Dupont Dow Elastomers, LLC

DUPONT DOW ELASTOMERS LLC 1071 Dupont Dow Elastomers L.L.C., an alter ego of E. I. du Pont de Nemours and Company and Chemi- cal Workers Association, Inc., Affiliate of Inter- national Brotherhood of Dupont Workers and Neoprene Craftsmen Union Local 788 and Dow Chemical Company. Cases 9–CA–34028 and 9– CA–33536 October 31, 2000 DECISION AND ORDER BY CHAIRMAN TRUESDALE AND MEMBERS FOX AND LIEBMAN On December 17, 1997, Administrative Law Judge Ir- win H. Socoloff issued the attached decision. The Gen- eral Counsel, Charging Party Chemical Workers Asso- ciation, and Charging Party Neoprene Craftsmen Union Local 788 each filed exceptions and supporting briefs. The Respondents each filed answering briefs. Charging Party Chemical Workers Association filed a reply brief. The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge’s rulings, findings, and conclusions only to the extent consistent with this Decision and Order. The issues presented in this case arise from the forma- tion of a joint venture by Respondent E. I. du Pont de Nemours and Company (Du Pont) and Party in Interest Dow Chemical Company (Dow). The complaint alleges that the Respondents, Du Pont and joint venture du Pont Dow Elastomers L.L.C. (DDE), are alter ego companies or, alternatively, that DDE is a successor to DuPont at production plant sites in Deepwater, New Jersey and in Louisville, Kentucky. The complaint further alleges that the Respondents violated Section 8(a)(5) and (1) of the Act by unilaterally changing certain terms and conditions of employment for employees in bargaining units sepa- rately represented by the Charging Parties at these plants and by failing to provide the Charging Party Neoprene Craftsmen Union Local 788 with requested bargaining information about the DDE joint venture. The judge found, and we agree, that DDE was not an alter ego of Du Pont.1 He noted that DDE was undisput- edly a successor to Du Pont within the meaning of NLRB v. Burns Security Services, 406 U.S. 272 (1972), and was therefore bound to recognize and bargain with the Un- ions. He further found, however, that DDE was not a “perfectly clear” successor, as that term from Burns was interpreted by the Board majority in Spruce Up Corp., 209 NLRB 194 (1974), enfd. per curiam 529 F.2d 516 (4th Cir. 1975). Accordingly, the judge found that DDE was privileged under Burns to set initial terms and condi- tions of employment for unit employees and that it did not act unlawfully by establishing terms and conditions different from those enjoyed by unit employees while working for predecessor Du Pont. 1 The judge found, and we agree, that there is insufficient evidence of common ownership and control or that DDE was formed to aid Du Pont in evading its obligations under the Act to conclude that DDE and Du Pont are alter egos. In determining whether an alter ego relationship exists between two apparently separate entities, the Board considers whether the two have substantially identical management, business purposes, operations, equipment, customers, supervision and owner- ship. Advance Electric, 268 NLRB 1001, 1002 (1984). The Board also considers whether the second company was created in order to allow the old employer to evade responsibility under the Act. Cofab, Inc., 322 NLRB 162 (1996); Fugazy Continental Corp., 265 NLRB 1301, 1301–1302 (1982), enfd. 725 F.2d 1416 (D.C. Cir. 1984). However, unlawful motivation is not a necessary element of an alter ego finding. Johnstown Corp. and/or Stardyne, Inc., 313 NLRB 170 (1993), enf. denied and remanded 41 F.3d 141 (3d Cir. 1994), sup. dec. 322 NLRB 818 (1997). In this regard, we disavow the judge’s suggestion that the lack of antiunion motivation “generally militates” against finding an alter ego relationship. For the reasons set forth below, we disagree with the judge on this issue. We find that DDE was a “perfectly clear” successor and that it violated Section 8(a)(5) and (1) of the Act by failing to bargain prior to setting unit employees’ initial terms and conditions of employment. FACTS For over 45 years, DuPont recognized the Neoprene Craftsmen Union Local 788 (NCU) as the exclusive col- lective-bargaining representative of production and main- tenance employees at Du Pont’s Louisville, Kentucky facility. For approximately the same amount of time, Du Pont recognized the Chemical Workers Association, Inc. (CWA) as the exclusive collective-bargaining representa- tive of separate units of production and maintenance em- ployees and clerical employees at Du Pont’s Chamber Works facility in Deepwater, New Jersey. Du Pont’s recognition of both unions was embodied in separate successive collective-bargaining agreements. On January 31, 1995, Du Pont informed the Unions that it had signed a letter of intent with Dow to form a joint venture to produce and market elastomer products. DuPont stated further that the joint venture, subsequently named DDE, would take over the production of neoprene at Louisville and the production of viton and FMDL at Chamber Works. Du Pont assured the Unions, however, that the formation of DDE would not result in personnel reductions at either facility. Prior to the formation of DDE, NCU represented ap- proximately 415 production and maintenance employees at Louisville in a single unit. Approximately 310 of these employees worked on neoprene products. The 332 NLRB No. 98 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1072 CWA represented approximately 1700 production and maintenance employees and 150 clerical employees in separate bargaining units at Chamber Works. Approxi- mately 81 production and maintenance employees and an undisclosed number of clerical employees worked on FMDL and viton products. In a meeting on January 31, 1995, Du Pont officials at Louisville assured employees that they did not anticipate that any employees would lose their jobs as a result of DDE taking over the production of neoprene. An Octo- ber 18, 1995, electronic mail message to Louisville em- ployees from DDE management representative Haven Harrington confirmed that DDE would offer employment to all employees working in neoprene. Concurrently, Louisville employees were informed that DuPont and Dow were still negotiating the terms and conditions of employment that DDE would offer its employees. Du Pont officials at Chamber Works initially advised the CWA that DDE would most likely contract employ- ees from DuPont rather than hire its own work force. On November 15, 1995, however, DDE advised the CWA that it would offer employment to all employees working on the viton and FMDL product lines, under terms and conditions to be announced on November 30, 1995. On November 30, 1995, DDE told both the NCU and the CWA that it planned to extend offers of employment to all incumbent employees in January 1996, and that it would offer its employees the same pay and benefits as they enjoyed under the Unions’ respective contracts with Du Pont. DDE stated further that employees would re- tain their seniority, but they would not have bidding and bumping rights back to Du Pont. Additionally, DDE announced that it would offer a bonus program, called success sharing. Under this program, DDE committed to pay employees a lump sum equal to 4 percent of their base yearly pay upon the successful start up of the com- pany and another 4.3 percent if the company met its first year performance goals. Success sharing was not avail- able to Du Pont employees. DDE did not offer to bargain prior to announcing ini- tial terms and conditions of employment, although the Unions had made clear their view that DDE should rec- ognize them and honor their contracts with DuPont.2 On 2 NCU, by letter of September 22, 1995, to DDE president-designate Donald Duncan, demanded recognition as the exclusive collective- bargaining representative of DDE’s work force. It further stated that DDE appeared to be an alter ego of DuPont and, as such, was required to abide by the substantive terms of NCU’s contract with DuPont. NCU subsequently repeated its request for recognition and its alter ego claim orally to DDE’s designated representatives. CWA, by letter of November 16, 1995, to DDE management designee Mike Foley, ad- vised DDE of its view that DDE and DuPont were alter ego companies. The letter also expressed the belief that DDE had “the obligation to November 30, 1995, DDE advised the Unions that it would not recognize or bargain with them until the hiring process was substantially complete and more than 50 percent of the needed work force was composed of for- mer DuPont employees represented by the Unions. In mid-December 1995, DDE held a series of meetings with Chamber Works and Louisville employees at which it described in detail its pay policies and benefits. DDE confirmed that employees would continue to receive the same pay and benefits as they enjoyed with Du Pont, with the addition of success sharing. DDE also reiterated that it would not recognize or bargain with the Unions until more than 50 percent of the needed work force was composed of former Du Pont employees represented by the Unions. DDE concedes that it hoped to retain all incumbent employees at Chamber Works and Louisville and that it considered its ability to retain these employees to be of fundamental importance to the success of the enterprise. On January 2, 1996, DDE offered employment to all incumbent employees at Louisville and Chamber Works. The written job offers stated that employees would con- tinue to receive the same pay and benefits as they had received from Du Pont, plus success sharing. Employees were required to accept or reject the offers within ap- proximately 30 days. On January 10, 1996, DuPont announced a reduction in force at Chamber Works of 486 positions in business units not included in the joint venture. Responding in part to the exclusion of DDE employees from the planned reduction,3 CWA filed a charge on January 12 alleging that DDE and Du Pont were alter ego compa- nies, and that they failed to apply the terms of the CWA’s collective-bargaining agreements with Du Pont to DDE employees in violation of Section 8(a)(5) and (1) of the Act.4 On January 19, 1996, DDE announced three changes in initial terms and conditions of employment at Cham- ber Works. In addition to the previously announced suc- cess sharing program, DDE would implement an en- hanced severance program, abolish the practice of paying bargain any and all changes to wages, benefits, compensation, and conditions of employment with the CWA before there is any communi- cation to or dealing with covered employees.” The letter concluded with a proposal to meet “in the very near future to discuss this issue.” 3 CWA objected to the exclusion of DDE employees from the reduc- tion because relatively senior DuPont employees would be laid off or downgraded while DDE employees with less seniority would be unaf- fected. 4 NCU filed a similar charge on January 25. This charge alleged, as an alternative legal theory, that DDE was a “perfectly clear” successor, and that it had violated Sec. 8(a)(5) by refusing to recognize and bar- gain with the NCU. DUPONT DOW ELASTOMERS LLC 1073 for scheduled overtime not actually worked, and reduce the number of maintenance crafts for seniority purposes from six to two. CWA president Corliss Sheppard testi- fied without contradiction that, at a meeting on January 19, he inquired whether DDE intended to bargain over the issues. DDE’s Chamber Works management repre- sentative Michael Foley responded negatively. The offer process was completed in early February 1996. At Louisville, approximately 97 percent of pro- duction and maintenance employees who received offers of employment accepted. At Chamber Works, approxi- mately 98 percent of production and maintenance em- ployees and clerical employees who received offers of employment accepted. In mid-February 1996, DDE notified the Unions of its desire to begin negotiating collective-bargaining agree- ments. After several sessions, however, the CWA, by letter dated March 12, 1996, withdrew from negotiations based on its position that DDE was bound as Du Pont’s alter ego to honor CWA’s collective-bargaining agree- ments with Du Pont. NCU withdrew from negotiations shortly thereafter. The Unions refused to continue nego- tiating despite DDE’s offer to bargain without prejudice to their alter ego claims. DDE began operating on April 1, 1996. As originally planned, DDE’s terms and conditions of employment at Louisville were equivalent to Du Pont’s, with the addi- tion of success sharing. At Chamber Works, DDE im- plemented the equivalent of former Du Pont contract terms and conditions of employment, with the exception of success sharing and the changes announced on Janu- ary 19, 1996. ANALYSIS Relying on NLRB v. Burns Security Services, 406 U.S. 272 (1972), as interpreted by the Board majority in Spruce Up Corp., 209 NLRB 194 (1974), enfd. per cu- riam 529 F.2d 516 (4th Cir. 1975), the judge found that DDE was a successor, but not a “perfectly clear” succes- sor, to Du Pont at Louisville and Chamber Works. Ac- cordingly, he dismissed the complaint allegations that DDE violated Section 8(a)(5) by failing and refusing to bargain with the Unions about initial terms and condi- tions of employment and by unilaterally changing terms and conditions of employment. As noted by the judge, the Supreme Court articulated in Burns an exception to the general rule that a successor employer may set initial terms and conditions of em- ployment unilaterally. Specifically, the Supreme Court stated Although a successor employer is ordinarily free to set initial terms on which it will hire the employees of a predecessor, there will be instances in which it is per- fectly clear that the new employer plans to retain all of the employees in the unit and in which it will be appro- priate to have him initially consult with the employees’ bargaining representative before he fixes terms.5 This exception has become known as the Burns “per- fectly clear” caveat. In Spruce Up, the Board interpreted the “perfectly clear” language of Burns as requiring both a manifestation of intent on the part of the employer to retain all or substantially all of its predecessor’s employ- ees and also a substantial likelihood that those offered employment will accept it. The Board therefore held that “[w]hen an employer who has not yet commenced opera- tions announces new terms prior to or simultaneously with his invitation to the previous work force . . . we do not think it can fairly be said that the new employer ‘plans to retain all of the employees in the unit,’ as that phrase was intended by the Supreme Court,” because of the possibility that those offered employment will not be willing to work under the new terms. 209 NLRB at 195. Applying those principles in Spruce Up, the Board found that the new employer did not have a perfectly clear plan to retain all of its predecessor’s employees because it announced that it would offer less favorable commission rates simultaneously with its expression of intent to re- tain the employees. Thus, the Board found that there was a very real possibility, as illustrated by the facts of that case, that former unit employees would refuse to work under the new rates, and that the union’s majority status would therefore not continue in the new work force. We note that events involving the Louisville plant in this case arise within the jurisdiction of the Sixth Circuit, which has taken a more restrictive view of the Burns “perfectly clear” caveat than the Board in Spruce Up and its progeny. The Sixth Circuit, in Peters v. NLRB, 153 F.3d 289 (6th Cir. 1998), considered the application of the “perfectly clear” exception where a successor an- nounced significant changes in terms and conditions after it expressed an intention to retain former unit employees but before it began operations. The court held that an employer may set initial terms, “(1) if it has not, by ‘tacit inference’ misled the employees into believing that prior working conditions will remain stable, or (2) if it has affirmatively announced its intention to retain the em- ployees under new employment conditions before or immediately after commencing operations.” 153 F.3d at 298. The judge here concluded that the requirements of the “perfectly clear” caveat were not met in this case because DDE communicated its intention to establish new terms 5 406 U.S. at 294–295. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1074 and conditions on November 30, 1995, shortly after it announced its intention to retain former Du Pont em- ployees at Louisville and Chambers Works. In effect, the judge found that DDE’s November 30, 1995, an- nouncement that it intended to implement success shar- ing put employees on notice that terms and conditions of employment would be different under DDE. We dis- agree. Although we adhere to the Board’s interpretation of the Burns’ caveat, we find that the facts in this case are sufficient to establish a “perfectly clear” successorship even under the Sixth Circuit’s more restrictive view of the Burns exception. As a starting point for analysis un- der either standard, it is certainly clear that DDE planned, and announced its intent, to retain the incumbent Du Pont unit employees at Louisville and Chamber Works. On November 15, 1995, DDE announced to the Unions that it intended to offer employment to all incumbent em- ployees at both plants under terms and conditions to be announced on November 30. On November 30, DDE notified the Unions that, al- though it declined to honor their contracts with Du Pont, DDE would maintain the employees’ wages and benefits under those contracts, adding only the hiring incentive bonus of success sharing. DDE did not indicate that there would be any other changes in current terms and conditions of employment. In mid-December 1995, DDE held a series of meetings with incumbent employ- ees at which it explained, in detail, the terms of its offer. Once again, there was no indication of changes in terms and conditions of employment other than the addition of the success sharing plan. On or about January 2, 1996, DDE tendered unconditional offers of hire under the terms previously discussed. In sum, up to and beyond the time of making formal offers of employment to all affected Du Pont employees, DDE manifested a clear desire to retain all those employ- ees under existing working conditions. It announced no new terms and conditions of employment other than the success sharing bonus plan. In fact, DDE never an- nounced or implemented any other changes prior to be- ginning operations at Louisville. At Chambers Works, DDE waited until 17 days after it had formally tendered unconditional offers of hire before announcing signifi- cant changes. By that date, a number of Chamber Works employees had already accepted DDE’s offer of em- ployment.6 Under the Board’s interpretation of the Burns’ caveat, it was perfectly clear no later than November 30 that 6 As of January 19, 1996, 45 of 101 incumbent production and main- tenance and clerical employees had accepted offers of employment. DDE intended to retain its predecessor’s employees at both Louisville and Chambers Works. Indeed, the suc- cess of the new joint venture depended on the continuing employment of this work force. The Respondent had announced its clear intent to hire the Du Pont unit em- ployees on November 15, while at the same time stating that it would disclose the terms and conditions of em- ployment on November 30. On that later date, the Re- spondent did not announce any new terms and conditions of employment other than success sharing, thus leading employees to believe that they would be employed on substantially the same basis as before. Further, there was nothing inherent in the announcement of success sharing by DDE on November 30, 1995, and conveyed in the offers of hire on January 2, which would diminish the likelihood that employees would accept DDE’s offer of employment. To the contrary, if anything, the addition of success sharing—the only announced change—would have enhanced, not diminished, the likelihood that em- ployees would accept the offers. The subsequent an- nouncement of changes at Chambers Works on January 19 were made after the formal hiring process had com- menced and the obligation to bargain with the Unions about initial terms and conditions of employment had already attached. The Board has consistently found that an announcement of new terms will not justify a refusal to bargain if, as in this case, the employer has earlier expressed an intent to retain its predecessor’s employees without indicating that employment is conditioned on acceptance of new terms.7 As indicated, we would find a violation even under the Sixth Circuit’s more restrictive view of the “perfectly clear” caveat. The facts of this case are sufficient to es- tablish that the incumbent employees at Louisville and Chambers Works were actively led to believe or misled by “tacit inference” into believing that they would be retained without significant changes in their terms and conditions of employment. The only change announced to employees at either facility prior to the formal tender of employment offers was the addition of a success shar- ing plan. This plan was not inconsistent with or a substi- tute for any of those terms and conditions of employment that unit employees had under their Du Pont contracts and that DDE had indicated they would continue to re- ceive if, as DDE planned, they accepted the offers to work for the new joint venture. Consequently, viewed 7 Canteen Co., 317 NLRB 1052 (1995), enfd. 103 F.3d 1355 (7th Cir. 1997); Fremont Ford, 289 NLRB 1290 (1988); Roman Catholic Diocese of Brooklyn, 222 NLRB 1052 (1976), enf. denied in relevant part sub nom. Nazareth Regional High School v. NLRB, 549 F.2d 873 (2d Cir. 1977). DUPONT DOW ELASTOMERS LLC 1075 from the perspective of the affected employees,8 the terms announced by DDE on November 30, 1995, and conveyed in the offers of hire on January 2, “by tacit inference misled the employees into believing that prior working conditions will remain stable.” Although DDE did not agree to honor Du Pont’s con- tracts with the Unions, it announced no plan to imple- ment any specific significant changes, aside from the addition of success sharing. DDE remained silent and withheld any notice of changes in preexisting terms and conditions until the announcement of changes at Cham- bers Works on January 19, when the hiring and accep- tance process was already well underway. By then, many employees had already accepted job offers. They, and others still considering DDE’s offer, may have fore- gone employment opportunities in reliance on DDE’s earlier promises of continued employment under essen- tially unchanged terms.9 Thus, even under the Sixth Cir- cuit’s view of the Burns “perfectly clear” caveat, we find that DDE’s notice of changed terms and conditions of employment came too late to justify its refusal to recog- nize and bargain with the CWA over initial terms of em- ployment.10 Based on the foregoing, we find that it was “perfectly clear” on November 30, 1995, that the Unions’ majority status would continue in the work forces at Louisville and Chamber Works. Accordingly, DDE was obligated on and after that date to recognize the Unions and to bar- gain with them prior to setting new terms and conditions of employment. Instead, it withheld recognition from the Unions until February 1996 and, without bargaining, it announced its decision to implement certain changes upon the commencement of operations. Our finding that the Respondent had an obligation to bargain in the circumstances of this case imposes no great burden on the general right of a successor employer under Burns to set the initial terms and conditions of em- ployment for its new workforce. As the Seventh Circuit has observed, 8 See Fall River Dyeing Corp. v. NLRB, 482 U.S. 27, 43 (1987). 9 See International Ass’n of Machinists & Aerospace Workers v. NLRB, 595 F.2d 664, 674–675 (DC Cir. 1978). 10 In our view, moreover, the Sixth Circuit’s holding in Peters v. NLRB cannot be divorced from the “unique circumstances surrounding Peters’ succession of Western,” including that Peters replaced Western as a result of bankruptcy proceedings and the transition from one em- ployer to another was effectively accomplished in a single day. Hence, the court found that Peters’ action of recalling his predecessor’s em- ployees to work within hours of his appointment as a receiver without first informing them of his intention to establish new terms was entirely reasonable because anything else would have resulted in additional lost workdays for the employees. 153 F.3d at 298. The approach of the Board is compatible with the prac- tical reality expressed by the Supreme Court in Fall River, 482 U.S. at 40–41: “[T]o a substantial extent, the applicability of Burns rests in the hands of the suc- cessor.” It may explore all options with respect to the composition of its workforce. However, when it de- termines that it will retain the workforce of its prede- cessor, it cannot ignore the Union those employees have chosen when it comes time to determine the con- ditions of employment.11 The judge found that, even assuming DDE is a per- fectly clear successor, the Unions effectively waived statutory bargaining rights by their insistence that DDE, as an alter ego, was bound to assume its predecessor’s contracts, and by their March 1996 withdrawal from ne- gotiations. We disagree. Preliminarily, we find that NCU’s letter of September 22, 1995, and CWA’s letter of November 16, 1995,12 constituted valid and continuing demands for bargaining. The Unions’ communications with DDE, although based on their alter ego claims, rea- sonably informed DDE that they sought to represent DDE’s employees and to bargain about any changes in their terms and conditions of employment. It is well es- tablished that a “valid request to bargain need not be made in any particular form, or in haec verba.”13 Ac- cordingly, these letters were sufficient to create an obli- gation to bargain. We find further that the Unions’ March 1996 with- drawal from negotiations did not constitute a waiver of bargaining rights because the damage to the bargaining relationships was already accomplished by that date. The bargaining obligation arose no later than November 30, 1995. Consequently, long before the Unions with- drew from negotiations, DDE had damaged the bargain- ing relationships by expressly refusing to recognize and bargain with the Unions on and after November 30, 1995, and by announcing its intent to implement success sharing at both plants and to make additional unilateral changes in terms and conditions of employment at Chamber Works.14 We further find that DDE failed to provide the Unions with a reasonable opportunity to bar- gain about the changes which it announced. It is well established that “a union is entitled to the opportunity to bargain when that bargaining could be productive—that is, when the change is under consideration.”15 In the 11 Canteen Corp. v. NLRB, 103 F.3d 1355, 1364–1365 (1997). 12 See fn. 2, infra. 13 Yolo Transport, 286 NLRB 1087 fn. 1 (1987). 14 Famous-Barr Co. v. NLRB, 326 U.S. 376, 384–386 (1945); NLRB v. Katz, 369 U.S. 736, 743 fn. 11 (1962). 15 ABC Trans-National Transport, 247 NLRB 240, 242 (1980), modified on other grounds 642 F.2d 675 (3rd Cir. 1981). DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1076 present case, however, DDE’s announcement of unilat- eral changes created the appearance, if not the reality, that DDE had no intention of bargaining with an open mind and that bargaining would therefore be futile. Consistent with the above discussion, we find that DDE violated Section 8(a)(5) and (1) by refusing to rec- ognize and bargain with the Unions from November 30, 1995 until after the Unions’ majority status was estab- lished through the hiring process, and by announcing and implementing unilateral changes in employment condi- tions of bargaining unit employees represented by those Unions.16 AMENDED CONCLUSIONS OF LAW “3. The following employees constitute units appro- priate for collective bargaining within the meaning of Section 9(b) of the Act: A. All employees of DuPont Dow Elastomers L.L.C. at its Louisville Works, Louisville, Kentucky, including powerhouse and refrigeration plant employees, chief operators, shift leaders, fire department employees, cafeteria employees, and counter attendants, but ex- cluding all office and clerical employees, chemical su- pervisors, technical engineers, assistant technical engi- neers, draftsmen, chemists, nurses and hospital techni- cians, general foremen, foremen, fire chief, guards, and all other supervisors and professional employees as de- fined in the National Labor Relations Act as amended. B. All production, engineering, environmental resources, and laboratory employees employed by DuPont Dow Elastomers L.L.C. at the plant known as Chamber Works and Associated Units but excluding office and clerical employees, chemists, planners and schedulers, draftsmen, engineers, librarians, technologists, all em- ployees of the Control and Human Resources Units, all salary roll employees exempt under the Fair Labor Standards Act, team managers, and all other supervi- sory employees with the authority to hire, promote, dis- charge, transfer or otherwise effect changes in the status of employees, or effectively recommend such ac- tion. C. All office and clerical employees of the Chamber Works and associated units of DuPont Dow Elastomers L.L.C., but excluding those clerks, stenographers, and secretaries specified by the Company as doing confi- 16 We find no violation with respect to the Respondent’s unilateral implementation of the success sharing program announced on Novem- ber 30. dential work, chemist, engineers, physicians, nurses, medical technicians, safety engineers, procedure ana- lyst, news editors, all salaried role employees exempt under the Fair Labor Standards Act, directors, assistant directors, managers, assistant managers, unit managers, supervisors, division heads and all other supervisory employees with the authority to hire, discharge, pro- mote, transfer, or affect changes in the status of em- ployees, or effectively recommend such action. 4. Respondent DuPont Dow Elastomers L.L.C. is a “perfectly clear” successor to E.I. du Pont De Nemours and Company with respect to the obligations to bargain with the Unions representing employees in the above units. 5. By refusing, on and after November 30, 1995, to recognize and bargain with the Neoprene Craftsmen Un- ion Local 758, as the exclusive collective-bargaining representative for employees in Unit A above, or with Chemical Workers Association, Inc., Affiliate of Interna- tional Brotherhood of Du Pont Workers, as the exclusive collective-bargaining representative of employees in Units B and C above, and by announcing and implement- ing unilateral changes in unit employees’ existing terms and conditions of employment, DDE has violated Section 8(a)(5) and (1) of the Act. 6. The violation found is an unfair labor practice af- fecting commerce within the meaning of Section 2(6) and (7) of the Act.” REMEDY Having found that Respondent Du Pont Dow Elastom- ers L.L.C. (DDE) has engaged in unfair labor practices in violation of Section 8(a)(5) and (1) of the Act, we shall order it to cease and desist and to take certain affirmative action to effectuate the policies of the Act. Specifically, we shall order DDE, on request by the Unions for the bargaining units they separately represent, to rescind the changes in employment terms made on April 1, 1996. As to those employment terms for which rescission is requested, DDE shall be ordered to make whole all unit employees for any loss of wages and other benefits suf- fered, as calculated in accordance with Ogle Protection Service, 183 NLRB 682, 683 (1970), with interest com- puted in the manner prescribed in New Horizons for the Retarded, 283 NLRB 1173 (1987).17 ORDER The National Labor Relations Board orders that the Respondent, DuPont Dow Elastomers L. L. C., Louis- 17 We decline to order the reimbursement of litigation expenses as requested by NCU. DUPONT DOW ELASTOMERS LLC 1077 ville, Kentucky, and Deepwater, New Jersey, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Refusing to recognize and bargain in good faith with the Neoprene Craftsmen Union Local 788 as the exclusive collective-bargaining representative of em- ployees in the following appropriate unit: All employees of DuPont Dow Elastomers L.L.C. at its Louisville Works, Louisville, Kentucky, including powerhouse and refrigeration plant employees, chief operators, shift leaders, fire department employees, cafeteria employees, and counter attendants, but ex- cluding all office and clerical employees, chemical su- pervisors, technical engineers, assistant technical engi- neers, draftsmen, chemists, nurses and hospital techni- cians, general foremen, foremen, fire chief, guards, and all other supervisors and professional employees as de- fined in the National Labor Relations Act as amended. (b) Refusing to recognize and bargain in good faith with the Chemical Workers Association, Inc., as the ex- clusive collective-bargaining representatives of employ- ees in the following appropriate units: All production, engineering, environmental resources, and laboratory employees employed by DuPont Dow Elastomers L.L.C. at the plant known as Chamber Works and Associated Units but excluding office and clerical employees, chemists, planners and schedulers, draftsmen, engineers, librarians, technologists, all em- ployees of the Control and Human Resources Units, all salary roll employees exempt under the Fair Labor Standards Act, team managers, and all other supervi- sory employees with the authority to hire, promote, dis- charge, transfer or otherwise effect changes in the status of employees, or effectively recommend such ac- tion. All office and clerical employees of the Chamber Works and associated units of DuPont Dow Elastomers L.L.C., but excluding those clerks, stenographers, and secretaries specified by the Company as doing confi- dential work, chemist, engineers, physicians, nurses, medical technicians, safety engineers, procedure ana- lyst, news editors, all salaried role employees exempt under the Fair Labor Standards Act, directors, assistant directors, managers, assistant managers, unit managers, supervisors, division heads and all other supervisory employees with the authority to hire, discharge, pro- mote, transfer, or affect changes in the status of em- ployees, or effectively recommend such action. (c) Announcing and implementing unilateral changes in wages, hours, and other conditions of employment of employees in the aforementioned units without bargain- ing about these changes with Neoprene Craftsmen Union Local 788 or the Chemical Workers Association, Inc. (d) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act. (a) On request of the Neoprene Craftsmen Union Local 788 or the Chemical Workers Association, with respect to the bargaining units they separately represent, rescind the unilateral changes in terms and conditions of em- ployment found unlawful and make the employees whole for any loss of earnings and other benefits attributable to its unlawful conduct, in the manner set forth in the rem- edy section of this Decision. (b) Preserve and, within 14 days of a request, make available to the Board or its agents for examination and copying, all payroll records, social security payment re- cords, timecards, personnel records and reports, and all other records necessary to analyze the amount of back- pay due under the terms of this Order. (c) On request, bargain collectively and in good faith concerning wages, hours, and other terms and conditions of employment with the Unions as the exclusive repre- sentative of employees in the above-described units, and embody any understanding reached in a signed agree- ment. (d) Within 14 days after service by the Region, post at its Louisville, Kentucky, and Deepwater, New Jersey facilities copies of the attached notice marked “Appen- dix.”18 Copies of the notice, on forms provided by the Regional Director for Region 9, after being signed by the Respondent DuPont Dow Elastomer’s authorized repre- sentative, shall be posted by DuPont Dow Elastomers and maintained for 60 consecutive days in conspicuous places including all places where notices to employees are customarily posted. Reasonable steps shall be taken by DuPont Dow Elastomers to ensure that the notices are not altered, defaced, or covered by any other material. In the event that, during the pendency of these proceedings, DuPont Dow Elastomers has gone out of business or closed the facility involved in these proceedings, DuPont Dow Elastomers shall duplicate and mail, at its own ex- pense, a copy of the notice to all current employees and 18 If this Order is enforced by a judgment of a United States Court of Appeals, the words in the notice reading “Posted by Order of the Na- tional Labor Relations Board” shall read “Posted pursuant to a Judg- ment of the United States Court of Appeals enforcing an Order of the National Labor Relations Board.” DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1078 former employees employed by it or by its predecessor DuPont De Nemours and Company at any time since November 30, 1995, at Louisville Works, Louisville, Kentucky, and at the Chamber Works, Deepwater, New Jersey. (e) Within 21 days after service by the Region, file with the Regional Director a sworn certification of a re- sponsible official on a form provided by the Region at- testing to the steps DuPont Dow Elastomers has taken to comply. APPENDIX NOTICE TO EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we vio- lated the National Labor Relations Act and has ordered us to post and abide by this notice. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representatives of their own choice To act together for other mutual aid or protection To choose not to engage in any of these protected concerted activities. WE WILL NOT refuse to recognize and bargain in good faith with the Neoprene Craftsmen Union Local 788 as the exclusive collective-bargaining representative of em- ployees in the following appropriate unit. All employees of DuPont Dow Elastomers L.L.C. at its Louisville Works, Louisville, Kentucky, including powerhouse and refrigeration plant employees, chief operators, shift leaders, fire department employees, cafeteria employees, and counter attendants, but ex- cluding all office and clerical employees, chemical su- pervisors, technical engineers, assistant technical engi- neers, draftsmen, chemists, nurses and hospital techni- cians, general foremen, foremen, fire chief, guards, and all other supervisors and professional employees as de- fined in the National Labor Relations Act as amended. WE WILL NOT refuse to recognize and bargain in good faith with the Chemical Workers Association, Inc. as the exclusive collective-bargaining representative of em- ployees in the following appropriate units. All production, engineering, environmental resources, and laboratory employees employed by DuPont Dow Elastomers, L.L.C. at the plant known as Chamber Works and Associated Units but excluding office and clerical employees, chemists, planners and schedulers, draftsmen, engineers, librarians, technologists, all em- ployees of the Control and Human Resources Units, all salary roll employees exempt under the Fair Labor Standards Act, team managers, and all other supervi- sory employees with the authority to hire, promote, dis- charge, transfer or otherwise effect changes in the status of employees, or effectively recommend such ac- tion. All office and clerical employees of the Chamber Works and associated units of DuPont Dow Elastomers L.L.C., but excluding those clerks, stenographers, and secretaries specified by the Company as doing confi- dential work, chemist, engineers, physicians, nurses, medical technicians, safety engineers, procedure ana- lyst, news editors, all salaried role employees exempt under the Fair Labor Standards Act, directors, assistant directors, managers, assistant managers, unit managers, supervisors, division heads and all other supervisory employees with the authority to hire, discharge, pro- mote, transfer, or affect changes in the status of em- ployees, or effectively recommend such action. WE WILL, on request of either the Neoprene Crafts- men Union Local 788 or the Chemical Workers Associa- tion, Inc., on behalf of the bargaining units they sepa- rately represent, rescind our unlawful unilateral changes that we made in the terms and conditions of employment of employees in the above units, and WE WILL make employees whole for any loss of earnings and other benefits attributable to our unlawful conduct, with inter- est. WE WILL, on request, bargain collectively and in good faith concerning wages, hours, and other terms and conditions of employment with the Unions as the exclu- sive representative of employees in the above-described units, and embody any understanding reached in a signed agreement. DU PONT DOW ELASTOMERS LLC Andrew L. Lang, Esq., for the General Counsel. Barry M. Willoughby, Esq., of Wilmington, Delaware, for the Respondent. Alan Burton, Esq., of Wilmington, Delaware, for the Respon- dent. Howard S. Simonoff, Esq., of Haddonfield, New Jersey, for the Chemical Workers Association. Max J. Goldsmith, Esq., of Louisville, Kentucky, for the Neo- prene Craftsmen Union. DUPONT DOW ELASTOMERS LLC 1079 DECISION STATEMENT OF THE CASE IRWIN H. SOCOLOFF, Administrative Law Judge. Upon charges filed on January 12, and 25, 1996, by, respectively, the Chemical Workers Association, Inc. (CWA) and the Neoprene Craftsmen Union Local 788 (NCU), herein referred to as the Unions, against E. I. Dupont De Nemours and Company (Du- pont) and its alleged alter ego, Dupont Dow Elastomers L.L.C. (DDE), (the Respondents), the General Counsel of the National Labor Relations Board, by the Regional Director for Region 9, issued an Order Consolidating Cases and an Amended Consoli- dated Complaint dated October 29, 1996, alleging violations by Respondents of Section 8(a)(5) and (1) and Section 2(6) and (7) of the National Labor Relations Act, as amended, herein called the Act. Respondents, by their Answers, denied the commis- sion of any unfair labor practices. Pursuant to notice, trial was held before me in Louisville, Kentucky, on January 7, 8 and 9, 1997, and in Wilmington, Delaware, on January 27, 28, 29, and 30, 1997, at which all parties were represented by counsel and were afforded full opportunity to be heard, to examine and cross-examine wit- nesses and to introduce evidence. Thereafter, the parties filed briefs which have been duly considered. Upon the entire record in these cases, and from my observa- tions of the witnesses, I make the following: FINDINGS OF FACT I. JURISDICTION Respondent, Dupont, a corporation, is engaged in the production of chemical and related products at its Chambers Works, Deepwater, New Jersey, and Louisville, Kentucky, facilities. During the year preceding issuance of the Complaint, Dupont, in conducting its operations at the above-referenced places of business, sold and shipped from those facilities goods valued in excess of $50,000, directly to points outside the States of New Jersey and Kentucky. I find that Respondent, Dupont, is an employer engaged in commerce within the mean- ing of Section 2(2), (6), and (7) of the Act. Respondent, DDE, a limited liability company, is engaged in the manufacture of elastomer products at its Chambers Works, Deepwater, New Jersey, and Louisville, Kentucky, facilities. Based upon projections, DDE will, annually, sell and ship from those facilities goods valued in excess of $50,000, directly to points outside the States of New Jersey and Kentucky. I find that Respondent, DDE, is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. II. LABOR ORGANIZATIONS The Unions are, each, labor organizations within the mean- ing of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. Background For some 45 years prior to the April 1, 1996, formation of DDE, Dupont recognized and dealt with the NCU as the exclu- sive collective-bargaining representative of its production and maintenance employees in Louisville, Kentucky, and with the CWA as such representative of separate units of its production and maintenance employees, and its clerical employees, at the Chambers Works, facility, in Deepwater, New Jersey. The most recent contract between Dupont and NCU, at Louisville Works, is effective May 25, 1994, until March 21, 1996, and from year-to-year thereafter unless terminated by either party. At Chambers Works, the latest contracts between Dupont and CWA run from July 18, 1991, until terminated by one party or the other. DDE is a joint venture formed by two of the world’s largest chemical companies, the Dow Chemical Company and Dupont. The venture was formed, on a global scale, to produce and market elastomer (synthetic rubber) products, bringing to- gether, essentially, Dupont’s established position as a manufac- turer of elastomers, including its production facilities and highly trained work forces, and Dow’s patented “Insite” tech- nology. Among the contributions to the venture made by Du- pont were its elastomers businesses at Louisville Works, where neoprene is produced, and at Chambers Works, engaged in the production of viton and FMDL. The venture also includes former Dupont facilities located at Beaumont, Texas, Elkton, Maryland, Newark, Delaware and Ponchartrain, Louisiana, and smaller sites contributed by Dow in Freeport, Texas, Plaque- mine, Louisiana and Stodd, Germany. In the instant cases, the General Counsel contends that, at Louisville, and at Chambers Works, DDE is the alter ego of Dupont and, thus, violated Section 8(a)(5) of the Act by failing to honor the existing contract between Dupont and NCU and the contracts of Dupont and CWA. Alternatively, the General Counsel urges, DDE, as the “perfectly clear” successor to Du- pont at those sites, failed to fulfill its bargaining obligations under the Act when it unilaterally implemented initial terms and conditions of employment. DDE argues that, as a global enterprise, 50 per cent owned and controlled by the Dow Chemical Company and formed, concededly, for legitimate business reasons, it is not the alter ego of Dupont at the above- referenced locations and, thus, was not obligated to honor the Dupont contracts at those sites. While acknowledging that, at Louisville and at Chambers Works, it is the successor to Du- pont, obligated to recognize and bargain with the incumbent unions, DDE denies that it is the “perfectly clear” type of suc- cessor, required to bargain about initial terms. Also at issue is whether Respondents, at Louisville, violated the Act by failing timely to provide the NCU with a copy of the venture’s forma- tion agreement, as requested. B. Facts1 1. An overview In January 1995, Dupont and Dow announced that they had signed a letter of intent to form DDE. There ensued, over the next 15 months, a complicated process of valuation, negotia- tion, formation and asset designation leading to the April 1, 1996, start-up of the venture, a limited liability company under 1 The fact-findings contained herein are based upon a composite of the documentary and testimonial evidence introduced at trial. The record is generally free of significant testimonial conflict. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1080 Delaware law,2 with $1 billion in assets and facilities located throughout the world. During the course of the January 1995, to April 1996, period, Dupont, concededly, kept the Unions and the Louisville and Chambers Works employees informed of major developments by various means of communication, in- cluding many electronic mail announcements. As finally agreed to, Dupont and Dow are 50–50 co-owners of DDE and share equally in its profits. The venture is gov- erned, globally, by a members committee, the equivalent of a corporate board of directors, composed of 2 representatives from Dow and 2 from Dupont. As there is no tie-breaker, the owners must agree upon the direction of DDE. The senior management team of the venture is made up of 4 former Dow officials and 7 individuals who came to DDE from Dupont. Under terms of the formation agreement, DDE has an initial life of 30 years and, for the first 10 years, neither Dow nor Dupont can leave the venture, except by mutual agreement. After 10 years, if one party decides to leave, the other has the right of first refusal to buy the departing party’s assets. The agreement provides for the recapture of assets contributed by the parents in the event of termination or dissolution. Preceding the start-up of DDE, and once full accord of the parents was reached, Dow and Dupont went about performance of a massive number of required tasks, including the separation from the parents of assets, equipment, facilities and work forces. Effective with the formation, Dow and Dupont agreed to place their elastomers businesses in the venture,3 including the patented Dow technology and physical and other assets at the effected sites. At the new DDE locations, its buildings and equipment were titled in its name, but the lands on which its facilities rest were leased from the parent companies at nominal sum, rather than placed in the venture, in order to protect DDE from possible environmental liability stemming from past use. At the various sites, environmental permits and other business licenses were transferred to the venture and DDE set up its own bank accounts and internal accounting functions. Centrally, DDE purchased workers’ compensation and other insurance policies, and obtained a federal employer identification number. The venture set up its own headquarters, in Wilmington, Dela- ware, as well as headquarters abroad in Geneva, Switzerland, and Singapore. Under the DDE structure, the members committee must ap- prove capital expenditures at any facility in excess of 5 million dollars, and it decides whether existing facilities will continue to operate and if new ones will be built. Senior management works out of the Wilmington headquarters and, globally, DDE has its own finance, operations, marketing, legal, human re- sources, customer service, and other departments. While DDE purchases its own raw materials, and markets its own products, Dupont extends to DDE the advantages of the parent’s third party contracts with suppliers. Raw materials bought directly from either parent are at market price, and DDE must purchase 2 Such companies are taxed like a partnership but enjoy the liability protection of a corporation. 3 Accordingly, concurrent with venture start-up, the parents left this business and neither produces or sells the type products manufactured and marketed by DDE. from Dupont needed raw materials produced by Dupont so long as they are made available to DDE at competitive prices. Most or nearly all of the DDE manufacturing facilities are located on sites shared with one of the parents where, formerly, Dow or Dupont conducted elastomers and non-elastomers op- erations. At those locations, and despite the separate ownership of equipment, buildings and other facilities that accompanied the advent of DDE, many systems, for reasons of economy and efficiency, have remained sitewide and are shared by the parent and DDE. At a global level, and to account for services pro- vided at integrated sites, Dow and Dupont, during the formation process, negotiated service agreements covering, generally, payment for services rendered to DDE by a parent, or by DDE to a parent, at shared locations. Such services are provided at market price, that is, at cost plus a profit, and DDE is not re- quired to buy needed services from a parent. Likewise, both the parent and DDE are free to discontinue the provision of any services no longer desired. At the site level, the specific charges, service by service, were negotiated during the months preceding the venture start-up. Such negotiations, at Louisville and at Chambers Works, were by and between Dupont repre- sentative and DDE “designees,” that is, individuals still em- ployed by Dupont who had been designated by Dow and Du- pont as on-site management officials of the new venture. These “designees” were without independent basis to assess the cost of services. However, the results of those negotiations were reviewed centrally, by Dow as well as Dupont, for fairness to both parties at the site. In practice, there is a net billing, and a transfer of funds from DDE to Dupont, at the central level, on a monthly basis to cover provision of services. DDE has set up a monitoring committee to review the site agreements and, in the fall of 1996, hired outside auditors to examine their operation. While, generally, and prior to start-up, DDE’s designated top management officials decided to leave for decision at the local level such matters as the wages and working conditions to be offered to DDE employees, certain labor relation issues were centrally decided. In this latter category, the designees, with the approval of the members committee, instituted a benefit program, “success sharing,” providing for the payment each year, to every DDE employee, of 8.3 per cent of salary if cer- tain company-wide goals were achieved for that year. In other respects, it was decided to maintain benefit coverage at “Du- pont levels,” by continued participation in existing plans, and to establish a new pension plan to “duplicate” the provisions of the Dupont plan.4 Dow, Dupont and the DDE designees glob- ally adopted a hiring philosophy, that is, the development of strategies designed to keep the skilled and experienced Dow and Dupont elastomer employees at their then current jobs. Left for local decision was whether to offer those employees positions with DDE, or to contract with the parent for their services. 4 DDE became a participant in Dupont’s multiple employer benefit plans for employees, administered by Dupont. The DDE pension plan, while the same as Dupont’s, is independent of it and separately funded. The Dupont pension fund investment group administers the DDE plan, but Dupont bears no liability for the obligations of that plan. DUPONT DOW ELASTOMERS LLC 1081 At formation, 95 per cent of the DDE rank-and-file workers were from Dupont, and some 5 per cent were from Dow. Those who became DDE employees were required to sever their relationship with the parent, that is, to resign or retire, “with no strings back.” Resigning employees had their pension benefits transferred to the venture. At the Dow sites at Free- port, Texas, Placquemine, Louisiana and Stodd, Germany, it was decided that DDE would contract for, or lease, the total of 120 employees, out of some 10,000 working at those sites, who were, thereafter, to perform their services for DDE. Those 120 individuals remained Dow employees and work for the venture under site service agreements. Similarly, at the Dupont site at Beaumont, Texas, those performing services for the venture do so under contract with Dupont, and not as DDE employees. 2. At Louisville Works When NCU and Dupont entered into their most recent con- tract, in the Spring of 1994, it covered some 415 production and maintenance employees at Louisville Works, who worked in 2 separate Dupont business units, producing neoprene, an elas- tomer, and fluoro products. The contract was locally bargained and has been locally administered. Under the agreement, em- ployees have bidding and bumping rights between business units. In the Fall of 1995, the venture leadership at Louisville de- termined that it would make offers of employment to all of the Dupont elastomers employees, and NCU was so informed. On November 30, the Union was advised that those individuals would be offered positions with DDE at the same rate of pay they were receiving from Dupont, with a carryover of their Dupont seniority, continued coverage under the Dupont benefit plans and coverage under a pension plan that duplicated Du- pont’s plan. At or about this time, the Union was also told that “success sharing” would be part of the offer package. Despite NCU’s continuing demand for recognition, and, based upon its alter ego claim, the Union’s demands that its contract with Du- pont be applied to the venture operations, DDE did not bargain with NCU concerning the initial terms of employment to be offered employees, nor would it adopt the Dupont contract. It advised the Union, only, that, at a future point, it wanted to negotiate a new contract. At the beginning of January 1996, all of Dupont’s elastomer employees received job offers from DDE, and were afforded a period of 30 days to decide whether or not to accept employ- ment. Under terms of the offer, wages and benefits remained the same as they were at Dupont, augmented by the introduc- tion of “success sharing;” pension-eligible employees were given the option to retire from Dupont or to transfer pension credits to the DDE plan; “banked” vacation was to be paid in cash; employees who accepted the offer had to resign or retire from Dupont and were to start at DDE with clean disciplinary records. The pressures upon the neoprene manufacturing employees to accept the DDE offers were great, as, concurrent with the start-up of DDE, Dupont was leaving the elastomers business. Indeed, there is record evidence that Dupont officials, during the offer period, stressed to these employees that, if they de- clined offers, they risked being without employment. By the close of the initial offer period, in early February, some 300 of the neoprene employees had accepted offers, and only 9 had declined employment with DDE. The 9 unfilled positions were then offered to suitably skilled fluoro products employees, and 6 of the jobs were filled in that way. At the conclusion of the offer process, the almost 310 new DDE employees constituted a far larger group than the remaining Dupont fluoro products group, which numbered about 80. In addition to the bargaining unit employees, all of the neoprene management people ac- cepted positions with DDE. Effectively, at start-up, DDE be- came the primary employer at the Louisville, facility, the larg- est of the DDE production plants. As DDE decided generally to honor the terms of the NCU-Dupont contract, but not the contract itself, the new DDE employees began work with the same terms and conditions of employment as previously en- joyed, plus “success sharing,” and minus bidding and bumping rights into fluoro products positions. At start-up, DDE, at Louisville, engaged in the very same business operation theretofore run by Dupont, producing neo- prene in the identical manner, using the same technology. The same rank-and-file work force, working at the same plant, util- ized the same equipment and processes to manufacture a prod- uct which was shipped to the same customers.5 Indeed, until the end of 1996, the product was shipped in bags bearing the Dupont name. DDE utilizes the same suppliers who previously serviced Dupont. It is undisputed that Dow’s “Insite” technol- ogy, its primary contribution to the venture, is not in use at Louisville, nor is there any plan to introduce it. It is not appli- cable. With the single exception of the plant manager,6 the Louis- ville employees work under the same plant supervisors and managers and, as noted, receive the same compensation and benefits as previously, and their seniority, earned at Dupont, is recognized. When, during 1996, Dupont and NCU negotiated a wage increase, the results of those negotiations were honored and applied by DDE. The new DDE employees kept the same employee identification numbers and passes and they park in the same lots and enter through the same gates, as before. They use the same change houses and lockers, the same work clothes distribution system and laundry services, the same cafeteria, medical facilities, telephone system and computer system, and the same tool room. Under service agreement, DDE employees perform for Dupont, and Dupont employees perform for DDE, certain specialized mechanical and maintenance functions, but, never, production work. DDE employees serve in the same fire and emergency brigade with Dupont employees and otherwise cross paths with the Dupont people in the course of daily activi- ties. Dupont and DDE have a common safety awards program. By virtue of the service agreements, DDE pays to Dupont, monthly, a net amount of approximately $4,000,000, due, prin- cipally, to utility charges. That amount will, presumably, de- 5 All of Dupont’s back orders were transferred to DDE. Customers were notified in advance of the venture formation and the intended transfer of orders. 6 Dupont Plant Manager Don Johnson had been designated DDE plant manager at Louisville, but he died prior to the April 1, 1996, start- up. He was replaced by Mike Sticklen, a Dow official. DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1082 crease somewhat as beginning January 1, 1997, Dupont no longer provides site accounting services for DDE. As indicated, DDE’s decision, at Louisville, to offer em- ployment to all of Dupont’s neoprene employees, and to staff entirely from that group, was made by November 1995. In that month, and after being advised by the NCU that it considered DDE bound by the contract in effect with Dupont, the DDE designees told the Union that the venture leadership knew DDE would, most likely, be a successor to Dupont. However, and until more than 50 per cent of the Dupont elastomers work force accepted employment with DDE, the Union was advised, the venture would not recognize or bargain with it. Thus, as set forth above, DDE set initial terms and conditions of employ- ment (the contract terms, plus “success sharing” and minus bidding and bumping rights to fluoro products positions) with- out negotiations. The decision, reached at the local level, to use the contract provisions as initial terms, but not to honor the contract as such, was made, primarily, to prevent inter- company bumping. When, late in November 1995, and prior to the offer process begun in January 1996, the Union was told that “success sharing” would be part of the offer package, it voiced no objection. After NCU filed its charge on January 25, 1996, in Case 9– CA–33536, claiming that DDE at Louisville was the alter ego of Dupont, the venture, in February, after tallying the results of the offer process, offered to bargain a contract with NCU, the negotiations to occur without prejudice to the Union’s alter ego position. The Union, maintaining that it already had a contract with DDE, refused to engage in that process. Thus, negotia- tions did not occur. The venture, since start-up, has, in fact, applied the terms of the Dupont-NCU contract, and grievances have been filed and processed pursuant to contractual provi- sions. On January 7, 1996, the president of NCU, Carl Goodman, sent the following letter to Haven Harrington, then Dupont’s human resources manager at Louisville, and the DDE designate human resources manager: Please provide me within five working days a copy of the contract that has been entered into by Dupont and the Dow Chemical Company to form their new ven- ture/merger that may impact Louisville Works employees. At trial, Goodman testified that he also verbally requested that information which the Union needed in order to assess what “this thing” was all about. Ten days later, on January 17, Harrington wrote to Good- man: There is currently no signed agreement between the two parent companies, however, we expect there should be an agreement signed in late February. When this agree- ment is available we will share a copy with you. The venture formation agreement was, in fact, signed there- after, on March 12, 1996, was held in escrow until April 1, and was furnished to the Union on April 11. There is no record evidence showing that Goodman, after receiving Harrington’s January 17, letter, sought provision of an unexecuted copy, or working draft, of the formation agreement. At trial, Goodman acknowledged that Respondents timely provided NCU with all requested information, except this document. 3. At Chambers Works The Chambers Works, facility, is much larger than Louis- ville Works and, prior to the advent of DDE, it comprised some 8 Dupont business units, including the elastomers unit, called polymer products or “PPD.” PPD produced viton, FMDL and hytrel, the latter also referred to as engineering polymers. At venture start-up, the viton and FMDL portions of the polymers business passed to DDE, while hytrel remained with Dupont. CWA’s contracts with Dupont originally covered some 1,700 production and maintenance employees and about 150 clerical workers at the facility. Of those, only 80, and 9, respectively, became employees of DDE, and some 50 workers remained in the Dupont hytrel operation. Thus, as urged by CWA, as of the April 1, 1996, formation of DDE, “a portion of the former Du- pont elastomers unit now operates as a virtual island within a sea of the remaining Dupont operation at the Chambers Works facility,” the mirror opposite of the situation in Louisville. At Chambers Works, serious consideration was given to con- tracting with Dupont for the necessary labor force, rather than hiring individuals to work as DDE employees. However, in mid-November, the DDE management designees advised the Union that the venture would offer employment to all of Du- pont’s viton and FMDL employees. At that time, as it had, previously, the Union insisted that its contracts with Dupont would continue to apply to those people, as DDE was the alter ego of Dupont. The designees took the position that the ven- ture would be a successor employer, and it would recognize the Union once it had hired a workforce more than 50 per cent of whom were the union represented elastomers employees. At the end of November, and, following, the venture man- agement told CWA that existing viton and FMDL employees would receive job offers during the first week in January, at then current wage rates and benefit levels, plus “success shar- ing” and minus bidding and bumping rights to positions in the hytrel portion of PPD and the other business units. As at Lou- isville, there would be a carryover of Dupont seniority, contin- ued coverage under the Dupont benefit plans and coverage under a duplicate pension plan. CWA, thereafter, voiced no objection to “success sharing,” per se, although, earlier, it stated opposition to that or any other change in contractual terms. Subsequently, in mid-January, after job offers had already been made, the venture leadership announced certain additional changes to existing terms and conditions of employment, as part of its initial offer package, namely: an enhanced severance program, a reduction in the number of crafts for seniority pur- poses from 6 to 2 and abolition of the practice requiring pay- ment for scheduled overtime not actually worked. The DDE designees refused to bargain with the Union concerning initial terms. The elastomers employees at Chambers Works were faced not only with the fact that Dupont was leaving the elastomers business but, also, concurrent reductions-in-force at the facility which would impact upon Dupont employees but not upon the new employees of the venture. Thus, the incentives to accept venture employment were great and, by mid-February, 1996, DUPONT DOW ELASTOMERS LLC 1083 some 98 per cent of the PPD employees offered jobs with DDE had accepted. At that time, the venture designees agreed to recognize CWA and bargain a contract with it. The Union, having re-asserted its alter ego claim in its January 12, 1996, charges filed with the NLRB, giving rise to the instant case, adhered to that position, stating that the new DDE employees were covered by the contract between CWA and Dupont. When the venture leadership agreed to conduct negotiations without prejudice to the charges, limited discussions, on a few issues, occurred. However, the Union refused to negotiate a new contract and, by late March, it had limited the number of items it would talk about at all to three, dues deduction authori- zation cards, discharge for cause and grievance/arbitration. At start-up, and since, as at Louisville, DDE has applied the terms of the Dupont contracts, with the noted changes, and grievances may be filed and processed. Primarily to avoid the possibility of inter-company bidding and bumping, DDE has refused to adopt the contracts, as such. As at Louisville, Dow’s “Insite” technology is not in use at Chambers Works, and is inapplicable. At formation, the new DDE employees stayed in the same physical facilities occupied while employed by Dupont, worked under the same supervisors and managers and used the same equipment and technology to produce the same products for the same customers. By virtue of the service agreements, DDE and Dupont facilities are pro- tected by the same security force theretofore utilized by Du- pont, and DDE and Dupont employees have continued to use the same tool room, medical facility, change house, laundry and lunchrooms and serve together on the same emergency unit or fire brigade. The two sets of employees use the same electronic time keeping system as before April 1, 1996, receive their pay- checks from the same payroll firm,7 utilize a single telephone and paging system and the same computer system. There is, at Chambers Works, a joint safety committee and Dupont and DDE employees attend joint safety meetings and operate under the same Dupont generated safety manual. Indeed, Dupont’s hytrel operations and DDE’s elastomer operations have been simultaneously audited for safety and occupational health. Joint training of employees has also occurred. As noted, most of the site service agreements were negoti- ated prior to start-up by and between Dupont officials and DDE “designees” who were, still, Dupont employees. These “desig- nees” bargained agreements based upon cost figures brought to the table by Dupont, and they lacked access to independent accountants and consultants. Since start-up, Dupont and DDE have continued to discover areas of service provision not cov- ered by agreement, necessitating the negotiation of further ser- vice agreements and calculations and payments for past ser- vices rendered. For accounting purposes, under the service agreements, the cost codes assigned by Dupont to DDE, and used by DDE since the joint venture commenced operations, are the same cost codes previously used by Dupont’s PPD busi- ness unit. The difference, however, is that now more than an accounting allocation function is involved. On a monthly basis, actual dollars, in payment for services, changes hands, 7 DDE contracts with Dupont to provide payroll and other account- ing services. Employees are paid on DDE checks. including a profit for the service provider. The services pro- vided, as at Louisville, range from utilities, to performance of specialized mechanical and maintenance functions. As at Louisville, Dupont transferred its back orders to DDE at start-up. Customers were advised, with considerable fanfare, of the intended creation and purposes of DDE well in advance of formation, and were also told that orders would be so trans- ferred. C. Conclusions 1. Alter Ego The Board will find an alter ego relationship to exist between two nominally separate entities if the two employers concerned have substantially identical management, business purpose, operations, equipment, customers and supervision, as well as ownership.8 In the absence of an identity of ownership, or an ownership interest demonstrated by the holdings of one com- pany in the other, the Board will examine whether the degree of control exercised by the first entity in the affairs of the second is such “as to obliterate any separation between them.”9 Addi- tionally, the Board assesses whether the new or second com- pany was created so as to allow the old employer to evade re- sponsibilities under the Act, and whether the two entities deal with each other, if at all, at arm’s length, with due regard for separateness.10 However, unlawful motivation is not a neces- sary element of an alter ego finding.11 Indeed, the Board has consistently held that no one factor, taken alone, is determina- tive, a substance-over-form approach approved by the courts. Thus, in Omnitest Inspection Services,12 the Court, in enforcing the Board’s order, stated: [The Employer’s] challenge to the Board’s reliance on actual control suggests that an alter ego finding should turn upon formal ownership alone. This argument ignores the Board’s decisions that the substantial identity of formal ownership is not the sine qua non of an alter ego relationship . . . . We are satisfied that the Board’s multi-factor test is a reasonable con- struction of the Act, and that depending on the facts of the case, actual control can be more significant than formal own- ership. Once a finding of alter ego relationship is made, it follows that the collective-bargaining agreement of the one employer is binding upon the second entity.13 In applying the above criteria, Board case law also instructs that, in the absence of common ownership, the older company must exercise very substantial control over the new one, in order to support an alter ego finding. Further, the lack of anti- union motivation in the creation of the second entity generally militates against finding a “disguised continuance” of the origi- nal organization. 8 Advance Electric, Inc., 268 NLRB 1001 (1984). 9 American Pacific Concrete Pipe Co., 262 NLRB 1223 (1982). 10 Fugazy Continental Corp., 265 NLRB 1301 (1982), enfd. 725 F. 2d 1416 (D.C. Cir. 1984). 11 Johnstown Corp., 313 NLRB 170 (1993), enf. denied and re- manded 41 F.3d 141 (3d Cir. 1994), supp. dec. 322 NLRB 818 (1997). 12 297 NLRB 752 (1990), enfd. 937 F.2d 112 (3d Cir. 1991). 13 Watt Electric Co., 273 NLRB 655 (1984). DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 1084 In this case, the General Counsel and the Charging Parties urge that the alter ego analysis be undertaken without regard to the global status of DDE, that is, that the Louisville and Cham- bers Works arms of the joint venture be examined in this regard absent consideration of the status of the other DDE sites, world- wide. As there is no controlling authority to the contrary, I am quite willing to take this approach, based upon its inherent logic, and in light of record evidence showing the considerable degree of local autonomy exercised at those sites. The diffi- culty I have with the arguments of the General Counsel and the Charging Parties lies in the failure of the record evidence to show, at Louisville and at Chambers Works, sufficient com- monality of ownership and, or, control, vis-a-vis Dupont and DDE, and the lack of any evidence indicating either an anti- union motivation in the creation of DDE, or questionable deal- ings between Dupont and the venture. It is beyond legitimate dispute that, at both of the sites in question, the former Dupont elastomers business units, and the current DDE operations, have had substantially identical man- agement, business purpose, equipment, customers, and supervi- sion. But DDE is 50 per cent owned by the Dow Chemical Company, and Dow wields 50 per cent control over centrally made decisions, including such significant business matters as major capital expenditures, and such important labor relations issues as “success sharing” and other benefit programs. Also, there is no evidence whatsoever, indeed, nary a contention, that Dow agreed with Dupont to form this global sized venture in order to aid Dupont in avoiding its collective-bargaining re- sponsibilities at Louisville and at Chambers Works, rather than for bona fide business reasons. At the local level, at the locations at issue, the remaining Dupont businesses, and DDE, share common sites and facilities and, through the service agreements, perform considerable work for each other, but never production work. Yet, despite the integrated nature of the sites, and the common systems, the businesses are structured as distinct entities, including separate ownership of buildings, equipment and production facilities. Services between the companies are paid for, and performed at a profit. The two entities, Dupont and DDE, do not share common management, nor do they engage in the same busi- ness. While, at the site level, the service agreements, initially, were negotiated between Dupont and DDE “designees,” who were, still, employed by Dupont, those agreements were subject to review by Dow to insure their fairness to the venture as well as adherence to the standards centrally negotiated between Dow and Dupont. Indeed, this record is replete with evidence of arm’s length and hard negotiations between the 2 parents, lead- ing to the venture’s formation. In light of the evidence showing separate ownership and con- trol, and the lack of evidence to suggest that DDE was formed for other than legitimate business reasons, or that there have been inappropriate dealings between Dupont and the venture, I conclude that, at Louisville and at Chambers Works, Dupont and DDE are separate entities. Simply put, too many of the critical factors traditionally relied upon by the Board to support alter ego findings are absent here. 2. “Perfectly clear” successor In the instant cases, the fact of successorship at the subject locations is not at issue. It is conceded. What is in dispute is whether, at Louisville and at Chambers Works, DDE’s succes- sorship to the former Dupont operations was “perfectly clear” from the outset, obligating it to bargain with the Unions con- cerning initial terms and conditions of employment. Thus, in NLRB v. Burns Security Services,14 the Supreme Court stated: Although a successor employer is ordinarily free to set initial terms on which it will hire the employees of a predecessor, there will be instances in which it is perfectly clear that the new employer plans to retain all of the em- ployees in the unit and in which it will be appropriate to have him initially consult with the employees’ bargaining representative before he fixes terms. In other situations, however, it may not be clear until the successor employer has hired his full complement of employees that he has a duty to bargain with a union, since it will not be evident until then that the bargaining representative represents a majority of the employees in the unit . . . . Interpreting the Burns “perfectly clear” caveat, the Board, in Spruce Up Corporation,15 ruled that when an employer who has not yet commenced operations announces new terms before or at the same time he invites the previous work force to accept employment under those terms, it cannot be said that the new employer plans to retain all of the employees in the unit, as referred to in Burns, since the old employees may choose not to accept employment in that situation. The Board held: We believe the caveat in Burns, therefore, should be restricted to circumstances in which the new employer has either actively or, by tacit inference, misled employees into believing they would all be retained without change in their wages, hours or conditions of employment, or at least to circumstances where the new employer . . . has failed to clearly announce its intent to establish a new set of condi- tions prior to inviting former employees to accept em- ployment. [Footnote omitted.] Thereafter, in Canteen Company,16 a Board plurality found that where a successor employer expressed to the union its desire to have the predecessor employees serve a probationary period, without indication of any changes in employment terms, the new employer “effectively and clearly communicated to the union its plan to retain the predecessor employees” and, since, as of that date it was perfectly clear that the successor planned to keep those employees, it “was not entitled to unilaterally implement new wage rates thereafter.” Chairman Gould, con- curring, expressed the view that the Spruce Up restrictions should be eliminated entirely. On the other hand, the dissenters urged that: . . . the perfectly clear exception should be limited to situations in which the employees have been tendered un- 14 406 U.S. 272 (1972). 15 209 NLRB 194 (1974), enfd. on other grounds 529 F. 2d 516 (4th Cir. 1975). 16 317 NLRB 1052 (1995), enfd. 103 F.3d 1355 (7th Cir. 1997). DUPONT DOW ELASTOMERS LLC 1085 conditional offers of hire, with no indication that the p- redecessor’s terms will be changed. The ‘perfectly clear’ exception should not apply if the employer indicates a change prior to or simultaneously with its offer to employ the predecessor’s work force . . . DDE argues that, here, however the facts and the law are construed, it was not obligated to bargain with the Unions, at all, until a majority of the predecessor’s elastomers employees, at each location, “accepted” offers of employment with the venture. I reject, outright, this contention, as, under any view of the case law, the focus of the “perfectly clear” inquiry is not the acceptance of the offers by the predecessor employees, but, rather, the announced intent to offer them employment, and the terms of the offer. Nonetheless, I conclude that, in the circumstances of this case, DDE did not violate Section 8(a)(5) of the Act by failing to bargain about initial terms and conditions of employment. At Louisville, and at Chambers Works, NCU, and CWA, re- spectively, were told in the early to mid-November, 1995, pe- riod, of DDE’s decision to offer employment to the Dupont elastomers employees. Shortly thereafter, by the end of No- vember, and many weeks before the start of the offer processes, the Unions were advised of the initial terms, that is, a carryover of the prior employment conditions, augmented by “success sharing.” The November 1995, announcements to the Unions, of the intent to hire and of the terms to be offered, were roughly contemporaneous, and both announcements preceded by many months the start-up of venture operations. The offer processes, clearly including “success sharing,” did not begin until January 1996.17 In February, still substantially before DDE commenced business on April 1, it extended recognition to the Unions and offered to bargain concerning all employment terms. The of- fers, which were without prejudice to the Unions’ alter ego claims, were rejected by both unions. As, in these cases, the announcements to the Unions con- cerning the intent to offer employment to the elastomers em- ployees, and the announcements concerning initial terms, in- cluding “success sharing,” were, essentially, contemporaneous, part of a long and well advertised formation process, and as those announcements occurred long before commencement of the offer processes, and many months before start-up, I con- clude that DDE never did effectively communicate an intent to retain the Dupont employees without changes in employment terms. This is not a case in which the new employer has failed clearly to state that it will set new conditions of employment prior to offering jobs to the predecessor employees, thereby misleading them into believing that they will be retained with- out changes in wages, hours and conditions of employment. Here, both the Unions and the employees knew, long before the offer processes began, that “success sharing” would be part of the employment package. Thus, the requirements of the “per- fectly clear” caveat have not been met and, accordingly, the General Counsel has failed to show that DDE was obligated to bargain with the Unions concerning initial employment terms, 17 As noted, at Chambers Works, shortly after the offer process had begun, DDE announced certain additional, less significant, changes to existing Dupont terms and conditions of employment. at Louisville and at Chambers Works. I note, too, that, as nei- ther union interposed objection to the implementation of “suc- cess sharing” despite ample time to do so, and as both unions refused to bargain about contractual terms when offered the opportunity to engage in such negotiations long before venture start-up, the Unions, by their total insistence that DDE assume its predecessor’s contracts, and their refusal to consider any- thing else, effectively waived statutory bargaining rights con- cerning “success sharing” and other terms and conditions of employment to prevail at start-up. 3. Request for Information NCU’s January 7, 1996, request, that it be furnished a copy of the venture agreement entered into by Dow and Dupont, in order to assess what “this thing” was all about, sought informa- tion which was clearly relevant to its statutory responsibility to represent the Louisville bargaining unit employees.18 However, when the Union learned, 10 days later, by the terms of the re- ply, that Dupont and DDE interpreted the request as one for a signed agreement between the parents, which was not yet in existence, it made no clarifying demand to see a copy of any existent unsigned draft agreement. Ultimately, the document sought was signed in March, and a copy of it was delivered to the Union in April. While, as urged by the General Counsel, information re- quested by the bargaining representative which is relevant and necessary to performance of its statutory duties must be pro- duced without unreasonable delay, here the delay which oc- curred was attributable, apparently, to a good-faith misunder- standing concerning precisely what was sought. As Respon- dents otherwise satisfied their obligations to produce relevant information, and as NCU, after receiving Respondents’ answer to its request for this particular piece of information failed to supply the needed clarification, I am unwilling to conclude that production of the formation agreement was unreasonably de- layed, in violation of the Act. CONCLUSIONS OF LAW 1. E.I. Dupont De Nemours and Company and Dupont Dow Elastomers L.L.C. are employers engaged in commerce, and in operations affecting commerce, within the meaning of Section 2(2), (6), and (7) of the Act. 2. Chemical Workers Association, Inc. and Neoprene Craftsmen Union Local 788 are labor organizations within the meaning of Section 2(5) of the Act. 3. Respondents have not violated the Act as alleged in the Complaint. [Recommended Order for dismissal omitted from publica- tion.] 18 See Roman Catholic Diocese of Brooklyn, 222 NLRB 1052 (1976), enf. denied on other grounds sub. nom. Nazareth Regional High School v. NLRB, 549 F. 2d 873 (2nd Cir. 1977).