University Health Care Center

764 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Nurminco, Inc. d/b/a University Health Care Center and Minnesota Licensed Practical Nurses Association affiliated with American As- sociation of Licensed Practical Nurses. Case 18-CA-8375 8 March 1985 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS HUNTER AND DENNIS On 6 July 1984 Administrative Law Judge Elbert D. Gadsden issued the attached decision. The General Counsel filed exceptions and a sup- porting brief, and the Respondent filed cross-excep- tions and a brief in support thereof and in answer to the General Counsel's exceptions. The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge's rulings, findings,' and conclusions2 and to adopt the recommended Order as modified.3 ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondent, Nurminco, Inc. d/b/a University Health Care Center, Minneapolis, Minnesota, its officers, agents, successors, and assigns, shall take the action set forth in the Order as modified. 1. Substitute the following for paragraph 1(a). "(a) Refusing and failing to bargain collectively in good faith with the Union as the exclusive col- lective-bargaining representative of its unit employ- ees, by laying off unit employees without first af- fording the Union an opportunity to bargain about such layoffs." 2. Substitute the following for paragraph 1(b). "(b) Refusing and failing to bargain collectively in good faith with the Union as the exclusive col- lective-bargaining representative of its unit employ- ees by unilaterally distributing the work of laid-off unit employees to nonbargaining unit employees." 3. Substitute the attached notice for that of the administrative law judge. i We correct an inadvertent error at p 9 of the judge's decision The letter requesting information is dated 27 April rather than 22 April 2 In adopting the judge 's decision, we find it unnecessary to rely on his discussion of First National Corp v NLRB, 452 U S 666 (1981) Chairman Dotson and Member Hunter note that the Board held in Otis Elevator Co , 269 NLRB 891 (1984), that management decisions which affect the scope, direction , or nature of an enterprise are excluded from the limited area of mandatory bargaining described by Sec 8(d) of the Act As the Board stated in Otis Elevator at 892, the critical factor in de- termining whether a management decision is subject to mandatory bar- gaining 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 " Applying that analysis to the facts of this case , Chairman Dotson and Member Hunter find that the Respondent's decision to lay off four unit employees and transfer the work to nonunit employees was based in substantial part on labor costs Accordingly, in their view, the Respond- ent's decision was subject to mandatory bargaining Member Dennis agrees with the judge that the Respondent was obli- gated to bargain over its decision to lay off bargaining unit employees and distribute their work to nonbargaining unit employees Her analysis is based on her interpretation of the Supreme Court's First National Corp decision, as set forth in her concurring opinion in Otis Elevator Co, 269 NLRB 891 ( 1984) In her view, a two-step test is used in deciding wheth- er a certain management 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 deci- sion, and (2) that the benefit for the collective-bargaining process out- weighs the burden on the business " The burden elements to be consid- ered in applying the second part of the test include extent of capital commitment , extent of changes in operations , and the need for speed, flexibility, or confidentiality In the instant case, Member Dennis finds that labor costs (a factor over which the Union has control) were a sig- nificant consideration in the Respondent 's decision Turning to the burden elements, she finds that the Respondent's decision involved no capital commitment , no change in operations, and there is no evidence of a need for confidentiality Although the Respondent was faced with a se- rous budget deficit and had some need for speed and flexibility, bargain- ing with the Union was still practicable Accordingly, she concludes that the General Counsel established that "the benefit" outweighs "the burden" and that the Respondent 's decision was a mandatory subject of bargaining 3 We shall conform the judge's recommended Order and notice to the violations found 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 unilaterally lay off bargaining unit employees in order to reduce work hours per- formed by them without first affording the Union an opportunity to bargain about such layoffs. WE WILL NOT unilaterally distribute the work of laid-off bargaining unit employees to nonbargaining unit employees without first affording the Union an opportunity to bargain and. bargaining about the distribution of such work. WE WILL NOT fail or refuse to bargain collec- tively with the Union as the exclusive collective- bargaining representative of our employees and the appropriate unit described as follows: All full-time and regular part-time licensed practical nurses employed by the Employer at its Minneapolis, Minnesota facility; excluding all other employees, guards and supervisors as defined in the Act. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees in the exercise of their Section 7 rights. 274 NLRB No. 112 UNIVERSITY HEALTH CARE CENTER 765 WE WILL offer J. Stenzel, D. Heern, P. Ness, and L. Peterson immediate and full reinstatement to their former jobs or, if those jobs no longer exist, to substantially equivalent positions, without prejudice to their seniority or any other rights or privileges previously enjoyed and WE WILL make them whole for any loss of earnings and other ben- efits resulting from their discharge, less any net in- terim earnings, plus interest. WE WILL remove from our files any reference to the unlawful layoff of employees J. Stenzel, D. Heern, P. Ness, L. Peterson, and any other LPNs so laid off, and notify them in writing that this has been done and that the layoffs will not be used against them in any way. ty, the Center, products, goods, and materials valued in excess of $50,000 directly from points outside the State of Minnesota The complaint alleges, the answer admits, and I find that Nurminco, Inc d/b/a University Health Care Center (the Respondent) is, and has been at all times ma- terial herein, an employer engaged in commerce within the meaning of Section 2(6) and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED The complaint alleges, the answer admits, and I find that Minnesota Licensed Practical Nurses Association, affiliated with American Association of Licensed Practi- cal Nurses (the Union) is, and has been at all times mate- rial herein, a labor organization within the meaning of Section 2(5) of the Act. NURMINCO, INC. D/B/A UNIVERSITY HEALTH CARE CENTER DECISION STATEMENT OF THE CASE ELBERT D. GADSDEN, Administrative Law Judge. A charge of unfair labor practices was filed in Case 18- CA-8375 on August 1, 1983, by Minnesota Licensed Practical Nurses Association affiliated with American Association of Licensed Practical Nurses (the LPN As- sociation or the Union) against Nurminco, Inc. d/b/a University Health Care Center (the Respondent). On behalf of the General Counsel, the Regional Director for Region 18 issued a complaint against the Respondent on September 29, 1983, alleging that Respondent failed and refused to bargain with the Union in violation of Section 8(a)(5) of the Act, by unilaterally laying off four unit em- ployees and thereafter distributing their work to nonbar- gaining unit employees. Respondent filed an answer on October 6, 1983, deny- ing that it has engaged in any unfair labor practices as set forth in the complaint. A hearing in the above matter was held before me in Minneapolis, Minnesota, on January 16 and 17, 1984. Briefs have been received from the General Counsel and counsel for the Respondent, respectively, which have been carefully considered On the entire record in-this case and from my observa- tion of the witnesses, I make the following FINDINGS OF FACT 1. JURISDICTION At all times material herein, Respondent, a Minnesota corporation with an office and place of business in Min- neapolis, Minnesota (the Center), has been engaged in the operation of a nursing home providing residential health care services. In the course and conduct of its business operations during the 12-month period ending December 31, 1982, Respondent derived gross revenues in excess of $100,000. During the same 12-month period, Respondent pur- chased and received at its Minneapolis, Minnesota facili- III. THE ALLEGED UNFAIR LABOR PRACTICES A. Background Facts Respondent operates a nursing home providing resi- dential supportive care to resident patients, 90 percent of whose care is paid for by Medicaid. Of the remaining 10 percent of care, 6 or 7 percent is paid for by the Veter- ans Administration and 3 or 4 percent by private per- sons. In rendering its services to patients , Respondent's Center employs 360 employees including ward clerks, registered nurses (RNs), licensed practical nurses (LPNs), trained medication aides (TMAs, nurses who have completed 12 weeks' training at the Minnesota vo- cational school to give oral medication , but no intermus- cular medication. They do no documentation or charting of patients' records), nurses aides (NAs), and graduate nurses (GNs). LPNs administer oral and intermuscular medications and they document patients' charts. LPNs and TMAs change dressings on wounds , treat light bed sores, and apply ointments . LPNs monitor nurses aides, answer tele- phones, order medications, and see that patients meet their lab and treatment appointments. LPNs can do ev- erything TMAs do but TMAs cannot do everything LPNs do. A graduate nurse (GN) is a nurse who has completed graduate nurses training but has not taken or has not passed the nurses' board examination. An RN can do everything a GN, LPN, or a TMA does, and an RN does things that neither a GN, LPN, nor a TMA does. Minnesota Licensed Practical Nurses Association affili- ated with American Association of Licensed Practical Nurses, the Union herein, was certified the exclusive col- lective-bargaining representative of Respondent's li- censed practical nurses (LPNs) on March 10, 1983, in an appropriate unit described as follows• All full-time and regular part-time licensed practical nurses employed by the Employer at its Minneapo- lis, Minnesota facility; excluding all other employ- ees, guards and supervisors as defined in the Act. At all times since March 10, 1983, the Union has been the exclusive collective-bargaining representative of the 766 DECISIONS OF NATIONAL LABOR RELATIONS BOARD employees in the above-described unit, for purposes of collective bargaining with respect to wages, rates of pay, hours of employment, and other terms and conditions of employment.' B. Unilateral Actions Taken by Respondent Center and the Union's Reactions Thereto In a supervisors' meeting on March 9, 1983, it was an- nounced that budget expenses exceeded budget revenues by $179,000. Instead of a substantial layoff of employees, it was decided on March 14, 1983, that each department would offset the deficits by accepting a one-half hour re- duction in the 8-hour work shift. On March 21, 1983, 11 days after the Union was certified and, without any com- munications with the Union representing the LPNs, Donna Novotny, Respondent's director of nursing, issued a memorandum (G.C. Exh. 3) to all nursing per- sonnel. The memorandum announced that the 8-hour shift nurses would be reduced to 7-1/2 hours, and one nurse position deleted, effective April 1 through Decem- ber 31, 1983. On March 28, 1983,2 Union Representative Elliott Cohn sent a letter dated March 21 (G.C. Exh. 2) to David Briscoe, administrator of Respondent's Center, which read as follows: It has come to my attention that you have decid- ed to reduce the 8 hour shifts for LPN's and other nursing personnel to 7 and one-half hours. I would like to inform you that this is a violation of Section 8, A, 5 of the National Labor Relations Act. This action constitutes a substantial change in the conditions of employment which cannot be done unilaterally. I would like to discuss this matter so as to offset any potential problems that could grow out of this action. This problem will obviously be dealt with in ne- gotiations, so I feel it would be fruitful if we dealt with this and other related matters in that forum or we will be forced to take further action. Please contact me at your earliest convenience at (313) 647-6171. Cohn also repeated the substance of his March 28 letter in a telephone conversation with Briscoe on March 28. Briscoe simply said, "I understand exactly what you're saying, and I understood my position," but that the Center had financial problems which he described. The half-hour reduction in the 8-hour work shift was imple- mented on April 1. When Cohn did not receive a response to his March 28 letter requesting Respondent to discuss (bargain) on the half-hour reduction in the work shift taken by the Respondent, the Union filed an unfair labor practice charge with the Board in Case 18-CA-8164 (G. C. Exh. 4) on April 7. On April 8, Briscoe sent a letter (G.C. Exh. 5) to Cohn which read as follows: ' The above facts are undisputed and are not in conflict in the record herein 2 All dates herein refer to the year 1983 unless otherwise specified I have once again reviewed your letter of March 28, 1983 regarding University Health Care Center's deletion of one-half hour from an eight hour shift. I would like to discuss this situation with you either in person or via telephone. I will be available to discuss this with you at your convenience on Monday (April 11), Thursday (April 14), or Friday (April 15). If a trip to Minneapolis to discuss this situation is not feasible for you, I'd be happy to dis- cuss the situation via telephone. Please contact me at your earliest convenience at: (612) 332-4262. Subsequently, Briscoe and Cohn held a telephone con- versation on April 14, during which Briscoe made an ad- ditional general explanation of Respondent's financial sit- uation. Cohn informed Briscoe he wanted the half-hour reduction in the 8-hour shift restored until the Union and the Center bargained on the reduction. Briscoe said, "Let's bargain over it," and a bargaining meeting was scheduled at the Center for April 21. Present at the meet- ing for the Center were the Center's attorney and bar- gaining representative David A. Grant and the adminis- trator David Briscoe. Present for the Union were Union Representative Elliott Cohn, along with members of the Union's bargaining committee Shirley Erickson, Bonnie Bauer, and Jan Stenzel. Analysis and Conclusions The issue presented for determination herein is wheth- er Respondent failed and refused to bargain with the Union in good faith, in violation of Section 8(a)(5) of the Act, by unilaterally laying off four licensed practical nurses and unilaterally removing from them and distrib- uting their bargaining unit work to nonbargaining unit employees. Respondent contends it laid off the four LPNs.(Jea- nette Stenzel, P. Ness, D. Heern, and L. Peterson) for economic reasons and that it was not under a duty to bargain about its decision or its implementation and the effects of the layoffs. In support of its position, Respond- ent presented evidence establishing that it paid its RNs and LPNs $2 and some cents more than other compara- ble health care facilities in the State of Minnesota; that as a result of a late 1982 legislative change in rule 49 (regu- lating rates payable for patient care and health care fa- cilities in the State) reducing by 4 percent the amount of reimbursements payable to providers for patient care, Respondent's Center substained substantial losses totaling $1 million during the period January to July 1983. More specifically, the rate change left Respondent rendering the same level of care for $3.33 less per patient in reim- bursements. Respondent's administrative staff met on March 9 and discussed the seriousness of the financial situation. On March 10, the Union was certified the exclusive collec- tive-bargaining representative of Respondent's LPNs. On March 21, in an effort to avoid layoffs, Respondent de- cided to reduce the work hours of RNs and LPNs from 8 hours to 7-1/2 hours, effective April 1 through Decem- ber 31. UNIVERSITY HEALTH CARE CENTER The Union wrote to Respondent on March 28, advis- ing Respondent that it had learned of Respondent's deci- sion to reduce the 8-hour work shift to 7-1/2 hours It advised Respondent that such unilateral decision by Re- spondent was in violation of Section 8(a)(5) of the Act. It demanded Respondent to restore the half-hour to the 8-hour work shift and requested it to discuss its decision in an effort to avoid potential problems from the deci- sion The Union (Cohn) also called Respondent ( Briscoe) on the same date and reiterated the contents of its March 28 letter. On April 4, Respondent imposed a freeze on LPNs and RNs wage scales for 1983 and delayed the annual adjustment of the RNs' wage scale for 1 month. When the Union did not receive a response to its March 28 letter and telephone conversation with Respondent, it filed a charge in the instant case with the Board on April 7 Was Respondent Under a Duty to Bargain with the Union About Its Decisions? With respect to Respondent's contention that it was not under a duty to bargain with the Union about its May 9 layoff of LPNs, and how it utilized its internal RN and TMA staff to perform the work of the laid-off LPNs, it is noted that Respondent is not denying its obli- gation to bargain with the Union as the exclusive collec- tive-bargaining representative of the LPNs. Nor is Re- spondent denying that its unilateral actions affected unit employees' wages, hours, and other terms and conditions of employment. Instead, Respondent merely contends its unilateral decisions to lay off, effectuate the layoff of LPNs, and its utilization of RN and TMA staff to per- form the work of the laid-off LPNs, were business deci- sions motivated solely by Respondent's deteriorating fi- nancial circumstances The evidence is uncontroverted that Respondent uni- laterally laid off the LPNs and unilaterally shifted its in- ternal RN and TMA staff to perform the work previous- ly performed by the laid-off LPNs, without first notify- ing the Union, or without bargaining with the Union about either such unilateral actions. It is particularly noted that while both the decision to lay off four LPNs and the decision to transfer their work to other nonbargaining unit employees are certainly con- ditions of employment, neither condition is contained in a contract between the Union and Respondent. The Union only having been recently certified the collective- bargaining representative of the LPNs on March 10, the parties were just preparing to commence negotiations to obtain a collective-bargaining agreement. This being the case, Respondent need not have obtained the Union's consent to lay off the LPNs or distribute their work to nonbargaining unit employees prior to making and imple- menting its decisions . Thus, in the absence of a contract embracing terms and conditions of employment, Re- spondent's obligation was the general one of bargaining in good faith to impasse over the subject before institut- ing proposed changes. Milwaukee Spring, 268 NLRB 601 (1984). However, the law is well settled that an employer may not unilaterally change hours, wages, and other terms 767 and conditions of employment without notifying the Union and bargaining in good faith to impasse with the Union over such contemplated actions. NLRB v. Katz, 369 U.S 736 (1962). The law is also well settled that an employer's unilat- eral distribution of bargaining unit work to nonbargain- ing unit employees, without first notifying the Union and bargaining with the Union about such contemplated work distribution, is likewise violative of Section 8(a)(5) of the Act. Fibreboard Corp. v. NLRB, 379 U.S. 203 (1964). Under these authorities, I find that Respondent was under a duty to bargain with the Union about its unilateral layoff of LPNs and its unilateral distribution of their work to nonbargaining unit employees. However, Respondent argues that it was not obligated to bargain with the Union prior to implementing the changes because the changes were motivated by non- profitable economic circumstances. In support of its posi- tion, Respondent cites First National Corp. v. NLRB, 452 U.S. 666 (1982). There, the employer was providing housekeeping, cleaning, maintenance, and related serv- ices to commercial customers at different locations. When the weekly fee for services at one customer loca- tion became nonprofitable for the employer, the employ- er, upon notice to the customer, terminated the service and the employment of employees assigned to the cus- tomer location during the term of the contract. The Court held that the employer was not legally bound to bargain with the employees about its decision to discon- tinue service to the customer. Although the employer's decision had a direct impact upon employment, having inexorably eliminated some 35 jobs, the Court said, citing its decision in Fibreboard Corp., supra, the employer's de- cision was nevertheless a decision involving a "change in the scope and direction of the enterprise," akin to a deci- sion whether to be in business at all. The Court further noted that the dispute between the employer and the cus- tomer was about a fee for services to be paid by the cus- tomer over which the union had no control or authority. The Court further held that the employer's change was a `fundamental change in the nature and direction of the business" and, therefore, not a mandatory subject of bar- gaining. Here, unlike the employer in First National, Respond- ent did not close any part of its nursing care facility or discontinue any of its nursing services. Nor were Re- spondent's changes in the scope and direction of the health care services, or decisions akin to the decision whether to be in business at all. Respondent's decision simply involved a layoff of four LPNs and shifting its RN and TMA staff around to perform the work previ- ously performed by the laid-off LPNs. It did not reduce its patient population nor its health care quarters. Re- spondent continued to use LPNs on its nursing staff. Hence, Respondent's unilateral changes did not consti- tute a fundamental change in the nature or direction of the business, as the employer closed part of its business operation in First National, supra. In view of these dis- tinctions between the employer in First National and Re- spondent Employer herein, I conclude and find that First National Corp., cited by Respondent, is inopposite to the 768 DECISIONS OF NATIONAL LABOR RELATIONS BOARD facts in the instant case. Therefore, Respondent was under a duty to bargain with the Union about the layoffs and the subsequent distribution of LPN work to nonbar- gaining unit employees. Both decisions involved manda- tory subjects of bargaining. NLRB v. Katz, supra; Fibre- board Corp. v. NLRB, supra The 'General Counsel stated in his brief that the judge intimated a concern during the hearing that Milwaukee Spring II, 268 NLRB 601 (1984), may have had some impact upon the issues in the instant proceeding I did not mention Milwaukee Spring II or any case in particu- lar. In fact I was anticipating that Respondent contem- plated an economic defense, involving recent decisions such as Respondent did in fact cite, First National Corp., supra. The relatively new and young counsel for General Counsel also stated that the judge may put Milwaukee Spring II aside and not concern himself with any attempt by Respondent to obfuscate the issues in the instant case with Milwaukee. Suffice it to say, that in deciding cases the judge must consider possible affirmative theories of General Counsel as well as possible defensive theories of the:Respondent, and he need not be told which cases he may put aside and not concern himself with in disposing of issues before him. While the decision in Milwaukee Spring II, supra, is not applicable to the facts in the in- stant case, a reading of the decision and dicta in Milwau- kee Spring II, in conjunction with a reading of NLRB v. Katz, supra; Fibreboard Corp., supra, and First National Corp., supra, I find enlightening in attempting to make an objective determination as to whether Respondent Center herein was under a duty to bargain about its uni- lateral changes. In fact, the judge very often reads cases that were not cited by either the General Counsel or counsel for Respondent in the disposition of issues pre- sented in administrative proceedings. Did Respondent Fail and Refuse to Bargain on its Unilateral Changes? As to whether Respondent failed and refused to bar- gain with the Union on its decision to layoff and effectu- ate a lay off of four LPNs, as well as its subsequent dis- tribution of their work to nonbargaining unit employees, the uncontroverted evidence of record shows that Re- spondent did fail and refuse to bargain with the Union on its unilateral decisions. On April 14, Briscoe and Cohn had a telephone dis- cussion about the half-hour work reduction and Briscoe explained Respondent's financial situation to Cohn. Cohn said he wanted the half hour restored to the work shift until Respondent and the Union bargained about the change in work hours, and Briscoe agreed to meet and bargain with the Union about its decision and implemen- tation of the half-hour reduction in the work shift. The parties met on April 21 but as the meeting commenced, Respondent distributed a letter dated April 22 (G.C. Exh. 6) to the union committee, which it announced it would insert in the paycheck envelopes of the LPNs on the following day (Friday, April 22). The letter read in pertinent part as follows: Dear LPN Staff Member: As you are aware the majority of UHCC staff have been working 7-1/2 hour shifts (rather than 8 hour shifts) since April 4, 1983. This change in shift length was implemented in order that UHCC might better deal with the 1983 budget problems facing the long term care industry. However, because of some legal technicalities and because of the stand the Minnesota LPN Asso- ciation has taken regarding the 7-1/2 hours shifts, UHCC will be asking all LPNs to work full 8 hour shifts begining Monday, April 25, 1983. In addition to this UHCC will be restoring any lost compensa- tion you might have realized by working the 7-1/2 hour shifts (rather than the 8 hour shifts) from April 4 through April 23, 1983. This back pay compensa- tion will be included with your next paycheck which you will receive on Friday, May 7, 1983. The 8-hour shifts which will be established on Monday, April 25 will begin and end at the follow- ing times: Day shift: 7:00 A.M.-3:30 P.M. Evening shift: 3:00 P.M.-11:30 P.M. Night Shift: 11:00 P.M.-7:30 A.M. This restoration of hours and back pay compen- sation has forced UHCC to look for another way in which to deal with the 1983 budget problem. Un- fortunately, this will mean that at least five LPN staff will be laid off. Cohn immediately protested Respondent's enclosing the April 22 letter in the LPNs' paycheck envelope, and stated that Respondent's decision to lay off would consti- tute another unfair labor practice, in violation of the Act. He said, since Respondent did not mention layoffs in the April 8 letter nor in their telephone conversation on April 14, the announced layoffs in the April 22 letter constituted a new proposal, and he requested Respondent to continue the half-hour reduction in the work shift until the Union could obtain more information on Re- spondent's financial situation, and formulate a position on its options (reduced hours or layoffs). Respondent did not deny or verbally assent to Cohn's request but it did not insert the April 22 letter in the paycheck envelopes of the LPNs, and the Union was thereby led to believe Respondent agreed with its request to await bargaining on the issues. In a letter to the Respondent dated April 22, Cohn re- quested specific information concerning the duties, work schedules, work hours, and rates of pay of the LPNs. Cohn agreed to Respondent's announcement that it would pay the LPNs backpay for the period their work hours were reduced, provided it retained the half-hour reduction in the work shift as long as other nonunit em- ployees were likewise affected, until the Union and Re- spondent bargained on the contemplated layoffs versus the half-hour reduction in the work shift. In a letter to the National Labor Relations Board dated April 26, the Union withdrew the charge protest- ing the half-hour reduction in the work shift, filed on April 7 in Case 18-CA-8375. UNIVERSITY HEALTH CARE CENTER 769 Cohn (the Union) received a letter from the Respond- ent dated April 29, notifying the Union that, due to eco- nomic hardship occasioned by legislative reimbursement restraints, and the Union's insistence on restoring the half-hour reduction in the work shift with backpay, Re- spondent would be laying off five LPNs on May 9. Re- spondent also advised the Union that it was invited to bargain about its layoff decision. In surprise, Cohn imme- diately called Briscoe and reminded him that the Union had agreed that Respondent continue the half-hour re- duction in the work shift until the Union received the fi- nancial and individual work information it requested and communicate its position to Respondent. However, Bris- coe again advised he would be laying off five LPNs on May 9 and such layoffs would constitute 300 work hours. Briscoe reiterated his layoff decisions in a letter to the Union dated May 2. News about the upcoming layoffs circulated through- out the LPN staff unit and on May 5, Jan Stenzel, along with Shirley Erickson and Bonnie Bauer, requested a meeting with Administrator Briscoe. Briscoe agreed, and he along with Nursing Director Novotny, and her assist- ant, Ellen Trumper, did meet with Stenzel, Bauer, and Erickson at 3 o'clock that afternoon. Stenzel testified without dispute that she stated it was her understanding in the last meeting that Respondent would retain the half-hour reduction in the 8-hour work shift, and that there would be no layoffs until the parties had an oppor- tunity to bargain about the subject (reduced hours or layoffs) Briscoe asked them why the LPNs filed an unfair labor practice charge. Stenzel said because the Center's unilaterally instituted half-hour reduction in the work shift was unlawful. Briscoe said he had stuck his neck out twice as far as he should have on two occa- sions, and he was not going to consider allowing LPNs to work 7-1/2 hours. Instead, he said he had decided to lay off jive LPNs and he would stand by his decision. Stenzel requested Briscoe to postpone his layoff deci- sion until the meeting with Cohn on May 9, but Briscoe said, "No," he had made his decision. Stenzel requested alternatives such as not filling current and future sched- uled LPN vacancies. Briscoe said the he was not going to allow the LPNs to have control,- that he was taking charge, and that he was not going to allow the LPNs to have any say in the matter. Consequently, as previously announced by Briscoe, in layoff notices stating that due to financial problems it is necessary to reduce the staff, four LPNs were laid off on May 9. They were. J. Stenzel; P. Ness; D. Heern; and L. Peterson. Cohn learned about the LPNs' layoffs through Erick- son. During the negotiations session in late May, he told Respondent's personnel director, Virginia Betlach, and Respondent's negotiator, Grant, the first priority for dis- cussion was the LPNs' layoffs. Grant said he was not discussing the layoffs, that the Center had made a decision and "they were going to take the bull by the horn and handle it themselves." The parties then proceeded to ne- gotiate other issues. Conclusions Although Respondent did not insert its April 22 letter in the paycheck envelopes of the LPNs on April 22, the record evidence is clear that on April 29, Respondent nevertheless notified the Union that, due to legislative re- imbursement restraints, and the Union's insistence on res- toration of the half-hour to the work shift, it was going to lay off five LPNs on May 9. Under these circum- stances the conclusion is inevitable that Respondent made its layoff decision on April 29, without notifying the Union or affording it an opportunity to bargain with it, as Respondent was legally obligated to do. Moreover, when the Union (Cohn) called and remind- ed Respondent that the Union understood that Respond- ent would not lay off until it bargained with the Union, Respondent reiterated its announced layoffs and thereaf- ter repeated it in its May 2 letter to the Union. Also, when the Union's bargaining committee members met with Respondent on May 5 and reminded Respondent it had intimated it would not lay off LPNs until the parties had an opportunity to bargain about the issue, Respond- ent announced that it was not going to reconsider return- ing the half-hour reduction in the work shift. It further announced that it had decided to lay off five LPNs.i On May 9, Respondent carried out its announced layoffs by laying off LPNs Stenzel, Ness, Heern, and Peterson. This Respondent did while knowing the Union was re- questing information to analyze and formulate a bargain- ing position. When Union Representative Cohn asked Respondent to discuss the layoffs during the next negotiation session in late May, Respondent (Grant) refused to discuss the layoffs and said the layoff decision had been made by Respondent and Respondent was going to handle the problem itself. Although Respondent argues that it invit- ed the Union to bargain about its decision or the effects of its decision, the evidence is clear that the Respondent first presented the Union a fait accompli. In fact Re- spondent's letter of April 22 clearly indicates that Re- spondent had already decided to issue its notice of layoff in the paycheck envelopes of the LPNs on April 22. It is therefore clear that Respondent notified the Union but failed and refused to bargain with it about its May 9 layoffs, and it unequivocally refused to bargain about the layoff decision either before or subsequent to its effectua- tion. Nor did the Respondent make any clear statement that it was offering to bargain about the effects of its de- cision The layoffs of the LPNs necessarily included the subject of Respondent's distribution of the work previ- ously performed by the laid-off LPNs to nonbargaining unit employees. Consequently, Respondent's failure and refusal to bargain with the Union about the layoff of the LPNs, as well as its distribution of their work to nonunit bargaining employees, constituted violations of Section 8(a)(1) and (5) of the Act. Based on Respondent's uncontroverted and credited evidence of record, I am persuaded, without any reserva- tions, that the evidence of Respondent's financial losses and problems is valid. The General Counsel made no effort to refute that evidence, but correctly maintained that Respondent was, nevertheless, under a statutory duty to bargain with the Union, before unilaterally de- ciding and implementing the layoffs and distributing the work to nonbargaining unit employees. In fact, if Re- 770 DECISIONS OF NATIONAL LABOR RELATIONS BOARD spondent had undertaken its statutory obligation to bar- gain with the Union, the Union might have capitulated on the changes, or Respondent could have first bar- gained to impasse, and then lawfully implemented its changes. In Ozark Trailers, 161 NLRB 561, 566 (1966), the employer violated Section 8(a)(5) and (1) of the Act because, during the term of the contract, it unilaterally subcontracted work previously performed at its Ozark plant. The Board explicitedly stated: In the first place, however, as we have pointed out time-and-time again, an employer's obligation to bargain does not include the obligation to agree, but solely to engage in a full and frank discussion with the collective-bargaining representative in which a bona fide effort will be made to explore possible al- ternatives, if any, that may achieve a mutually satis- factory accommodation of the interest of both the employer and the employees. If such efforts fail, the employer is wholly free to make and effectuate his decision [161 NLRB at 568.] In the instant case, although Respondent' s unilateral changes were not midterm contract changes, the obliga- tion to first bargain with the Union is no less mandatory than it was for the employer in Ozark. Here, the Union requested to discuss or bargain with the Respondent about the layoff on more than one occasion and Re- spondent told the Union the decision had been made. When Respondent agreed to bargain with the Union about the changes, Respondent subsequently refused to discuss the subject when the parties met to do so on May 21. Respondent's refusal was clear, general, and un- equivocal, and I find no reason in the record to conclude that Resondent's refusal did not apply to bargaining about its unilateral decisions, as well as the effects of those decisions. The complaint does not allege that Re- spondent failed and refused to furnish information re- quested by the Union. Nor does the evidence establish such a failure and refusal. Instead, the evidence shows Respondent was furnishing information requested by the Union. Counsel for Respondent contends the Union had ade- quate notice of Respondent's decision to lay off five LPNs and it failed to request bargaining on the Respond- ent's decision. In support of its position, Respondent cites Globe-Union, 222 NLRB 1081 (1976). However, I find the facts in the Globe case quite distinguishable from the facts in the instant case and, therefore, inapplicable as controlling here. Counsel for Respondent also argues that if Respondent is found to have violated Section 8(a)(5) of the Act, the remedy should be one as that applied in Hillcrest Furni- ture Mfg. Co., 253 NLRB 72 (1980), often referred to as a "Transmarine Remedy." Transmarine Navigation Corp., 170 NLRB 389 (1968). However, it is particularly noted that the employer in Hillcrest laid off all employees and closed business operations, which made the remedy ap- plied therein the only reasonable alternative. Here, Re- spondent did not lay off all LPNs and close its health care operation. In fact, Respondent not only retained LPNs in its employ, but also employs LPNs on a tempo- rary basis. The evidence also shows that LPN vacancies do occur as a result of resignations and terminations. Under such circumstances I find that a Transmarine Remedy in the instant case would be less than adequate to remedy Respondent's unlawful conduct. IV THE REMEDY Having found that Respondent has engaged in certain unfair labor practices, I shall recommend that it be or- dered to cease and desist therefrom and to take certain affirmative action designed to effectuate the policies of the Act. Having found that Respondent failed and refused to bargain with the Union as the exclusive collective-bar- gaining representative of its licensed practical nurses (LPNs) by unilaterally deciding and laying off bargain- ing unit employees in order to reduce work hours per- formed by them, and unilaterally deciding and actually distributing the work of the laid-off employees to non- bargaining unit employees, without affording the Union, a reasonable opportunity to bargain about the changes, Respondent has interfered with, restrained, and coerced employees in the exercise of their rights protected by Section 7, in violation of Section 8(a)(1) of the Act and, by the same conduct, Respondent has failed and refused to bargain collectively in good faith with the duly certi- fied representative Union of its employees, in violation of Section 8(a)(5) and (1) of the Act, the recommended Order will provide that Respondent cease and desist from engaging in such unlawful conduct, and that it offer the laid-off employees full reinstatement and make them whole for any loss of earnings they may have suffered within the meaning and in accord with the Board's deci- sion in F. W. Woolworth Co., 90 NLRB 289 (1950), and Florida Steel Corp., 231 NLRB 651 (1977), 3 except as specifically modified by the wording of such recom- mended Order. Because of the character of the unfair labor practices herein found, the recommended Order will provide that Respondent cease and desist from, or in any like or relat- ed manner interfering with, restraining, or coercing em- ployees in the exercise of their rights guaranteed by Sec- tion 7 of the Act. NLRB v. Entwistle Mfg. Co., 120 F.2d 532, 536 (4th Cir. 1941). On the basis of the above findings of fact and on the entire record in this case, I make the following CONCLUSIONS OF LAW 1. The Respondent, Nurminco, Inc. d/b/a University Health Care Center, is an employer engaged in com- merce within the meaning of Section 2(6) and (7) of the Act. 2. The Union, Minnesota Licensed Practical Nurses Association affiliated with American Association of Li- censed Practical Nurses, is and has been at all times ma- terial herein a labor organization within the meaning of Section 2(5) of the Act. 3. By unilaterally deciding and laying off LPN bar- gaining unit employees in order to reduce work hours 3 See generally Isis Plumbing Co, 138 NLRB 716 (1962) UNIVERSITY HEALTH CARE CENTER 771 performed by them, and unilaterally deciding and actual- ly distributing work of the laid-off unit employees to nonbargaining unit employees, without first affording the Union an opportunity and bargaining with the Union about such changes, Respondent has interfered with, re- strained, and coerced its employees in the exercise of the rights guaranteed them by Section 7 of the Act, in viola- tion of Section 8(a)(1) of the Act. 4. By unilaterally deciding and laying off LPN bar- gaining unit employees in order to reduce work hours performed by them, and unilaterally deciding and actual- ly distributing work of the laid-off unit employees to nonbargaining unit employees, without first affording the Union an opportunity to bargain and bargaining with the Union, Respondent has failed and refused to bargain col- lectively in good faith with the representative of its em- ployees, in violation of Section 8(a)(5) and (1) of the Act. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed4 ORDER The Respondent, Nurminco, Inc. d/b/a University Health Care Center, Minneapolis, Minnesota, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Interfering with, restraining, and coercing employ- ees in the exercise of their protected Section 7 rights, by unilaterally deciding and laying off bargaining unit em- ployees in order to reduce work hours performed by them, without first affording the Union an opportunity to bargain and bargaining with the Union. (b) Refusing and failing to bargain collectively in good faith with the Union as the exclusive collective-bargain- ing representative of its unit employees, by laying off LPN employees without first affording the Union an op- portunity to bargain and bargaining with the Union (c) 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 is deemed necessary to effectuate the policies of the Act (a) Offer immediate and full reinstatement to licensed practical nurses J. Stenzel, D. Heern, P. Ness, L Peter- son, and any other LPNs similarly laid off, to their former positions or, if such positions no longer exist, to substantially equivalent positions without prejudice to their seniority or other rights previously enjoyed, and make them whole for any loss of pay suffered by reason of their layoff, with interest, in the manner described in the section of this decision entitled "The Remedy." (b) Offer to, and on request, bargain collectively with the Union as the exclusive collective-bargaining repre- sentative of the employees in the appropriate unit de- scribed as follows- All full-time and regular part-time licensed practical nurses employed by the Employer at its Minneapo- lis, Minnesota facility, excluding all other employ- ees, guards and supervisors as defined in the Act. (c) Remove from Center files any reference to the un- lawful layoff of employees J. Stenzel, D. Heern, P. Ness, L Peterson, and any other LPN so laid off, and notify them in writing that this has been done and that the lay- offs will not be used against them in any way (d) 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. (e) Post at Respondent's health care center in Minne- apolis, Minnesota, copies of the attached notice marked "Appendix."5 Copies of the notice, on forms provided by the Regional Director for Region 18, 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 conspic- uous places including all places where notices to employ- ees are customarily posted Reasonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. (f) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply IT IS FURTHER ORDERED that the complaint be dis- missed insofar as it alleges violations of the Act not spe- cifically found herein 4 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 S 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 "