girls work on at international 2 weeks earlier. Ruggerio, who was with Hellman on both occasions, did not testify that the girls were working on the same material; he testified only that in the first visit Hellman protested that the girls were working on unit work, "in violation of our contract." Washington , who recalled the last incident, did not remember the job he was working on. It is unnecessary to make a specific f"ndmg as to the identity of the material in question Although most of the findings in this section are based on the testimony of Hellman (to the extent credite i). Hellman at times tended to exaggerate in order to portray the position .if t. ,s union in the best possible light. INTERNATIONAL OFFSET CORP. 865 Morel was going to print for him as broker and that Morel's accounts "would be primarily Mr. Becker's." Also in the same conversation, Casino told Mule that he had "no business" in a nonunion plant like Morel and that he was going to be in trouble with Local 1. Burlakoff interjected that if Local I "made any sort of problem" for Mule, he would "never sign a contract with Local 1." On July 18, Casino went to see Becker at International. Becker was out and Casino left copies of contracts covering the new shop. Becker did not respond and on August 14 Casino revisited International, asking Becker "about a contract for the new shop." Becker said he had "nothing to do" with Morel and "didn't want to talk about it." iv. Conclusions A. Alleged 8(a)(1), (3), and (5) Violations Based on the Contention that Morel is an Alter Ego of International It is settled law that an employer violated Section 8(a)(1), (3), and (5) of the Act if he discontinues and transfers his operations to another location in order to deprive his employees of their statutory rights, including their right to representation and bargaining collectively through their statutory representatives . Garwin Corporation, etc., 153 NLRB 664, 676, affd. on this point sub nom. Local 57, International Ladies Garment Workers' Union, 374 F.2d 295, 298 (C.A.D.C., 1967), cert. denied 387 U.S. 942. The fact that the relocated business is conducted under a different name or in a different legal form is in itself of no consequence, if that business is an alter ego or "a disguised continuance of the old employer." (Southpost Petroleum Co. v. N.L.R.B., 315 U.S. 100, 106); Garwin Corporation, supra, at 676-677; N.L.R.B. v. Herman Brothers Pet Supply, Inc., 325 F.2d 68, 69-70 (C.A. 6, 1963); N.L.R.B. v. E.C. Brown, 184 F.2d 829 (C.A. 2). The basic issue posed here is one of motivation; namely, whether International discon- tinued or shut down its operations and continued them at a new location (two blocks away) as an alter ego under the name Morel in order to avoid bargaining with Local I and Local 119 (International employees' statutory representa- tives), as alleged in the complaint. As in almost all cases of this nature, there are factors militating both for and against a finding that Morel was a bona fide new business with ownership and control unlinked to International and its owner Becker. Based on the entire record and giving due weight to all factors, I find that General Counsel has failed to meet the burden, which is his, of establishing by a preponderance of the substantial credible evidence that Morel was but a "disguised continuance" of International, designed and utilized to escape Locals 1 and 119 and to avoid dealing with them. I rely particularly on the following considerations: 1. There is no question that "antiunion bias and demonstrated unlawful hostility are proper and highly significant factors for Board evaluation in determining motive." N.L.R.B. v. Dan River Mills, 274 F.2d 381, 384 (C.A. 5, 1960). Absent here is the deep-seated hostility to unionism often found in cases of this type-such as threats to job security, reprisals for union activity, interrogations, etc. Cf. Garwin, supra, 513 NLRB at 667-668. Indeed, the credited evidence does not show a single expression of antiunion sentiment by Becker, owner and operator of International, during the many months covering the events in this proceeding. To be sure, General Counsel points to two unfair labor practice proceedings instituted against International back in 1967 and 1968. However, apart from remoteness in time, both resulted in settlements with "no- admission" clauses. Moreover, the record shows that not long after he commenced to operate in 1960, Becker took the initiative to deal with one of the two charging unions here. According to Local I Vice President Blank, Becker at that time approached his union for help and "sign a contract . . . for a trade shop." 2. The validity of an employer's claim that economic problems led to the discontinuance of his operations is, of course, an important factor. Respondents' position that International's financial condition forced it to phase out and ultimately cease production is unassailable. The record shows that for a considerable time before the July 1972 bindery shutdown there were defaults in payments to Gibraltar (holder of the security interest in International equipment), bouncing of checks (including those for wages), arrears in contributions to union welfare and pension funds and suits to recover payment, attempts to raise money by sale of equipment directly and through advertisements, inability to meet payrolls, and steps to reduce the workforce to alleviate conditions. Becker even sold his building "in order to get these vendors, finance people, taxes, and what have you off [his] back." This, then, is a case where "economic considerations [were] honestly invoked" and not just "to disguise an antiunion motive." N.L.R.B. v. Savoy Laundry, Inc., 327 F.2d 370, 372 (C.A. 2, 1964). 3. Another relevant inquiry is International's role in the formation and operation of the new company. Morel was the brainchild of Burlakoff, International's plant manager. Aware of its financial difficulties, Burlakoff, formerly himself in business, saw an opportunity to set up another one. He offered to buy International equipment and assume its debt to Gibraltar; and suggested that Becker convert his manufacturing operation to a purely "selling company," i.e., to "broker" his customers' work at Morel. Becker, on the other hand, saw in Burlakoff's proposal an opportunity to be taken "off the hook" and accordingly accepted Burlakoff's proposition. Burlakoff then interested the Washington brothers and (through his father, an attorney) a Mr. Joffe to invest cash, arranged to buy International equipment valued at $125,000, hired person- nel for Morel, and commenced production. There is no credible evidence that Becker had any hand in the formation and subsequent operation of Morel. General Counsel made no showing (and the burden is his, of course) that Becker's equity in the transferred equip- ment was any greater than that due, owing, and to be paid thereon to Gibraltar (holder of the security interest)-full payment on which was assumed by Morel. And Gibraltar, in turn, executed an instrument obligating Morel to make the periodic payments in place of International. Insofar as appears, these transactions, as well as Becker's dealings with Morel as broker, were bona fide arms length 866 DECISIONS OF NATIONAL LABOR RELATIONS BOARD transactions. After phasing out his bindery operations in July 1972, Becker contracted out the bindery and some of his printing work to Morel and others. After completely discontinuing printing in December 1972, he became a "broker," contracting out all work-likewise to Morel and others. There is no evidence that Becker received any special treatment from Morel in regard to price or service. He testified credibly that he placed his orders "wherever it's best fitted for [him]." Nor is there any credible evidence that Becker's three or four weekly visits to Morel were made in a capacity other than that of a broker-to see to it that his orders were properly filled and to telephone customers to check whether Morel's quoted prices (plus his markups) were satisfactory. Becker neither directed nor instructed Morel employees in the performance of their work tasks. 4. The extent to which Morel has utilized International equipment and facilities and succeeded to International suppliers and customers are likewise relevant factors. To begin with, contrary to General Counsel's contention (br. p. 34), Morel and International have not operated out of "common locations." The International premises were at 115 Schmitt Boulevard (Farmington, New York) and Morel's are at 220 Sherwood Avenue, two blocks away. Nor does the record support the contention that "equip- ment has been transferred back and forth between the two plants." Morel employees have indeed "shuffled ... back and forth," but only because of the understandable arrangement (entered into when Morel purchased the machinery in June 1972) that Morel personnel could use the machinery (much of which took weeks to disassemble, move, and reassemble) until it was physically removed to Morel. Finally, while it is true, as General Counsel stresses, that "only a small portion" of Morel's equipment was "purchased" from sources other than International (i.e., $20,500 as compared to $125,000 worth), this is of little significance since, as found, the International equipment was acquired in a bona fide arms-length transaction. Moreover, it should not be ignored that Morel also uses $60,000 worth of machinery owned by Burlakoff so that the proportion of former International equipment utilized by Morel is not as imposing as appears on the surface. General Counsel makes a more persuasive showing in regard to mutual dealings and customers. Thus, as he properly points out (br. p. 31), "Morel did the bulk of its work for International"-i.e., $66,526 out of $120,237 (about 55 percent) of Morel's gross income between June 1972 and January 1973 was derived from International; and three of Morel's other four customers were also International's customers. However, important as this factor is, it cannot be viewed in isolation. In any event, insofar as appears, International's (i.e., Becker's) dealings with Morel have been at arms length; there is no evidence 211 Morel started production around June 1, Mule first appears on Morel's payroll in the week ending July 25 29 These nine were Accardi, Memon, Janssen, J. DeCicco, G. DeCicco, Konon, McMillian, Forte, and Tortosa. 30 It is this crucial factor-the absence of International production (unit) employees at inception of Morel 's operations in June 1972 and the small proportion of such employees on Morel payroll afterward-that precludes a finding that Morel, even if not International's alter ego, was at least a of any special consideration and treatment to Internation- al. As to suppliers, the stipulated facts reveal nothing of special note. From the point of volume, about $78,000 of Morel's $134,000 purchases between June 1972 and February 1973 have been made at suppliers who had also supplied International. From the point of identity of suppliers, only 26 or 27 of International's 200 suppliers have also supplied Morel. 5. Also important is the extent to which Morel has employed International personnel. Burlakoff, Internation- al's manager, continued to hold that title at Morel, but, as presently shown, that title appears to be a mask and cloak for Burlakoff's ownership and control of Morel. The crucial fact is that Burlakoff operated Morel not for International and Becker, but for himself,' and if this, as I believe, is the reasonable inference, it lays to rest General Counsel's theory of the case-that Morel was the alter ego of International. Apart from Burlakoff, Morel hired only one other former International supervisor, Press Foreman Mule-but only 7 weeks after it began to operate.28 Friedman, Internation- al's "office man" was not hired until the end of 1972, or about 7 months after Morel's operations commenced. Two clericals (Fritz and Hurwitz) were hired about the same time Mule was-7 weeks after Morel was in operation. Insofar as the production (unit) employees are con- cerned, Morel had a full complement by the week ending June 20, 1972. None of the nine "regular" employees then on the payroll had worked for International immediately preceding their hire.29 It was only in the week ending July 25 (7 weeks after operations commenced) that two International employees (alleged discriminatees Shacklady and Van Orden), laid off as a result of International's bindery shutdown, entered Morel's employ. Former International bindery employee Melenchuk (another alleg- ed discriminatee laid off as far back as March 7, 1972) was not hired by Morel until the week ending August 29, 1972. There is no evidence that any International employees laid off as a result of the December 1973 pressroom shutdown were Morel employees.30 6. In support of his contention that Morel is the alter ego of International, General Counsel stresses Burlakoff's role in the creation and operation of Morel and the fact that he was the "number two man" in International. To begin with, Burlakoff's role in International was a far cry from that he played in Morel. It was Becker, Internation- al's "number one man," who took full rein in International, making all significant decisions and shouldering the full economic burden of running the business. On the other hand, it is clear, as General Counsel recognizes, that Burlakoff was the "number one man" in Morel, its voice of authority, and the one with the last word in administering significant aspects of the business. Burlakoff truly was the successor of Morel. In determining whether one employer is successor to another it must appear that a significant percentage of employees "after the change of ownership . were employed by the preceding employer." See N.L R.B. v Burns Security Services, 406 U.S. 272, 279, aff. 441 F.2d 911, 915, In I (CA 2, 1971). See also N L.R.B v. Wayne Convalescent Center, 465 F.2d 1039 (C.A 5, 1972); Emerald Maintenance, Inc v. N.LR.B., 464 F.2d 698 (C.A. 5, 1972). INTERNATIONAL OFFSET CORP. 867 midwife in effectuating the development as well as birth of Morel. It was he who conceived it, persuading Becker that it would be to their mutual advantage; arranged for Morel's assumption of International's debt on equipment and contributed $60,000 worth of his own; brought in the Washingtons and Joffe as "investors" to act (as we shall see) as "fronts" to cloak his own stake in the business; hired all Morel personnel; secured customers and dealt with suppliers to "get credit" for the enterprise; helped install a new union (NIPEU) and negotiated with it a collective agreement; and through deception and artifice led Charging Parties to believe that he needed their skilled members and wished to deal with them-only ultimately to reject them out of hand. In short, I am satisfied that Morel was Burlakoff and Burlakoff was Morel. Indeed, in his testimony at the hearing Burlakoff often spoke as owner of Morel; and employees and others quoted him as claiming ownership. He specifically told one union official (Local I Representative Casino) that he was "the owner with a silent partner." As General Counsel aptly puts it (br. p. 33), the Washingtons, Morel's titular owners (who allegedly raised half of their $20,000 investment through friends and relatives), were used by Burlakoff as a "front" and their role in Morel and that of Joffe (the other "investor" who contributed $30,000 without being given a stock interest or as much as a note for security) are totally "fictional." I agree with General Counsel that this record demonstrates that the Washingtons were nothing but "rank-and-file" employees, paid on the basis of hours worked and earning far less than a supervisor such as Mule, let alone Burlakoff. I also agree with General Counsel that "One can only infer that the Washingtons were so set up . . . to hide the true ownership, direction, control, and motivation of Morel." However, it does not necessarily follow, as General Counsel argues, that this "set up" was designed "to avoid [International's] obligations to Locals 119 and 1. Becker, as we have seen, had ample business reasons to discontinue production. Having carefully observed him during the long hearing (including three appearances on the witness stand), I find it hard to believe that he joined with Burlakoff in a grandiose scheme to escape his obligations to Charging Parties. To be sure, he had union problems, including making the over-due welfare and pension payments. Nonetheless, I am persuaded that Becker's dominant motive in phasing out production was economic necessity. In any event, insofar as the $28,000 or $29,000 welfare- pension delinquency is concerned, International is not judgment-proof; it still operates as a "selling company" and has considerable assets in the form of equipment.31 7. This is not to say that the circumstances surrounding the "set-up" of Morel are beyond suspicion. The most damning one is that during the first 4 months of Morel's operations (June-September 1972), Burlakoff remained on International payroll drawing his weekly $500 salary as International manager. While Becker knew of Burlakoff's dual role, there is no evidence that he knew the extent of his activities for Morel. Be that as it may, absent evidence to the contrary, it may be presumed that Burlakoff continued to fulfill his diminishing responsibilities (as International was being liquidated) during Morel's trans- itional period; Becker, as well as Burlakoff, claimed that Burlakoff did. Additionally, it is not difficult to understand why Becker, in the extreme financial straits that he was, would in desperation tolerate Burlakoff's devotion to Morel in the hope that if Burlakoff's new venture was successful he would eke out an existence by "brokering" for Morel. Still another suspicious circumstance is the motivation behind Burlakoff's duplicity in the cover-up of Morel's ownership and control. As to this, one can only speculate. Employers have been known to conceal interest in enterprises for a variety of reasons, including attempts to insulate assets from creditors. The point is, as already found, that International's dealings with Burlakoff and Morel were bona fide arms-length transactions. The fact that a person (like Burlakoff) acquiring assets and property in such transaction resorts to devious devices and strata- gems to conceal the nature of his business and mask ownership is not material, let alone determinative. It does not convert an arms-length transaction to unlawful action under the National Labor Relations Act. For all of the foregoing reasons, and giving due weight to all countervailing factors, I find, contrary to General Counsel's contention, that the credible evidence falls short of establishing that Morel was an alter ego or disguised continuance of International. On the basis of the entire record, I conclude that General Counsel has failed to meet his burden of establishing by a preponderance of the credible evidence that Respondents, in violation of Section 8(a), (1), (3), and (5) of the Act, discontinued Internation- al's operations and laid off employees in order to avoid continued bargaining with Charging Parties, the statutory representatives of International's employees. On the contrary, I find that the dominant and controlling reasons for International's action were economic and not union connected. B. The Alleged 8(a)(1) and (5) Violation Based on International's Failure to Notify and Bargain with its Employees' Statutory Representatives Concerning its Decision to Shut Down Operations and the Effects of the Shutdown Upon Unit Employees There is no question that even where, as here found, an employer's discontinuance or shutdown of operations is motivated by lawful economic considerations, it is at the very least obligated to notify and consult with its employees' statutory representatives concerning the effect of the shutdown. As the Board stated in Interstate Tool Co., Inc., 177 NLRB 686, 687: We have held that an employer must notify its employees' collective-bargaining representative of a decision to close part of its operation so the union can bargain about the effects of the closing on displaced employees . . . . So, too, where an employer sold its entire business, eliminating employees' jobs, we have with court approval, required notice and bargaining 31 Indeed, as noted (supra, In 26), Local 119 President Hellman at least once rebuffed Becker's attempt to settle Local 119's welfare-pension claim. we DECISIONS OF NATIONAL LABOR RELATIONS BOARD about the effects .... In New York Mirror [ 151 NLRB 834] we held that the effects of a termination of operations is a mandatory subject of bargaining. Id at 838, footnote 4. As indicated in that case, the requirement to bargain turns not on the means whereby, or the extent to which, the employer termi- nates operations, but rather on the fact that the elimination of unit jobs is within the statutory phrase "other terms and conditions of employment." (Cita- tions omitted). See also N.LRB. v. Royal Plating and Polishing Co., Inc., 350 F.2d 191, 196 (C.A. 3, 1965); N.LR.B. v. Rapid Bindery, Inc., 293 F.2d 170, 176 (C.A. 2); Morrison Cafeterias Consolidated, Inc., 177 NLRB 591, enfd. on this point 431 F.2d 254, 257-258 (C.A. 8, 1970). The record shows that although Local I and Local 119 were for a long time aware of International's economic difficulties, they were never notified of International's decision to discontinue operations-the bindery in July and the pressroom in December 1972. Under settled law, the Unions were, at least entitled to an opportunity to discuss ways and means of minimizing the impact of the shutdowns, including, possibly, by severance or termina- tion payments. I find and conclude that International violated Section 8(axl) and (5) of the Act by failing to notify and bargain with Local 1 and Local 119 concerning its decision to discontinue or shut down operations and the effects of the shutdown upon the unit (bindery and pressroom) employ- ees.32 C. Alleged 8(a)(1) and (2) Violation Based Upon Morel's Assistance in the Establishment of NIPEU and its Execution and Maintenance of a Union- Security Contract The credited evidence shows that even before advent of NIPEU at Morel, Burlakoff, then still International plant manager told one International employee that he was "going to open a shop" and offered him employment there if he gave up his interest in his union (Local 119); he told another that the new shop would be "union" and she "would be required to join" it if she wanted to work there. Burlakoff later (June 1972) also told job applicants gathered at Morel that they were "going to have a union" in the shop. Still later, at a June 17 meeting of newly hired Morel employees, Burlakoff "passed the word around" that a union representative was going to talk to them; attended the meeting (as did Supervisor Mule and the Washingtons) at which NIPEU President Hafter spoke about his union's benefits and distributed NIPEU cards; and then announced that employee Merrion "will collect 32 In reaching this conclusion, I am not unnundful that the complaint alleges an 8(ax5) refusal to bargain on another theory, i.e., that International discontinued its operations and continued them under another name (Morel) in order to avoid bargaining with Local I and Local 119. It is clear, however, that the violation here found is not unrelated to that alleged in the complaint in that both deal with International's shutdowns the circumstances leading thereto, and International's failure to deal with the Unions regarding them. Indeed, the facts underlying the violation found tore not only fully developed, but are substantially undisputed. All that is iavaiead is a difference in "legal theory" upon which she alleged 8(ax5) the cards" and "will be shop steward." Shortly afterward on the same day (June 17), Burlakoff met with Hafter, agreed within 45 minutes to the terms of a collective agreement recognizing NIPEU, incorporating a union- security clause, and stipulating for a dues and initiation fee checkoff upon employee authorization. Morel thereafter maintained and enforced the agreement, including the checkoff provisions--remitting to NIPEU fees and dues deducted from wages. In July 1972, Burlakoff told an employee , who inquired about NIPEU, that the purpose of that union was "to keep other unions out" of Morel ; and that he could not work at Morel if he did not join it . In August, when he led Local 119 President Hellman to believe that he might deal with Local 119 because he needed skilled help, Burlakoff dismissed the importance of NIPEU by telling Hellman, "My father [Attorney Burlakoff ] brought them [NIPEU] in and they will be able to get rid of them the same way he brought them in." That Morel's course of conduct constituted interference with the formation of a labor organization, and assistance and support in establishing it, violative of Section 8(aX2) and (1) of the Act, needs no citation of authority.33 CONCLUSIONS OF LAW 1. International and Morel are each employers within the meaning of the Act. 2. Local 1, Local 119, and NIPEU are labor organiza- tions within the meaning of the Act. 3. Local 1 and Local 119 were, until International's discontinuance of production, each exclusive bargaining representatives, respectively, of International's lithographic and bindery employees in appropriate units described in paragraph II of the complaint. 4. Respondents have not violated Section 8(axl), (3), and (5) of the Act by discontinuing operations under the name International, laying off International employees as a result of such actions, and continuing International operations at another location as successor or alter ego under the name Morel. 5. International violated Section 8(axl) and (5) of the Act by failing to notify and bargain with Local I and Local 119, the statuutory representatives of its employees prior to the shutdowns, concerning its decision to discontinue the bindery and pressroom operations and the effects thereof on unit employees. 6. Morel violated Section 8(axl) and (2) of the Act by interfering with the formation and establishment of NIPEU at its plant and by granting NIPEU support and assistance, including a collective agreement with union- security and dues-fees-checkoff clauses. 7. The unfair labor practices enumerated in above violation is predicated. See Associated Home Builders v. N LR B, 352 F.2d 745, 752-754 (C.A. 9, 1965 ), and cases cited therein. See also Randolph Rubber Company, 152 NLRB 496, 499, In. 7; Independent Metal Workers Union, Local No. I (Hughes Tool Co), 147 NLRB 1573, 1576-77; Sheet Metal Workers, etc., Local No 71 (H.J. Otten Co.), 193 NLRB 23, 27, fn. 14. Cf. N L.R.B. v Syracuse Stamping Co., 208 F.2d 77, 80 (C.A. 2). 33 The complaint, as amended at the hearing, did not allege company domination. General Counsel at the hearing claimed only unlawful assistance. - INTERNATIONAL OFFSET CORP. M paragraphs 5 and 6 affect commerce within the meaning of Section 2(6) and (7) of the Act. THE REMEDY A. Having found that Respondent International, in violation of Section 8(axl) and (5) of the Act, discontinued its operations and shut down production without prior notice to and bargaining with its employees' statutory representatives concerning its decision to shut down and the effects of the shutdown on unit employees, I shall recommend that International cease and desist from any such future unlawful actions in the event International resumes operations in the future. The affirmative remedial requirements will be those prescribed by the Board in similar cases, such as Interstate Tool Co., Inc., 177 NLRB 686; and Morrison Cafeterias Consolidated Inc., 177 NLRB 591, 597-599, affd. on this point 431 F.2d 254, 258 (C.A. 8). Here, as in Interstate, "it [is] necessary in order to effectuate the purposes of the Act, to require [Internation- al j to bargain with the Union [representing each of the two bargaining units herein] concerning the effects of the shutdown on its employees; and [the] order [will provide] a limited backpay requirement designed both to make whole the employees for losses suffered as a result of the violation and to recreate in some practicable manner a situation in which the parties' bargaining position is not entirely devoid of economic consequences for [International]." As the employer in Interstate, International shall pay the employees laid off or terminated as a result of the shutdowns 34 backpay at the rate of their normal wages when last in [International's] employ from 5 days after the date of this Order until the occurrence of the earliest of the following conditions : (1) the date [International ] bargains to agreement with the Union35 on those subjects pertaining to the effects of the plant shutdown on its employees; (2) a bona fide impasse in bargaining; (3) the failure of the Union to request bargaining within 10 days of the date of this Order, or to commence negotiations within 10 days of 34 The complaint identifies seven bindery employees allegedly laid off as a result of the bindery shutdown on July 18 or 20, 1972; i.e, Bonellt, Don, Herrera, Shacklady, Van Orden, Melenchuk, and Rizzuti. However, since the last two were let go a considerable time before the shutdown-Melen- chuk in the week ending March 7, 1972, Rizzuti in the week ending May 9, 1972-these will not be covered by the backpay order. The identity (as well as number) of the pressroom employees laid off at the end of 1972 are not specified in the complaint, and may be ascertained in the compliance proceeding International's notice of its desire to bargain with the Union; or (4) the subsequent failure of the Union to bargain in good faith ; but in no event shall the sum paid to any of these employees exceed the amount he or she would have earned as wages from the date on which International shut down its operations, to the time he or she secured equivalent employment elsewhere , or the date on which International shall have offered to bargain, whichever occurs sooner; provided however, that in no event shall this sum be less than these employees would have earned for a 2-week period at the rate of their normal wages when last in International's employ. Since, in view of the shutdowns notices to employees cannot now be posted by International at its former plant, I shall recommend that it send, by first class mail, appropriate notices to all persons who were in its employ prior to the shutdowns at such persons' last known addresses. B. Having found that Respondent Morel violated Section 8(axl) and (2) of the Act by assisting and encouraging the formation and establishment of NIPEU at its plant, I shall recommend that Morel cease and desist from such unlawful conduct. Affirmatively, the order will require Morel to withdraw recognition from the assisted union; to cease to give effect to any collective agreement with it unless and until it has been certified as the exclusive bargaining representative of the employees in an appropri- ate bargaining unit; and to reimburse its employees, present and former, for all dues and fees it checked off and deducted on behalf of and paid to the assisted union, together with interest thereon, in the manner prescribed in Salmirs Oil Cowl any, 139 NLRB 25, 27. See Virginia Electric and Power Company v. N.LR.B., 319 U.S. 553, 540; Paul M. O'Neill International Detective Agency, Inc. v. N. L. R. B., 280 F.2d 936,947-948 (C.A. 3, 1960); N.L R. B. v. Getlan Iron Works, Inc., 377 F.2d 894, 897 (C.A. 2, 1967). [Recommended Order omitted from publication.] 35 As used herein "Union" shall refer separately (as the case may be) to Local 119, as representative of International's employees in the bindery unit , and to Local 1, as representative of its employees in the lithographic unit "Shutdown" shall refer separately (as the case may be) to discontin- uance of bindery operations in July and discontinuance of pressroom operations in December 1972.