Mason City Dressed Beef

MASON CITY DRESSED BEEF Mason City Dressed Beef, Inc., and Packing House and Industrial Services, Inc. and Local P-38, Amalgamated Meat Cutters and Butcher Work- men of North America, AFL-CIO National Industrial Workers Union and Local P-38, Amalgamated Meat Cutters and Butcher Work- men of North America, AFL-CIO. Cases 18-CA- 4893 and 18-CB-725 August 30, 1977 DECISION AND ORDER BY MEMBERS JENKINS, MURPHY, AND WALTHER On December 29, 1976, Administrative Law Judge Walter H. Maloney, Jr., issued the attached Decision in this proceeding. Thereafter, all Respondents filed exceptions and supporting briefs; General Counsel and Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, filed answering briefs; and Respondent Mason City Dressed Beef, Inc. (herein MCDB), joined by Respondent Packing House and Industrial Services, Inc. (herein PHIS), filed: (a) a motion to set aside the Administrative Law Judge's Decision and for a new hearing, and (b) an accompanying brief.t Thereafter, the Charging Party filed a motion to add, as a party respondent, Iowa Beef Processors, Inc.; Respondents i Respondent MCDB has moved for a hearing de novo before a different Administrative Law Judge on the grounds: (I) that the Administrative Law Judge who heard the instant proceeding is incapable of rendering an impartial decision in a case involving counsel for Respondent MCDB; and (2) because the Administrative Law Judge did not, in fact, give either Respondent Employer a fair hearing. We have carefully considered these two allegations and we reject them both. Counsel for MCDB bases his first allegation on his involvement in a prior case, Farah Manufacturing Company, Inc.. 214 NLRB 304 (1974), which was heard by the same Administrative Law Judge involved herein. Additionally. counsel notes that the chief participant in these proceedings for Respondent PHIS is a member of a law firm which was also involved in the Farah Manufacturing case cited above. We note that, while we disavowed certain of the Administrative Law Judge's comments in Farah, we also found there that he was not biased against that respondent. We see no reason to disqualify the Administrative Law Judge here simply because he made injudicious comments in that decision. Further, we have carefully considered the record and attached Decision. and we reject Respondent Employers' claim that they did not receive a fair hearing in this proceeding. We do, however, disavow the Administrative Law Judge's comments appeanng at fn. 16 of his Decision. 2 Upon due consideration, the Charging Party's motion to add Iowa Beef Processors. Inc.. as a party respondent at the present time is hereby denied. :' Respondents 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 (1950), enfd. 188 F.2d 362 (C.A. 3, 1951). We have carefully examined the record and find no basis for reversing his findings. The Administrative Law Judge held both Respondent Employers liable for the various unfair labor practices he found, since he concluded that they were joint successors, and joint employers. and that Respondent PHIS was the agent of Respondent MCDB. As we agree with the Administrative Law Judge's findings that MCDB and PHIS are successors to Iowa Beef Processors. and that PHIS is the agent of MCDB, we do not pass on his findings that the two are also joint employers. 231 NLRB No. 102 MCDB and PHIS submitted letters in opposition; and the General Counsel filed a statement in opposition to the Charging Party's motion.2 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, find- ings,3 and conclusions of the Administrative Law Judge, as modified herein, to modify his remedy,4 and to adopt his recommended Order. The Administrative Law Judge found that, by executing a collective-bargaining agreement with Respondent Employers, Respondent NIWU violated Section 8(b)(2) of the Act. We disagree. Since the contract entered into did not contain a union- security clause, we cannot find a violation of Section 8(b)(2) here5 and accordingly we shall dismiss that finding of the Administrative Law Judge. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board hereby adopts as its Order the recommended Order of the Administrative Law Judge and hereby orders that the Respondents, Mason City Dressed Beef, Inc., Mason City, Iowa, As we agree with the Administrative Law Judge that the filing of individual applications for employment was futile in this case, we do not rely on his further intimation that, in a successorship situation. a union's blanket application for reemployment of the predecessors' employees whom it represents is always sufficient to establish the employees' legal entitlement to such reemployment by the successor employer. The Administrative Law Judge found that the recognition accorded Respondent National Industrial Workers Union (herein NIWU) by Respondent Employers was unlawful because PHIS' supervisors participat- ed in the solicitation and distribution of NIWU authorization cards and, when recognition was requested and granted, the current work force did not constitute a representative employee complement. As we agree that there was supervisory participation in the card solicitation sufficient to taint the cards, and since this establishes the 8(aX2) violation, we do not pass on the Administrative Law Judge's further finding that the work force did not contain a representative complement of employees. In fn. 15 of his Decision, the Administrative Law Judge found that Charles Sykes was an incorporator and investor in PHIS. While Sykes apparently played a major role in the formation of that corporation, examination of the record reveals that he was neither an incorporator of the company, nor had he invested any money in the organization. In support of his finding that Respondent Employers violated Sec. 8(aX3) of the Act, the Administrative Law Judge relied in part on the Board's decision in Macomb Block and Supply, Inc., 223 NLRB 1285 (1976). While Member Walther dissented in that decision, he finds the instant case factually distinguishable and therefore joins his colleagues in adopting the Administrative Law Judge's finding herein. 4 In accordance with our decision in Florida Steel Corporation, 231 NLRB 651 (1977), we shall apply the current 7-percent rate for periods prior to August 25, 1977, in which the "adjusted prime interest rate" as used by the Internal Revenue Service in calculating interest on tax payments was at least 7 percent. I Cf. Seaview Manor Homefor Adults, 222 NLRB 596 (1976). 735 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and Packing House and Industrial Services, Inc., Mason City, Iowa, their officers, agents, successors, and assigns, and the Respondent, National Industrial Workers Union, its officers, agents, and representa- tives, shall take the action set forth in the said recommended Order, except that the attached notice marked "Appendix A" is substituted for that of the Administrative Law Judge. APPENDIX A NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL NOT recognize and bargain collective- ly with National Industrial Workers Union as the collective-bargaining representative of our pro- duction and maintenance employees unless it becomes certified by the Board after an election is held. WE WILL NOT give effect to any membership application for National Industrial Workers Union signed by our employees on or after February 7, 1976. WE WILL NOT give effect to a contract which we signed with National Industrial Workers Union on February 9, 1976, or to any extension or modification of that contract. WE WILL NOT assist National Industrial Work- ers Union in obtaining membership applications from our employees and WE WILL NOT assist it or contribute support to it in any manner. WE WILL NOT refuse to hire, threaten to refuse to hire, or discriminate in any way against anyone because he becomes or remains a member of Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO. All of our employees are free to become and WE WILL NOT in any other manner interfere with, restrain, or coerce employees in the rights guaranteed them by Section 7 of the National Labor Relations Act. WE WILL recognize and bargain collectively with Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, as the collective-bargaining representative of our production and maintenance employees, and, if we reach an agreement, we will embody the agreement in a signed written contract. WE WILL offer full and immediate reinstate- ment to their former or substantially equivalent position to all former employees of Iowa Beef Processors, Inc., who were employed at the remain members of that Union or any other union. Mason City plant when Iowa Beef Processors, Inc., ceased its operations on January 31, 1976. WE WILL make whole all of these former employees of Iowa Beef Processors, Inc., for any loss of pay they may have suffered because of the discrimination which was practiced against them, together with interest at 7 percent per annum. MASON CITY DRESSED BEEF, INC. AND PACKING HOUSE AND INDUSTRIAL SERVICES, INC. DECISION FINDINGS OF FACT A. Statement of the Case WALTER H. MALONEY, JR., Administrative Law Judge: This case came on for hearing before me at Mason City, Iowa, upon a consolidated unfair labor practice comp- laint,' issued by the Regional Director for Region 18. The complaint alleges that Respondent Mason City Dressed Beef, Inc. (MCDB), and Respondent Packing House and Industrial Services, Inc. (PHIS),2 violated Section 8(aX)(), The principal docket entries in this case are as follows: Charge filed by Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North Amenca, AFL-CIO (herein called Union), against Mason City Dressed Beef, Inc. (MCDB), and Packing House and Industrial Services. Inc. (PHIS), on February 13, 1976, and amended on March 1, 1976; charge filed by the Union against National Industrial Workers Union (NIWU) on March 15, 1976; consolidated complaint issued on August 18, 1976: answer of Respondent PHIS filed on August 26, 1976; answer of Respondent MCDB filed on August 30, 1976; answer of Respondent NIWU filed on August 27. 1976; hearing held in Mason City, Iowa, on September 13 17, 1976; briefs filed by the General Counsel, the Charging Party, and all Respondents on or before November 1, 1976. In addition. I was furnished with a copy of a letter, dated September 20, 1976, from counsel for Respondent MCDB to Mr. Thomas W. Miller, Jr., Director, Division of Information. NLRB, in which counsel requested Mr. Miller to furnish him "a copy of each administrative law judge's decision issued by Judge Walter H. Maloney. Jr., since he became a Judge with the Board, as well as a copy of the Board's Decision and Order, if any in each case." Mr. Miller declined to honor the request on the basis that the Board does not index or catalogue decisions in the manner required to fulfill the request. 2 Respondent MCBD admits, and I find, that it is an Iowa corporation which maintains its principal place of business at Mason City, Iowa. I find that at all times material herein MCDB has engaged in the production and nonretail sale and distribution of beef and that, in the course and conduct of such operations, it will annually purchase and cause to be transported to its Mason City, Iowa, plant directly from points and places outside the State of Iowa goods and materials valued in excess of $50,000, and will produce and sell at its Mason City, Iowa, plant directly to points and places outside the State of Iowa goods and merchandise valued in excess of S50,000. Accordingly, Respondent MCDB is an employer engaged in commerce within the meaning of Sec. 2(2), (6), and (7) of the Act. Respondent PHIS is a Nebraska corporation which maintains its principal place of business in Lincoln, Nebraska, and a place of business at Mason City, iowa. At its Mason City, Iowa, place of business Respondent PHIS will annually perform services for Respondent MCDB valued in excess of $50,000 and will produce goods over $50,000 which will be shipped directly from its Mason City, Iowa, place of business to points and places located outside the State of Iowa. Accordingly, PHIS is an employer 736 MASON CITY DRESSED BEEF (2), (3), and (5) of the National Labor Relations Act, as amended. More particularly, it alleges that these Respon- dents discriminatorily refused to hire 83 unionized indivi- duals who had been employees of a predecessor employer in the same employing enterprise; had intimidated and coerced employees in the exercise of rights guaranteed by Section 7 of the Act; and had unlawfully refused to recognize and to bargain with the Charging Party as the representative of their employees. The complaint further alleges that the Respondents unlawfully assisted Respon- dent NIWU to become the bargaining agent of their newly hired employees and unlawfully recognized NIWU when Respondents had not yet retained a representative comple- ment of employees. As for Respondent NIWU, the complaint alleges that it violated Section 8(b)(X1)(A) of the Act by restraining and coercing employees in the exercise of rights guaranteed by Section 7 of the Act and by attempting to cause the Respondent Employers to violate Section 8(a)(2) of the Act. Respondent Employers deny any obligation to hire employees who had been employed by an asserted predecessor who owned and operated the plant in question, deny any obligation to recognize and bargain with the employing Union, and deny the other allegations contained in the complaint. Respondent NIWU entered a general denial of the allegations of the complaint. Upon these contentions, the issues herein were joined.3 B. The Unfair Labor Practices Alleged Between 1969 and January 31, 1976, Iowa Beef Proces- sors, Inc. (IBP), owned and operated a beef slaughtering plant at Mason City, Iowa. IBP is a large midwestern meatpacking operation, having its headquarters in Dakota City, Nebraska. In 1969, it purchased the Mason City plant here in question and a similar plant at Le Mars, Iowa, from Blue Ribbon Beef Company. No sooner had IBP made these acquisitions than it ran afoul of the antitrust laws and was the subject of a civil suit filed on February 24, 1969, by the Department of Justice in the U.S. District Court at Des Moines. In this suit the Government requested the divestiture by IBP of both the Le Mars and Mason City plants. IBP and the Justice Department entered a consent agreement, approved by the district court on March 23, 1970, by terms of which IBP undertook to divest itself of ownership and control of both facilities. It sold the Le Mars plant in 1974. However, its efforts to sell the Mason City plant failed to bear fruit until the fall of 1975. During the period of time between 1969 and January 30, 1976, IBP continued to operate the Mason City plant and did so pursuant to the terms and conditions of successive collective-bargaining agreements with the Charging Party which covered a unit of about 83 production and maintenance employees. The most recent of these agree- ments was concluded with the Union on August 7, 1974, and was due to expire on January 1, 1977. 4 On October 31, 1975, the trustee appointed by the district court filed a notice of proposed sale of the plant to Sam W. Davis, a meat packer and entrepreneur from Dodge City, engaged in commerce within the meaning of Sec. 2(2), (6), and (7) of the Act. Both the Charging Party and Respondent NIWU are, respectively, labor organizations within the meaning of Sec. 2(5) of the Act. :' Errors in the transcript have been noted and corrected. Kansas. Davis is a coowner of Hyplains Dressed Beef Company, Inc., a meatpacking concern located in that city, and is engaged in meatpacking and farming operations in Kansas, Nebraska, and Oklahoma. The proposed divesti- ture agreement called for a sale of the assets of the Mason City plant to Respondent MCDB, a corporation yet to be established but to be wholly owned and operated by Davis. The purchase price was set at $1,750,000, payable to IBP on the basis of no down payment by MCDB and equal monthly payments over a period of 10 years, with interest at 8 percent on the unpaid balance. IBP would retain legal title to the premises during this period of time as a security for the purchase price. IBP also proposed to enter into a 10-year slaughter agreement by the terms of which it would agree to purchase the entire output of the Mason City plant from MCDB on the basis of cost plus $1.50 per head. MCDB would be given the right to terminate the slaughter contract after 5 years and sell to the open market if at that time it could pay off the amount still due under the plant purchase agreement. If MCDB defaulted or elected to terminate the agreement, IBP would receive the plant back and would agree to place it in the hands of a court- appointed trustee who would begin the divestiture effort anew. The district court held a hearing on the proposal on December 18, 1975, in Des Moines and, on December 29, entered an order approving the proposed IBP-MCDB agreement, with minor modifications, and setting January 31, 1976, as the settlement date for the conclusion of all arrangements. During the fall of 1975, a news article appeared in the Mason City Globe Gazette indicating that an offer had been made to purchase the plant. However, nothing definite concerning the fate of the plant was actually communicated to employees or the Union until late in January. During January, Davis and IBP were still negotiating the details of the transfer, an effort which was punctuated with difficulties which rendered the consum- mation of the agreement uncertain until a day or two before the final date for settlement established in the court's December 29 Order. At the same time Davis was negotiating the details of a plant sales contract and a slaughter contract with IBP, he came into contact with Charles Sykes, a labor lawyer employed by the firm of Nelson, Harding, Marchetti, Leonard, and Tate. From time to time, Sykes had represented IBP in various matters and was personally acquainted with Arden Walker, IBP's vice president for industrial relations. It was Walker who had overseen all personnel and labor relations matters at the Mason City plant during IBP's 6-year tenure of ownership. In Novem- ber 1975, Sykes became an incorporator of Respondent PHIS, an organization based in Lincoln, Nebraska, which was organized for the purpose of providing business operation and management services to plant owners who prefer to farm out the responsibility for the day-to-day operations of their plants. As of the time of the hearing, PHIS had obtained and was performing about six plant 4 The Charging Party or its predecessor in interest was also the recognized bargaining agent of Blue Ribbon's employees prior to the plant acquisition by IBP. 737 DECISIONS OF NATIONAL LABOR RELATIONS BOARD operation contracts in three or four midwestern states in the meatpacking and trucking industries. About January 18, Davis phoned Sykes at Sykes' home, noted that Sykes had a client which was operating a meatpacking plant at Fort Morgan, Colorado, and inquired of Sykes whether PHIS would be interested in operating the Mason City plant for MCDB. The following week Davis and Sykes met by mutual agreement at the IBP headquarters at Dakota City and were formally introduced at that time by Walker, who permitted them the use of his office to discuss the terms and conditions of a possible management agreement between MCDB and PHIS. At that time, MCDB had not as yet finalized the plant sale agreement with IBP so the discussions between Davis and Sykes were conditioned upon the success of Davis-IBP negotiations still in progress. Part of the IPB-Davis discussion at Dakota City included a paragraph-by-paragraph review by Davis and Walker of the current collective-bargaining agreement between IBP and the Union. Davis, who operates a unionized plant in Dodge City, made a point-by-point comparison of his Dodge City contract and IBP's Mason City contract in this discussion with Walker. During this same period of time and early in February, Walker also discussed labor relations at Mason City with Sykes as well as with Davis. In response to a specific question from Sykes as to whether the supervisory staff at Mason City could be relied on "if things got tough," Walker told Sykes that they were reliable. He also informed Sykes that some of the employees at Mason City were valuable and that some were not. He noted that over the years the plant had experienced problems with labor relations and absenteeism, and that these problems had contributed in part to the unprofitability of the operation during IPB's tenure in the plant. On or about January 27, the Union obtained information leading it to believe that the plant transfer to MCDB was imminent. On that date, Ray Long, an International representative and longstanding resident of the Mason City area, sent a telegram to Davis at his place of business in Dodge City, stating as follows: We are advised that your company is taking over ownership and operation of plant currently owned and operated by Iowa Beef Processors in Mason City, Iowa, Local P-38 AMC and BW of NA is the legally designated and recognized collective bargaining repre- sentative of the employees at this plant and those employees are covered by collective bargaining agree- ment with IBP for a current term ending January I, 1977. The contract provides that it continues in effect for successors and assigns of IBP. We are available for immediate meeting with you to discuss your employ- ment plans and terms and conditions of employment. Please advise of time and place convenient to you for prompt meeting. The telegram was never answered. At or about the same day, Tony I. Fetter, another International representative, contacted IBP for the same I Art. XIX of the IBP-Union contract provided: "This Agreement shall be binding upon the heirs, executors, and administrators, and assigns of the parties hereto." purpose. During the latter years of IBP's ownership of the Mason City plant, Fetter had been the principal union representative in contract negotiations and grievance discussions and had become well acquainted with Walker, IBP's principal spokesman on labor matters. Fetter spoke by phone with Walker sometime in January and asked him about the details of the proposed sale to Davis. Walker said that no details had been worked out but that he hoped to have the information requested on January 26, when the parties were tentatively scheduled to meet in Mason City to discuss grievances relating to the Mason City plant. The January 26 meeting was postponed by mutual consent until January 30. Fetter sent a telegram to Walker on January 27 which stated as follows: We are advised that another company is taking over ownership and operation of your Mason City plant. Employees have been advised that this Friday will be the last day of work under IBP operations until further notice. We must have immediate meeting with you so that we may be advised of facts necessary to determine and effectuate employees rights under the contract including facts with respect to the status and terms of the transaction, what action IBP has taken to comply with the successorship clause in our contract, what plans and intentions IBP has with respect to the announced shutdown of the plant. Please be advised that we wish to discuss these things with you on our scheduled meeting Friday, January 30. On January 28, Fetter again called Walker to ask about the sale. Walker said that the details had not been worked out. Fetter informed Union Counsel Eugene Cotton of this conversation and Cotton sent Walker a telegram demand- ing to bargain over the effects of the shutdown. On January 30, Walker, Francis Trupe, the plant manager, and Edward M. Millard, the kill floor foreman, met with Long, Fetter, and other union representatives. Walker notified union representatives that the plant would be closed that day. The meeting began by a discussion and disposition of grievances pending under the Union-IBP contract. Thereafter, Walker handed Fetter a letter which was backdated to January 23, stating that IBP would be available to meet and bargain with the Union concerning the effects of the sale. Fetter objected that this was an abrupt way of doing business since Walker had given the Union no time to formulate proposals. Walker replied that the details of the sale had only been finalized on the preceding evening. Fetter asked Walker whether the successorship clause in the IBP-Union contract meant anything.5 Walker replied that he did not know what Sam Davis would do but he thought that Davis was going to close the plant in order to remodel it. Walker also announced that Trupe was being retained as plant manager. Fetter then advanced 'the thought that it would be fruitless to talk further with Walker and that he should be talking to Trupe, the agent of the new owner. Trupe replied that he did not know enough to respond to Fetter's questions and remarks and that Fetter would have to talk 738 MASON CITY DRESSED BEEF directly with Davis. Fetter let Trupe and Walker know that he wanted to talk with Davis. Fetter asked Walker whether the Mason City employees would be employed at other IBP plants. Walker's only remark was that they could put in individual applications and suggested sarcastically that they might want to apply at Fort Dodge. (At that time, the Union was on strike at the IBP plant in Fort Dodge.) Fetter declined this tongue- in-cheek offer, saying that his people were not going to be scabs. Walker stated that there were some employees at Mason City he would recommend for employment. He also informed Fetter that Trupe was the man to contact about payment of hospitalization benefits and unpaid vacation benefits. (In a letter to Mason City employees, distributed the same day, Walker gave employees the addresses of local insurance agents to contact for conversion of a group life insurance policy and health insurance policy to individual policies.) Walker told Fetter no one had authorized him to offer continuity of employment and expressed the opinion that the plant would be closed from 6 months to a year, whereupon Fetter asked that IBP employees be used for cleanup work. During the course of this discussion, Mel Peterson, the Local chairman for the IBP unit, was summoned from the room by a clerical employee and asked to quell a commotion which had arisen in the plant. It appeared that employees had not received their Friday paychecks at the customary hour and had become upset. Peterson returned to the room and demanded to know why paychecks were being withheld. Walker told him the checks were being withheld so that union officials could be notified first that the plant was closing. Peterson became incensed but was told by Fetter to calm down. Walker thereupon released the paychecks and with them a letter informing each employee of the plant closure and the above-mentioned information concerning conversion of insurance policies. On the afternoon of January 30, Long sent a telegram to Sam Davis and directed it to the Hyplains Beef plant in Dodge City. The telegram read as follows: We have been advised by Iowa Beef Processors today that the employees of the Mason City plant purchased by you are no longer employed by IBP as of Saturday midnight, January 31, 1976. As to this action we wish to advise you that we consider these people now to be the employees of Hyplains Dressed Beef. We are hereby requesting a meeting with you at your earliest possible convenience to discuss terms and conditions of employ- ment. Other attempts were made by union officials to contact Davis by phone but these efforts were unsuccessful. Davis did not return any phone calls nor did he respond to Long's telegrams. On the afternoon of January 30, Walker and Trupe prepared a list of 20 or so IBP employees whom they regarded as valuable employees. This list was furnished by Walker to Sykes and was later the subject of discussion between Trupe and Sykes. Trupe was kept on the IBP payroll and in charge of the plant until February 6, at which time he went on the payroll of PHIS in the same capacity. During the week following the closing of the plant, IBP shipped from the plant the completed product which was in the storage cooler. Walker estimated that the beef in question was worth about $200,000. On Saturday, January 31, Davis and IBP went to settlement. Davis, acting through MCDB, took control of the plant at midnight on that date. At the January 31 settlement, IBP and MCDB entered into two contracts, one for the sale of the plant operating assets and the other for the slaughtering of beef. Both are of record and will only be summarized here. The Assets Purchase and Sale Agreement transferred to MCDB immediately the possession and usufruct of the Mason City plant, reserving to IBP legal title to the premises as security for the ultimate payment of the purchase price. Included in the transfer were land, improvements, and machinery. Excluded were cash on hand, trademarks, accounts receivable, truck tractors and trailers, work in process and inventory, and "all contract and contract rights," except as noted, relating to the plant prior to or at the time of closing. The stipulated purchase price was $1,750,000, to be paid in monthly installments over a period of 10 years, with interest accruing on the unpaid balance at the rate of 8 percent per annum. In the event that MCDB elected to terminate the concurrently concluded slaughter contract, the entire purchase price would become due and payable immediately. Should IBP elect to terminate the slaughter contract, which it could do only for good cause, then it had the election to accelerate MCDB's payments or to require the relinquishment of the premises by MCDB. MCDB agreed to use its best efforts to operate the plant continuously as a beef slaughter facility pursuant to the slaughter contract, to maintain the plant assets in operating condition, to maintain insurance on the assets, to keep the property free from legal encumbrances which would cloud the title, and to refrain from any merger or sale of MCDB's assets (without IBP's prior written consent) which would change the management, control, or ownership of MCDB or of the plant operating assets. Both parties warranted that the agreement should be "binding upon the parties and their respective successors, assigns, heirs and representatives." The agreement recited that, if IBP should reacquire possession of the assets because of MCDB's default, IBP would consent to the appointment by the district court of another trustee charged with the responsibility of carrying out the divestiture contemplated in the outstanding consent de- cree. The contemporaneously executed slaughter agreement provided that MCDB would sell and IBP would buy the entire output of the plant. It further provided that IBP could require MCDB to close the plant for 3 months out of any 1 year. MCDB agreed to use its best effort to provide IBP with 2,200 to 4,000 carcasses per week, but it would not be held in default of its obligation if it were not able to do so because of a host of natural and manmade calamities, including picketing and strikes, if they were above and beyond MCDB's control. Production was limited to cows and fat cattle, and MCDB was obligated to purchase cows that would yield 350 pounds dressed weight. Hides and all byproducts of the slaughtering operation are to become the property of IBP. MCDB was also obligated 739 DECISIONS OF NATIONAL LABOR RELATIONS BOARD to provide IBP salesmen with office space at the plant. For its efforts, IPB was obligated to pay MCDB on the basis of cost plus $1.50 per head. An involved formula, including the appointment of a cost control committee when necessary, was set forth to determine just which costs are to be borne by IBP and which are to be met by the $1.50-per- head payment. MCDB was assigned the responsibility to build a network of purchases so that it could buy livestock directly from farmers and dealers. Upon advance notice MCDB might terminate the slaughter contract on January 31, 1981, upon payment of the balance due under the Assets Purchase and Sale Agreement, but its failure to exercise the option on that date will result in the entire contract proceeding to a full term of 10 years. While all hourly rated employees were dismissed, all supervisory and clerical employees were notified by Trupe to report to work as usual on Monday, February 2, and they did so. During the first 2 or 3 days of this week, engineers employed by MCDB were inspecting the plant for the purpose of making designs, recommendations, and estimates for the remodeling of the plant. Their ultimate recommendation to Davis indicated a possible expenditure on his part of about $500,000. Davis spoke by phone with Sykes early in the week, told Sykes of the costly expendi- ture that would be required to remodel the plant, and indicated that the expense was out of the question. Both of them agreed to put the plant into operation as soon as possible and agreed to meet in Mason City on Thursday to work out a written agreement between PHIS and MCDB concerning the operation and management of the plant. The PHIS-MCDB contract concluded by Sykes and Davis was executed on February 5. Since it is also on record a brief summary of its major provisions will suffice. PHIS agreed to staff and operate the Mason City plant as a beef slaughtering facility and to employ all persons who were employed in this regard at Mason City, with the exception of a few individuals whom MCDB or IBP wished to station on the premises. The contract contains a disclaimer that: No agent, officer, employee, or servant of Packing House & Industrial Services, Inc., shall be deemed to be an employee agent, or servant of Mason City Dressed Beef, Inc. No agent, officer, employee, or servant of Mason City Dressed Beef, Inc., shall be deemed an employee, agent, or servant of Packing House and Industrial Services, Inc. Mason City Dressed Beef, Inc., is interested only in the results obtained under this agreement; the manner and means of conducting the work are under the sole control of Packing House and Industrial Services, Inc. MCDB retained the responsibility for procuring livestock. MCDB also became obligated to pay a $25,000 service fee to PHIS immediately upon the execution of the agreement and a weekly service fee thereafter, computed on the basis of the cost of operation plus $800. The costs which form the basis for the basic weekly fee include wages, salaries, fringe benefits, social security contributions, payroll prepa- ration, unemployment and workmen's compensation con- tributions, and similar or related items. Either party is free to terminate the agreement upon giving the other 10 days' written notice. While Sykes was in the process of finalizing his arrangement with Davis, he also began recruiting employ- ees to begin the operation. Sykes set as his immediate goal the opening of the plant with employees of his selection, working under terms and conditions which he established. He admittedly expected trouble from displaced IBP employees. On February 5, Sykes hired Trupe and placed him on the PHIS payroll, informing Davis of this selection. Trupe and others in management went to a backlog of local job applicants contained in the IBP personnel files and phoned two or three persons whose names appeared on applications, asking them if they would like to do "cleanup work" at the plant. Applicants who agreed were told to report to work early Saturday morning, February 7. Sykes told Trupe not to recall any former employees who had actually been on IBP's payroll. Trupe opined that Sykes did not want to recall any of them "because we figured we would have enough trouble, anyway...." PHIS also sought to obtain employees from the Iowa Department of Employment Security. The Union urged the department not to make any referrals on the basis that a labor dispute was in progress. The Union also requested of the department that, if it did make job referrals to the plant, that it send former IBP employers. The department decided not to refer any applicants to PHIS. During the early part of the same week, Long, Peterson, and several other IBP employees who were local union officials went to the plant to speak to Trupe. They met Trupe on the stairs of the plant. Long asked Trupe whether he had anything to tell them about the plant closing and also asked Trupe if he did not think he owed the employees something. Trupe said he did not owe the employees anything, ordered the individuals there present to leave the premises, told them not to come back, and further instructed them to keep union members away. On the following day, Trupe sent clean laundry, consisting of privately owned work clothes of former IBP employees, to the union hall for distribution to the owners. In addition to local hiring, Sykes made considerable effort to recruit unemployed workers who resided in the Omaha area, some 265 miles from Mason City. Sykes called an acquaintance, Tim Runyon, an official of the American Beef Packers, and asked him for his assistance in recruiting 30-35 men from Omaha to work at the Mason City plant. Runyon agreed and in turn enlisted the assistance of another American Beef Packing Company employee, Art Davis. Sykes paid Runyon and Davis a total of $4,500 for their recruiting efforts. Runyon and Davis recruited about 30 employees, promised to pay them $500 plus expenses for working the first week and $5 an hour without expenses thereafter. On February 5 and 6, three vanloads of unemployed men from the Omaha area drove to Mason City in vehicles rented by Sykes or persons acting on his behalf and registered at the R-Motel in Garner, some 20 miles west of Mason City. Sykes personally arranged for these motel accommodations and picked up the tab. Along with the handful of local recruits, they came to the plant early Saturday morning, February 7, to begin work. 740 MASON CITY DRESSED BEEF All applicants were processed for employment in the locker room at the plant. Job application forms and W-4 forms were passed out, signed, and returned by prospective employees to the company officials who distributed them. At or about the same time, and before any work began, two unidentified men showed up in the locker room, asked the employees in question if they wished to join a union, assured them that they did not have to do so if they did not want to, passed out blue union designation cards which contained language authorizing the Respondent National Industrial Workers Union to act as bargaining agent. These cards were also signed by the job applicants and were returned immediately. Three witnesses testified that the individual who handed them union cards wore a green or blue helmet. Two others testified that the individuals who handed them union cards wore a yellow or orange helmet. From these descriptions and from the color code which is in use at the plant with respect to helmets,6 as well as from the fact that the events occurred on company premises in the course of the hiring-in procedure, I conclude that the distribution and collection of union designation cards as to these individuals and to others who were with them was made by agents of Respondent PHIS. Only a few of the new recruits had ever worked in a packing house before and none, or almost none, had done packinghouse work which required the use of a knife. No extended formal training or instruction was given to any employee on Saturday. They were just issued boots, knives, and helmets and were told to report to various parts of the plant where a supervisor or some other employees gave them cursory on-the-spot instructions about what they were to do. Some employees refused to work with a knife and were assigned other jobs. By all accounts, the morning kill was a mild disaster, a fact which Trupe attributed to the lack of experience of the men employed. Hides were scored, meat was hacked up, offal was lost, and production was incredibly slow. In a plant which normally produced 400-500 head of dressed beef in an 8-hour day, Saturday morning's 4-hour shift yielded 42 head. Later the same morning, Pat Hagen, a representative of NIWU, appeared in the plant office and spoke to Sykes. She told Sykes that she and George (meaning George West, the attorney for NIWU), had "finally got this place organized" and handed Sykes about 35 designation cards. Sykes asked Mrs. Hagen what kind of unit they wanted and she said a P & M unit. Sykes said he would talk to West about the demand. Trupe drove Sykes to the airport shortly after the plant closed at noon. During that trip Sykes told Trupe that they would have to recognize the NIWU. Sykes flew to Des Moines on the same afternoon and visited West, who was hospitalized with a broken jaw. Sykes met with West in his hospital room where they discussed the terms and condi- tions of a labor contract. Sykes told West that he wanted a basic wage rate of $5 per hour, which was the rate Sykes' agents in Omaha were offering the men who were recruited for employment at Mason City. Sykes also told West that " Both PHIS and IBP employ a helmet color code at Mason City for the purpose of identifying various categories of employees. Plant Manager Trupe and Plant Engineer Jerry Saathoff wear green helmets; foremen wear yellow: utility men wear blue: maintenance men wear grey: and production employees wear white. he wanted the "Amarillo" language, meaning the text of a contract which the Teamsters had concluded in Amarillo, Texas, with IBP. West agreed. Sykes went to his office, took portions of the Amarillo contract, cut and pasted it to sheets of yellow paper with revisions applicable to Mason City, and returned to West's hospital room on Monday morning with the completed document. It was executed at this time and in the form indicated. On Saturday afternoon, Larry Bucci, a former IBP employee and the Union's chief steward at the Mason City plant, received word from Mel Peterson that slaughtering operations had taken place that morning. Bucci phoned Richard Mammen, whowas assistant foreman of the kill floor for IBP and who occupies the same position of PHIS. Bucci inquired of Mammen whether his information from Peterson was correct. Bucci, who is a longtime friend of Mammen, also asked him if he would meet him that evening at the home of a friend. Mammen agreed to do so. About 6:30 p.m., Mammen met with Bucci, Peterson, and Raleigh King, Local P-38's recording secretary, at the appointed place and they discussed what had transpired. Mammen told them that about 30-35 recruits had been brought in from Omaha and that he did not know they were coming. He also stated that he and Bill LeDuc, the cleanup foreman, did not think that what was happening was right. Mammen told Bucci and friends that PHIS had a 3-year contract to operate the plant and related that the slaughtering that morning had gone badly. Only 42 head had been killed, hides had been scored and ripped apart, and meat was dropped. Mammen expressed the feeling that he was fed up and about ready to quit. Bucci asked Mammen why the IBP employees had not been hired back. Mammen stated that, at some point in the distant future, some 15-20 former IBP employees would be rehired but that no union officers, past or present, would ever be rehired. He said that the Company would operate the following Monday and that six IBP plant security guards from Dakota City would be on hand. Upon further questioning by the IBP employees present, Marnmen said he did not know the names of any of the men who had worked that day and that he was just referring to them by locker number.' On Monday morning, a large crowd of former IBP employees gathered at the entrance to the plant. They continued to gather at this point in a similar manner each working day for the next 3 weeks. They did not formally picket the plant but they spoke with and, from time to time, shouted and engaged in catcalling at persons who reported to work at the plant. Three van loads of out-of-state recruits who had worked on Saturday returned to go to work on Monday morning but did not actually go to work. In fact, PHIS evidence on the record indicates that beef production took place only on the final 3 days of the workweek beginning February 9. While the record in this case discloses no specific incident or episode of physical violence, many of the Omaha-based employees testified that they did not want to 7 Mammen, who was summoned to testify by the Respondent, essentially corroborated the version presented by the General Counsel's witnesses. 741 DECISIONS OF NATIONAL LABOR RELATIONS BOARD continue to work at the plant because of fear of reprisal by displaced IBP employees. After lingering on the premises for an hour or two, they informed PHIS' management that they did not want to work. They returned to the R-Motel and met with Sykes that afternoon. Sykes finally struck a deal with them by which he would pay those who remained for the week the already promised $500, while those who elected to return to Omaha immediately would receive $200. Most returned to Omaha on Monday afternoon. A few new Omaha-based recruits arrived on Tuesday and worked out the week. In 2 or 3 weeks, all but two or three of those hired on February 7 from any source had quit. On February 9, Fetter and Longsent identical telegrams to Hyplains Dressed Beef at Dodge City and to Sykes and MCDB at the plant in Mason City. The telegrams read: We understand that you have resumed operations at the Mason City plant previously operated by Iowa Beef Processors Incorporated. You have not offered employ- ment to any former employees. This will confirm that all production and maintenance employees who were employed at this plant by Iowa Beef Processors are available for continued employment by you and we hereby make application to you on their behalf for employment at this plant. PHIS's efforts in obtaining permanent employees in the next few months was not marked with success. It placed want ads in several local newspapers published within a radius of 40 miles of Mason City and also ran ads for employees on television. While the want ads introduced in the record called for permanent, full-time employees, none indicated a requirement by PHIS for experienced slaught- erhouse employees. During the next 3 months, PHIS hired nearly 200 persons for a unit normally employing slightly over 80 persons. Most of the new hires quit voluntarily. Of the employees on the PHIS payroll in September at the time of the hearing, only one was hired before February I 1. Of those still working at the time of the hearing, a breakdown by date of hire during the first 3 months of the PHIS operation indicates as follows: Hired Before Feb. 11 1 Feb. 11-13 8 Feb. 16-20 25 Feb. 23-27 2 Mar. 10 Apr. 6 Total - Feb. - Apr. 52 As discussed later, PHIS began to rehire some former IBP employees after May 10. As of September 1976, some 12 former IBP employees had been hired by PHIS, I of whom was taken on as cleanup foreman. During the first weeks of the PHIS operation, parties to this dispute took to the media to voice their respective " The reference to Armour is an allusion, well known locally, to the fact that a large Armour packing plant, which employed about 1,200 people in the Mason City area, had closed its plant the previous year and laid off most positions and otherwise to appeal for public support. An ad was placed by the Union in the Mason City Globe Gazette, signed by "former IBP employees" which recited the background of the antitrust suit and complained about the injustice suffered by the failure of PHIS to rehire IBP employees. It stated, in part: The work force had no hint that the new owners intended to operate with new employees until the last day of operation under IPB on Friday, January 30, when they received a letter with their paychecks. When the company was pressed for a statement as to the status of the workers and how long they would be unemployed, the Company replied that it was no longer the concern of IBP and that the new owner would have to decide these things. IBP representatives indicated that extensive remodeling would take place, and the plant might be closed for as much as one year. Repeated telegrams and phone calls to the new owner produced no response, and in fact no acknowl- edgment that they were ever received. Finally, on Saturday, February 7, the company killed 42 head of cattle with workers brought in by rented vans bearing Nebraska license plates. If they had intended to operate, why did they not call the regular employees? We had indicated our availability for work. We have repeatedly said that the entire production and maintenance force is ready and available for employment. We have stated that we would like a meeting to discuss terms and conditions of employ- ment. This remains our position. They also passed out a leaflet at the plant gate which read as follows: People of Mason City We Need Your Help We were told Friday, January 30th that we were no longer employees of Iowa Beef Processors and that another Company was taking over. We have tried to contact the new owner, but they will not talk to us. Saturday, February 7th, the new owner reopened the plant without any of the past employees. We were not even approached about the opening. Last week we were told to stay off the property. They brought in men from out of town to work. We cannot understand how men who have put up to twelve years of service into this plant can just be pushed out in the street. We need your support! First Armour . . . Now us! Contact the Mayor and Your Councilman8 Help Us Get Our Jobs Back In a television interview over Station KGLO by reporter Max Lee, Mel Peterson stated on February 11 that "we feel that we had a successor clause in the contract, and that the employees out there are ready to go back to work and willing to go back to work. And we will be more than of its employees. These employees also belonged to the Union. In the ensuing months, a few former Armour employees were hired by PHIS. 742 MASON CITY DRESSED BEEF happy to negotiate everything else as long as we can get our people back to work; and if Mr. Skyles [sic] would want to sit down and talk to us, we would be more than willing to negotiate everything else." When asked if he thought that the successorship clause would hold up in court, Peterson replied that it would. When pressed to say whether employees would be willing to go to work under present conditions on a wait-and-see basis, Peterson replied: "No, I think that . . . Let me put it this way. We are willing to go back to work; and if Mr. Skyles [sic] would want to talk about anything else, we would be willing to sit down and talk about everything." When Peterson was asked as to whether employees would go back to work at $5 an hour,9 he replied: "We'd be willing to talk about it. The thing is here, Mr. Skyles [sic] said that he would talk to us as long we were out there in a social gathering. Well, it is my understanding that they did kill 42 head of cattle Saturday. I don't think - or I do not believe anybody was out there at the time; and not one person that worked there before was called to come to work. . . Yes we have. That is why all the people that worked there before are concerned. They're just like concern citizens. They're willing to go down there every morning, and they're willing to wait until Mr. Skyles [sic] sees fit to talk to them." In another television interview on February 9, Long stated that the Union's next move "is to continue to try to contact the new owner to set up a meeting. The contract with Iowa Beef has successors and assigns clause, and we feel that's enforceable; and we want to sit down with the new owner and talk about it." On the employer side, Sam Davis was on the same television news show on February II. After reviewing his extensive experience in the meatpacking industry and in large-scale farming, Davis confirmed that he was the sole stockholder in MCDB, indicated that he had a packing- house equipment manufacturer's representative and a draftsman in the plant to make recommendations concern- ing a major renovation but, because of the cost, he decided to "fire up the feeder operation a little bit" and then decide how etensive the remodeling program would be. When asked if he was looking forward to operating in Mason City, Davis replied, "Very much . . . the plant is a real challenge in the fact that I am - I didn't believe it myself and probably most people don't - is that the plant has never made anybody any money. And after I go into the IBP records, I couldn't - I didn't - believe that the plant was an impossible plant prior to getting IBP's records. The plant has never made any money and that's the kind of challenge that I like . . . I want to see if we can't put it on- stream and put on-stream right to make some money out of it." Sykes was interviewed on KGLO television news the same day. In response to questioning, he stated during his interview that the Company had hired 35 new employees and was advertising locally and regionally for more. Sykes acknowledged that the Union had sent the above-refer- " The base rate of IBP employees at the time of the plant closing was $5.73 including fringe benefits. More skilled employees were paid on the basis of higher bracketed rates which progressed in increments of 5 cents per hour. a} From the description given hs Gonzales, including the fact that the f;ireman in question wore a yellow helmet, I conclude that the conversation enced telegrams, containing language to the effect that former IBP employees were willing to come back to work, but stated that he was hiring on the basis of individual applications. Sykes further said that he had received no demands "on the employer here" to sit down and talk with the Union and added that the current employer was not legally obligated to do so. He also asserted that the Union had demanded that the current employer honor the former IBP agreement and stated that he clearly would not, adding that the Union did not represent the employees who were currently employed at the plant. When asked who was operating the plant, Sykes said that it was not Hyplains Dressed Beef. "Mason City Dressed Beef is the operational company here, and they have contracted with Packing House Industrial Services to operate the plant." During the month of February, while the entire situation was in the state of flux and confusion described above, various individual employees had illuminating conversa- tions with a number of PHIS supervisors relating to their status or to the operation of the plant. New employee Francisco Gonzales had a conversation during the first week or so of the PHIS operation with a foreman "named Dick" who wore a yellow hat. Later, Gonzales changed his identification to say that the foreman in question was named "Bill." 'o The foreman in question told Gonzales that the Company was hiring new employees because it did not want to have the Union back in the plant. On or about February 24, Bucci ran into LeDuc at a bowling alley where they had a couple of beers together. Bucci asked LeDuc in the course of their conversation if there was any way that any of the IBP employees could get back to work with PHIS. LeDuc told him that some 15 or 20 employees would be hired at some time in the distant future but that no union officers would be rehired. LeDuc also told Bucci that Arden Walker was still running the show. He repeated to Bucci a conversation in which Walker reportedly stated that the work force, then at 130, should be reduced to about 104 before starting any union procedures. Early in February, three out-of-work employees who had worked IBP, Dennis Heglund, King, and Peterson, asked Foreman Edward M. Millard for letters of recommenda- tion. On February 3, Millard gave each of them short handwritten recommendations. In the case of King, Millard stated, "Raleigh King has proven to be very reliable, honest, and extremely good worker. I had known Raleigh for five years and he has held several different jobs. I would highly recommend Raleigh King." The other notes were of similar import. Millard later told King that he had "caught hell" from Trupe for giving out letters of recommendations since issuing such letters was against company policy. On or about February 14, Raleigh King had a conversation with William LeDuc at King's house. LeDuc had dropped by in the company of another employee, Gary Mariner. LeDuc told King that he was glad that the union demonstration was peaceful and expressed to King the opinion that he knew that the in question was with Foreman Bill LeDuc. Gonzales' personal description of the foreman in question fits that of LeDuc. Moreover. the color of the helmet worn by the speaker identifies him as a foreman, even apart from a further personal identification. LeDuc. who still works for PHIS, was not called to testify. 743 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Company was trying to break the Union. He told King that the black employees who had been brought to Mason City from Omaha were just being used as "guinea pigs" to see if union sympathizers would start trouble with them." During the first week of the PHIS operation, Mammen told Peterson in front of the plant that Sykes and Trupe had instructed foremen to recruit two new employees per day until the "kill got running." Mammen and LeDuc reportedly protested this policy but to no avail. During the same week, LeDuc told Peterson when they were together at LeDuc's house that the night cleanup operation was terrible and that he had asked Trupe for permission to rehire Don Hewee. Trupe told LeDuc he would have to check out the request with Arden Walker. Later, Trupe reportedly told LeDuc that he could not hire Hewee immediately but that possibly he could do so in 2 or 3 months. LeDuc stated that he would like to have his entire cleanup crew back to work. He also expressed to Peterson the same opinion he gave to Bucci; namely, that Walker was still calling the shots at the plant. In a later phone conversation with Peterson, LeDuc reported the remark made by Sykes to the effect that it had been a mistake to import workers from Omaha to Mason City but that he thought he could cover up the mistake. Early in March, after the charges in this and other cases had been filed with Region 18, Sykes decided to withdraw recognition from NIWU until such time as its status as bargaining agent was free from controversy. There is no question that, during the period of its brief incumbency, NIWU did not perform the normal functions of a bargaining agent. It did not appoint stewards, process grievances, or collect dues. During the spring and early summer of 1976, another labor organization in which West was also the principal leader and activist began to solicit membership from newly hired PHIS employees. This group, calling itself the United Industrial Packinghouse and Allied Workers Union, obtained authorization cards and held a meeting or meetings of PHIS employees in Mason City at which West was the main speaker. It appointed stewards and has sought recognition and bargaining. Its inplant spokesman and West attempted to meet in Des Moines with Sykes but a scheduled negotiating meeting did not materialize. Neither of the Respondent Employers currently recognizes this organization as the bargaining agent for the Mason City employees. As previously indicated, PHIS continued to hire employ- ees on a large scale. It also continued to lose employees, either by discharge or voluntary quit, almost as fast as they were hired. As the summer wore on and a stable complement of employees had acquired packinghouse experience, production increased. However, PHIS has frequently operated the plant on a 6-day week in order to boost its output. Davis visits the plant several times a month and his principal conversation with Trupe normally relates to ways and means of increasing production. On or about March 24, the Union held a meeting and discussed, among other things, whether former IBP employees should accede to the PHIS requirement of making individual applications for reemployment, or 1l As noted above, LeDuc was not summoned by the Respondents to testify. Accordingly, I credit King's uncontradicted version of this conversation. whether they should hold fast to the position that the February 9 telegram from Long and Fetter to all principals constituted a sufficient application. At the time, the membership decided not to make individual applications. However, by the first of May, various employees, with union assent, began to file with PHIS individual applica- tions for employment. Between May I and September 11, some 23 former IBP employees had filed such applications. This number included Larry Bucci. During that period of time 12 former IBP employees were rehired and two more were offered employment but declined. Bucci has not been hired nor has any other union official who worked for IBP. In its memorandum and order dated December 29, 1975, the district court set January 31, 1976, as the final date for closing of the divestiture sale. In that order, the court stated: Prior thereto, the parties shall prepare final drafts of the purchase agreement, slaughter contract and other written instruments (including bills of sale for inventory or equipment, assignments of existing labor and industrial track agreements, title opinions and the like) which may be necessary for the transfer of all rights and interests. The executed contracts were not filed in the records of the district court until late in February. No assignment of the collective-bargaining agreement, as contemplated by the above-recited order, was ever executed. On March 12, 1976, and prior to the final ratification of the sale by the court, the Union sought to intervene in the antitrust proceedings in order to protect the interests of the IBP employees who had been discharged. In its petition for intervention, the Union recited its standing as bargaining agent for IBP employees, the existence of the outstanding agreement with IBP, and the fact that the agreement contained a successorship clause. It also recited the text of the above-quoted provision of the December 29 order of the court and complained that no assignment to the collective-bargaining agreement had been made or filed, despite the express direction of the court. The Union also complained to the court that the new owner of the plant was not employing former IBP employees, that it was operating with a totally different work force, and that the Union had received no response from its various efforts to gain recognition from the new owners. It asked the court to require a continuation by the new owners of the employ- ment of IBP employees, under the continuing provisions of the contract for the balance of its current term, and to require the new owners to grant the Union recognition as the bargaining agent of all hourly rated employees working at the Mason City plant. In a Memorandum and Order dated March 19, 1976, the court ratified the Trustee's Final Report of the divestiture sale. It also denied the Union's motion for intervention, stating that the motion was untimely, there was no showing that the Government had failed to protect the public interest in the purpose of the divestiture suit, and the relief sought by the Union was collateral to the purpose of the 744 MASON CITY DRESSED BEEF suit. The court, citing San Diego Building Trades Council v. J.S. Garmon, 359 U.S. 236 (1959), also held that the Board had exclusive jurisdiction to grant the relief sought by the Union in its petition for intervention and noted that unfair labor practice charges had already been filed. In response to the Union's contention that the December 29 Order required the assignment by IBP of the existing collective- bargaining agreement to the new purchases, the court stated that the language of its Order cited above "was intended merely to suggest the types of instruments which the purchaser (MCDB) might want to request, in order to assure that it would receive all the rights necessary to operate the plant. The Court did not intend to direct that any particular contracts should be entered into other than the Assets Purchase and Sale Agreement and the Slaughter Contract, which are the basis of the divestiture and are the only instruments mentioned in the offer by MCDB which was accepted by the Trustees." C. Analysis and Conclusions I. PHIS and MCDB as successors to IBP The General Counsel and the Charging Party urge, inter alia, that PHIS and MCDB be deemed successors to IBP and that they be subjected to a bargaining order, requiring them to recognize the Union and bargain with it as the collective-bargaining agent of the Mason City employees. Neither party supporting the complaint contends before me that PHIS and/or MCDB is an alter ego of IBP, a legal conclusion which would justify a remedy requiring the assumption by these Respondents of the IBP-Union contract. The contract in question is due to expire on January I, 1977, and before any Board order could reasonably be expected to be issued. Hence, the reliance by these parties upon a legal theory which would support results limited to a bargaining order has pragmatic as well as academic virtues. In N.L.R.B. v. Burns International Security Services, Inc., 406 U.S. 272, 291 (1972), the Supreme Court had occasion to review the results which flow from an application by the Board of its successorship doctrine. The Court noted essentially three results which can follow from the litigation of a successorship claim - an existing contract can under some circumstances be imposed upon a successor; a successor can acquire a business free and clear of an existing collective-bargaining agreement but can be re- quired to recognize and bargain with an incumbent union; or a sale and purchase transaction can be at such distant arm's length that no successorship obligation of any kind will arise. The Court stated [406 U.S. 272 at 201]: Also, in a variety of circumstances involving a merger, stock acquisition, reorganization, or assets purchase, the Board might properly find as a matter of fact that the successor has assumed the obligations of the old contract [citing cf. Oilfield Maintenance Co., Inc., 142 NLRB 1384 (1963)]. Such a duty does not, however, ensue as a matter of law from the mere fact that an 12 In Burns, see 406 U.S. 280, 281, fn. 5; in HowardJohnson, the reference to this Burns footnote is set forth above. employer is doing the same work in the same place with the same employees as his predecessor. A few years after Burns, the Supreme Court stated in an arbitration enforcement case [Howard Johnson Co., Inc. v. Detroit Local Joint Executive Board, Hotel & Restaurant Employees & Bartenders International Union, AFL-CIO, 417 U.S. 249 at 254, fn. 8 (1974)] that a bona fide purchaser of the assets of a business had no obligation to hire the employees of the predecessor, but added the caveat that: Of course, it is an unfair labor practice for an employer to discriminate in hiring or retention of employees on the basis of union membership or activity under § 8(aX3) of the NLRA. Thus, a new owner could not refuse to hire the employees of his predecessor solely because they were union members or to avoid having to recognize the Union. See Burns, supra, 406 U.S. at 280- 281, fn. 5. In both of these cases, the Court cited with approval, either directly or by clear reference, an earlier Board decision in Piasecki Aircraft Corporation, 123 NLRB 348 (1959), enfd. 280 F.2d 575 (C.A. 3, 1960).12 The well-settled test of whether a successorship exists has been enunciated in many Board decisions and turns on whether the former employing enterprise has been substan- tially continued in existence by the new owner. Johnson Ready Mix Co., 142 NLRB 437 (1963); Cagle's Inc., 218 NLRB 603 (1975); J.R. Sousa & Sons, Inc., 210 NLRB 982 (1974); Foodway of El Paso (1974), a Division of Kimbell Foods, Inc. 201 NLRB 933 (1973); Maintenance, Incorporat- ed, 148 NLRB 1299 (1944); J. Howard Jenks, d/b/a Glendora Plumbing, 172 NLRB 1700 (1968); The Bell Company, Inc., et al. d/b/a Endurall Products, 225 NLRB 474 (1976). The Board looks to whether similarities exist between the new and old enterprise in such matters as type of goods produced, the manufacturing processes, location, management, suppliers and customers, employee comple- ment, and machinery and fixtures. In this case, the new enterprise is located in the same building as the old and utilizes the same machinery, with the sole exception that tripe is no longer saved during the course of the slaughter- ing operation so the tripe machine has been removed. The new enterprise retained all of the management, superviso- ry, and clerical employees of IBP.13 Only in the failure of the new enterprise to retain a majority of the former employees, a question to be discussed later, is there any factor in this case which would not on its face fill out a clear picture of successorship. The Mason City plant presently produces the same items it did under IBP, namely, dressed beef coming from either cows or fat cattle. Trupe, the general manager, testified that it uses the same manufacturing process. Its suppliers are essentially the same, namely, farmers and cattle auctions. Moreover, IBP has an even closer relationship to the new enterprise than the ordinary seller of a business, who, in most Board cases on the subject, takes his money and walks away. IBP actually retains title to the premises to secure the purchase price by the vendee and has, in fact, financed the purchase 1: The IBP office manager, Sherlene Ulrick, remained, but as an employee of MCDB. 745 DECISIONS OF NATIONAL LABOR RELATIONS BOARD by the vendee in a no downpayment sale. IBP also may take, and is entitled to, the entire output of the plant, having a relationship to the present enterprise which, in other industries, would cause the Mason City plant to be designated a "captive facility." IBP's influence with the new enterprise is still so pervasive that, late in March, IBP was able to tell the present PHIS plant manager to switch the entire plant production from the slaughtering of cows to the slaughtering of fat cattle. Walker admitted in his testimony that IBP has a continuing financial interest in the well-being of the plant, and indeed it does, since, should MCDB default in its obligations, IBP would find itself once again with complete ownership and operating control of the business, subject to another divestiture effort by a trustee appointed by the U.S. district court. IBP can also regain control should MCDB's sole owner, Davis, die, go bankrupt, or become totally disabled. There is little doubt that MCDB, with whom IBP is in privity of contract, is a successor to IBP. IBP's control over MCDB is so complete that MCDB, a separate corporation, may not, under the terms of the contract of sale with IPB, change its chief operating officer (Davis) without IBP's consent. MCDB must submit to an audit of its books by IBP and must refrain, except upon prior written consent of IBP, from any merger, acquisition, consolidation, or sale of MCDB's assets which would materially change the man- agement, control, or ownership of MCDB or of the plant operating assets. In light of these considerations, there can be no doubt that MCDB is, at the very least, a successor to the employing enterprise which was operated by IBP. MCDB's undertaking with IBP obligates it to "use its best efforts to continually operate the Plant and use the Plant Operating Assets as a beef slaughter facility." It may not put the situs of the employing enterprise to any other use. The same contract states that the agreement "shall be binding upon and inure to the benefit of the parties hereto and their respective successors, assigns, heirs and represen- tatives but may not be assigned by MCDB without the prior written consent of IBP." Hence, MCDB may not assign its obligation to operate the plant as a beef slaughter facility to PHIS or anyone else without the express written consent of IBP, an express consent not in evidence in this case or suggested by the testimony. In any event, the assignment of the obligation to operate the facility is subordinate to the sale and slaughter agreements tying MCDB to IBP. Thus, while PHIS is not technically in privity with IBP,'4 its presence at Mason City is of necessity subordinate to the court-approved contract and any and all arrangements which MCDB entered into with the original owner. Moreover, while PHIS is technically not in privity with IBP, its contract to fulfill MCDB's operating responsibility to IBP came about largely through the aegis of IBP. Sykes, the principal operating figure on behalf of PHIS in the Mason City transaction, is a sometime attorney for IBP and a close associate of Walker, IBP's chief for labor 14 In Burns, a successorship was found despite the fact that Burns, the successor, was not in privity with Wackenhut, the predecessor, and had no connection with Wackenhut other than as a competitor who replaced Wackenhut as the plant security contractor at an aircraft manufacturing facility. 's It is clear from Sykes' own testimony that he was much more than an relations matters.15 It was Walker who formally introduced Sykes to Davis. The essence of their understanding was worked out in Walker's office. It was Walker who supplied Sykes with information concerning the labor relations history of the plant, with sought-after advice as to the quality of its supervisory force, and with detailed informa- tion concerning the merits of individual IBP's production and maintenance employees. In light of IBP's close and intimate control over the operations of MCDB, IBP could, without any difficulty, have scotched any arrangement between Davis and Sykes concerning the operation of the plant. It is a short and inescapable inference that Walker not only knew about Davis' intention to farm out day-to- day production chores at Mason City of PHIS but that he approved of it as well. If he had not approved, MCDB would be in material breach of its agreement with IBP. It is clear that, at least as to the Mason City operation, PHIS and MCDB are siblings of the same parent. I therefore conclude that PHIS is, to the extent of its involvment at Mason City, a joint successor with MCDB of the "employing enterprise" which IBP maintained at this plant until January 31, 1976. MCDB attempts to escape responsibility for any of the misdeeds of PHIS by claiming that PHIS agreed to operate the plant as an independent contractor for whom MCDB bears no vicarious liability. MCDB points to a clause in its agreement with PHIS, cited above, to the effect that MCDB is interested only in the results obtained under this agreement and that the means of conducting the work are under the sole control of PHIS. The cases cited by Respondent MCDB in support of its contention involve construction work or franchise agreements in which the work to be performed by the independent contractor was totally divorced from the main operations of the purported principal. In this case, the participation of MCDB and PHIS in the final product are inextricably intertwined. Both have an integral share of the "employing enterprise." MCDB supplies the building, the machinery, the expenda- ble supplies, the plant overhead, and, most important, the item to be processed, namely a beef carcass. It maintains on the premises a full-time employee who is charged by Davis with the responsibility of maintaining a continuing and detailed surveillance of the daily operation of the plant. PHIS employees and supervisors take MCDB's property, in MCDB's plant, use MCDB's machinery and supplies and produce for the immediate acquisition and retention by MCDB (and its sole customer) of the single end product, namely, a dressed beef carcass. Without MCDB's participation in this production process, PHIS would be incapable of operating and there would be no end result. Without MCDB's contribution at every step of the production process, the "results obtained" by PHIS, to use the phraseology of their contract, would be nothing. MCDB's principal, Sam Davis, was well aware of the labor relations history of the plant and of the outstanding IBP-Union contract. Having gone over the Union-IBP attorney for PHIS. He is an incorporator, invested money in the corporation, solicited business for PHIS, hired PHIS plant manager at Mason City, recruited employees to go to work at Mason City, personally oversaw the commencement of the slaughtering operation, and served as public spokesman for the Company. Trupe testified that he reported to Sykes for some matters. 746 MASON CITY DRESSED BEEF contract with Walker, he was also well aware that it contained a successorship clause. Davis hired PHIS, acting through Sykes, to operate the plant, agreeing with IBP in the assets purchase and sale contract to keep the plant functioning as a beef slaughtering facility. Davis and Sykes jointly made the decision to begin operations on Saturday, February 7, after Davis informed Sykes he was not going to delay production in order to remodel the plant. Davis was present in Mason City during the tumultuous days which marked the beginning of the resumed operations and he appeared on television to describe to the general public what he was undertaking to do by purchasing the plant. His only known financial investment in the business which appears from this record, other than the expenses of the engineering survey, was the $25,000 which he agreed to pay in cash to PHIS on Thursday, February 5, when he concluded the MCDB-PHIS management agreement. This sum was used in substantial part by Sykes to pay recruiting fees and expenses of employees who were imported from Omaha. From these various factors, it is clear that MCDB is not only a joint successor with PHIS of the IBP employing enterprise, PHIS is also an agent of MCDB and a joint employer of the personnel at the Mason City plant, a fact which renders MCDB jointly responsible with PHIS for any unfair labor practices which were committed by Sykes or by any other persons on the payroll of PHIS at Mason City. AMP, Incorporated, 218 NLRB 33 (1975); Manpower, Inc., of Shelby County and Armour Grocery Products Co., Division of Armour and Company, 164 NLRB 287 (1967). 2. The refusal by the joint Employer to rehire IBP employees When IBP terminated its operations at Mason City on January 31, the bargaining unit had 83 employees, all but I of whom was maintaining a current checkoff of union dues. This unit was also covered by an understanding collective- bargaining agreement which had nearly a year to run. None of these unionized employees were hired by PHIS when it resumed the operation of the plant a week later. Sykes told Trupe during the changeover not to hire any of them and Trupe complied. When several former IBP employees who were union officials went to the plant during this interim period to discuss the status of IBP employees with Trupe, they were abruptly thrown off the premises and told to stay away. As Sykes explained in his testimony, "They were going to try to make us eat the contract and we weren't going to eat it." 6 To avoid "eating the contract," the Respondents determined not to sk This case contains a number of posthearing motions and statements of counsel going to the question of Sykes' credibility as a witness. I have little qualm concerning this facet of the case. What is disturbing is not Sykes' veracity on the stand but the fact that, by virtue of his own statements and related evidence. Sykes emerges in this case as a labor lawyer and practitioner before this Agency who designed and executed a flagrant and sharply defined violation of the Act, and who sought to achieve his ends by simply "gutting it through." even at the price of wholesale violence which he anticipated but which did not materialize. 11 One excuse advanced by the Respondents for their refusal to hire IBP employees to assist in the resumption of operations is that they had heard from Walker that IBP employees had a long track record of absenteeism and illegal strike activity. In fact, there had been no strike activity of any sort at Mason City after August 1974. when the current contract came into hire any former IBP employees until a different comple- ment of employees had been established in the plant, working under terms and conditions set by Sykes. Foremen Mammen and LeDuc told various IBP employees early in the PHIS takeover that only 15-20 former employees would be hired, that this rehiring would not take place until a date in the distant future, and that no union officials employed by IBP would ever be rehired. As a prophecy, these words were remarkable as this is exactly what took place between February, when these statements were uttered, and September, when the record herein was made. In one conversation, LeDuc added that the purpose of this was to break the Union. Walker and Trupe complied and furnished Sykes with a list of 20 or so IBP employees whom they regarded as able and useful employees, and whom they recommended to Sykes; none were hired to assist in the startup of the PHIS operation.: Instead, a few local job applicants whose names were in the IBP files were contacted and Sykes went to much trouble and expense to import nearly 30 others from a distant city to be on hand for the February 7 startup. Thereafter, PHIS placed want ads in nearly every local paper in the entire region looking for help. None of the men who were hired at this time had any significant packinghouse experience, and the result of their employ- ment, not only on February 7 but also in the weeks which followed, was large-scale destruction of beef in process and a marked decline in production. In terms of stability and efficiency of operation, the decision not to grant immediate reemployment of IBP employees had utterly no business justification and could not, by any stretch of the imagina- tion, be regarded as an exercise of businessjudgment. Even Sykes admitted that bringing in Omaha-based workers was a mistake. The Respondents' witnesses effectively concede that the decision not to rehire IBP employees was taken because the presence on their payroll of union adherents formerly covered by the IBP contract would serve to support a successorship claim being pressed by the Union. The Piasecki case, cited above, and many more that have been decided since Piasecki,18 stand for the well-established proposition that the refusal of an incoming employer to hire the employees of his predecessor because of their union membership and in order to forestall the establish- ment of a successorship in the employing industry is a discrimination in the hire and tenure of employment in violation of Section 8(aX3) of the Act. That such a motive lay behind the refusal of PHIS to hire IBP employees is amply demonstrated by the record herein. Accordingly, by effect. The emptiness of this defense is made clear when one considers that in February the Respondents refused to hire even the 20 or so IBP employees whom Walker and Trupe had recommended to Sykes as worthy of retention. Their presence inside the plant rather than in front of the plant during the first few weeks of the resumed operations would have mitigated or cured many of PHIS' early and overwhelming production problems. iL Tri State Maintenance Corporation, 167 NLRB 933 (1967), enfd. 408 F.2d 171 (C.A.D.C., 1968): K B. A J. Young's Super Markets, Inc., 157 NLRB 271 (1966). enfd. 377 F.2d 463 (C.A. 9, 1967); N.LR.B. v. News England Tank Industries, Inc., 302 F.2d 273 (C.A. . 1962). cert. denied 371 U.S. 875; J. R. Sousa and Sons, supra, Triangle Maintenance Corporation, et al., 194 NLRB 486 (1971); Foodway of El Paso, 201 NLRB 933 (1973); Macomb Block and Supply, Inc., 223 NLRB 1285 (1976). 747 DECISIONS OF NATIONAL LABOR RELATIONS BOARD this course of conduct PHIS and its joint employer violated Section 8(a)(1) and (3) of the Act. The fact that later on in the year they engaged in a form of tokenism by rehiring a few former IBP employees does not militate against this finding or mitigate its gravity. It is no defense to such conduct that IBP employees initially refused to file individual applications for employ- ment as PHIS required. In the case of economic strikers, the Board once held that it was an unfair labor practice even to require individual rather than group offers of reinstatement. Mooney Aircraft, Inc., 132 NLRB 1194 (1961). In this instance, an insistence by PHIS upon individual rather than a single group application by IBP employees was part and parcel of a discriminatory scheme to destroy the effectiveness of the Union's effort to obtain reemployment for its members. As a discriminatorily motivated requirement, it violates Section 8(a)(1) and (3) of the Act. W. C. McQuaide, Inc., 220 NLRB 593 (1975). There is no doubt as to the Union's authority to make a request to PHIS on behalf of its members for reemploy- ment,19 and there is no question that the Union repeatedly made this request to the Respondents. However, such a request on the part of the Union or on the part of individual employees is actually rendered unnecessary where, as here, a company had already determined to refuse to rehire a predecessor's employees, because making any such applications would be an empty and futile gesture. Rushton & Mercier Woodworking Co., Inc., and Rand & Co., Inc., 203 NLRB 123 (1973); N.LR.B. v. Southern Greyhound Lines, 426 F.2d 1299 (C.A. 5, 1970); Virginia Stage Lines, Inc. v. N.L.R.B., 441 F.2d 499 (C.A. 4, 1971); Idaho Potato Growers, Inc. v. N.L.R.B., 144 F.2d 295 (C.A. 9, 1944). One last string in the Respondents' bow is the contention that they were under no obligation to hire former IBP employees since the application for employment, made on their behalf by the Union, was not unconditional but was contingent upon acceptance by the new employer of the terms and conditions of the old contract. Were PHIS and MCDB found to be alter egos rather than mere successors, such insistence by the Union would not be fatal to an application. Part of the stratagem devised by the Respon- dents in this chain of events was to keep the Union and the IBP employees in the dark, insofar as possible, about the facts and circumstances surrounding the plant transfer. Accordingly, it is understandable that a union might misconceive its rights and remedies since the facts and circumstances upon which it had to base its judgments were, in substantial part, concealed from it. However, this contention of the Respondents requires but scant attention. There is little doubt that the Union would have preferred that the Respondents assume all of the obligations of the existing contract with IBP. In light of the Union's request to the district court in March 1976 that MCDB be required to take over the old contract, it is idle for the Union to pretend that it did not seek to achieve this result. It is equally clear that the Union had a fallback or secondary position, and that this position was also made abundantly 19 M. R. & R. Trucking Company, 178 NLRB 167 (1967); Elmira Machine & Speciality Works, Inc., er at 148 NLRB 1695 (1964); Brown and Root, Inc., et at, 99 NLRB 1031 (1952), enfd. 203 F.2d 139 (C.A. 8, 1953); American clear to the Respondents. Both Long and Peterson stated on television, the standard means of communication between these parties before the charges herein were filed, that they would accept the reemployment of their members without an assumption of the contract. In response to probing questions by newsman Max Lee, Peterson an- nounced to the television audience that union members would work at less than the contract rate if they could get their jobs back and would be willing thereafter to sit down and discuss with PHIS representatives the terms and conditions of their continued employment. In the telegram of February 9 to the various employers involved in this case, the Union, on behalf of its members, made an application for the reemployment for all former IBP employees and did not condition this application upon any other agreement, including the assumption of the IBP contract by PHIS. Therefore, I conclude that the Union made an unconditional offer to PHIS to reemploy its members who had previously worked for IBP. However, this right of former IBP employees to obtain reemployment matured even before the plant had reopened. Therefore, since no application by the Union was necessary to preserve the rights of IBP employees in light of the previous unfair labor practices committed by the Respondents by their determination not to hire IBP employees at the outset of the PHIS startup, this telegram and the television statements made contemporaneously by union spokesmen are merely surplus requests, made in an abundance of caution, which were not essential to perfect the legal standing which former IBP employees had already ac- quired. One further aspect of the Piasecki line of cases merits some attention. In Piasecki, the Board found that the discriminatory efforts of a new employer to avoid hiring the employees of its predecessor constituted a violation of Section 8(a)(3) of the Act but did not amount to a refusal to bargain in violation of Section 8(a)(5). However, the Board did issue a bargaining order to remedy the 8(a)(3) violation. Later cases, cited supra, have enlarged the Piasecki doctrine to find an 8(aX5) violation as well in such circumstances. In light of this development in the law, as well as the repeated demands of the Union herein for recognition and the stonewalling response which they received, I conclude that the Respondent Employers herein also violated Section 8(a)(1) and (5) of the Act. 3. Illegal assistance to NIWU to obtain recognition The NIWU organized the new PHIS employees with extraordinary swiftness and achieved recognition and a contract with unseemly haste. Before the former employees of IBP had become aware that the plant was even operating, an NIWU organizer had obtained designation cards from 34 newly hired employees. Within 2 or 3 hours after a presentation to Sykes of the NIWU cards, Sykes was in Des Moines, had contacted West in his hospital room, and had worked out the substance of a collective- bargaining agreement which was then executed the United Inns, Inc. d/b/a/ Ramada Inn, 201 NLRB 431 (1973); Consolidated Edison Companyof New York, Inc., et al. v. N.L.R.B., 305 U.S. 197 (1938). 748 MASON CITY DRESSED BEEF following Monday. Such a labor relations coup by NIWU could only have occurred with the active assistance of Sykes and as a part of an operating tactic to reopen the plant with new employees, on his terms, and then to engage in a physical confrontation whenever an anticipated reaction by former employees might take shape. Recognition of the NIWU by the employer was predicat- ed on 34 or 35 authorization cards which were obtained from new employees on Saturday morning, February 7, as part of the hiring-in procedure. Credited evidence in this record indicates that the cards were obtained by or with the assistance of Respondent Employer's supervisors, on company premises, and before any work had commenced. This scenario depicts a classic form of illegal assistance by an employer to a labor organization. Park Inn Hotel, Inc., and 115-02 Ocean Promenade, Inc., 139 NLRB 669 (1962); Prospect Gardens of Norwalk, Inc., 177 NLRB 136 (1969); Senco, Inc., 177 NLRB 882 (1969); Columbus Janitor Service, Division of Servisco, 191 NLRB 902 (1971); Howard Creations, Inc., 212 NLRB 179 (1974). On the Saturday afternoon when recognition was accorded, only 35 employ- ees had been hired in a unit normally containing 83. Of these employees, only one is now on the payroll and only two or three others were on the payroll for as long as 3 weeks. The bulk of the employees present on that day had been imported from another locality. They were then being paid on a basis which was temporary in character and which presumed the fact that they might not remain in Mason City as permament employees in the plant. In the ensuing 3 months, nearly 200 more persons were hired in an effort by the employer to develop a stable cadre with which to man the plant. Thus, at the time recognition was granted, a representative complement of employees had not been retained. To grant recognition to a labor organization under such circumstances is another form of illegal assistance by an employer. Cowles Communications, Inc., and Sufsun Co., Inc., 170 NLRB 1596 (1968). Thus, by helping the NIWU to achieve majority status and by granting recognition to it when the employer had not yet hired a representative component of employees, the Respondent Employers violated Section 8(a)2) of the Act. By achieving recognition in this manner and by accepting the benefits of unlawful recognition by the Employer, the Respondent NIWU violated Section 8(b)(1)(A) of the Act. By executing a collective-bargaining agreement designed to perpetuate conditions which would in the future cause unlawful discrimination by the employer against employ- ees on the basis of union considerations, Respondent NIWU violated Section 8(b)(2) of the Act. Harry Edison, et al., a Co-Partnership doing business as Seaview Manor Home for Adults, 222 NLRB 596 (1976); N.L.R.B. v. Richard W. Kaase Baking Co., et al., 346 F.2d 24 (C.A. 6, 1965). The fact that Sykes later withdrew recognition from the NIWU and refused to honor the contract in no way detracts from this finding, since it is well established that the discontin- uance of an unfair labor practice is no defense to the imposition of a Board order. N.L.R.B. v. Mexia Textile Mills, Inc., 339 U.S. 563 (1950). 4. Independent violations of Section 8(a)(1) of the Act The General Counsel alleged in the complaint that the Respondent Employer violated Section 8(a)(1) of the Act by virtue of coercive statements made by certain supervi- sors to former IBP employees. In the findings of fact herein and in the discussion above concerning the motivation of the employees for their refusal to hire former IBP employees, I found that Foreman Mammen told Bucci, Peterson, and King on the evening of February 7 that the Respondents would never rehire IBP employees who were union officials and would not hire any former IBP employees for a period of several months. Foreman LeDuc made a similar statement to Bucci about 2 weeks later during a conversation at a bowling alley. On another occasion, LeDuc told King that the Respondent Employers were hiring new employees instead of IBP employees in order to break the Union. In addition to supplying the record with evidence of antiunion motivation, these statements constitute violations of Section 8(a)(1) of the Act. I so find and conclude. Upon the foregoing findings of fact, and upon the entire record considered as a whole, I make the following: CONCLUSIONS OF LAW I. Respondents Mason City Dressed Beef, Inc., and Packing House and Industrial Services, Inc., are jointly and severally employers engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, and Respondent National Industrial Workers Union are, respectively, labor organizations within the meaning of Section 2(5) of the Act. 3. Respondent Mason City Dressed Beef, Inc., and Respondent Packing House and Industrial Services, Inc., are joint employers of all production and maintenance employees employed at the Mason City, Iowa, plant, formerly owned and operated by Iowa Beef Processors, Inc. 4. All production and maintenance employees em- ployed by Respondent Employers at the Mason City, Iowa, plant, formerly owned and operated by Iowa Beef Packers, Inc., excluding office clerical employees, storeroom em- ployees, nurses, buyers, salesmen, professional employees, beef graders, yards scalehouse personnel, quality control personnel, guards, and supervisors as defined in the Act, constitute a unit appropriate for collective bargaining within the meaning of Section 9(b) of the Act. 5. At all times material herein, Local P-38, Amalga- mated Meat Cutters and Butcher Workmen of North America, AFL-CIO, has been the exclusive representative of all employees in the aforesaid unit for the purposes of collective bargaining with respect to rates of pay, wages, hours of employment, and other terms and conditions of employment, within the meaning of Section 9(a) of the Act. 6. By assisting National Industrial Workers Union in obtaining union membership cards by supervisors on company premises on company time; by executing a collective-bargaining agreement with National Industrial 749 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Workers Union before the said employers had hired a representative complement of employees; and by recogniz- ing and executing a collective-bargaining agreement with National Industrial Workers Union when Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, was the exclusive representa- tive of employees in the bargaining unit covered by said agreement, Respondents Mason City Dressed Beef, Inc., and Packing House and Industrial Services, Inc., violated Section 8(a)(2) of the Act. 7. By accepting from the Respondent Employers illegal assistance in obtaining union designation cards, and by requesting from Respondent Employers recognition as the collective-bargaining representative of its employees when it did not represent an uncoerced majority of the employ- ees of the Respondent Employers and when another labor organization was the duly designated collective-bargaining representative of the bargaining unit employees, Respon- dent National Industrial Workers Union violated Section 8(b)(l)(A) of the Act. 8. By executing a collective-bargaining agreement with the Respondent Employers when it was not the duly designated representative of an uncoerced majority of the employees of the Respondent Employers, Respondent National Industrial Workers Union violated Section 8(b)(2) of the Act. 9. By its refusal on February 7, 1976, and thereafter to rehire the 83 employees named in the appendix to the consolidated complaint herein in order to discourage their membership in and support of Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, the Respondent Employers herein have violat- ed Section 8(a)(3) of the Act. 10. By their refusal to recognize and bargain with Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, as the duly designated bargaining representative of their employees employed in the unit set forth above in Conclusion of Law 4, the Respondent Employers herein have violated Section 8(a)(5) of the Act. II. By the acts and conduct set forth above in Conclusions of Law 6, 9, and 10, and by telling employees they would not be rehired because of their union member- ship and activities, the Respondent Employers violated Section 8(a)(l) of the Act. 12. The aforesaid unfair labor practices have a close, intimate, and substantial effect on the free flow of commerce within the meaning of Section 2(6) and (7) of the Act. REMEDY Having found that the Respondents herein have commit- ted various unfair labor practices, I will recommend that they be ordered to cease and and desist therefrom and to take other actions designed to effectuate the purposes and policies of the Act. Respondent Employers will be required to withdraw and withhold recognition from National 2z F. W Woolworth Company, 90 NLRB 289 (1950). 21 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. Industrial Workers Union and to cease giving effect to the collective-bargaining agreement which these parties had heretofore executed. Said Employers will be required to recognize and bargain with the Charging Party and, if they agree upon the terms and conditions of a contract, to execute the same in writing. Said Employers will also be required to offer full and immediate reinstatement to all of the discriminatees named in the appendix to the consoli- dated complaint who have not as yet been rehired and to make them whole for any losses which they have suffered, in accordance with the Woolworth formula,20 with interest thereon computed at six percent per annum. Because the unfair labor practices committed herein have been serious and pervasive and include discriminations which violate Section 8(a)(3) of the Act, I will recommend to the Board a so-called broad 8(a)(1) Order designed to suppress any and all violations of that section of the Act. Upon the foregoing findings of fact, conclusions of law, and upon the basis of the entire record herein considered as a whole, and pursuant to Section 10(c) of the Act, I make the following recommended: ORDER21 A. Respondent Mason City Dressed Beef, Inc., and Packing House and Industrial Services, Inc., Mason City, Iowa, jointly and severally, and their officers, agents, successors, and assigns, shall: I. Cease and desist from: (a) Recognizing or bargaining with National Industrial Workers Union as the collective-bargaining representative of their production and maintenance employees employed at the Mason City, Iowa, plant, unless and until said labor organization is certified by the Board as the collective- bargaining representative of said employees pursuant to Section 9(c) of the Act. (b) Giving effect to a certain collective-bargaining agreement concluded with National Industrial Workers Union on or about February 9, 1976, or to any modifica- tion or extension thereof. (c) Giving effect to any membership application executed by their employees on or after February 7, 1976, on behalf of National Industrial Workers Union or, by means or in any manner, assisting or contributing to the support of National Industrial Workers Union. (d) Refusing to recognize and bargain collectively with Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, as the collective- bargaining representative of the production and mainte- nance employees employed at their Mason City, Iowa, plant. (e) Telling employees they would not be hired if they became or remained members of Local P-38, Amalga- mated Meat Cutters and Butcher Workmen of North America, AFL-CIO. (f) Refusing to hire or otherwise discriminating against employees in their hire or tenure of employment because they are members of or give support to Local P-38, 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. 750 MASON CITY DRESSED BEEF Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO. (g) By any other means interfering with, restraining, or coercing employees in the exercise of rights guaranteed to them by Section 7 of the Act. 2. Take the following affirmative action designed to effectuate the purposes and policies of the Act. (a) Offer to the 83 persons formerly employed by Iowa Beef Processors, Inc., at the Mason City, Iowa, plant, who are named in the appendix to the consolidated complaint, full and immediate reinstatement to their former or substantially equivalent positions, without prejudice to seniority or other rights which they have formerly enjoyed, discharging if necessary other employees who have been hired in their places. (b) Make whole all of the discriminatees named in the appendix to the consolidated complaint for any loss of pay they may have suffered by reason of the discrimination practiced against them and found herein, in the manner described above in the section entitled "Remedy." (c) Withdraw and withhold from National Industrial Workers Union recognition as the collective-bargaining representative of their production and maintenance em- ployees employed at the Mason City, Iowa, plant. (d) Recognize and, upon request, bargain collectively with Local P-38, Amalgamated Meat Cutters and Butcher Workmen of North America, AFL-CIO, as the collective- bargaining representative of a unit of all production and maintenance employees employed by the Respondents at their Mason City, Iowa, plant, excluding office clerical employees, storeroom employees, nurses, buyers, salesmen, professional employees, beef graders, yard scalehouse personnel, quality control personnel, guards, and supervi- sors as defined in the Act, and, if an agreement is reached, embody said agreement in an executed written contract. (e) Preserve and, upon request, make available to the Board or its agents, for examination and copying, all records necessary to analyze and compute the amount of backpay which may be due and owing under the terms of this recommended Order. (f) Post at its Mason City, plant, copies of the attached notice marked "Appendix A." 22 Copies of said notice, on forms provided by the Regional Director for Region 18, and duly signed by a representative of the Respondent Employers, shall be posted by the Respondent Employers immediately upon receipt thereof, and be maintained by them for 60 consecutive days, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken to insure that such notices are not altered, defaced, or covered by any other material. (g) Notify the Regional Director for Region 18, in writing, within 20 days from the date of this Order, what steps Respondent Employers have taken to comply herewith. B. Respondent National Industrial Workers Union, its officers, agents, and representatives, shall: I. Cease and desist from: (a) Giving effect to a certain collective-bargaining agreement with Packing House Industrial Services, Inc., executed on or about February 9, 1976, and to any modification or extension thereof. (b) Acting or purporting to act as the collective-bargain- ing representative of the production and maintenance employees of Packing House Industrial Services, Inc., and Mason City Dressed Beef, Inc., who are employed at their Mason City, Iowa, plant, unless and until it has been certified by the Board as the collective-bargaining repre- sentative of said employees pursuant to Section 9 of the Act. (c) Giving effect to any membership applications executed by any employees of Packing House Industrial Services, Inc., or Mason City Dressed Beef on or after February 7, 1976. (d) By any other means restraining or coercing employ- ees of Packing House Industrial Workers, Inc., or Mason City Dressed Beef, Inc., in the exercise of rights guaranteed to them by Section 7 of the Act. 2. Take the following affirmative action designed to effectuate the purposes and policies of the Act: (a) Post at its office and meeting hall copies of the attached notice marked "Appendix B."2 3 Copies of said notice, after being signed by a representative of the Respondent Union, shall be posted immediately upon receipt thereof, and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to members are customarily posted. Reason- able steps shall be taken by Respondent Union to insure that such notices are not altered, defaced, or covered by any other material. Immediately after their receipt from the Regional Director, other copies of said notice shall be signed by a representative of the Respondent Union and shall be forwarded to Packing House and Industrial Services, Inc., and Mason City Dressed Beef, Inc., for posting at the Mason City, Iowa, plant. (b) Notify the Regional Director for Region 18, in writing, within 20 days from the date of this Order, what steps Respondent Union has taken to comply herewith. 22 In the event the Board's 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." 23 See fn. 22, supra. APPENDIX B NOTICE To MEMBERS POSTED BY ORDER OF THE NATInoNAL LABOR RELATIONS BOARD An Agency of the United States Government National Industrial Workers Union is posting this notice to comply with the provisions of an Order of the National Labor Relations Board. This Order was issued after a hearing before an Administrative Law Judge in which it was found that we violated certain provisions of the National Labor Relations Act. WE WILL NOT give effect to any membership applications executed on or after February 7, 1976, by employees of Mason City Dressed Beef, Inc., or 751 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Packing House and Industrial Services, Inc., who are employed at the Mason City Iowa, plant. WE WILL NOT give effect to a contract entered into with Mason City Dressed Beef, Inc., or Packing House and Industrial Services, Inc., on or about February 9, 1976, or to any modifications or extensions thereof. WE WILL NOT act or purport to act as the collective- bargaining representatives of the employees of Mason City Dressed Beef, Inc., or Packing House and Industrial Services, Inc., who are employed at their Mason City, Iowa, plant, unless and until we have been certified by the Board after the holding of an election. WE WILL NOT restrain or coerce employees of Mason City Dressed Beef, Inc., or Packing House and Industrial Services, Inc., in any manner with respect to the exercise of rights guaranteed to them by the National Labor Relations Act. NATIONAL INDUSTRIAL WORKERS UNION 752