Lake Castings, Inc.

LAKE CASTINGS, INC Lake Castings, Inc. and International Union, United Automobile, Aerospace and Agricultural Imple- ment Workers of America (UAW) and its Local No. 393. Case 8-CA-16208 22 February 1985 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS HUNTER AND DENNIS Upon a charge filed by the Union on 28 October 1982, the General Counsel of the National Labor Relations Board issued a complaint 10 December 1982 against the Company, the Respondent, alleg- ing that it had violated Section 8(a)(5) and (1) of the National Labor Relations Act. The complaint further alleges that the Union is the exclusive rep- resentative of the Respondent's employees in the appropriate unit and that the most recent collec- tive-bargaining agreement between the Union and the Respondent is effective by its terms from 7 De- cember 1981 to 10 December 1984. The complaint also alleges that since 1 April 1982 the Respondent, without notice to the Union and without affording the Union the opportunity to bargain, has failed to make premium payments for medical insurance as required by the collective-bargaining agreement. Although properly served copies of the charge and complaint, the Company has failed to file an answer. On 17 October 1983 the General Counsel filed a Motion for Summary Judgment alleging, inter alia, that the Respondent is currently involved in bank- ruptcy proceedings. On 19 October 1983 the Board issued an order transferring this proceeding to the Board and a Notice to Show Cause why the motion should not be granted. The Company filed no response. On 12 April 1984 the General Counsel filed a motion to file a supplemental brief in sup- port of the Motion for Summary Judgment and at- tached thereto a copy of the Respondent's volun- tary petition for relief under Chapter 11 of the Bankruptcy Code which was filed with the bank- ruptcy court on 23 July 1982. Thereafter, on 20 June 1984 the General Counsel filed a motion to file a second supplemental brief in support of the Motion for Summary Judgment in which he asserts that the Respondent, after filing the Chapter 11 bankruptcy petition, did not move the bankruptcy court to reject the collective-bargaining agreement and that the Respondent has taken no other formal action with respect to the collective-bargaining agreement. Additionally, the General Counsel at- tached a copy of an order, dated 17 November 1982, of the United States Bankruptcy Court for the Northern District of Ohio, Western Division, in 225 which the court converted the Chapter 11 proceed- ing to a proceeding under Chapter 7 of the Bank- ruptcy Code. The Company has filed no opposition to the General Counsel's motions to file supplemen- tal and second supplemental briefs and we grant those motions. The allegations of the Motion for Summary Judgment and of the supplemental and second supplemental briefs in support of the Motion for Summary Judgment are undisputed. Ruling on Motion for Summary Judgment Section 102.20 of the Board's Rules and Regula- tions provides that the allegations in the complaint shall be deemed admitted if an answer is not filed within 10 days from service of the complaint, unless good cause is shown. The complaint states that unless an answer is filed within 10 days of service, "all the allegations in the complaint shall be deemed to be admitted to be true and may be so found by the Board." Further, the undisputed alle- gations in the Motion for Summary Judgment dis- close that the General Counsel, by letter dated 26 September 1983, confirmed a telephone conversa- tion of 15 September 1983, during which the Re- spondent's trustee in bankruptcy indicated that he would not file an answer, and further advised the trustee in bankruptcy that a Motion for Summary Judgment would be filed forthwith. In its recent opinion in NLRB v. Bildisco & Bil- disco, 104 S.Ct. 1188 (1984), the Supreme Court held that a debtor-in-possession does not commit an unfair labor practice when it unilaterally rejects or modifies a collective-bargaining agreement before the bankruptcy court approves formal rejection. Accordingly, applying Bildisco, we consider sepa- rately the portions of the complaint involving pre- petition activity from those involving activity which occurred on or after the date of the filing of the bankruptcy petition. In the absence of good cause being shown for the Respondent's failure to file a timely answer, we grant the Motion for Sum- mary Judgment insofar as the complaint alleges that the Respondent violated Section 8(a)(5) and (1) of the Act by failing to make premium pay- ments for medical insurance covering its unit em- ployees for the period from about 1 April 1982 until 23 July 1982, the date the Company filed its bankruptcy petition. We, however, deny the Motion for Summary Judgment insofar as the complaint alleges that the Respondent violated the Act by failing to make premium payments for medical insurance on or after 23 July 1982, the date the Respondent filed its bankruptcy petition. As the Supreme Court stated in Bildisco: "[F]rom the filing of a petition in bank- ruptcy until formal acceptance, the collective-bar- 274 NLRB No. 40 226 DECISIONS OF NATIONAL LABOR RELATIONS BOARD gaining agreement is not an enforceable contract within the meaning of NLRA Sec. 8(d)." 104 S.Ct. at 1199. In the present case, we conclude that sub- stantial issues under Bildisco have been raised with respect to the alleged postpetition activity which are not appropriate for resolution in this Motion for Summary Judgment proceeding. We therefore shall deny the General Counsel's Motion for Sum- mary Judgment insofar as it relates to postpetition activity, and shall remand this portion of the case to the Regional Director for further consideration under Bildisco and for further appropriate action consistent herewith. i On the entire record, the Board makes the fol- lowing' FINDINGS OF FACT 1. JURISDICTION The Company, a corporation, with an office and place of business in Sandusky, Ohio, has been en- gaged in the manufacture of metal castings. During the 12 months preceding the filing of the charge, the Company, in the course and conduct of its business operations, sold and shipped from its San- dusky, Ohio facility products, goods, and materials valued in excess of $50,000 directly to points out- side the, State of Ohio. We find that the Company is an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act and that the Union is a labor organization within the mean- ing of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES For the past several years, and at all times mate- rial herein, the Union has been the designated ex- clusive collective-bargaining representative of the Respondent's employees in the appropriate unit and has been recognized as such by the Respondent. Recognition has been embodied in successive col- lective-bargaining agreements, the most recent of which is effective by its terms for the period from 7 December 1981 to 10 December 1984. Since about 1 April 1982, and continuously thereafter, the Respondent has failed to make premium pay- ments for medical insurance covering its employees as required by the collective-bargaining agreement between the Company and the Union. The Compa- ny has failed to make such premium payments 1 Member Hunter notes that the Respondent 's violation of Sec 8(a)(5) and (1) of the Act, based on its failure to make premium payments for medical insurance , occurred prior to the Respondent 's filing of its bank- ruptcy petition Accordingly, and for the reasons fully set forth in his dis- sent in Edward Cooper Painting, 273 NLRB 1870 (1985), Member Hunter disagrees with terminating the remedy as of 23 July 1982, the date the Respondent filed its bankruptcy petition, and does not join in remanding thisiproceeding to the Regional Director without prior notice to the Union and without af- fording the Union the opportunity to negotiate and bargain as the exclusive bargaining representative of the employees in the appropriate unit with re- spect to such acts and conduct and the effect of such acts and conduct. Accordingly, we find that, by the aforesaid conduct, between about 1 April 1982 and 23 July 1982, the Company has failed and refused to bargain collectively in good faith with a representative of its employees, and the Company has thereby been engaging in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act. 2 CONCLUSIONS OF LAW 1. By the activities of the Company set forth in section II, above, occurring in connection with the operations described in section I, above, the Com- pany has engaged in unfair labor practices affecting commerce within the meaning of Section 8(a)(5) and of Section 2(6) and (7) of the Act. 2. By the acts described in section II, above, the Company has interfered with, restrained, and co- erced its employees in the exercise of their rights guaranteed them by Section 7 of the Act and there- by has engaged in unfair labor practices within the meaning of Section 8(a)(1) of the Act. REMEDY Having found that the Respondent has engaged in certain 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. The Respondent having unlawfully discontinued premium payments for medical insurance, we shall order it to make unit employees whole by paying such premium payments which have not been paid and which would have been paid absent the Re- spondent's unlawful discontinuance of such pay- ments and by reimbursing unit employees for any unreimbursed medical or other expenses ensuing from the Respondent's unlawful failure to make such required contributions. This shall include re- imbursing employees for any contributions they themselves may have made for the maintenance of medical insurance after the Respondent unlawfully discontinued premium payments; for any premiums they may have paid to third party insurance com- panies to continue medical coverage in the absence of the Respondent's premium payments for medical 2 It is also clear that Sec 8 (d) of the Act prohibits a party to an exist- ing collective-bargaining agreement from modifying the terms of such agreement without obtaining the consent of the other party to the agree- ment LAKE CASTINGS, INC 227 insurance, and for any medical bills they may have paid directly to health care providers that the con- tractual policies would have covered. All payments to the employees shall be made with interest See Ferro Mechanical Corp., 249 NLRB 669 (1980), and Angelus Block Co., 250 NLRB 868 (1980) Interest on all such sums shall be paid in the manner pre- scribed in Florida Steel Corp., 231 NLRB 651 (1977). See generally Isis Plumbing Co., 138 NLRB 716 (1962). ORDER The National Labor Relations Board orders that the Respondent, Lake Castings, Inc., Sandusky, Ohio, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Failing and refusing to bargain with Interna- tional Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) and its Local No. 393 as the exclusive rep- resentative of its employees in the appropriate unit set forth below by failing to make those premium payments for medical insurance covering its unit employees, as provided by the collective-bargain- ing agreement between the Company and the Union, from about 1 April 1982 to 23 July 1982. The appropriate unit is: All production and maintenance employees at the Respondent's plant in Sandusky, Ohio, but shall not include Plant Manager, and assistants to the Plant Manager, Departmental Superin- tendents, Foremen, Chief Pattern Maker, Chief Maintenance Mechanic, and supervisory em- ployees with the power to hire and discharge or effectively recommend such action, Watch- men, Plant Protection employees, office and clerical employees, including those engaged in the keeping of time, Engineering, Technical, Experimental, Confidential Research and Per- sonnel employees (b) In any like or related manner interfering with, restraining, or coercing employees in the ex- ercise of the rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action neces- sary to effectuate the policies of the Act. (a) Make unit employees whole by paying all premium payments for medical insurance which have not been paid, which were due and payable between about 1 April 1982 and 23 July 1982, and which would have been paid absent the Company's unlawful discontinuance of such payments, and by reimbursing unit employees for any unreimbursed medical or other expenses ensuing from the Com- pany's unlawful failure to make such required con- tributions, in the manner provided in the remedy section of this decision. This shall include reimburs- ing employees for any contributions they them- selves may have made for the maintenance of med- ical insurance after the Company unlawfully dis- continued premium payments; for any premiums they may have paid to third party insurance com- panies to continue medical coverage in the absence of the Company's premium payments for medical insurance, and for medical bills they may have paid directly to health care providers that the contrac- tual policies would have covered. All payments to the employees shall be made with interest. (b) Post at its facility in Sandusky, Ohio, copies of the attached notice marked "Appendix."3 Copies of the notice, on forms provided by the Re- gional Director for Region 8, after being signed by the Respondent's authorized representative, shall be posted by the Respondent immediately upon re- ceipt and maintained for 60 consecutive days in conspicuous places including all places where, no- tices to employees are customarily posted. Reason- able steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply. IT IS FURTHER ORDERED that the General Coun- sel's Motion for Summary Judgment, insofar as that motion relates to the Company's activities on or after the filing of the bankruptcy petition on 23 July 1982, is denied. IT IS FURTHER ORDERED that this case be re- manded to the Regional Director for Region 8 for further appropriate action consistent herewith. 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 Judgment of the United States Court of Appeals Enforcing an Order of the Nation- a] Labor Relations Board 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 violated the National Labor Relations Act and has ordered us to post and abide by this notice. WE WILL NOT fail and refuse to bargain with International Union, United Automobile, Aerp- space and Agricultural Implement Workers of 228 DECISIONS OF NATIONAL LABOR RELATIONS BOARD America (UAW) and its Local No. 393 by failing to make those premium payments for medical in- surance covering its employees in the bargaining unit described below, and as provided by our col- lective-bargaining agreement with the Union, and which were due and payable between about 1 April 1982 and 23 July 1982. The bargaining unit is: All production and maintenance employees at the Employer's plant in Sandusky, Ohio, but shall not include Plant Manager, and assistants to the Plant Manager, Departmental Superin- tendents, Foremen, Chief Pattern Maker, Chief Maintenance Mechanic, and supervisory em- ployees with the power to hire and discharge or effectively recommend such action, Watch- men, Plant Protection employees, office and clerical employees, including those engaged in the keeping of time, Engineering, Technical, Experimental, Confidential Research and Per- sonnel employees. WE WILL NOT in any like or related manner cise of the rights guaranteed you by Section 7 of the Act. WE WILL make our unit employees whole by paying all premium payments for medical insurance which have not been paid between about 1' April 1982 and 23 July 1982, and which would have been paid absent our unlawful discontinuance of such payments, and by reimbursing unit employees for any medical or other expenses ensuing from our unlawful failure to make such required payments. This shall include reimbursing employees for any contributions they themselves may have made for the maintenance of medical insurance after we un- lawfully discontinued premium payments; for any premiums they may have paid to third party insur- ance companies to continue medical coverage in the absence of our required premium payments for any medical insurance; and for medical bills they may have paid directly to health care providers that the contractual policies would have covered. All payments to the employees shall be made with interest. interfere with, restrain, or coerce you in the exer- LAKE CASTINGS, INC.