Bio Additives, LLC of Kentucky

BIO ADDITIVES 349 NLRB No. 3 1 Bio Additives, LLC of Kentucky, a Division of CMB Additives and International Union of Electronic, Electrical, Salaried, Machine and Furniture Workers–Communications Workers of Amer- ica, Local 774, AFL–CIO. Case 9–CA–42971 January 16, 2007 DECISION AND ORDER BY CHAIRMAN BATTISTA AND MEMBERS LIEBMAN AND SCHAUMBER The General Counsel seeks a default judgment in this case on the ground that the Respondent has failed to file an answer to the complaint and compliance specification. On a charge filed by the Union on July 20, 2006, against Bio Additives, LLC of Kentucky, a Division of CMB Addi- tives, the Respondent, the General Counsel issued the complaint and compliance specification on September 29, 2006, alleging that it has violated Section 8(a)(1) and (5) of the Act. The Respondent failed to file an answer. On November 7, 2006, the General Counsel filed a Mo- tion for Default Judgment with the Board. On November 14, 2006, the Board issued an order transferring the pro- ceeding to the Board and a Notice to Show Cause why the motion should not be granted. The Respondent filed no response. The allegations in the motion are therefore un- disputed. The National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. Ruling on Motion for Default Judgment Section 102.20 of the Board’s Rules and Regulations provides that the allegations in the complaint shall be deemed admitted if an answer is not filed within 14 days from service of the complaint, unless good cause is shown. Similarly, Section 102.56 of the Board’s Rules and Regu- lations provides that the allegations in a compliance speci- fication will be taken as true if an answer is not filed within 21 days from service of the compliance specifica- tion. In addition, the complaint and compliance specifica- tion affirmatively stated that unless an answer was filed by October 13, 2006, all the allegations in the complaint and compliance specification could be considered admitted. Further, the undisputed allegations in the General Coun- sel’s motion disclose that the Region, by letter dated Octo- ber 23, 2006, notified the Respondent that a Motion for Default Judgment would be filed if an answer was not filed by October 31, 2006. Thereafter, the General Counsel learned that Marc A. Pergament had been appointed as the Respondent’s trustee in bankruptcy on October 24, 2006. By letter dated Octo- ber 26, 2006, the General Counsel sent copies of the com- plaint and compliance specification and the October 23, 2006 warning letter to the trustee. The General Counsel specifically informed the trustee that absent the filing of an answer, the Region could make a motion to the Board for default judgment, and notified the trustee that as a gov- ernment agency the Region was free to prosecute and per- fect its claim notwithstanding bankruptcy proceedings. Nevertheless, no answer to the complaint and compliance specification was filed.1 In the absence of good cause being shown for the failure to file a timely answer, we grant the General Counsel’s Motion for Default Judgment. On the entire record, the Board makes the following FINDINGS OF FACT I. JURISDICTION At all material times, the Respondent, a corporation, has been engaged in the manufacture of chemical feed sup- plements at its Louisville, Kentucky facility. During the 12-month period preceding issuance of the complaint, the Respondent sold and shipped goods valued in excess of $50,000 from its Louisville, Kentucky facility directly to points outside the Commonwealth of Kentucky. We find that the Respondent is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act and that International Union of Electronic, Elec- trical, Salaried, Machine and Furniture Workers– Communications Workers of America, Local 744, AFL– CIO (the Union) is a labor organization within the mean- ing of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES At all material times, the following individuals held the positions set forth opposite their names and have been supervisors of the Respondent within the meaning of Sec- tion 2(11) of the Act and agents of the Respondent within the meaning of Section 2(13) of the Act: Frank Montelano Chief Corporate Officer 1 The General Counsel’s motion indicates that the Respondent’s trus- tee in bankruptcy sent a letter to the General Counsel dated October 31, 2006, in which he indicated that “the Trustee does not agree with your analysis that the National Labor Relations Board is authorized to prose- cute the claim referenced in your [October 26] letter.” In addition, the trustee requested that the General Counsel voluntarily agree to stay the Board’s proceedings. The trustee did not express an intention to file an answer. It is well established that the institution of bankruptcy pro- ceedings does not deprive the Board of jurisdiction or authority to entertain and process an unfair labor practice case to its final disposi- tion. See, e.g., Cardinal Services, 295 NLRB 933 fn. 2 (1989), and cases cited there. Board proceedings fall within the exception to the automatic stay provisions for proceedings by a governmental unit to enforce its police or regulatory powers. See id., and cases cited therein; NLRB v. 15th Avenue Iron Works, Inc., 964 F.2d 1336, 1337 (2d Cir. 1992). Accord: Ahrens Aircraft, Inc. v. NLRB, 703 F.2d 23 (1st Cir. 1983). DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 2 Danny Lang Facility Supervisor The following employees of the Respondent constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act: All production and maintenance employees employed at [Respondent’s] Louisville, Kentucky facility, but excluding all clerical employees and professional em- ployees, guards and supervisors as defined in the Na- tional Labor Relations Act. Since about March 2005, when the Respondent com- menced operating the facility, the Union has been the des- ignated exclusive collective-bargaining representative of the unit employed by the Respondent and since that date the Union has been recognized as the representative by the Respondent. This recognition has been embodied in suc- cessive collective-bargaining agreements, the most recent of which is effective from April 1, 2006, to March 31, 2011. At all times since March 2005, based on Section 9(a) of the Act, the Union has been the exclusive-bargaining rep- resentative of the unit employed by the Respondent. Since about April 24, 2006, the Respondent has failed to pay employees the wages provided under article XVII and Schedule A of the 2006–2011 collective-bargaining agreement described above. Since about April 24, 2006, the Respondent has failed to pay employees their vacation pay under article V of the 2006–2011 collective-bargaining agreement. Since about April 24, 2006, the Respondent has failed to pay employees severance pay provided under article VI, paragraph 14 of the 2006–2011 collective-bargaining agreement. Since about April 24, 2006, the Respondent has failed to maintain employees’ health care benefits provided under article XIX of the 2006–2011 collective-bargaining agreement. The subjects set forth above relate to wages, hours, and other terms and conditions of employment of the unit and are mandatory subjects for the purpose of collective bar- gaining. By the conduct described above, the Respondent failed to continue in effect the terms and conditions of the parties’ 2006–2011 collective-bargaining agreement. The Respondent engaged in the conduct above without the consent of the Union. CONCLUSION OF LAW By failing to pay employees the wages, vacation pay, and severance pay, and to maintain employees’ health care benefits, as provided in the 2006–2011 collective- bargaining agreement, the Respondent has failed and re- fused to bargain collectively and in good faith with the exclusive collective-bargaining representative of its em- ployees, in violation of Section 8(a)(5) and (1) of the Act. The Respondent’s unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. REMEDY Having found that the Respondent has engaged in cer- tain unfair labor practices, we shall order it to cease and desist and to take certain affirmative action designed to effectuate the policies of the Act. Specifically, having found that the Respondent violated Section 8(a)(5) and (1) of the Act by failing and refusing to pay employees the contractually required wages, vacation pay, and severance pay, and to maintain the employees’ health care benefits, we shall order the Respondent to make the employees whole by paying them the amounts set forth in the compli- ance specification, plus interest accrued to the date of payment as set forth in New Horizons for the Retarded, 283 NLRB 1163 (1987), and minus tax withholdings re- quired by Federal and State laws. ORDER The National Labor Relations Board orders that the Re- spondent, Bio Additives, LLC of Kentucky, A Division of CMB Additives (Marc A. Pergament Trustee-In- bankruptcy), Louisville, Kentucky, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Failing and refusing to recognize and bargain with International Union of Electronic, Electrical, Salaried, Machine and Furniture Workers–Communications Work- ers of America, Local 744, AFL–CIO, as the exclusive collective-bargaining representative of the employees in the following appropriate unit by failing to pay employees the wages provided under article XVII and Schedule A of the 2006–2011 collective-bargaining agreement with the Union; failing to pay employees their vacation pay pro- vided under article V of the 2006–2011 collective- bargaining agreement; failing to pay employees severance pay provided under article VI, paragraph 14 of the 2006– 2011 collective-bargaining agreement; and failing to main- tain employees’ health care benefits provided under article XIX of the 2006–2011 collective-bargaining agreement. The appropriate unit is: All production and maintenance employees employed at [Respondent’s] Louisville, Kentucky facility, but excluding all clerical employees and professional em- ployees, guards and supervisors as defined in the Na- tional Labor Relations Act. (b) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act. BIO ADDITIVES 3 2. Take the following affirmative action necessary to ef- fectuate the policies of the Act. (a) Make whole the individuals named below for the failure to pay contractually required wages, vacation pay, severance pay, and to maintain employees’ health care benefits by paying them the amounts following their names, plus interest accrued to the date of payment, as prescribed in New Horizons for the Retarded, 283 NLRB 1163 (1987), minus tax withholdings required by Federal and State laws:2 (b) Within 14 days after service by the Region, post at its facility in Louisville, Kentucky, copies of the attached notice marked “Appendix.”3 Copies of the notice, on forms provided by the Regional Director for Region 9, 2 The compliance specification indicates that there are no known amounts due for benefits under the health care provision of the contract. 3 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.” after being signed by the Respondent’s authorized repre- sentative, shall be posted by the Respondent and main- tained for 60 consecutive days in conspicuous places in- cluding all places where notices to employees are custom- arily posted. Reasonable steps shall be taken by the Re- spondent 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, the Respondent has gone out of business or closed the facility involved in these proceedings, the Respondent shall duplicate and mail, at its own expense, a copy of the notice to all current employees and former employees employed by the Respondent at any time since April 24, 2006. (c) 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 that the Respondent has taken to comply. APPENDIX NOTICE TO EMPLOYEES POSTED BY ORDER OF THE Employee Hourly Wage Backpay Vac. 2006 Vac. 2007 Severance Pay Total Jake Johnson $18.47 $2955 $1302 $1477 $18,470 $24,204 Bill Drury $20.95 $3352 $3519 $1676 $20,950 $29,497 Keith Caudill $20.95 $3352 $3184 $1676 $20,950 $29,162 Billy Lovins $18.47 $2955 $2364 $1477 $18,470 $25,266 David Clemins $21.45 $3432 $2745 $1716 $21,450 $29,343 Freed Lovins $18.97 $3035 $2883 $1517 $18,970 $26,405 Robert Clemens $19.22 $3075 $2613 $1537 $19,220 $26,445 Jerry Caudill $19.65 $3144 $1100 $1572 $19,650 $25,466 Rick Hodge $18.95 $3032 $1383 $1516 $11,370 $17,301 Les Newsome $14.75 $2360 $354 $1180 $8850 $12,744 Lewis Willis $18.95 $3032 $3032 $1516 $11,370 $18,950 Dewayne Stephens $18.95 $3032 $1099 $1516 $11,370 $17,017 Ed Seger $19.22 $3075 $0 $1537 $7688 $12,300 Richard Harden $19.22 $3075 $2614 $1537 $7688 $14,914 Mike Reed $14.75 $2360 $1888 $1180 $5900 $11,328 Chris Wilson $14.75 $2360 $944 $1180 $5900 $10,384 TOTAL $330,726 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD 4 NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated Federal labor law and has ordered us to post and obey this notice. FEDERAL LAW GIVES YOU THE RIGHT TO Form, join, or assist a union Choose representatives to bargain with us on your behalf Act together with other employees for your bene- fit and protection Choose not to engage in any of these protected activities. WE WILL NOT fail and refuse to recognize and bargain with International Union of Electronic, Electrical, Sala- ried, Machine and Furniture Workers–Communications Workers of America, Local 744, AFL–CIO, as the exclu- sive collective-bargaining representative of the employ- ees in the following appropriate unit by failing to pay employees the wages provided under article XVII and Schedule A of the 2006–2011 collective-bargaining agreement with the Union; failing to pay employees their vacation pay provided under article V of the 2006–2011 collective-bargaining agreement; failing to pay employ- ees severance pay provided under article VI, paragraph 14 of the 2006–2011 collective-bargaining agreement; and failing to maintain employees’ health care benefits provided under article XIX of the 2006–2011 collective- bargaining agreement. The appropriate unit is: All production and maintenance employees employed at our Louisville, Kentucky facility, but excluding all clerical employees and professional employees, guards and supervisors as defined in the National Labor Rela- tions Act. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exercise of the rights guaranteed you by Section 7 of the Act. WE WILL make whole our unit employees for our fail- ure to pay contractually required wages, vacation pay, severance pay, and our failure to maintain health care benefits by paying them the amounts following their names, plus interest accrued to the date of payment, and minus tax withholdings required by Federal and State laws: BIO ADDITIVES 5 BIO ADDITIVES, LLC OF KENTUCKY, A DIVISION OF CMB ADDITIVES Employee Hourly Wage Backpay Vac. 2006 Vac. 2007 Severance Pay Total Jake Johnson $18.47 $2955 $1302 $1477 $18,470 $24,204 Bill Drury $20.95 $3352 $3519 $1676 $20,950 $29,497 Keith Caudill $20.95 $3352 $3184 $1676 $20,950 $29,162 Billy Lovins $18.47 $2955 $2364 $1477 $18,470 $25,266 David Clemins $21.45 $3432 $2745 $1716 $21,450 $29,343 Freed Lovins $18.97 $3035 $2883 $1517 $18,970 $26,405 Robert Clemens $19.22 $3075 $2613 $1537 $19,220 $26,445 Jerry Caudill $19.65 $3144 $1100 $1572 $19,650 $25,466 Rick Hodge $18.95 $3032 $1383 $1516 $11,370 $17,301 Les Newsome $14.75 $2360 $354 $1180 $8850 $12,744 Lewis Willis $18.95 $3032 $3032 $1516 $11,370 $18,950 Dewayne Stephens $18.95 $3032 $1099 $1516 $11,370 $17,017 Ed Seger $19.22 $3075 $0 $1537 $7688 $12,300 Richard Harden $19.22 $3075 $2614 $1537 $7688 $14,914 Mike Reed $14.75 $2360 $1888 $1180 $5900 $11,328 Chris Wilson $14.75 $2360 $944 $1180 $5900 $10,384 Total $330,726