Clinton's Ditch Cooperative Co., Inc.

728 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Clinton's Ditch Cooperative Co., Inc. and Teamsters Local 317, International Brotherhood of Team- sters, Chauffeurs, Warehousemen & Helpers of America. Case 3-CA-10085 28 February 1985 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS HUNTER AND DENNIS On 5 January 1983 Administrative Law Judge Martin J. Linsky issued the attached decision. The Respondent filed exceptions and a supporting brief, the Charging Party filed cross-exceptions, a sup- porting brief, and an answering brief, and the Gen- eral Counsel filed a brief in support of the judge's decision 1 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,2 findings, and i Thereafter, the Respondent and the Charging Party filed several let- ters calling to the Board's attention a number of recently issued Board decisions Both parties move to strike the other's letters on the ground that they are untimely filed supplemental briefs because they contain ar- gument supporting their interpretation of the cited cases We have con- sidered the cases cited by the parties, but we have not considered any Supporting argument Therefore, both motions to strike are moot 2 The Respondent has excepted to some of the judge's credibility find- ings The Board's established policy is not to overrule an administrative law judge's credibility resolutions unless the clear preponderance of all the relevant evidence convinces us that they are incorrect Standard Dry Wall Products, 91 NLRB 544 (1950), enfd 188 F 2d 362 (3d Cir 1951) We have carefully examined the record and find no basis for reversing the findings 3 We agree with the judge's finding that the Respondent (Clinton's Ditch) and Fairfield Transportation Corp (Fairfield) were joint employ- ers because, as found by the judge, they shared or codetermined matters governing the essential terms and conditions of employment of the driv- ers NLRB v Browning-Ferris Industries, 691 F 2d 1117 (3d Cir 1982) We do not rely on his discussion of other factors that are relevant only in the single employer context In addition, we do not rely on his statement that it would be unjust for Clinton's Ditch to be found to be anything other than a joint employer We agree with the judge's finding that the appropriate remedy is a return to the status quo ante The record contains no evidence that such a remedy would be unduly burdensome Chairman Dotson and Member Dennis find that the record contains in- sufficient evidence to support a conclusion that the Respondent agreed to be bound by the collective-bargaining agreement negotiated between the Union and Fairfield They do not pass on the question whether the Re- spondent should be found to be obligated to honor the contract by virtue of its status as a joint employer They note that inasmuch as the Board is finding that the Respondent violated Sec 8(a)(5) by unilaterally changing existing terms and conditions of employment and as the Board is ordering a status quo ante remedy, the employees' backpay will be based on the terms and conditions of employment established by the collective-bar- gaining agreement between the Union and Fairfield Further, under the particular circumstances of this case, they agree with the judge that "[t]he purposes of the Act will be accomplished if the drivers are rein- stated with backpay and both sides commence to bargain in good faith regarding a new contract between them " Contrary to the judge, Member Hunter additionally would find that the Respondent is bound to the collective -bargaining agreement between Fairfield and the Union and that the Respondent 's failure to apply that agreement was in abrogation of Sec 8 (d) of the Act and violative of Sec 8(a)(5) He notes that the Respondent initially was party to a collective- bargaining agreement with the Union and that , although the Respondent and Fairfield subsequently entered into a contract which provided that conclusions3 and to adopt the recommended Order as modified.4 We agree with the judge that the Respondent violated Section 8(a)(5) by failing to bargain with the Union over its decision to subcontract its truck- ing operations, but we do so for the following rea- sons. In our recent decision in Otis Elevator Co., 269 NLRB 891 (1984), we interpreted the Supreme Court's decision in First National Maintenance Corp. v. NLRB, 452 U.S. 666 (1981), as follows: "[T]he critical factor to a determination whether the decision is subject to mandatory bargaining is the essence of the decision itself, i.e., whether it turns upon a change in the nature or direction of the business, or turns upon labor costs; not its effect on employees nor a union's ability to offer alterna- tives." Supra at 892. (Emphasis in original.) We also stated that "[i]ncluded within Section 8(d) . . . are all decisions which turn upon a reduction of labor costs." Supra at 893. As found by the judge, the breakdown in negoti- ations for a new agreement between the Respond- ent and its joint employer, Fairfield, which ended their relationship, occurred because the Respond- ent would not agree to a rate increase based on labor costs. The record reveals that, when the rela- tionship with Fairfield was ending, the Respondent contacted other companies concerning new trans- the latter assume that collective-bargaining agreement and that it would provide a written release of the Respondent from the Union, the Union never gave such a release and made it clear that it would continue to look to the Respondent as the ultimate employer Furthermore, although the Respondent did not actually execute the subsequent collective-bar- gaining agreement between Fairfield and the Union, it is clear that during the negotiations for that agreement Fairfield continuously informed the Respondent of the status of the negotiations, Fairfield had to secure the Respondent's approval before making any monetary commitments, and the Respondent sought and obtained language in the agreement to pro- tect certain of its interests Given these facts, coupled with the additional evidence concerning the Respondent's and Fairfield's joint employer status which indicates that in all essential aspects control over the truck- ing operations remained with the Respondent, Member Hunter considers it appropriate in the circumstances here to find the Respondent bound to the collective-bargaining agreement executed by Fairfield and the Union In his view, to hold otherwise would be to ignore the realities of the rela- tionship between the Respondent, Fairfield, and the Union Further, and contrary to his colleagues, Member Hunter concludes that the remedy will be materially affected by a finding that the Respondent is bound to the collective-bargaining agreement In so doing , Member Hunter notes, for example, that while the agreement contains a dues-checkoff provision obligating Fairfield to periodically withhold from employees' pay and remit to the Union certain amounts for union dues, the present order does not require that the Respondent reimburse the Union for lost dues and interest thereon See Fox Painting Co, 263 NLRB 437 (1982), affd per curiam 732 F 2d 554 (6th Cir 1984) The judge incorrectly found that Fairfield employees other than one driver and a dispatcher were generally not at the Clinton's Ditch prem- ises before "2 45 a m " instead of "2 45 p m " He also incorrectly found that the Respondent did not commence looking for a new source of truckdrivers until "following receipt of the cancellation notice" from Fairfield, the record reveals that the Respondent contacted other truck- ing companies prior to that time These errors are apparently inadvertent and have no effect on our decision 4 We have modified the judge's Conclusion of Law 3 and par 2(a) of his recommended Order to describe more accurately the violation found 274 NLRB No. 103 CLINTON'S DITCH CO portation arrangements . The Respondent's General Manager Alan Woodruff spoke with Jack Bevans of Global Leasing, Inc. (Global) on 26 August 1980. The next day Bevans wrote Woodruff the following letter, which reveals that labor costs were a key consideration in the negotiations be- tween the Respondent and Global: As I told you in my conversation while in Syr- acuse, I recommend that these drivers be put under a union contract with the Brotherhood of Railway & Airline Clerks. I believe that Local 317 will do all in their power to orga- nize this operation as they will be losing this membership. Any rates that I am quoting you I am sure that I will be able to negotiate with BRAC, but I do not want to contact the Union until such time as we know that this is the way it is going to go. On 29 October 1980, without notice to the Union, the Respondent and Global entered into an agree- ment for Global to supply drivers to the Respond- ent. In sum, the Respondent's relationship with Fair- field ended because of labor costs, and the Re- spondent was looking for labor-cost savings when it entered into its relationship with Global. Fur- thermore, when the Respondent contracted with Global for drivers, there was no "change in the nature or direction" of the Respondent's business. Otis Elevator, supra. The Respondent still used the same leased equipment, but now it was leased from Ryder and Lincoln Leaseway instead of Fairfield. The Respondent still used leased drivers, but now they were leased from Global instead of Fairfield. The only difference in the Respondent's operation was that the drivers were a different group of em- ployees. Therefore, we find that the Respondent's decision to subcontract its trucking operations "turn[ed] upon labor costs" within the meaning of Otis Elevator. Accordingly, it was a mandatory sub- ject of bargaining.-' 5 Member Dennis agrees that the Respondent was obligated to bargain over its decision to subcontract its trucking operation Her analysis is based on her interpretation of the Supreme Court's First National Mainte- nance decision, as set forth in her concurring opinion in Otis Elevator Co In her view , a two-step test is used in deciding whether a certain man- agement decision is a mandatory subject of bargaining "[T]he General Counsel must prove (1) that a factor over which the union has control was a significant consideration in the employer's decision, and (2) that the benefit for the collective-bargaining process outweighs the burden on the business " 269 NLRB 891 at 897 The burden elements to be considered in applying the second part of the test include extent of capital commit- ment , extent of changes in operations, and the need for speed, flexibility, or confidentiality In the instant case, Member Dennis agrees that labor costs (a factor over which the Union has control) were a significant con- sideration in the Respondent's decision to subcontract its trucking oper- ation Turning to the burden elements, she finds that the Respondent's decision involved no capital commitment , virtually no change in oper- ations, and there is no evidence of a need for speed, flexibility, or confi- 729 AMENDED CONCLUSIONS OF LAW Substitute the following paragraph 3 for that of the administrative law judge. "3. By unilaterally subcontracting its trucking operation without bargaining with the Union over the decision or its effects on the unit employees, the Respondent engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act." ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondent, Clinton's Ditch Cooperative Co., Inc., Syracuse, New York, its officers, agents, succes- sors, and assigns, shall take the action set forth in the Order as modified. 1. Substitute the following for the first sentence of paragraph 2(a). "(a) Offer those employees who were displaced by the unilateral subcontracting of the Respond- ent's trucking operation immediate and full rein- statement to their former jobs or, if these jobs no longer exist, to substantially equivalent positions, without prejudice to their seniority or other rights and privileges previously enjoyed, and make them whole for any loss of pay and other benefits suf- fered by them commencing on 1 November 1980." 2. Substitute the attached notice for that of the administrative law judge. dentiahty Accordingly, she concludes that the General Counsel estab- lished that "the benefit" outweighs "the burden" and that the Respond- ent's decision was a mandatory subject of bargaining 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. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representa- tives of their own choice To act together for other mutual aid or pro- tection To choose not to engage in any of these protected concerted activities. 730 DECISIONS OF NATIONAL LABOR RELATIONS BOARD WE WILL NOT refuse to bargain collectively with Local 317, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of Amer- ica, as the exclusive bargaining representative of all truckdrivers who work out of our Cicero, New York, facility by contracting out the work of those employees or otherwise changing their wages, hours, and other terms and conditions of employ- ment without first bargaining with the above- named labor organization. WE WILL NOT in any like or related manner interfere with, restrain, or coerce employees in the exercise of the rights guaranteed them by Section 7 of the Act. WE WILL offer reinstatement to all the drivers displaced by the unilateral subcontracting of our trucking operation. WE WILL pay backpay with interest to all driver- employees who were displaced by the unilateral subcontracting of our trucking operation. WE WILL bargain collectively with Local 317, International Brotherhood of Teamsters, Chauf- feurs, Warehousemen and Helpers of America, as the exclusive bargaining representative of the driv- ers who work out of our Cicero, New York, facili- ty. FINDINGS OF FACT I. JURISDICTION Respondent is, and has been at all times material herein, a corporation duly organized under, and existing by virtue of, the laws of the State of New York. At all times material herein, Respondent has main- tained its principal office and place of business at Pardee Road, Cicero, New York, and is, and has been at all times material herein, continuously engaged at the plant, place of business, and facility, in the business of canning, bottling, and distributing soft drink products and related services. During the past 12 months, Respondent, in the course and conduct of its business operations, purchased, trans- ferred, and delivered to its Cicero, New York plant syrup and other goods and materials, valued in excess of $50,000, which were transported to the plant directly from States of the United States other than the State of New York. Respondent is now, and has been at all times material herein, an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II LABOR ORGANIZATION Teamsters Local 317, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America is a labor organization within the meaning of Section 2(5) of the Act. CLINTON'S DITCH COOPERATIVE CO., INC. DECISION STATEMENT OF THE CASE MARTIN J. LINSKY, Administrative Law Judge On a charge filed on November 5, 1980, by Teamsters Local 317, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America (the Union or Local 317) the General Counsel for the National Labor Relations Board, by the Regional Director for Region 5, issued a complaint, dated May 18, 1981, and an amend- ment, dated January 25, 1982 The complaint, as amend- ed, alleges that Clinton's Ditch Cooperative Co., Inc. (Respondent or Clinton's Ditch) in violation of Section 8(a)(1) and (5) and Section 8(d) of the National Labor Relations Act (the Act) unlawfully subcontracted its trucking operations Respondent denied that it violated the Act in any way. Nine days of hearings were held in February and March 1982 and the record was closed on April 29, 1982, upon receipt and admission of additional exhibits submitted by Respondent and the Charging Party On the entire record in this case, to include posthear- ing briefs filed on July 29, 1982, by the General Counsel, Respondent, and the Charging Party, reply brief filed by the Charging Party, which I have considered over objec- tion from Respondent, and Respondent's opposition to the Charging Party's reply brief, and on my observation of the demeanor of the witnesses, I make the following III THE UNFAIR LABOR PRACTICES Clinton's Ditch was formed in 1967, pursuant to the Farm Cooperative Laws of the State of New York. It exists for the purpose of bottling, canning, and internally distributing Pepsi Cola and related products to its ap- proximately 15 members who have distribution rights within given geographical areas. The policies of Clin- ton's Ditch are determined by its 15-member board of di- rectors. Alan Woodruff, Clinton's Ditch's general man- ager, has responsibility for overseeing day-to-day oper- ations and is answerable to each co-op member. The employees of Clinton's Ditch involved in the can- ning and bottling of soft drinks have been represented by the United Steelworkers since Clinton's Ditch's Cicero, New York facility went into operation in 1968. Since at least 1970, until September 20, 1976, Clinton's Ditch di- rectly employed drivers represented by Local 317. Clin- ton's Ditch and Local 317 were parties to a series of 3- year collective-bargaining agreements, with the last agreement having a term February 2, 1975, through Feb- ruary 1, 1978. A. Trucking Operations Prior to September 20, 1976 For the 6-year period prior to September 20, 1976, Robert Venette, a Clinton's Ditch supervisor had direct responsibility over the trucking and loading operations of Clinton's Ditch, including all aspects of dispatching, loading, and supervision of drivers. Clinton's Ditch uti- lized trailers and tractors rented from Ryder. The trac- tors were marked with the Clinton's Ditch logo and CLINTON'S DITCH CO trailers with Pepsi Cola logos. Until January 1, 1975, Clinton's Ditch had a full-service maintenance agreement with Ryder for the equipment Ryder maintained the equipment at Clinton's Ditch's garage located approxi- mately 400-500 feet from the bottling plant In January 1976 Fairfield Transportation Corp purchased the equip- ment from Ryder and proceeded to lease it back to Clin- ton's Ditch At the same time Fairfield replaced Ryder in regard to the maintenance of the vehicles at Clinton's Ditch's garage, paying an annual rental of $1. The workflow for driving started with co-op members either sending in written orders or phone orders request- ing delivery of specified products at certain dates and, where requested, specified times. On a daily basis Ven- ette received shipping tickets listing the orders to be de- livered for the following day From the shipping tickets, which he received at 9 through 10 in the morning, Venette prepared a dispatch sheet on which he listed the drivers' names, destination, backhauls, and starting times. As mandated in the labor agreement , Venette assigned drivers to runs on the basis of seniority, either in terms of distance of the runs or total amount of revenues. Drivers were paid for runs on the basis of mileage and a set dollar amount for a drop or pickup In determining runs Venette had to take into consideration the drivers' ICC hours, the utilization of tandems, i e , two trailers pulled by one tractor which could only be driven on the New York State Through- way, and the geographical area for backhauls. In prac- tice, Venette utilized certain set tandem runs and single runs and was familiar with the seniority of the top 12 of the 15-20 member crew of drivers In the afternoon the dispatch schedule was posted, either in the garage or in Venette's office in the ware- house, for the drivers to ascertain their runs for the fol- lowing day If a driver had left for the day before the dispatch sheet was posted the driver was notified by phone of his next day's work. In the morning the drivers reported to Clinton's Ditch, picked up their bills of lading and other paperwork, and departed on their runs. Venette attached a yellow slip of paper to the driver's bill of lading, giving the details of backhauls. Apart from driving, drivers regularly moved empty trailers to the loading dock and moved trailers to the Throughway compound. The product itself was loaded onto the trailers by forklift operators supervised by Venette As mentioned previously, Venette directly dispatched, handled driver discipline, and otherwise had overall supervisory respon- sibility for transportation In this regard drivers regularly contacted Venette when dispatch and transportation problems arose. If drivers had hours' left after returning from a run, they picked up bills of ladings and took second trips Second trips often were not listed on the dispatch sheet. B Trivet House Meeting On September 2, 1975, Shop Steward George An- drews, along with union officers Paul Gambacordo and i By law drivers may not drive more than 10 hours a day or work more than 15 hours total a day or work more than 60 hours a week 731 John Del Guidice, at the invitation of Clinton's Ditch, met with Woodruff and Venette at a luncheon meeting at the Trivet House. At this meeting Woodruff informed Local 317 that Fairfield was taking over the trucking op- erations for Clinton's Ditch but that nothing would change, that the Ditch would supervise everything, that all actions taken by Fairfield, including the negotiation of a contract, would have to be approved by Clinton's Ditch and that, if things did not work out, Clinton's Ditch would buy the equipment back and the drivers would be reemployed directly by Clinton's Ditch. Woodruff explained that the change was being made as a first step in Clinton's Ditch owning its own trucks.2 Gambacordo died prior to the hearing in this case and obviously could not be a witness. Del Guidice, as a result of several medical problems about the time of the meeting, had no recollection of what had occurred at the meeting when he testified at the hearing. While driver and Union Steward George Andrews was incorrect as to exactly who attended the meeting, I credit his testimony that he was told by Clinton's Ditch that no substantive changes would occur when Fairfield came into the pic- ture. C Fairfield's Assumption of Transportation In January 1976 Fairfield purchased the equipment, used by Clinton's Ditch, from Ryder and leased the equipment back to Clinton's Ditch on the same basis as Ryder had At that time Fairfield replaced Ryder insofar as the maintenance of the equipment3 was concerned. On May 17, 1976, Clinton's Ditch and Fairfield en- tered into a carrier agreement. The carrier agreement provided for Fairfield to assume the Local 317-Clinton's Ditch collective-bargaining agreement and for Fairfield to provide a written release from the Union to Clinton's Ditch from the labor agreement. A written release was never obtained. In fact, Quinn, counsel for Clinton's Ditch, suggested a three-party agreement between Clin- ton's Ditch, Fairfield, and Local 317 be entered into so that Clinton's Ditch could be relieved of its obligations to Local 317 and the drivers it represented No such three-party agreement was entered into and, in fact, counsel for Local 317 made it crystal clear that it would continue to look to Clinton's Ditch as the ultimate em- ployer The carrier agreement , because of delays in securing ICC and DOT approval, did not go into effect until Sep- tember 20, 1976, at which time without any hiatus in transportation operations Fairfield took on Clinton's 2 Three drivers were informed by Clinton's Ditch prior to the takeov- er by Fairfield that the arrangement with Fairfield would not affect them Woodruff told driver James Revior that nothing would change, that it was the beginning of Clinton's Ditch owning its own fleet and that he would always have a job Driver Donald Stuper was told by Venette that under the change everything would go on the same as it always did Venette told driver Lynne Root that the operation would be the same, but that the pay would come from Fairfield 8 Fairfield maintained the equipment at the Ditch's garage paying a dollar a year garage rental The equipment retained the logo of Clinton's Ditch on the trucks and Pepsi logos on the trailers 732 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Ditch's drivers and assumed the Local 317-Clinton's Ditch collective-bargaining agreement.4 The carrier agreement and its successors entered into between Clinton's Ditch and Fairfield were terminable by either party upon specified notice, required Clinton's Ditch to purchase Fairfield's equipment upon termina- tion, and provided for periodic bargaining for rate ad- justments Compensation was based on a flat rate per case and a flat fee for backhauls. Periodically compensa- tion was increased partially based on labor figures sub- mitted to Clinton's Ditch in justification by Fairfield. Under the carrier agreement, before Fairfield periodical- ly replaced equipment, the approval of Clinton's Ditch as to specifications of the purchase was required. Prior to the actual loading of a trailer by Clinton's Ditch, Fairfield had no knowledge of the product or the weight of the trailer. In loading trailers, Clinton's Ditch attempted to get the maximum payload . Similarly, inas- much as Fairfield's compensation was based on a per- basis, Fairfield had no idea of its compensation for a run prior to loading by Clinton's Ditch. In this regard, due to bulk and weight factors, Fairfield's compensation varied depending on whether the trailer was loaded with cans or bottles. Moreover, wear and tear on Fairfield's equipment varied depending on the weight of the prod- uct carried. Fairfield had no ability under the carrier agreement to vary those factors, which influenced the profitability of its operations. Similarly, inasmuch as Fairfield was required to take whatever loads given to them and deliver the loads, as dictated by Clinton's Ditch, and as Fairfield was not informed of its work on other than a day-before basis, Fairfield was without any power to efficiently schedule work to avoid utilizing extra men or renting extra equipment or to vary weight and deliveries to minimize wear and tear on equipment or to otherwise schedule deliveries in a manner they might have deemed more efficient. Under the carrier agreement Fairfield was required to transport or pick up materials at the destination, date, and time specified by Clinton's Ditch Fairfield has no discretion or input to deviate from the above conditions. Fairfield was informed of its work on a daily basis for the next day's runs or, as often was the case, Fairfield was directed to perform the work as it arose. Drivers were assigned runs on the basis of seniority. The assign- ments themselves did not constitute much more than a ministerial act on Fairfield's part, inasmuch as several of the runs would not be run as tandems because of the lack of proximity to the Throughway, driving time , and geog- raphy. Tandems could be used for only certain locations based on consideration of geography, and backhauls were tied in to proximity to the place of delivery. day work The drivers merely continued operating as they had pre-Fairfield For at least a 2-month period from September 20, 1976, the date when Fairfield assumed the driving oper- ations, Venette trained Fairfield dispatcher Horton. Ven- ette met with Horton on a daily basis and showed him how the dispatch sheet was to be made up and how runs and backhauls were to be made Venette advised Horton of what single runs to use, what tandem combinations to use, and what times particular co-op members were to receive deliveries. During this break-in period, Venette approved or disapproved the combinations proposed by Horton When Venette disapproved of a combination and suggested a change Horton followed Venette's sug- gested changes. Venette similarly trained the Fairfield dispatchers who succeeded Horton. At some point after Fairfield was in place Venette told the Fairfield dispatch- er that he (the dispatcher) should be aware of what time the drivers actually departed so that when a co-op member called Venette to find out why a delivery was not made Venette could respond. Thereafter, Fairfield changed its operations so that it recorded the driver's actual departing time. On a daily basis Venette continued to receive shipping tickets for the next day's deliveries. Venette would there- after prepare a list of destinations, delivery times, and backhauls which he presented to the Fairfield dispatcher. As discussed, supra, Venette, until he was satisfied that the dispatcher could assign the work correctly, directly supervised the dispatchers in preparing the dispatch sheet. Following the training period, Venette regularly worked with the dispatcher in preparing the sheet Runs continued to be assigned on the basis of seniority. Often Venette added runs or made changes to the assignment sheets after the dispatcher had departed for the day and at other times. As had been the previous practice, Ven- ette added a slip to the bills of lading, which continued to be prepared by Clinton's Ditch, either specifying the product to be picked up for delivery (backhauls) or a slip for the driver to call when he arrived at the destination for further assignment.5 On occasion the dispatch sheet specified what driver should take a particular second run. Generally, however, drivers were not assigned spe- cific second runs. Instead the driver took the most lucra- tive second run on the list on the dispatch sheet on a first-in, first-out basis in accordance with his hours re- maining of driving time. Often drivers were assigned second or even third runs by Clinton's Ditch which were not listed on the dispatch sheet. In such circumstances the driver took the run without notifying the Fairfield dispatcher 6 D Transportation Under Fairfield Dispatching of drivers and day-to-day operations re- mained substantially the same under Fairfield as it had under Clinton's Ditch In this regard Fairfield never in- structed the drivers as to how to perform their day-to- 4 Many of the drivers refused to fill out new job applications, as re- quested by Fairfield, and were not disciplined for failing to do so 5 The directive for a driver to call back was not listed on the dispatch sheet, only on the slip attached to the bills by Venette 6 Although Venette testified that he almost never made a change in runs affecting a driver, unless he first cleared the change with the dis- patcher, I find this statement to be less than totally credible given the limited hours, as discussed, infra, that the Fairfield dispatcher was on the premises and the fact that drivers were regularly making deliveries and returning to Clinton 's Ditch almost on a 24-hour basis, and particularly at times when the dispatcher was gone during the workday Accordingly, I do not credit Venette's testimony in this regard although I am sure he Continued CLINTON'S DITCH CO On an average of once a week, Venette added runs during the course of a day. On the same frequency Ven- ette substituted runs for scheduled runs where Clinton's Ditch did not have the product for the original run On returning from runs Venette regularly directed drivers to take a load to East Syracuse.7 The drivers took such runs without checking with Fairfield and were paid by Fairfield for the runs. Often the Syracuse runs were not listed on the dispatch sheet. On one occasion in 1978 or 1979 driver Peck, on re- turning from a run, was asked by Venette to take a run to Auburn Peck replied that he only had 2 hours' driv- ing time left and that the trip would take in excess of that time. Peck took the run, despite the obvious illegal- ity of performing the work, after Venette told him that he had to take the load Fairfield's dispatcher, John Knatco, was present during the conversation and did not countermand Venette's directive During the 1979 strike at co-op member Syracuse Pepsi Cola, Venette directly supervised the drivers. Thus, on one occasion, driver Paul Lee, after returning from his first run, went to the driver's room to pick up bills for a run to Auburn Pepsi. When he picked up the bills, the dispatcher told him to see Venette. Lee report- ed to Venette who told him to take a load to the back of William's Market and that a person from Syracuse Pepsi would meet him there and show him where to drop the trailer. Lee proceeded to William's Market but could not locate anyone from Syracuse Pepsi Lee then called Clin- ton's Ditch in an attempt to reach Venette but Venette was out to lunch. Lee informed Clinton's Ditch why he was calling and was told that Clinton's Ditch would call over to Syracuse Pepsi to find out where the person was who Lee was to meet A few minutes later Clinton's Ditch called Lee back and said that someone from Syra- cuse Pepsi was on his way. While waiting Lee saw a fellow driver and gave him the bills for the Auburn run to take back to the garage since he would not be able to make the trip A short time thereafter Venette came to the Market and asked Lee if anyone showed up yet Lee replied that he had not seen anyone. Venette and Lee proceeded to look for a person from Syracuse Pepsi. Venette then went inside the Market and came out and directed Lee to drop the trailer Lee then went back to the garage but lost the Auburn trip On another occasion during the Syracuse strike, driver Symer returned from a run but could not find the dis- patcher He went to Clinton's Ditch to get the bills for a Syracuse run and met Venette who told him that the bill kept the dispatcher informed as to what he was doing if the dispatcher were on the premises and it was convenient to do so Moreover, as dis- cussed, infra, the dispatcher did not often express surprise when a driver explained a delay in returning as scheduled by the fact that he had been contacted by Venette to do additional work In this regard it is noted that driver Symer, when he regularly returned to the facility, at 8 30 a in , would observe Fairfield dispatcher Mosley going through the driv- ers' trip sheets and adding entries to the previous days' dispatch sheet to conform to the changes directed by Venette in the course of the day Moreover, in the course of the conversation Mosley would note to Symer, in reviewing Symer's trip sheet, that Symer had been given addi- tional rum the previous day I credit Symer's testimony in this regard 7 The East Syracuse facility of co-op member Syracuse Pepsi was lo- cated approximately 15 minutes from the Ditch's facility 733 was made out to Syracuse Pepsi, but that he should park the trailer at a grocery store off Midler Avenue and that he should see the store manager At any given time Fairfield employed only one dis- patcher The hours of the dispatcher varied. Dispatchers Horton and Knatco during their tenures worked from approximately 7 a m. to 4:30 p.m. Mosley, during most of his tenure, worked slightly longer hours. However, during the last 2 months Mosley rarely was at the prem- ises for more than 2 to 3 hours a day. The dispatchers prior to Mosley were regularly absent from the facility between the hours of 10 a.m. and noon. In addition, the dispatchers were regularly absent from the facility each Monday morning. Drivers left the facility anytime from 2 a m. to 6 p m., with the bulk of the runs starting at 4 a.m. Drivers regularly arrived at their destinations and were back to Clinton's Ditch from first runs at times when the dispatcher was off the premises Generally no other Fairfield employee other than a driver and dis- patcher would be at the premises before 2 45 a m. It is not surprising in light of this absence of Fairfield repre- sentatives that the drivers often contacted Clinton's Ditch when problems arose. The Fairfield drivers were under direct instructions to call Clinton's Ditch if they had problems in the field with the product, delivery, or pickup. Fairfield was called only if the driver encountered mechanical difficul- ties with the vehicles. In addition, drivers were instruct- ed by Clinton's Ditch to contact it for authorization before taking product back from a customer. At a time approximately 4 to 6 months after the drivers went on the Fairfield payroll, Clinton's Ditch imposed a practice, for the most part honored, of refusing to accept collect phone calls from the drivers. The drivers continued to contact Clinton's Ditch either by calling collect, having the co-op member dial Clinton's Ditch, or calling Clin- ton's Ditch but billing the call to Fairfield. As discussed, supra, often notes were attached to the bills of lading directing the driver to contact Clinton's Ditch when they arrived at a destination The driver, on arriving at the destination, would call Clinton's Ditch for instruction as to what they were to do next 8 Generally the instructions involved additional work, resulting in added compensation. Drivers regularly contacted Venette or other Clinton's Ditch representatives when they encountered difficulties ranging from wrong product, refusal of a customer to accept load, damaged product, delay in pickup or deliv- ery, errors in the bills of lading, customer requests for return of product, product unavailability, and instruc- tions as to care of product. Venette's instructions to the drivers would range from arranging for the product to be delivered elsewhere, return of the product to Clin- ton's Ditch, additional pickups, substitution of pickups, or arranging for the member to accept the load. Depend- ing on Venette's instructions, the drivers' compensation could be increased or the driver would encounter sub- stantial downtime for which he was not compensated. 8 Venette conceded that pursuant to "call back" slips he was contacted by drivers once or twice a month and that he handled the call, often without informing the dispatcher 734 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Venette's activities in resolving driving difficulties are illustrated by his intervention with American Can. In early 1980 driver Albert Peck encountered a prob- lem in picking up empty cans at the American Can facili- ty in Fairport, New York. The problem was that other customers of American Can were receiving priority in pickup, thereby causing Peck to have to remain at the fa- cility until the other customers were loaded.9 On return- ing to the Clinton's Ditch facility Peck sought out Ven- ette and related the problem. Venette responded that Peck should contact him if he encountered loading prob- lems in the future at Fairport. Thereafter, on at least two occasions, Peck called Venette while at Fairport to com- plain that he was being delayed.1 ° Following each call Venette resolved the delay and Peck was placed ahead of other trucks at Fairport. On arriving at their dispatched destinations drivers were regularly contacted by phone by Venette and in- structed by him to make an additional stop At other times, rather than direct telephone contact with the driver, Venette left messages with the place of destina- tion relating the additional change.' 1 The changes in the run were additions to the original assignments. Inasmuch as they were under instructions by Fairfield to conform to Venette's directive, the drivers did not clear Venette's instruction with Fairfield. As is apparent from the fact that drivers were often questioned by the Fairfield dis- patcher as to why they were delayed in returning and were not disciplined when they responded that Venette had made a change, it is clear that Venette's changes were made in many cases without the prior knowledge of Fairfield. Often notes were attached by Venette to the bill of lading instructing the driver to pick up a check (c.o.d delivery) at a customer's location. At some locations the customers, without any prior notification to the driver, gave the driver a check to return to Clinton's Ditch When a driver was instructed to make the delivery cod and the check was not presented on arrival the driver called Venette for instructions as to whether to make the delivery. Venette regularly went to the Fairfield garage to pick up shipping tickets12 and checks (c.o.d.'s). At times Ven- ette questioned the dispatcher as to why he had not sepa- rated the shipping tickets and returned the checks to Venette. On occasion Venette would perform Fairfield's work by separating the shipping tickets. By encountering delays at Fairport, Peak lost dnving hours which he could have utilized for other paid runs 10 Driver Boots similarly called Venette in August or September 1980 when he was delayed at Fairport Venette told Boots to call back in 30 minutes if he was not loaded in that time Venette thereafter intervened and Boots' trailer was loaded ii Venette testified that poor to contacting a driver to add a run he would first clear the additional work with the dispatcher Mosley testified that when Venette contacted him regarding having a driver deviate from an original assignment , he would tell Venette to leave word at the point of destination for the driver to make the change and that the driver would not call Mosley back for confirmation of the directive related by Venette iz On completing a run , drivers would turn in their shipping tickets to Fairfield Fairfield retained one copy of the tickets and Clinton's Ditch was given a copy As part of their normal duties, drivers, without receiv- ing extra pay, on returning from a run took their empty trailers to Clinton's Ditch's loading dock and backed the trailer to the dock if a space was available. Throughout the course of their employment with Fairfield, drivers regularly pulled loaded trailers from the dock and moved empty trailers from the yard to the dock for load- ing. This movement of trailers was referred to as "spot- ting." The drivers were paid extra per spot by Fairfield. The drivers were under standing order from Fairfield to perform whatever work, including spotting, requested by representatives of Clinton's Ditch. Drivers were regu- larly directed by representatives of Clinton's Ditch, pri- marily Venette, to spot trailers. The drivers followed such directives without clearing the directive with Fair- field, were paid by Fairfield for such work, and were not questioned or disciplined for following the directives of Clinton's Ditch to spot.13 Although the drivers spotted throughout the year, most of the spotting work took place during the winter months when Fairfield did not employ a yardman to per- form spotting. Inasmuch as a driver would have no way of knowing what trailers had been loaded or were ready for loading spotting did not take place unless the driver was specifically directed to pull a specified trailer. The principal procedure for spotting was for Venette14 to stop a driver and direct him to spot a particular trailer or trailers. Often Venette handed the driver a list of trailers to be spotted. In addition to spotting at Clinton's Ditch's facility, the drivers regularly spotted at co-op members. This circum- tance occurred if a trailer was already in the member's loading dock. In these cases the co-op member directed the Fairfield driver to move the trailer. Procedurally the driver unhooked his trailer, pulled the trailer to be moved with his tractor , and then rehooked the Fairfield trailer to the tractor for backing into the loading dock The drivers were paid extra for this work by Fairfield and performed such work without clearance or question- ing by Fairfield. 1 s In late 1977 and early 1978 Union President Thomas Hall met with representatives of Fairfield to negotiate a labor agreement to succeed the Local 317-Clinton's Ditch agreement which had been adopted by Fairfield. Bargaining was frustrated by the fact that Fairfield, prior to making any commitments with the Union concerning monetary increases, had to check with Clinton's Ditch as to whether it could meet the requested increases. Apart from monetary items, Fairfield informed the Union that Clinton's Ditch wanted specific language in the contract to ensure that the Union would not honor a picket line in the event the Steelworkers struck. Ultimately language was reached protecting Clinton's Ditch. Throughout the 13 The drivers had regularly spotted under the directive of Venette prior to the arrival of Fairfield in September 1976 14 Depending on the time of the year and the time they came back from runs drivers would perform spotting work anywhere from a couple of times a week to a couple times a month Although the Fairfield dis- patcher and employees of the Ditch would on occasion request drivers to spot, the majority of the directives to spot were made by Venette 15 The drivers were similarly paid for such spotting when employed directly by Clinton's Ditch CLINTON'S DITCH CO course of the negotiations, Clinton's Ditch, through writ- ten correspondence from Fairfield, was informed of the status of negotiations . I specifically credit the testimony of Tom Hall regarding these negotiating sessions. While employed directly by Clinton's Ditch the driv- ers, in addition to the compensation specified in the labor agreement, received two cases of low fill sodas a week, a Thanksgiving turkey, and were invited to Clinton's Ditch annual clambake i 6 Throughout the course of their direct employment by Fairfield, Clinton's Ditch continued to provide drivers with turkeys, weekly low fills, and a clambake. 17 By memorandum dated September 24, 1976, Woodruff informed the co-op members as follows- TO: ALL MEMBERS CLINTON'S DITCH COOP. CO., INC. RE- FAIRFIELD TRANSPORTATION Effective Monday, September 20, 1976, we trans- ferred our drivers over to Fairfield Transportation. As of that date the drivers became employees of Fairfield Some are bitter but they will adjust to the new employers in a short period of time. If you have any problems with any one of these drivers please contact me. Now that the change has taken place, it is even more important that at NO TIME you send back more than 75 pallets on any truck Would you kindly see to it that each truck gets some pallets but no more than 75. Have a Pepsi Day, Alan Woodruff testified that pursuant to the memorandum, members of the co-op contacted him with problems they had encountered with drivers and that he forwarded the complaints to Fairfield. The second portion of the memorandum, directing members not to return more than 75 pallets with a driver, relates to the fact that Clin- ton's Ditch paid Fairfield for a pickup if drivers returned more than 75 pallets Woodruff testified that the purpose of the directive was to avoid Clinton's Ditch becoming obligated for a pickup. By memorandum dated June 6, 1977, Woodruff in- formed co-op members as follows TO: ALL MEMBERS CLINTON'S DITCH COOP CO., INC RE: NEW DRIVERS Due to the large volume of sales, our trucker, Fairfield Transportation, has hired several new drivers. So, I thought this would be an appropriate time to advise you as to the responsibilities of each driver-old and new. 16 In 1973 prior to the entry of Fairfield on the scene the Union won an arbitration award reinstating the weekly low fills following the unilat- eral cessation of the practice by Clinton's Ditch 17 Although Fairfield became the direct employer of the drivers on September 20, 1076, Clinton's Ditch paid for the vacation that was taken by drivers during the period September 20 through December 31, 1976 735 1. He should arrive at your plant at the approxi- mate time you requested. 2 He is responsible to get the pallets of full prod- uct to the tailgate by use of a hand jack. You are not required to supply any assistance , but you may. 3. He should bring back two stacks of empty pal- lets and please remember-no more than 90 as I have to pay for more than 90 4 Any foul or abusive language should be report- ed to either Bob Vinette or myself for appropriate disciplinary action. 5. No driver is authorized to make settlements for damaged products. Contact Bob Vinette or myself in this case. If you have any problems or questions please contact me As discussed supra, Clinton's Ditch directed its mem- bers to contact it if they had complaints about the driv- ers. On receiving complaints Clinton's Ditch notified Fairfield and expected Fairfield"' to act on such com- plaints, including taking appropriate disciplinary action. As attested by Venette, Fairfield met Clinton's Ditch's expectations in following through on imposing discipline Venette explained that it was his policy to complain about drivers by first verbally discussing the matter with the Fairfield dispatcher and thereafter, if necessary, lodg- ing a written complaint. Venette explained that, if he lodged a written complaint, Fairfield would generally give him a written response and that in such cases the complained-of conduct did not repeat itself. The above- described procedure was in effect throughout the course of Clinton's Ditch's relationship with Fairfield. Set forth below, in chronological order, are the complaints that representatives of Clinton's Ditch recalled lodging with Fairfield. On June 6, 1977, Woodruff wrote Fairfield's dispatch- er Horton relating that he had a call from an individual who claimed that a driver had used foul language. Woodruff advised Horton that he should tell the drivers that even though they work for Fairfield that Clinton's Ditch name and the name of Pepsi Cola is on the vehi- cle. Woodruff concluded by suggesting that Horton "straighten out a couple of immature drivers that you have on your payroll." Woodruff explained that he wrote the letter after receiving a complaint about driver George Andrews. Thereafter Andrews received a writ- ten warning over this alleged incident, with a copy of the warning letter going to Woodruff.19 By letter, dated March 4, 1977, Andrews received a written warning from Horton for terminating his daily run at his home. Andrews met with Horton and ex- plained that he was not taking the vehicle home and that he had only been using a different Throughway exit to avoid traffic Horton said that he had received his infor- mation from Venette. Andrews then talked to Venette la Fairfield dispatcher, Mosley, testified that when he received com- plaints about a driver from Clinton's Ditch or a member he would inves- tigate, take appropriate action, and advise the caller of his action 19 After returning from the run, where the incident occurred, An- drews was questioned by Venette as to whether he had a run-in with somebody 736 DECISIONS OF NATIONAL LABOR RELATIONS BOARD and explained as he had to Horton. Venette told him not to worry that it was only a warning notice and that they assumed he was taking off because he had gotten off a different exit from that used by the other drivers. By the letter dated November 12, 1976, with a copy sent to Venette, driver Fred Hassney received a written warning from Fairfield for refusing a Syracuse run given to him by Venette The letter states: Failure to comply with the above outlined proce- dure, or to cooperate with officials of Clinton's Ditch or Fairfield Trans. Corp. will result in further disciplinary action in the form of suspension or if continued, possible dismissal. Thereafter, Andrews, Horton, Venette, and Hassney met to discuss the letter Venette and Horton took the posi- tion that Hassney had been goofing off while Andrews and Hassney replied that Hassney had already worked a 14-hour day. By letter dated June 23, 1977, Venette wrote Horton that co-op member Buffalo Pepsi had complained about driver Dale Reynolds using pallets to position his load. Thereafter, by letter, dated June 27, 1977, with copies to Woodruff and Venette, Horton issued a written warning to Reynolds. Andrews discussed the unloading problem with Venette and Venette suggested that junk pallets be used in the future On February 20, 1978, Woodruff wrote Horton to complain about Reynolds and concluded by stating that he "strongly suggest[s] that you do not send this man to the Buffalo plant any longer." Woodruff testified that by sending the letter he expected Fairfield not to send Reynolds any longer to Buffalo. In fact, thereafter, fol- lowing a meeting with Andrews, Horton, and Reynolds, Reynolds was no longer sent to Buffalo. By letter dated August 31, 1977, Venette wrote Horton complaining about Andrews damaging the prod- ucts in running to Keesville. Thereafter, by letter, dated September 6, 1977, with a copy to Venette, Horton issued a written warning to Andrews. Andrews went di- rectly to Venette and told him that the problem was caused by the manner in which Clinton's Ditch was loading the product and questioned how could he be re- sponsible in such circumstances. Venette replied, "Don't worry about it, it's just a warning letter." By letter dated February 20, 1978, Woodruff com- plained again to Horton about damaged products on Keesville runs caused by the negligence of Andrews. By letter dated January 14, 1978, Venette wrote Horton to complain about driver Walter Watkins' failure to make a pickup. Venette concluded his letter by stat- ing: Jim, I would appreciate a written reply, at your ear- liest convenience explaining how and why this situ- ation happened and the appropriate reprimand action taken with this driver. Venette elaborated that he was thereafter informed by Horton that Watkins had claimed he was sick and there- fore left the load. Venette testified that he accepted Nor- ton's explanation. In January 1977 Venette and Woodruff, along with Fairfield, participated in a meeting at the Union's hall concerning the discharge of driver Root At this meeting Venette stated that they were better off without Root. Ultimately it was agreed to reinstate Root. Periodically Clinton's Ditch sent memoranda to Fair- field instructing Fairfield to take certain actions with re- spect to the drivers Woodruff acknowledged that he ex- pected Fairfield to carry through with his memoranda and that Fairfield did, in fact, conform to the requested actions In this regard Mosley testified that it was his practice to take a copy of the memorandum from Clin- ton's Ditch, make a handwritten notation on it calling the drivers' attention to the memo, and post the memo- randum on the drivers' bulletin board. Mosley testified that he expected the drivers to conform with Woodruff's memoranda. On May 5, 1980, Woodruff wrote Mosley complaining that a loaded trailer had not been placed back to back so as to prevent theft and that Pepsi trailers had not been placed at the entrance to the driveway of Clinton's Ditch for advertising purposes .20 Following receipt of the memo Mosley took steps to ensure that the matters were taken care of. By letter dated July 21, 1980, Woodruff wrote Mosley Please advise all of your drivers that they are not authorized to bring back any product from Member plants without a return authorization slip or verbal approval from either Mr. Davies, Mr. Venette or myself. In addition to the above, Mosley recalled posting memo- randa from Clinton's Ditch directing drivers to check trailer wheels when they backed empty trailers to the Clinton's Ditch loading dock and not to drop loaded trailers on the black top in front of the plant. Clinton's Ditch had sole responsibility for loading product on the Fairfield trailers and for determining the method to secure the product on the trailer. In 1979 Clinton's Ditch utilized iron grates to hold pallets in place. The grates caused damage to drivers' clothing during the unloading process When the Union com- plained to Fairfield about the use of grates Fairfield re- sponded that it was Clinton's Ditch's problem After un- successfully attempting to contact Clinton's Ditch, the Union filed an OSHA complaint which resulted in Clin- ton's Ditch abandoning the use of the grates By letter, dated July 29, 1980, Fairfield, following a breakdown in negotiations with Clinton's Ditch for a rate increase, sent Clinton's Ditch a notice of termination effective October 31, 1980. As discussed previously, in the negotiations Fairfield had submitted documents which, inter alia, set forth labor costs as justification for the increase Following receipt of the cancellation notice, Woodruff commenced contacting other companies to make arrangements for transportation. At no point did Clinton's Ditch inform the Union of the cancellation notice or thereafter contact the Union in any manner. By 20 Once the product was loaded on the trailers Fairfield was responsi- ble for the product CLINTON'S DITCH CO letter dated October 24, 1980, Woodruff informed Fair- field that pursuant to its obligations under the carrier agreement to buy back Fairfield's equipment, Ryder would purchase the tractors and Lincoln Leaseway would purchase the trailers. Thereafter, the equipment was purchased and Ryder and Leaseway, in turn, leased the equipment back to Clinton's Ditch. This equipment, which had been used by Fairfield, continued to be marked with the Clinton's Ditch logo. By letter dated October 16, 1980, Fairfield informed the Union that effective on October 31, 1980, all bargain- ing unit members would be permanently laid off.2 i On receipt of the letter Union President Hall confronted Fred Durkin, Fairfield's President, and asked him what was going on Durkin told him that the matter was out of Durkin's hands and that Hall should talk to Clinton's Ditch. After unsuccessfully attempting to reach Wood- ruff by phone, Hall went to the Cicero facility and de- manded from Woodruff that he be kept informed about what was going on so that he could protect the employ- ees' rights. Woodruff responded that he had asked Durkin for a 30-day extension, that Durkin had not granted it, and that Hall should deal with Durkin. After speaking with Woodruff, Hall again met with Durkin who told Hall that he was "washing his hands, it's be- tween you and Clinton's Ditch." By telegram, dated October 30, 1980, the Union re- quested a meeting with Clinton's Ditch to discuss the termination of the Local 317 drivers. Clinton's Ditch made no response to the Union's demand This was at a minimum the functional equivalent of a demand to bar- gain made by Local 317 to Clinton's Ditch. E. Fairfields' Existence Fairfield was formed for the sole purpose of servicing Clinton's Ditch and at no time serviced anyone but Clin- ton's Ditch As of October 31, 1980, following the imple- mentation of the buy-back agreement with Clinton's Ditch, Fairfield had no trailers, tractors, assets, employ- ees, or existence.22 21 Fairfield, prior to the October 16, 1980 letter, never informed the Union of the uncertainty of the continuation of a relationship with Clin- ton's Ditch or requested bargaining with the Union to effectuate a reduc- tion in the monetary package so as to enable it to make a better proposal to Clinton's Ditch 22 Mosley credibly testified that the modus operandi of Fred Durkin is to form a separate corporation to service a particular client When the agreement with the client is terminated , the trucking company is dis- solved Each Durkin corporation is separately incorporated, maintains separate tax records, and individually engages in collective bargaining The collective-bargaining agreements provide for separate seniority lists and separate health and welfare contributions In this regard Mosley testi- fied that Durkin takes steps to ensure the separate identity of the various corporations On occasion when Fairfield needed extra equipment or extra drivers it would rent equipment from a Durkin or other company and ask a Durkin or other company if it had men who were available The extra men, so acquired , received the terms and conditions of the Fairfield-Local 317 agreement In this regard a man employed by a Durkin company could not be ordered to work elsewhere The singleness of the Fairfield operation is further illustrated by the fact that the Fair- field drivers who obtained employment with other Durkin companies had to apply as new applicants and did not retain or carry over any seniority or benefits accrued with Fairfield In sum , the record is inescapable that Fairfield vis-a-vis other Durkin entities constituted a single employer under the Act Fred Durkin did not testify 737 F. Global Leasing As discussed supra, following receipt of the cancella- tion notice from Fairfield, Woodruff began seeking alter- native means of transportation. On August 25, 1980, Woodruff met with Jack Bevans of Global Leasing, Inc, hereafter "Global." On August 26, 1980, Bevans sent Woodruff a written proposal which stated in part As I told you in my conversation while in Syracuse, I recommend that these drivers be put under a union contract with the Brotherhood of Railway & Airline Clerks. I believe that Local 317 will do all in their power to organize this operation as they will be losing this membership. Any rates that I am quoting you I am sure that I will be able to negoti- ate with BRAC, but I do not want to contact the Union until such time as we know that this is the way it is going to go. Sometime prior to October 14, 1980, Woodruff told Bevans to prepare to supply drivers as of November 1, 1981.23 On October 23, 1981, the Clinton's Ditch board of directors approved entering into an agreement with Global to replace Fairfield. Thereafter Clinton's Ditch and Global entered into an agreement , dated October 29, 1980.24 Interestingly enough, the agreement contains numerous provisions in- dicative of joint employer status, e.g., article 3 provides that Clinton's Ditch can cause the discharge of Global drivers; article 7 provides that Global will assume no re- sponsibility for compliance with ICC or DOT rules relat- ing to personnel; article 8 provides that Clinton's Ditch shall have the right to examine Global's personnel records; article 9 provides that Clinton's Ditch will do all dispatching and all day-to-day operations of the vehi- cles, and article 18 provides that Clinton's Ditch will not violate any collective-bargaining agreements entered into by Global and that Clinton's Ditch will indemnify Global for any monetary awards arising under the labor agreements of Global.25 Without any hiatus in delivery operations, Global re- placed Fairfield on November 1, 1980. Global did not retain any of the Fairfield drivers but utilized a similar complement of men. Global utilized the equipment leased to Clinton's Ditch 26 Clinton's Ditch had input into the selection of the Global dispatcher Venetic, as he had for Fairfield, spent a 2-month period breaking in the Global dispatcher, teaching the Global dispatcher the proce- 21 Woodruff contended that the agreement was in effect on a tempo- rary basis between October 1980 and April 1981 24 Clinton's Ditch gave no notice to the Union as to its intent to enter into an agreement with Global 21 Woodruff contended that prior to signing, he informed Bevans that any agreement he signed was subject to the approval of his attorney The October 29, 1980 agreement, as acknowledged by Woodruff, contains no such reservation Respondent contends that the October 29 agreement was never enforced as to those items indicating joint employer , status and there is no evidence that it was and that in April 1981 a new agreement was entered into between Global and Clinton's Ditch, which does not contain the aforesaid clauses indicative of joint employer status 26 Sometime in December 1981 or January 1982 Global took over maintenance responsibilities from Ryder About the same time Clinton's Ditch purchased the trailers and tractors it had leased 738 DECISIONS OF NATIONAL LABOR RELATIONS BOARD dures for dispatching runs and backhauls In all respects, including dispatching, runs, loading, daily assignments, and backhauls, Global's operations have remained identi- cal to Fairfield 1S.27 G. Discussion It is uncontested that up to September 20, 1976, Clin- ton's Ditch was the employer of its drivers who were represented by Teamsters Local 317 As such Clinton's Ditch had certain obligations toward those drivers with respect to bargaining, etc. On September 20, 1976, Clin- ton's Ditch's drivers went onto the payroll of Fairfield Fairfield adopted the collective- bargaining agreement be- tween Clinton's Ditch and Local 317 and when that agreement expired in 1978 Fairfield entered into a sepa- rate collective-bargaining agreement with Local 317. On October 31, 1980, the drivers covered by the collective- bargaining agreement between Fairfield and Local 317 were terminated, when Clinton's Ditch and Fairfield ter- minated their relationship. Clinton's Ditch thereafter sub- contracted its delivery functions to Global Leasing whose delivery functions had been unit work of its drivers/employees, at least up to September 20, 1976. The actions of Union President Tom Hall, discussed supra, in talking with Durkin and Woodruff about the termination of the drivers and sending the October 30, 1980-telegtam to Woodruff clearly constitute attempts to bargain over the termination of the drivers and its ef- fects If Clinton's Ditch continued to be an employer of the drivers represented by Local 317 after September 20, 1976, and up to October 31, 1980, then Clinton's Ditch violated Section 8(a)(1) and (5) of the Act when it unilat- erally subcontracted the unit work to Global Leasing without first honoring Local 317's request to bargain. The subcontracting effectively breached the collective- bargaining agreement then in effect between Local 317 and Fairfield. The remedy would be to return to the status quo ante, i.e., reinstatement with backpay to the terminated drivers and an order to Clinton's Ditch to bargain in good faith with Local 317 regarding the sub- contracting of the unit work. If Clinton's Ditch was not an employer of the drivers represented by Local 317 on October 31, 1980, then the complaint in this matter should be dismissed . Clinton's Ditch could only be an employer of the drivers represented by Local 317 as of October 31, 1980, if Clinton's Ditch was a joint employer of those drivers along with Fairfield. There are numerous reported cases wherein the Board has discussed whether or not an entity is or is not a joint employer with another. Several tests have evolved for determining joint employer status The Board generally looks to four principal factors in determining whether two arguably separate employers are really point employ- ers These factors are. (1) common ownership or finan- cial control, (2) common management, (3) interrelation of operations, and (4) centralized control of labor rela- tions. Holiday Inn of Benton, 237 NLRB 1042 (1978). All four factors need not be present and centralized control of labor relations has been held to be the most significant 21 Global's compensation is based on a cost-plus basis, i e , direct oper- ating costs, including the costs of the dispatcher, plus a flat fee factor. Floyd Epperson & United Dairy Farmers, Inc., 202 NLRB 23 (1973), enfd. 491 F 2d 1390 (6th Cir 1974) Clearly, Clinton's Ditch and Fairfield do not have common officers, common management officials, or common financial control. Accordingly, they are not a single employer or joint employer based on the theory of common financial control, common management, or common officers However, on the basis that there was such an interrelation or integration of operations between the two and such other evidence pointing to joint em- ployer status, I conclude that Clinton's Ditch and Fair- field were joint employers They shared or codetermined matters governing the essential terms and conditions of employment of the drivers The General Counsel, Respondent, and the Charging Party have cited virtually all the leading cases on the question of joint employer status. No one case cited by any of them is exactly comparable with the instant case. Each case can be distinguished on its facts from the in- stant case. However, an analysis of those cases and the factors that those cases hold to be indicative of point em- ployer status lead to the inescapable conclusion that Clinton's Ditch was a joint employer with Fairfield. Those factors which in the aggregate lead to the con- clusion that Clinton's Ditch was a joint employer with Fairfield can be summarized as follows. 1. Integration or interrelationship of operations. See, e.g, Land Equipment, 248 NLRB 685 (1980) Fairfield did not exist except to service the need of Clinton's Ditch to deliver its product. Venette and whoever the Fairfield dispatcher was at the time worked hand in glove on a daily basis to accomplish the task of deliver- ing Clinton's Ditch's product. Fairfield could not even purchase trucks without the approval of Clinton's Ditch. See Berkshire Concrete Corp., 238 NLRB 1658 (1978). The drivers on the Fairfield payroll drove trucks with the Clinton's Ditch logo on them. See Sinclair & Valen- tine Co., 238 NLRB 754 (1978); Browning-Ferris Indus- tries, 259 NLRB 148 (1981) 2. Participation in collective-bargaining process. Tom Hall credibly testified that during the negotiating be- tween Local 317, which he represented, and Fairfield that the Fairfield representatives continually had to con- sult with Clinton's Ditch. See Pulitzer Publishing Co., 242 NLRB 35 (1979), American Air Filter Co., 258 NLRB 49 (1981). Pipe & Foundry & Winfrey Enterprises, 247 NLRB 139 (1980). 3. Day-to-day supervision of work Even acknowledg- ing that some of the drivers exaggerated the numbers of times that Venette contacted them in the field or that they contacted Venette while they were in the field it is still crystal clear that as a practical matter the entry of Fairfield on the scene only introduced one supervisory level individual between the drivers and Venette, namely, the Fairfield dispatcher. For all practical pur- poses the drivers continued to be Venette's men See Moderate Income Management Co, 256 NLRB 1193 (1981), Pulitzer Publishing Co, 242 NLRB 35 (1979), Syufy Enterprises, 220 NLRB 738 (1975) Possibly the case with the greatest factual similarity to the instant case is Floyd Epperson, 202 NLRB 23 (1973), enfd. 491 CLINTON'S DITCH CO F.2d 1390 (6th Cir 1974) The Board found joint em- ployer status in that case on facts substantially similar to those in the instant case, United was found to be a joint employer with Floyd Epperson where the drivers, who were obstensibly employed by Floyd Epperson but hauled for United, were directed in the field by United supervisors not unlike the way in which Venette directed the drivers in this case who were obstensibly employed by Fairfield 4. Control of wages, hours, and other terms of em- ployment Joint employer status has been based on the implementation, direct or indirect, of discipline See, e.g., Syufy Enterprises, supra, and Floyd Epperson, supra In the instant case Clinton's Ditch effectively disciplined drivers and directed other terms and conditions of their employment by issuing directions on a wide range of subjects. The drivers often received orders directly from Clinton's Ditch regarding spotting and taking second runs which directly affected their wages Some factors which would point to joint employer status are not present in this case, e g , it appears that hiring and firing was done by ICC and DOT, and Fair- field handled the payroll for the drivers to include paying social security and withholding taxes. However, the presence in this case of so many of the factors which point to joint employer status in the cases cited by the parties leads to the conclusion that Clinton's Ditch and Fairfield were joint employers on October 31, 1980. Two additional points should be noted. (1) Local 317 in September 1976, in a letter to Clinton's Ditch from Local 317's attorney (a letter Clinton's Ditch never re- sponded to) clearly put Clinton's Ditch on notice that it was not releasing it from its collective-bargaining obliga- tions to Local 317 and advising further that Local 317 would continue to look to Clinton's Ditch, and (2) Clin- ton's Ditch, through its agents, led the drivers represent- ed by Local 317 to believe that the entry of Fairfield would only result in a change of the name on their pay- checks, thereby lulling the drivers into a sense of securi- ty, which proved to be false in October 1980 I conclude that the case of American Pacific Concrete Pipe Co., 262 NLRB 1223 (1962), cited in the Charging Party's reply brief, is not controlling in this case. There was no con- tract between Clinton's Ditch and Local 317 because there was no meeting of the minds between the parties that Clinton's Ditch would rehire the drivers as their direct employees if Fairfield went out of business How- ever, Clinton's Ditch clearly left the impression that this would be the case. Accordingly, it would be unjust for Clinton's Ditch in light of all the foregoing to be found anything other than a joint employer. The telegram of October 30, 1980, from Hall to Clin- ton's Ditch can only be interpreted as a timely request to bargain in light of the history of the relationship between Local 317, Fairfield, and Clinton's Ditch and in light of the manner in which Hall was told by Fred Durkin 2 weeks prior to sending the telegram that the closing of Fairfield was out of his hands and he should talk to Alan Woodruff and when Hall spoke with Woodruff, Wood- ruff told him the matter was out of his hands and he should talk to Durkin. 739 The contracting out of the work previously performed by members of an existing bargaining unit is a subject of mandatory collective bargaining Fibreboard Corp. v. NLRB, 379 U S 203 (1964) Accordingly, Clinton's Ditch, which refused to bargain about this matter with local 317, but unilaterally brought in Global Leasing to perform the unit work of delivering its product violated Section 8(a)(1) and (5) of the Act First National Corp. v. NLRB, 452 U.S. 666 (1981), relied on by Clinton's Ditch, is not controlling. When Fairfield terminated its very ex- istence the only remaining parties to the existing employ- er-employee relationship were Clinton's Ditch and the drivers represented by Local 317. While a management decision to terminate a part of its operation for economic reasons may not be a subject of mandatory collective bargaining, Clinton's Ditch in the instant case was con- tinuing the delivery portion of its operation only its de- livery of product to its co-op members would be done by drivers working for Global Leasing and not by the drivers represented by Local 317. This contracting out is clearly a mandatory subject of bargaining In light of the violations of Section 8(a)(1) and (5) the only remedy available is to return to the status quo ante insofar as possible, i.e, the drivers should be reinstated with backpay, Clinton's Ditch directed to cease and desist in its unlawful practices and to bargain in good faith with Local 317. See Hillside Manor Health Facility, 257 NLRB 981 (1981); Capital Parcel Delivery Co., 256 NLRB 302 (1981) Respondent points out that this usual Board remedy will cause problems for Clinton's Ditch. This is true and regrettable but the necessary conse- quence of violating the law. CONCLUSIONS OF LAW 1. Respondent is an employer engaged in commerce, and in operations affecting commerce, within the mean- ing of Section 2(2), (6), and (7) of the Act 2. The Union is a labor organization within the mean- ing of Section 2(5) of the Act. 3. By displacing the drivers represented by the Union, upon the expiration of its contract with Fairfield Trans- portation without permitting the Union to bargain over the decisions or its effects on these employees, Respond- ent engaged in unfair labor practices within the meaning of Section 8(a)(1) and (5) of the Act.28 4. The aforesaid unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed29 28 1 do not conclude that Respondent violated Sec 8(d) of the Act because Clinton's Ditch was not signatory to the existing collective-bar- gaining agreement between Fairfield and Local 317 and it was Fairfield who elected to terminate the existing carrier agreement between it and Clinton's Ditch in accord with the provisions of that agreement The Our- poses of the Act will be accomplished if the drivers are reinstated with backpay and both sides commence to bargain in good faith regarding a new contract between them 29 If no exceptions are filed as provided by Sec 102 46 of the Board's Rules and Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec 102 48 of the Rules, be adopted by the Board and all objections to them shall be deemed waived for all pur- poses 740 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ORDER The Respondent, Clinton's Ditch Cooperative Co Inc., Syracuse, New York, its officers, agents, successors, and assigns, shall I Cease and desist from (a) Refusing to bargain collectively with Local 317, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, as the exclusive bargaining representative of its truckdrivers who work at its Cicero, New York facility by contracting out the work of those employees or otherwise changing their wages, hours, and other terms and conditions of employ- ment without first bargaining with the above labor orga- nization. (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. 2 Take the following affirmative action which will ef- fectuate the policies of the Act. (a) Reinstate and make whole those employees dis- placed by the termination of the carrier agreement be- tween Respondent and Fairfield Transportation Corp for any loss of pay and other benefits suffered by them commencing on November 1, 1980. Backpay to be com- puted in accordance with F. W. Woolworth Co., 90 NLRB 289 (1950), with interest as set forth in Florida Steel Corp., 231 NLRB 651 (1977) (see generally Isis Plumbing Co, 138 NLRB 716 (1962)) (b) Bargain collectively with Local 317 as the exclu- sive representative of the above-described employees with respect to wages, hours, and other terms and condi- tions of employment (c) Preserve and, on request, make available to the Board or its agents for examination and copying, all pay- roll records, social security payment records, timecards, personnel records and reports, and all other records nec- essary to analyze the amount of backpay due under the terms of this Order. (d) Post at its facility in Cicero, New York, copies of the attached notice marked "Appendix. 1130 Copies of the notice on forms provided by the Regional Director for Region 3, after being signed by Respondent's authorized representative, shall be posted by it immediately upon re- ceipt and be maintained for 60 consecutive days in con- spicuous places, including all places where notices to em- ployees are customarily posted. Reasonable steps shall be taken by Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (e) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. 50 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- al Labor Relations Board "