Kuhns, Earl, d/b/a Frenchy's K & T and Earl's News Stand

DECISIONS OF NATIONAL LABOR RELATIONS BOARD Earl Kuhns d/b/a Frenchy's K & T and Earl's News stand and Retail Clerks Union, Local 648, United Food and Commercial Workers Interna- tional Union, AFL-CIO. Cases 20-CA-14319 and 20-CA-14456 September 30, 1982 SUPPLEMENTAL DECISION AND ORDER BY MEMBERS FANNING, JENKINS, AND HUNTER On February 20, 1980, the National Labor Rela- tions Board issued a Decision and Order in this proceeding,' which ordered Respondent, inter alia, to offer immediate and full reinstatement to seven employees and to make them whole for any loss of earnings they may have suffered as a result of their discharges, which were found to be in violation of Section 8(a)(3) and (1) of the National Labor Rela- tions Act, as amended. On March 25, 1981, the United States Court of Appeals for the Ninth Cir- cuit entered a judgment enforcing the Board's Order. 2 On November 27, 1981, the Acting Regional Di- rector for Region 20 issued a backpay specification and notice of hearing alleging, inter alia, that a controversy had arisen over the amount of backpay due under the terms of the Board's Order. On De- cember 5, 1981, Respondent filed an answer gener- ally denying the allegations contained in the back- pay specification. On June 1, 1982, the Regional Director for Region 20 issued an amendment to the backpay specification, relating solely to the interim earnings of one discriminatee. On June 15, 1982, Respondent filed an answer generally denying the allegations contained in this amendment. On June 14, 1982. counsel for the General Coun- sel filed directly with the Board a Motion for Par- tial Summary Judgment with exhibits attached. Subsequently, on June 16, 1982, the Board issued an order transferring the proceeding to the Board and a Notice To Show Cause why the General Counsel's Motion for Partial Summary Judgment should not be granted. On July 6, 1982, Respond- ent filed a response to the Notice To Show Cause. Upon the entire record in this proceeding, the Board makes the following: 247 NL.RB 1212. 2 N.L.R.B. v. Earl Kuhns d/b/a Frenchy's K & T and Earl's News Stand, Case No, 80- 7269. 264 NLRB No. 57 Ruling on the Motion for Partial Summary Judgment Section 102.54(b) and (c) of the National Labor Relations Board Rules and Regulations, Series 8, as amended, states: (b) Contents of the answer to specification.- The answer to the specification shall be in writing, the original being signed and sworn to by the respondent or by a duly authorized agent with appropriate power of attorney af- fixed, and shall contain the post office address of the respondent. The respondent shall spe- cifically admit, deny, or explain each and every allegation of the specification, unless the respondent is without knowledge, in which case the respondent shall so state, such state- ment operating as a denial. Denial shall fairly meet the substance of the allegations of the specification denied. When a respondent in- tends to deny only a part of an allegation, the respondent shall specify so much of it as is true and shall deny only the remainder. As to all matters within the knowledge of the re- spondent, including but not limited to the var- ious factors entering into the computation of gross backpay, a general denial shall not suf- fice. As to such matters, if the respondent dis- putes either the accuracy of the figures in the specification or the premises on which they are based, he shall specifically state the basis for his disagreement, setting forth in detail his position as to the applicable premises and fur- nishing the appropriate supporting figures. (c) Effect of Jfilure to answer or to plead spe- cifically and in detail to the specification-.If the respondent fails to file any answer to the speci- fication within the time prescribed by this sec- tion, the Board may, either with or without taking evidence in support of the allegations of the specification and without notice to the re- spondent, find the specification to be true and enter such order as may be appropriate. If the respondent files an answer to the specification but fails to deny any allegation of the specifi- cation in the manner required by subsection (b) of this section, and the failure so to deny is not adequately explained, such allegation shall be deemed to be admitted to be true, and may be so found by the Board without the taking of evidence supporting such allegation, and the respondent shall be precluded from introduc- ing any evidence controverting said allegation. The backpay specification duly served on Re- spondent states that, pursuant to Section 102.54 of the Board's Rules and Regulations, "Respondent 412 FRENCHY'S K & T shall file with the undersigned Acting Regional Di- rector, acting in this matter as agent of the Nation- al Labor Relations Board, an original and four (4) copies of an answer to the said Specification within fifteen (15) days from the service hereof." The backpay specification states further that "[t]o the extent that such answer fails to deny allegations of the Backpay Specification in the manner required under the Board's Rules and Regulations, and the failure to do so is not adequately explained, such allegations shall be deemed to be admitted to be true, and Respondent shall be precluded from in- troducing any evidence controverting them." The Motion for Partial Summary Judgment sub- mits that the answer filed by Respondent on De- cember 5, 1981, states merely a general denial of all the allegations in the backpay specification, which does not specifically dispute either the accuracy of the figures used in the specification to compute gross backpay or the premises on which they are based and which fails to provide any alternative formula for computing the amounts of gross back- pay owed. Counsel for the General Counsel con- tends that, except as to the issue of interim earn- ings, Respondent's December 5, 1981, answer fails to comply with the requirements of Section 102.54(b) and (c) of the Board's Rules and Regula- tions as to specificity. Therefore, counsel for the General Counsel requests that the Board deem the allegations of the backpay specification concerning gross backpay to be admitted to be true and that the backpay hearing be limited to the issue of inter- im earnings. A copy of the answer filed by Respondent on December 5, 1981, is attached to the Motion for Partial Summary Judgment as an exhibit. This answer simply denies all of the allegations con- tained in the backpay specification. We agree with counsel for the General Counsel that the December 5, 1981, answer of Respondent constitutes a general denial which fails to comply with the requirements of Section 102.54(b) and (c) as to those compliance matters within its knowl- edge. Thus, the answer does not dispute the accu- racy of the gross backpay figures contained in the backpay specification or provide any alternative formula for computing the amounts of gross back- pay owed. Certainly, the hours worked by his em- ployees and their rates of pay are normally within the knowledge of an employer; however, in re- sponse to the Notice To Show Cause, Respondent asserts that he no longer possesses any knowledge of these matters, since he turned over all of his books and records to counsel for the General Counsel pursuant to a subpeona during the hearing before the Administrative Law Judge in this pro- ceeding. Section 102.54(b) requires that, if an em- ployer is without knowledge as to any allegation of the backpay specification, his answer "shall so state, such statement operating as a denial." Re- spondent's December 5, 1981, answer does not state that he is without knowledge as to the wages and hours of his discharged employees, nor does his answer contain any explanation for his failure to deny specifically the gross backpay allegations, as required by Section 102.54(c). Therefore, we find Respondent's assertion in his response to the Notice To Show Cause that he is without knowl- edge to be untimely. Furthermore, we note that, al- though Respondent may no longer possess his original payroll records, he clearly has access to other sources of information from which to con- firm the gross backpay figures alleged in the back- pay specification that he apparently has not at- tempted to pursue. Thus, Respondent has not indi- cated that he ever requested access to or copies of the payroll records allegedly in the possession of counsel for the General Counsel before filing his response to the Notice To Show Cause.' In addi- tion, the record of the hearing before the Adminis- trative Law Judge in this case contains testimony from the discharged employees about their hours and rates of pay as well as some of the timecards for these employees, which were introduced as ex- hibits. Respondent has not indicated that he ever analyzed this record evidence to determine wheth- er the gross backpay allegations are correct. Rather, Respondent has simply relied upon the be- lated assertion that he lacks knowledge. 4 We do not find this to be an adequate explanation for his failure to comply with the requirements of Section 102.54(b) in his original answer. Since Respondent has failed to deny specifically the gross backpay allegations or to explain ade- quately his failure to do so, Section 102.54(c) re- quires that these allegations be deemed to be ad- mitted to be true. Accordingly, we find them to be 3 Respondent's July 6, 1982, response to the Notice To Show Cause merely states that "[a] year ago . . [Respondent] had told the Board Representatives that we didn't have the records and requested that a hearing be held .... " The Acting Regional Director thereafter obliged by issuing the backpay specification and notice of hearing While Re- spondent's response to the Notice To Show Cause contains a request for copies of the payroll records in counsel for the General Counsel's posses- sion, there is nothing to indicate that counsel for the General Counsel has denied this request. Obviously, Respondent has the right to inspect or re- ceive copies of material which he has provided in response to a subpoe- na. 4 In the response to the Notice To Show Cause, Respondent contends that a hearing is required on the gross backpay allegations in order to take testimony from the discharged employees, under oath, regarding their wages and hours or to receive the employees' Federal income tax and social security records into evidence to verify their earnings. Inas- much as the underlying record in this case already contains testimony, under oath, from these employees as to their wages and hours, we see no need to hold another hearing on this issue. 413 DECISIONS OF NATIONAL LABOR RELATIONS BOARD correct, and we shall grant counsel for the General Counsel's Motion for Partial Summary Judgment. However, inasmuch as counsel for the General Counsel does not seek summary judgment with re- spect to the amounts of net interim earnings alleged in the backpay specification and as we have held that a general denial of the allegations concerning interim earnings in a backpay specification is suffi- cient under Section 102.54 to raise an issue war- ranting a hearing, 5 we shall order a hearing limited to the determination of the net interim earnings of the seven discharged employees. As stated above, we deem Respondent to have admitted all other al- legations in the backpay specification to be true. ORDER It is hereby ordered that the General Counsel's Motion for Partial Summary Judgment as to all al- s Dews Construction Corp.. a subsidiary of The Aspin Group, In:., 246 NLRB 945 (1979). legations in the backpay specification except those relating to the amounts of net interim earnings be, and it hereby is, granted. IT IS FURTHER ORDERED that this proceeding be, and it hereby is, remanded to the Regional Direc- tor for Region 20 for the purpose of issuing a notice of hearing and scheduling a hearing before an administrative law judge, which hearing shall be limited to taking evidence as to the amounts of the net interim earnings of the seven discharged em- ployees involved herein. IT IS FURTHER ORDERED that the administrative law judge shall prepare and serve on the parties a decision containing findings, conclusions, and rec- ommendations based on all the record evidence. Following the service of the administrative law judge's decision on the parties, the provisions of Section 102.46 of the Board's Rules and Regula- tions, Series 8, as amended, shall apply. 414