U.S. Banknote Corp.

450 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Security-Columbian Banknote Company, A Division of U.S. Banknote Corporation and Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4. Case 4-CA-6541 December 10, 1974 DECISION AND ORDER BY MEMBERS FANNING, JENKINS, AND KENNEDY On June 28, 1974, Administrative Law Judge Thomas D. Johnston issued the attached Decision in this proceeding. Thereafter, General Counsel filed ex- ceptions and a supporting brief, Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4 (herein Pressmen) filed exceptions and a supporting brief, Respondent filed exceptions and an answering brief, and Graphic Arts International Union, Local 14L (herein Graphic Arts) filed exceptions and a brief in support of its exceptions and in opposition to the General Counsel's and Pressmen's exceptions. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the Na- tional Labor Relations Board has delegated its au- thority in this proceeding to a three-member panel. The Board has considered the record and the at- tached Decision in light of the exceptions and briefs and has decided to affirm the rulings, findings, and conclusions of the Administrative Law Judge, as amended, and to adopt his recommended Order as modified herein. We find merit in General Counsel's and Pressmen's exceptions to the Administrative Law Judge's conclu- sion that Respondent is not a successor employer to Federated Banknote Company (herein Federated). It is well established that an enterprise which continues the "employing industry" of a predecessor employer is properly regarded as a successor employer whenever it uses substantially the same facilities and work force to produce the same basic products for essentially the same customers in the same geographic area.' Utiliz- ing these guidelines, Respondent fits the definition of a successor employer to Federated. The Administrative Law Judge found that Respond- ent, after purchasing Federated's Caroline Road plant, fixed assets, inventory, and existing contracts, con- tinued operating this plant. Respondent completed Federated's work, without interruption, utilizing its equipment and employing its former employees and supervisors. The Administrative Law Judge also found that "these factors are sufficient to establish a successor relationship with respect to the acquisition of the I Valley Nitrogen Producers, Inc, 207 NLRB 208 (1973), Ranch-Way, Inc, 183 NLRB 1168 (1970) facility itself." Nevertheless, he concluded that Re- spondent was not a successor employer and did not violate the Act when it withdrew recognition from and refused to bargain with the Pressmen because the unit in issue had not remained intact or retained its separate identity. We disagree. The record indicates that under Federated the letter- press and offset employees who comprised the subject bargaining unit worked in a combined department, un-, der the same supervision, and performed both letter- press and offset functions. However, after Respon- dent's takeover, the employees performed either letterpress or offset work, were assigned to different departments, and performed their functions separately. Notwithstanding these changes, we find the Respond- ent to be the successor employer to Federated. All of the factors mentioned to substantiate the change in the unit's identity are directly attributable to the Respon- dent's unlawful recognition of Graphic Arts as the bar- gaining representative of the offset employees. But for this recognition and the subsequent changes which re- sulted, the department would have remained intact, retaining its original identity, with its employees func- tioning in the same manner as under Federated. Moreover, the Respondent continued essentially the same operation, with substantially the same employees and equipment and in the same location. Respondent employed no employees who had not previously worked for Federated. Additionally, in the specific unit in question all eight of the employees hired2 by Re- spondent had been employees of the predecessor Federated.' Accordingly, for the reasons stated above, we find that the Respondent is the successor employer of Federated and therefore violated Section 8(a)(5) of the Act by withdrawing recognition from, and by refusing to bargain with, Pressmen, the statutory representative of Federated's employees. AMENDED CONCLUSIONS OF LAW 1. Security-Columbian Banknote Company, a Divi- sion of U.S. Banknote Corporation, is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. 2. Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4 and Graphic Arts Inter- national Union, Local 14L, are each labor organiza- tions within the meaning of Section 2(5) of the Act. 3. For the purposes of the Act, at times' pertinent, Security-Columbian Banknote Company, a Division of 2 Federated had employed 12 offset and letterpress operators of whom Respondent hired 8, 4 in letterpress and 4 in offset 3 See Howard Johnson Co. v Detroit Local Joint Executive Board Hotel & Restaurant Employees, 94 S Ct 2236 (1974), N.L.R B v Burns Interna- tional Security Services, Inc, 406 U S 272 (1972) 215 NLRB No. 85 SECURITY-COLUMBIAN BANKNOTE COMPANY 451 U.S. Banknote Corporation, is the successor of Fed- erated Banknote Company. 4. By recognizing Graphic Arts International Union, Local 14L, as the bargaining representative of the em- ployees performing "offset" functions at the Caroline Road plant without any lawful basis and when it did not lawfully represent a majority of the employees, and by applying and enforcing Graphic Arts International Union, Local 14L's union-security collective-bargain- ing agreement to those employees , Respondent has rendered unlawful assistance and support to Graphic Arts International Union, Local 14L, and thereby has engaged in unfair labor practices within the meaning of Section 8(a)(2) of the Act. 5. By applying Graphic Arts International Union, Local 14L's union-security collective-bargaining agree- ment to the employees performing "offset" functions at the Caroline Road plant, Respondent has dis- criminated with respect to the hire, tenure, and terms and conditions of employment of its employees, thereby discouraging membership in Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4 and encouraging membership in Graphic Arts International Union, Local 14L, and engaging in unfair labor practices within the mean- ing of Section 8(a)(3) of the Act. 6. By withdrawing recognition from, and refusing to bargain with, Philadelphia Printing Pressmen, As- sistants and Offset Workers' Union No. 4, as the bargaining representative of the employees per- forming "offset" functions at the Caroline Road plant, Respondent violated Section 8(a)(5) of the Act. 7. Respondent, by engaging in such conduct set forth above, has interfered with, restrained, and coerced its employees in the exercise of their rights guaranteed by Section 7 of the Act and has thereby engaged in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 8. The aforesaid unfair labor practices affect com- merce within the meaning of Section 2(6) and (7) of the Act. ORDER Pursuant to Section 10(c) of the National Labor Re- lations Act, as amended, the National Labor Relations Board adopts as its Order the recommended Order of the Administrative Law Judge, as modified below, and hereby orders that Respondent, Security-Columbian Banknote Company, A Division of U.S. Banknote Cor- poration, Philadelphia, Pennsylvania, its officers, agents, successors, and assigns, shall take the action set forth in the said recommended Order, as modified herein: 1. Insert the following as paragraphs 1(e) and 2(b), respectively, and reletter the existing paragraphs ac- cordingly: "(e) Failing and refusing to recognize, meet, or bar- gain collectively with Philadelphia Pressmen Assis- tants and Offset Workers' Union No. 4, as the exclu- sive bargaining representative of its employees per- forming `offset' functions at the Caroline Plant. "(b) Upon request, recognize Philadelphia Printing Pressmen, Assistants, and Offset Workers' Union No. 4 as the exclusive bargaining representative of the em- ployees performing `offset' functions at the Caroline Plant, and bargain or consult with the Union at its request concerning the wages, rates of pay, hours, and working conditions of such employees." 2. Substitute the attached notice for the Administra- tive Law Judge's notice. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL withhold and withdraw recognition from Graphic Arts International Union, Local 14L, as the collective-bargaining representative of our employees performing "offset" functions at the Caroline Plant unless and until it has been certified as the bargaining representative by the National Labor Relations Board. WE WILL NOT give any force or effect to our col- lective-bargaining agreement with the above- named union, or any modification, extension, renewal, or supplement thereto insofar as it per- tains to the employees performing "offset" func- tions at the Caroline Plant. We will not, however, abandon any benefits which have been established for them under the collective-bargaining agree- ment. WE WILL NOT give any unlawful assistance or support to the above-named labor organization or any other labor organization. WE WILL NOT unlawfully encourage membership in the Graphic Arts International Union, Local 14L, or discourage membership in the Phila- delphia Printing Pressmen, Assistants and Offset Workers' Union No. 4, or in any other labor or- ganization with respect to hire, tenure , and terms and conditions of employment. WE WILL bargain collectively concerning rates of pay, wages, hours, and other terms and conditions of employment with Philadelphia Printing Press- men, Assistants and Offset Workers' Union No. 4, as, the exclusive representative of the employees 452 DECISIONS OF NATIONAL LABOR RELATIONS BOARD performing "offset" functions at the Caroline Plant. ' WE WILL NOT in any like or related' manner, in- terfere with, 'restrain, or coerce our employees in the exercise of their right to self-organization, to form, join, or assist any labor organization, to bar- gain collectively through representatives of their own choosing, to engage in other concerted activi- ties for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities, except to the extent such right is affected by the provisos in Section 8(a)(3) of the Act. WE WILL reimburse those employees who per- formed "offset" functions at the Caroline Plant for all initiation fees, dues, and other moneys paid by them or withheld from their pay as a result of the illegal application and enforcement beginning on May 21, 1973, of the collective-bargaining agree- ment to them. All our employees are free to become or remain, or to refrain from becoming or remaining, members of any labor organization, except to the extent such right may be affected by the provisos in Section 8(a)(3) of the Act. SECURITY-COLUMBIAN BANKNOTE COMPANY, A DIVISION OF U.S. BANKNOTE CORPORATION DECISION The issues involved are whether Respondent was a succes- sor employer to Federated; and whether Respondent violated Section 8(a)(1), (2), (3), and (5) of the Act by withdrawing recognition from and refusing to bargain with the Pressmen Local as the bargaining representative of certain employees performing "offset" functions and by instead recognizing the Graphic Arts Local as their bargaining representative and applying and enforcing their collective-bargaining agreement containing the union-security provision to them. The parties at the hearing were afforded full opportunity to introduce relevant evidence, to examine and cross-examine witnesses, to argue orally on the record, and to submit briefs. Upon the entire record in this case and from my observa- tion of the witnesses, and after due consideration of the briefs filed by the parties, I hereby make the following: FINDINGS OF FACT I THE BUSINESS OF THE RESPONDENT Respondent, a Virginia corporation with a plant located at 55th and Sansom Street and another plant located at 11600 Caroline Road, Philadelphia, Pennsylvania, is engaged in the business of designing, engraving, and printing stocks, bonds, foreign currency, foreign stamps, and other matter. During the 12-month period preceding February 12, 1974, Respond- ent in the course of its operations at its Philadelphia, Pennsyl- vania, plants made sales, in excess of $50,000, to customers located outside the Commonwealth of Pennsylvania. Respondent admits, and I find, that it is engaged in com- merce within the meaning of Section 2(6) and (7) of the Act. STATEMENT OF THE CASE THOMAS D. JOHNSTON, Administrative Law Judge: This case was heard at Philadelphia, Pennsylvania, on April 25 and 26, 1974, pursuant to a charge filed on August 14, 1973,1 by the Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4 (herein referred to as Press- men Local) and a complaint issued on February 12, 1974. The complaint alleged that Security-Columbian Banknote Company, a Division of the U.S. Banknote Corporation (herein referred to as the Respondent) was a successor em- ployer to the Federated Banknote Company (herein referred to as Federated) and that the Respondent by withdrawing recognition from and refusing to bargain with the Pressmen Local as the bargaining representative of employees perform- ing "offset" functions which it had represented while they were employed at Federated and by recognizing the Graphic Arts International Union, Local 14L (herein referred to as Graphic Arts Local),' as the bargaining representative of said employees and by applying and enforcing a collective- bargaining agreement between them containing a union- security provision to those employees violated Section 8(a)(1), (2), (3), and (5) of the National Labor Relations Act, as amended (herein referred to as the Act). Respondent in its answer filed on February 19, 1974, de- nied having violated the Act. II THE LABOR ORGANIZATIONS INVOLVED Respondent admits, and I find, that the Philadelphia Print- ing Pressmen, Assistants and Offset Workers' Union No. 4 and the Graphic Arts International Union, Local 14L, are each labor organizations within the meaning of Section 2(5) of the Act. III THE UNFAIR LABOR PRACTICES A. Background Since about 1968 Federated had operated a plant (herein referred to as the Caroline Plant) located at 11600 Caroline Road, Philadelphia, Pennsylvania. Previously its plant had been located on North Broad Street, Philadelphia, Pennsyl- vania. Federated's employees, except for some who were unrepre- sented, were represented by various labor organizations' in- cluding the Pressmen Local. According to Frederick Day who is the secretary-treasurer and business representative of the Pressmen Local, his union had had written collective- bargaining agreements with Federated at least'as far back as 1967 when he took office and since Federated was then con- tributing to the union's welfare fund this meant they would have had written collective-bargaining agreements prior to All dates referred to are in 1973 unless otherwise stated 3 These other labor organizations were the Philadelphia Typographic No 2 The Graphic Arts International Union was formerly named the Lithog- 2, Teamsters Local 470, Bookbinders and Bindery Womens' Union Local raphers and Photoengravers International Union No 2, International Plate Printers, and the Engravers Union SECURITY-COLUMBIAN BANKNOTE COMPANY 453 that time. The most recent collective-bargaining agreement between Federated and the Pressmen Local which covered the period from May 1, 1970, to April 13, 1973, and was extended by agreement of the parties until May 18, 1973, described the bargaining unit, in part, as follows: The Company recognizes that the Union is the exclusive and sole collective bargaining agent for all employees in the pressrooms operated by the Company and that the jurisdiction of this contract extends over all printing presses operated by the Company, including but not limited to gravure, offset and letter presses and as- sociated devices. It is understood, also, that the jurisdiction of this con- tract extends over all work in connection with offset platemaking, including camera operation, all darkroom work, stripping layout, opaquing and press lineup.' Respondent operated a plant (herein referred to as the Sansom Plant) located at 55th and Sansom Street, 'Phila- delphia, Pennsylvania, where it employed 150 production employees, including 12 offset employees and 8 letterpress employees This plant was located approximately 20 miles from the Caroline Plant. Its employees, except for some who were unrepresented, were represented by various labor organizations including the Pressmen Local and Graphic Arts Local. The current collective-bargaining agreement covering the Respondent and the Graphic Arts Locals was effective from May 1, 1972, to April 30, 1975. Article 5 of the agreement defined the Union's jurisdiction, in part, as "all work, pro- cesses, operations and products directly associated with or related to Lithography, Offset (including dry or wet), Photo- engraving, Itaglio, Gravure, and all other methods or tech- niques of printing, or otherwise reproducing images of all kinds, or any other purpose, including without limitations any technological or other change, evolution of or substitu- tion for any work, process, operation of product now or hereinafter utilized in any of the methods or for any of the purposes described above." Section 2 of the agreement provided in part as follows: "This contract shall be binding on all members of the As- sociation, for their plants or departments in the Philadelphia area.... Article 6 of the agreement contained union-security provi- sions requiring as a condition of employment that those em- ployees who were members of the Union on the effective date of the agreement to remain members and those employees who were not members of the Union to become and remain members in good standing after the 30-day period. Respondent and the Pressmen Union for many years have had collective-bargaining agreements covering the letterpress employees employed at the Sansom Plant.6 While the cur- 4 While the agreement includes gravure presses and associated devices neither Federated nor Respondent , after taking over the plant as discussed ,nfm employed such employees 5 The agreement is between the Graphic Arts Local and the Lithographers Association of Philadelphia, A Division of Graphic Arts Association of Delaware Valley , Inc., of which the Respondent is a member rent collective bargaining agreement effective from May 1, 1973, to April 30, 1976, contained under paragraph 4 of the recognition clause language that would include employees performing "Offset" functions, Business Representative Day acknowledged this language did not mean the Respondent had agreed to recognize the Pressmen Local as a representa- tive of such ` employees. The clause itself made exceptions where an employer as at the Sansom Plant had already granted jurisdiction of work to other unions. On May 18, 1973, Respondent's parent corporation, United States Banknote Corporation, purchased the Caroline Plant from Federated's owners, namely, Thomas De La Rue, Inc., a wholly owned subsidiary of the De La Rue Company Limited.' The purchase with certain exceptions included the seller's rights to the land and building, fixed assets, machinery, equipment, inventories, copyrights, contracts, orders, and work-in-process. Albert D'Orazio, an employee of Federated, testified em- ployees were first notified of the proposed sale by memoran- dum distributed about March 19 and a newspaper article which appeared in the March 19 edition of the Evening Bulle- tin. Meetings of employees were also held about April 1 and April 15 to discuss the sale and on April 13 the employees were issued a notice informing them of the sale and that United States Banknote Corporation would be meeting with certain employees and their unions to discuss `offering them jobs. On May 18 Federated terminated its employees paying them their accrued vacation pay, gave them notice of cancel- lation of their insurance, and with the exception of those employees who were to be hired by Respondent paid them severance pay, That same day Federated by letter notified Business Representative Day that United States Banknote was taking possession of the plant, Federated's employees were being terminated that day and it considered their collec- tive-bargaining agreement terminated. B. Respondent 's Operation of the Caroline Plant On May 21 Respondent began operating the Caroline Plant employing a total of 45 production employees who had been employed by Federated when it ceased operations.' No new production employees were hired at least up until September 20.9 Based on the testimony of Plant Superintendent Robert Christophersen, who was over both the Sansom Plant and the Caroline Plant where he spent approximately 35 to 40 percent of his time, those supervisors employed directly at the Caro- line Plant included Production Manager Richard Di Lorenzo, Assistant Foreman John Gedeon, Assistant Fore- man Daniel Acker and Assistant Foreman Norman Hale. Other persons with supervisory authority over the Caroline Plant included Winfield Korn, who was the foreman over the 6 The collective-bargammg' agreement is between the Pressmen Local and the Allied Printing Employers Association, a Division of Graphic Arts Association of Delaware Valley, inc , of which Respondent is a member 7 Plant Manager Chrstophersen stated the plant was purchased in hopes of obtaining a portion of the Federal food coupon contract however these hopes never materialized % 8 Plant Manager Chnstophersen testified by May 17 it had completed offering jobs to Federated's employees 9 Federated at the time it ceased operations employed 66 production employees and 7 production foremen 454 DECISIONS OF NATIONAL LABOR RELATIONS BOARD finishing department for both plants; Mike Gerace, who was the foreman over the DP department for both plants; and John Cerak who was the foreman over the offset or litho department and Frank Widdowson, who was the foreman over the letterpress department. Estimates of the times spent by these foremen at the Caroline Plant during the period following its takeover by Respondent established Korn spent less than 50 percent; Gerace between 2 to 5 hours a week; Cerak about 5 hours a week; and Widdowson none. Produc- tion Manager Di Lorenzo, Assistant Foremen Gedeon, Acker, and Hale, and Foreman Korn had held supervisory positions with Federated at the time it ceased operations. The equipment purchased from Federated10 included four offset presses, five letterpresses, three rotary steel presses, two die stamping presses, engraving equipment (ruling machine, geometric lathe, and four to five transfer presses), two guillo- tine cutters, material handling equipment such as lift trucks, two photosetters, a Ludlow casting machine, cameras, a Klu- gie press, a Heidelberg press, two Miller presses, and three verticle presses. According to Plant Manager Christophersen, approximately 70 percent of the equipment purchased from Federated was utilized by Respondent and the remaining 30 percent which was either junked or transferred elsewhere included one offset press, engraving equipment, material han- dling equipment, and the photosetters. Plant Manager Christophersen stated about 65 percent of the work which was in process by Federated and more than half of its new orders on which no work had been performed were completed by the Respondent. The remaining orders were not completed because of such reasons as customers canceling them or going out of business. Christophersen stated immediately following the takeover possibly all of the security printing work performed utilized Federated's plates. While Albert D'Orazio who had formerly worked at Federated and was employed as a pressman by the Respondent at the Caroline Plant testified they continued to perform the same kind of work for the same customers except for two new jobs, Christophersen stated the work for new customers included printing for 90 percent of the new engrav- ing performed at the Sansom Plant. Upon taking over the Caroline Plant, Christopherson stated the composing room which had been operated by Federated was closed and a single stonehand was there- after used at the Caroline Plant. Other changes included moving the engraving, gluing, and shingling work from the Caroline Plant to the Sansom Plant and moving most of the push-up of serial wing bonds from the Caroline Plant to Respondent's Chicago facility.'' According to Plant Manager Christophersen the skills and functions of those employees in both the Caroline Plant and the Sansom Plant were essentially the same. While Christo- phersen testified there were interchanges of employees be- tween the two plants as the necessity arose, and both plants 10 Plant Manager Christophersen stated the purchase included all except three or four pieces of equipment. 11 The contention that other changes in the operations of the Caroline Plant were delayed as a result of a strike by the Pressmen Local during the period June 5, 1973, until July 23 was refuted by Plant Manager Christo- phersen's testimony under cross-examination in which he acknowledged he wasn't sure whether Respondent's plans to use new or different equipment or planned changes in the supervision at the Caroline Plant were delayed or effected by the strike. were used interchangeably to perform certain jobs, no figures were given to show the extent of such interchanges of em- ployees and products. The only evidence relating to the transfer of employees between the two plants occurred in late summer or early fall when employees were transferred from the litho department of the Sansom Plant to the Caroline Plant to run the Webb press which had been moved from the Sansom Plant to the Caroline Plant. Although Albert D'Orazio who worked at the Caroline Plant stated after being laid off from work in February 1974 he was assigned to the Sansom Plant, upon his recall he stated it was not customary to assign employees of the Caroline Plant to work at the Sansom Plant. Christophersen acknowledged during the period May 21 through June 6 he did not know whether there had been any transfers between the two plants or if the employees of the Caroline Plant had worked at the Sansom Plant. The only other equipment moved from the Sansom Plant to the Caroline Plant was an Ashton offset "press which was also moved in the late summer or early fall. About June a Vacuumatic electronic counter was moved from the Caroline Plant to the Sansom Plant. A multilith offset press and a paging press were moved to the Caroline Plant from New York in late summer or early fall and a Klugie-Webbflow letterpress was purchased about the same time. Some moving equipment was also sent to the Caroline Plant from Respon- dent's G Street facility. Certain items common to both plants such as rolls, dies, plates, inventory borders and paper have been transferred between the plants, and Christophersen who is responsible for recommending purchases of equipment for both plants makes all purchases. According to Christophersen all sales for both plants which are made by the same sales force are funneled through him and he determines based on the differences in the press equipment which plant gets the work. Plant Manager Christophersen testified personnel records for both plants are kept at the Sansome Plant and new hires are referred there for approval. He was also responsible for setting the personnel policies for both plants and except for those collective-barganing agreements negotiated by the as- sociations of which Respondent is a member he was responsi- ble for negotiations for those plants. Insofar as grievances which might go to arbitration are concerned, he reports to his supervisor for determining company policy. C. Respondent's Recognition of the Graphic Arts Local rather than the Pressmen Local for those Employees Performing "Offset" Functions at the Caroline Plant Business Representative Day of the Pressmen Local, after receiving a copy of the April 13 notice of the impending sale of the Caroline Plant from Federated's President Bahmer,12 on April 18, informed Fred Esty, who is the Chairman of the Board of United States Banknote Corpora- tion, by letter that he had received the notice and informed Esty his Union represented a bargaining unit of pressmen at the Caroline Plant and had an agreement with Federated and 12 Business Representative Day stated he had heard rumors as early as March about the possible sale of the plant. SECURITY-COLUMBIAN BANKNOTE COMPANY 455 stated if the negotiations resulted in the purchase of the plant and its asserts he assumed Esty's Company would fulfill its legal obligation to grant recognition to his Union as the bar- gaining agent for the unit he represented. On May 4 a meeting was held between Business Represen- tative Day and Respondent's Plant Manager Christophersen at the Union's office. Day testified Christophersen informed him of the impending sale stating they were going to take the plant over and offer employment to some of the employees including 7 of the 13 employees who Day represented. Chris- tophersen informed him three of the employees would be in letterpress and four of them in offset, however, those em- ployees in offset would have to be members of the Graphic Arts Local. Day objected stating they had a bargaining unit there and would be entitled to have the Respondent recognize them for the employees they represented. Chnstophersen ac- knowledged he was aware of the letter Day had set to Chair- man Esty. Christophersen did not deny Day's version of the conversation. On May 7, 1973, Plant Manager Christophersen by letter informed Day since they viewed Federated's facility and as- sets as an accretion to the Sansom Plant they could only recognize Day's jurisdiction over those letterpress employees to whom Respondent would be offering employment. Chris- tophersen mentioned Respondent had a collective-bargaining agreement with the Graphic Arts Local which covered their present location and all future locations and that the offset portion which was being purchased must come under the jurisdiction of their collective-bargaining agreement with the Graphic Arts Local. The letter also stated Respondent was interested in offering employment to three of four individuals who would only be concerned with letterpress. On May 17, 1973, Plant Manager Christophersen by letter notified Day that Respondent would offer letterpress employ- ment to Norman Hale, Albert D'Orazio," Emil Korn- berger, and Earl Eppes. It also informed Day Respondent would offer offset employment to other employees the Press- men Local represented, namely, Daniel Acker, George Rob- erts, Horace Hale, and Anthony Di Lorenzo14 who would come under Respondent's collective-bargaining agreement with the Graphic Arts Local. Besides these eight employees named who were all hired by the Respondent to work at the Caroline Plant the Pressmen Local represented four other employees in the litho and letterpress department and the litho platemaking department who were not hired. Plant Manager Chnstophersen testified about the latter part of April during a telephone conversation with Walter Buczko, who was the secretary of the Graphic Arts Local, that he, explained to Buczko they were in negotiations to purchase the plant and assets of Federated and would offer jobs to certain employees whose primary function was offset and offset preparation, i.e., camera, stripping, and opaquing. Christophersen stated since he had a contract he asked if 13 Albert D'Orazio testified about May 15 Respondent's Plant Manager Chnstophersen offered him and Earl Eppes jobs as letterpressmen which he accepted This meant he would no longer perform offset work and in addi- tion would give up his job as a working night foreman 10 Daniel Acker was a foreman in the litho platemaking department and George Roberts was a platemaker in the same department . Horace Hale worked in the litho and letterpress department operating both the offset and letterpress and Anthony Di Lorenzo worked in the same department on offset there would be any problem in offering jobs to those em- ployees who were not members of the Graphic Arts Local. According to Christophersen, Buczko did not object and it was his conclusion their collective-bargaining agreement would be extended to cover those employees. On May 17, 1973, Plant Manager Chnstophersen by letter confirmed his early conversation with Secretary Buczko stat- ing he had offered employment with Respondent at the Caro- line Plant to Daniel Acker, George Roberts, Horace Hale, and Anthony Di Lorenzo. Respondent since taking over the operation of the Caroline Plant on May 21 has recognized the Graphic Arts Local as the bargaining representative of those employees at the Caro- line Plant who are engaged in operating offset printing presses and associated devices and employees engaged in off- set platemaking, including camera operations, darkroom work, strapping layout, opaquing, and press lineup and has applied its collective-bargaining agreement with the Graphic Arts Local covering those employees at the Sansom Plant to those employees at the Caroline Plant. Respondent's recogni- tion of the Graphic Arts Local for the Caroline Plant em- ployees was based on its conclusion, it was bound to be so under their collective-bargaining agreement and that it was an accretion to the existing unit rather than upon any evi- dence or conclusion, those offset employees at the Caroline Plant had independently chose or authorized the Graphic Arts Local to represent them. Since taking over the Caroline Plant and at all times material herein Respondent has recognized the Pressmen Lo- cal as the bargaining representative of those employees operating the letterpress printing presses and associated devices. 15 Following acquisition of the Caroline Plant by the Re- spondent those unions representing the employees of the Caroline Plant have included the Engravers Union, Photo Printers, Steel Plate Printers Union, Graphic Arts Local, Pressmen Local, and Teamsters Local 107 These unions also represented employees at the Sansom Plant. D. Conclusions and Analysis The General Counsel contends while Respondent denies that the Respondent violated Section 8(a)(1), (2), (3), and (5) of the Act16 by withdrawing recognition from and refusing to bargain with the Pressmen Local as the bargaining re- presentative of employees performing "offset" functions at the Caroline Plant while instead recognizing the Graphic Arts Local as their bargaining representative and by applying and enforcing their collective-bargaining agreement, which contained union-security provisions to them. 15 Respondent does not have any employees engaged in operating as- sociated devices to the letterpresses 16 Sec 8(a)(1) of the Act prohibits an employer from interfering with, restraining , or coercing employees in the exercise of the rights guaranteed in Sec 7 of the Act Sec 8(a)(2) of the Act prohibits an employer from dominating or interfering with the formation of any labor organization or contributing financial or other support to it Sec 8(a)(3) of the Act provides in pertinent part "it shall be an unfair labor practice for an employer by discrimination in regard to hire or ;tenure of employment or any term or condition of employment to encourage or discourage membership in any labor organization "Sec 8(a)(5) of the Act prohibits an employer from refusing to bargain collectively with the representative of its employees. 456 DECISIONS OF NATIONAL LABOR RELATIONS BOARD While the General Counsel and the Pressmen Local con- tend Respondent was a successor to Federated and therefore legally obligated to recognize and bargain with the Pressmen Union as the representative of the "offset" employees which it had represented at Federated, both Respondent and the Graphic Arts Local assert such employees constituted an accretion to their existing bargaining unit at the Sansom Plant and therefore recognition of the Graphic Arts Local as their bargaining representative and application of their col- lective-bargaining agreement to them was lawful. Where there is a substantial continuity in the identity of the employing enterprise the purchasing employer is required to recognize and bargain with the incumbent union, Northwest Galvanizing Co., 168 NLRB 26, 28 (1967). A determination whether a new group of employees at a new facility operated by the same employer constitutes an accretion to an existing unit must be determined in the light of the circumstances of each individual case. Haag Drug Company, Incorporated, 169 NLRB 877 (1968). Certain fac- tors to which weight has been given by the Board in determin- ing whether an accretion exists include the integration of operations, centralization of management and administrative control, geographic proximity, similarity of working condi- tions, skills, functions, common control over labor relations, collective-bargaining history, and the interchange of em- ployees. Pilot Freight Carriers, Inc., 208 NLRB 853 (1974). The Board in its Melbet Decision" stated: We will not, however, under the guise of accretion, com- pel a group of employees, who may constitute a separate appropriate unit, to be included in an overall unit with- out allowing those employees the opportunity of express- ing their preference in a secret election or by some other evidence that they wish to authorize the Union to repre- sent them. When an employer upon being confronted with conflicting representational claims by two unions negotiates a collective- bargaining agreement with one of them before its right to be recognized as the collective-bargaining representative has been finally determined under the procedures set forth under the Act, such conduct constitutes unlawful assistance. Midwest Piping & Supply Co., Inc., 63 NLRB 1060. Upon considering the findings supra, the evidence estab- lished that the Respondent after purchasing Federated's plant, fixed assets, inventories, and existing contracts, con- tinued operating the Caroline Plant, without interruption, completing such work along with similar work utilizing Federated's equipment and employing its former employees and supervisors. While these factors are sufficient to establish a successor relationship with respect to the acquisition of the facility itself, Federated's employees were separated into a number of different bargaining units and represented by various labor organizations. With respect to the bargaining unit in issue here because of certain changes made in the operations of the Caroline Plant upon Respondent's takeover this unit did not remain intact or retain its separate identity. Under Federated the letterpress and offset employees comprising the bargain- 17 Melbet Jewelry Co., Inc., and I.D.S.-Orchard Park, Inc., 180 NLRB 107, 110 (1969). ing unit worked in the same departments, under the same supervision, and performed both letterpress and offset func- tions. However, following Respondent's takeover those em- ployees, who were formerly employed in the bargaining unit and were offered and accepted employment with the under- standing they would perform either letterpress or offset work, were assigned to different departments, worked under differ- ent supervision, and performed these functions separately and to some extent the offset work was performed in conjunc- tion with employees of the Sansom Plant. Moreover, there was a substantial reduction in the number of those employees hired. Such changes in operations as previously noted were not limited to these employees alone but also involved em- ployees affected by closing the composing room and moving the engraving, gluing, and shingling work from the Caroline Plant to the Sansom Plant. However, Respondent did recognize the Pressmen Local as the bargaining representative of the letterpress employees which it had previously represented and although the former unit description included employees performing gravure work and work on associated devices neither Federated nor the Respondent had employed such employees at the Caro- line Plant. Under these circumstances, inasmuch as the bargaining unit in issue here did not remain intact or retain its separate identity following the takeover of the Caroline Plant, I find that the Respondent by withdrawing recognition from and refusing to bargain with the Pressmen Local as the bargaining representative of these employees performing "offset" func- tions at the Caroline Plant1e did not violate Section 8(a)(1), (2), (3), or (5) of the Act as alleged in the complaint. The remaining issue is whether Respondent violated Sec- tion 8(a)(1), (2), and (3) of the Act as alleged by granting recognition to the Graphic Arts Local as the bargaining re- presentatives of those employees performing "offset" func- tions at the Caroline Plant and by applying and enforcing their collective-bargaining agreement, which contains union- security provisions, to those employees. Respondent and the Graphic Arts Local in asserting their accretion defense rely both on the recognition language in their collective-bargaining agreement and certain factors ap- plicable to both plants. Insofar as the recognition clause is concerned such reliance is misplaced since their agreement was executed prior to the acquisition of the Caroline Plant and its language makes no specific provisions for newly acquired facilities such as here. While a consideration of the evidence pertaining to those factors applicable to both plants disclosed centralized man- agement; common control over labor relations and personnel policies; central personnel records keeping; common sales force; common purchasing; similar working conditions; possession of similar work skills and functions; and an inter- change of items commonly used in the production process, such evidence failed to establish that the interchange of em- ployees and work products and the transfer of employees between the two plants were other than minimal or that the operation of the Caroline Plant was not substantially autono- mous. Upon considering these factors in their entirety and in 18 Respondent at no time had ever recognized the Pressmen Local as the bargaining representative of these employees. SECURITY-COLUMBIAN BANKNOTE COMPANY 457 view of the geographic separation of the two plants and prior bargaining history, I find that those employees performing "offset" functions at the Caroline Plant were not an accretion to the existing bargaining unit of offset employees at the Sansom Plant. Having found those employees were not an accretion to the existing bargaining unit which was the sole basis for granting recognition, I find that Respondent by granting recognition to the Graphic Arts Local as the bargaining representative of the employees performing "offset" functions at the Caroline Plant and applying and enforcing their union-security collec- tive-bargaining agreement to them with knowledge of the Pressmen Local's claim to represent them and that a real question concerning representation existed, thereby rendered unlawful assistance and support to the Graphic Arts Local in violation of Section 8(a)(1) and (2) of the Act. Further I find since the collective-bargaining agreement with the Graphic Arts Local which Respondent unlawfully applied to those employees contained union-security provisions Respondent discriminated against them with respect to hire and tenure of employment thereby discouraging membership in the Press- men Local in violation of Section 8(a)(1) and (3) of the Act. Union No. 4 and encouraging membership in the Graphic Arts International Union , Local 14L, and engaging in unfair labor practices within the meaning of Section 8(a)(3) of the Act. 5. Respondent, by engaging in such conduct set forth above has interfered with , restrained, and coerced its employees in the exercise of their rights guaranteed by Section 7 of the Act and has thereby engaged in unfair labor practices within the meaning of Section 8(a)(1) of the Act. 6. By withdrawing recognition from and refusing to bar- gain with the Philadelphia Printing Pressmen , Assistants and Offset Workers' Union No. 4 as the bargaining representative of the employees performing "offset" functions at the Caro- line Plant, Respondent did not violate Section 8(a)(1), (2), (3), or (5) of the Act, as alleged in the complaint. 7. The aforesaid unfair labor practices effect commerce within the meaning of Section 2 (6) and (7) of the Act. THE REMEDY IV THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent set forth in section III, above, found to constitute unfair labor practices occurring in con- nection with the operations of Respondent described in sec- tion I, above, have a close, intimate, and substantial relation- ship to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce and the free flow thereof. CONCLUSIONS OF LAW 1. Security-Columbian Banknote Company, a Division of U.S. Banknote Corporation, is an employer engaged in com- merce within the meaning of Section 2(6) and (7) of the Act. 2. Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4 and the Graphic Arts International Union, Local 14L, are each labor organizations within the meaning of Section 2(5) of the Act. 3. By recognizing the Graphic Arts International Union, Local 14L, as the bargaining representative of the employees performing "offset" functions at the Caroline Plant without any lawful basis and at a time when a real question concern- ing representation existed with respect to those employees and by applying and enforcing Graphic Arts International Union, Local 14L's union-security collective-bargaining `agreement to those employees, Respondent has rendered un- lawful assistance and support to Graphic Arts International Union, Local 14L, and thereby has engaged in unfair labor practices within the meaning of Section 8(a)(2) of the Act. 4. By applying Graphic Arts International Union, Local 14L's union-security collective-bargaining agreement to the employees performing "offset" functions at the Caroline Plant, Respondent has discriminated with respect to the hire, tenure, and terms and conditions of employment of its em- ployees, thereby discouraging membership in the Phila- delphia Printing Pressmen, Assistants and Offset Workers' Having found that the Respondent has engaged in certain unfair labor practices within the meaning of Section 8(a)(1), (2), and (3) of the Act, I shall recommend that it be ordered to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act. Having found that the Respondent violated the Act by recognizing Graphic Arts Local as the bargaining representa- tive of the employees performing "offset" functions at the Caroline Plant and by applying and enforcing the union- secunty collective-bargaining agreement to those employees, I shall recommend that the Respondent be ordered to with- draw and withhold recognition from the Graphic Arts Local as the representative of those employees unless and until the Board shall certify it as the bargaining representative. It shall also be recommended that Respondent be ordered to cease giving effect to its collective-bargaining agreement with the Graphic Arts Local or to any modification, extension, renewal, or supplement thereto, insofar as its applies to those employees performing "offset" functions at the Caroline Plant However, this recommended Order shall not be con- strued to require Respondent to vary any of the substantive terms, conditions, and benefits presently in effect for these employees. Further, since the collective-bargaining agreement con- tained union-security and checkoff provisions, it shall be recommended that Respondent be ordered to restore to pre- sent or former employees performing "offset" functions at the Caroline Plant since May 21, 1973, when the collective-bar- gaining agreement was first applied to them any fees, dues, or other payments by them to the Graphic Arts Local or which were unlawfully deducted from their pay including in additton`to the reimbursements the payment of interest on such amounts at the rate of 6 percent per annum. See Bisso Towboat Company, Inc., 192 NLRB 885 (1971) Upon the foregoing findings of fact, conclusions of law, and the entire record, and pursuant to Section 10(c) of the Act, I hereby issue the following recommended: 458 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ORDER'9 Respondent, Security- Columbian Banknote Company, a Division of U.S. Banknote Corporation, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Giving unlawful assistance or support to the Graphic Arts International Union, Local 14L, or any other labor organization. (b) Recognizing the Graphic Arts International Union, Local 14L, as the representative of its employees performing "offset" functions at the Caroline Plant for the purpose of dealing with Respondent concerning grievances, labor dis- putes, wages, rates of pay, hours, or other terms and condi- tions of employment. (c) Giving any force or effect to the collective- bargaining agreement with the Graphic Arts International Union, Local 14L, or to any modification, extension, renewal, or supple- ment thereto, insofar as it applies to those employees per- forming "offset" functions at the Caroline Plant, provided, however, that nothing herein shall require the Respondent to vary any of the substantive terms, conditions, and benefits presently enjoyed by those employees, which have been estab- lished in the performance of this collective- bargaining agree- ment. (d) Encouraging memebership in the Graphic Arts Inter- national Union, Local 14L, or any other labor organization and discouraging membership in the Philadelphia Printing Pressmen, Assistants and Offset Workers' Union No. 4 or any other labor organization by discriminating with respect to the employees' hire, tenure, and terms and conditions of employment. (e) In any like or related manner interfering with , restrain- ing, or coercing its employees in the exercise of their right to self- organization, to form, join, or assist any labor organiza- tion, to bargain collectively through representatives of their own choosing, to engage in concerted activities for the pur- poses of collective bargaining or other mutual aid or protec- tion, or to refrain from any or all such activities, except to the 'y In the event no exceptions are filed as provided by Sec. 102.46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in Sec. 102.48 of the Rules, and Regulations, be adopted by the Board and become its findings, conclusions, and Order, and all objections thereto shall be deemed waived for all purposes. extent that such right may be affected by the provisos of Section 8(a)(3) of the Act. 2. Take the following affirmative action necessary to effec- tuate the policies of the Act: (a) Withdraw and withhold recognition from the Graphic Arts International Union, Local 14L, as the collective- bar- gaining representative of those employees performing "off- set" functions at the Caroline Plant for the purpose of dealing with Respondent concerning grievances, labor disputes, wages, rates of pay, hours of employment, or other terms or conditions of employment, unless and until the Board shall certify said labor organization as their bargaining representa- tive. (b) Reimburse all present and former employees perform- ing "offset" functions at the Caroline Plant except those who joined the Graphic Arts International Union, Local 14L, prior to the unlawful enforcement and application of the union- security collective- bargaining agreement on May 21, 1973, for all initiation fees, dues, and any other moneys, if any, paid by or withheld from them pursuant to the terms of 'the collective- bargaining agreement in the manner provided for in the section of this Decision entitled "The Remedy." (c) Post at both its Caroline Plant and Sansom Plant located in Philadelphia, Pennsylvania, copies of the attached notice marked "Appendix."" Copies of said notice, on forms provided by the Regional Director for Region 4, shall, after being duly signed by an authorized representative of Respondent, be posted immediately upon receipt thereof, and maintained by it for 60 consecutive days thereafter, in con- spicuous places, including all places where notices to em- ployees are customarily posted. Respondent shall take rea- sonable steps to insure that said notices are not altered, defaced, or covered by any other material. (d) Notify the Regional Director for Region 4, in writing, within 20 days from the date of this Decision, what steps have been taken to comply herewith. IT IS FURTHER ORDERED that the complaint, be, and it hereby is dismissed insofar as it alleged unfair labor practices not specifically found herein. 20 In the event the Board's Order is enforced by a Judgment of the 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."