Dayton Malleable, Inc.

DAYTON MALLEABLE, INC. GHR Foundry Division of Dayton Malleable, Inc. and United Electrical, Radio &. Machine Work- ers of America, Local Union No. 765, UE. Case 9-CA-19029-1,-2 17 June 1985 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS - HUNTER AND DENNIS On 5 February 1985 Administrative Law Judge Norman Zankel issued the attached supplemental decision.' The Respondent filed exceptions and a supporting brief. The Board has considered the supplemental deci- sion and the record in light of the exceptions and brief and has decided to affirm the judge's rulings, findings, and conclusions only to the extent consist- ent with this Decision and Order.2 - Contrary to the judge, we find that the Respond- ent did not violate the Act by refusing to bargain with the Union regarding the effects of its 21 Janu- ary 1983 plant shutdown.3 T The evidence establishes that for several years prior to the shutdown -of its Dayton, Ohio facility,, on 21 January 1983 the Respondent experienced se- rious financial difficulties. In October 1981 the Re- spondent notified the Union that only a major cap- ital investment and modifications in the parties' colt lective-bargaining agreement could "save the GHR facility."4 Thereafter, -the Respondent and the Union met on numerous occasions to discuss the Respondent's proposals. By letter of 1 October 1982 the Respondent ad- vised the Union that the Respondent's existence was "in jeopardy" because of operating losses. Thereafter, at a bargaining session on 25 October 1982, the Respondent advised the Union that a shutdown was "imminent." By letter of 29 Novem- ber 1982 the Respondent advised the Union that on approximately 14 January 1983 the Respondent's facility would shut down and that the resulting The judge's original decision issued on 9 January 1984 On 30 August 1984 the Board remanded this proceeding to the judge for issuance of a supplemental decision - 2 The Respondent has requested oral argument. The request is denied as the record, exceptions, and brief adequately present the issues and the positions of the parties No exceptions were filed to the judge's conclusions that the Re- spondent did not violate the Act by refusing to ;bargain over the decision allegedly to relocate unit work and by laying off employees following the shutdown In the absence of exceptions to these conclusions, we find it unnecessary to determine whether the Respondent effectuated only an in- definite plant shutdown, as contended by the Respondent, rather than a relocation and transfer of unit work Further, in the absence of excep- tions to these conclusions, we also find it unnecessary to consider the judge's discussion regarding the scope of Milwaukee Spring Division, 268 NLRB 601 (1984), and Otis Elevator Co, 269 NLRB 891 (1984) The Respondent and the Union were parties to a collective-bargain- ing agreement effective,1 June 1980 to 4 June 1983 707 layoff of employees would, be for an indefmite period. In this letter - the Respondent indicated that - no decision had been made whether the shutdown, would become permanent and invited the Union to discuss , the matter further if it - so desired. On 16 December 1982 the Respondent and the Union met again. On this occasion the Union demanded con- tinued recognition of the Union and asked that the Respondent continue its insurance program. There is no evidence that the Union asked the Respond- ent to bargain over any specific matter regarding the effects of the shutdown other than its demand for continued recognition and continued applica- tion of the insurance program. It is undisputed that subsequent to the Union's demand the Respondent continued in effect all contractual provisions re- garding pensions, layoffs, and other matters perti- nent to the shutdown.. . , - On 21 January 1983 the Respondent shut down its facility and shortly thereafter laid off all em- ployees. In April 1983 the Respondent and the Union commenced negotiations for a collective- bargaining agreement to succeed the expiring 1980- 1983 agreement. Based on the foregoing we find that the Re- spondent gave the Union ample and sufficient notice of the impending shutdown and fulfilled its obligation to bargain with the Union concerning. the effects of its decision. Thus, the evidence estab- lishes that over a period of many months preceding the shutdown the Respondent was open and frank with the Union regarding the likelihood of a shut- down: Indeed, in October 1982 the Respondent ad- vised the Union that a shutdown was-"imminent" and in November 1982 expressly notified the Union that a shutdown would occur the following Janu- ary. Thereafter, the Union made no specific pro- posals concerning - the effects of the shutdown on the employees and requested only that the Re- spondent honor its contractual commitments re- garding recognition and insurance. The -Respondent honored, these requests. - In short, the Respondent (1) notified the Union of the shutdown well in advance of its implementa- tion, (2) gave the Union an opportunity to bargain over the-effects of the shutdown, and (3) adequate- ly ,responded to the limited demands made by the Union during bargaining.' Although the judge found that "little, if any, evidence demonstrates [the parties],bargained over the effects of the termi- nation," it is not the Respondent's fault that the Union made few specific proposals concerning the effects of the shutdown and that little actual-bar- gaining occurred . regarding effects. See, e.g., Penta- lic Corp.; 194 NLRB 500 (1971). On the contrary, the record establishes that the Respondent duly ap- 275 NLRB No. 99 708 DECISIONS OF NATIONAL LABOR RELATIONS BOARD prised the Union of the direction of its 'overall.op- eration -that culminated in the shutdown of January 1983 • arid that the' Respondent satisfied its bargain- ing obligation to -the Union during the -"critical period as the shutdown approached. Accordingly, we shall dismiss the complaint in its entirety. ORDER • The complaint is dismissed. ' SUPPLEMENTAL- DECISION NORMAN -ZANKEL,' Administrative Law Judge. On January 9, 1984, I issued an original decision in "this case. Exceptions were- filed by the General Counsel, the Em- ployer (Respondent), • - and the Union (the Charging Party). i - . - - . On August 30, 1984, the -Board remanded -the proceed-. ing to me to issue a. supplemental ' decision on the issues in light of-the Board's decisions in Milwaukee Spring, 268 NLRB . 601 (1984); herein Milwaukee II, and Otis Elevator Co., 269 NLRB . 89,1 (1984), herein Otis IL - , . • The remand order did not mandate that the hearing be reopened .2 By letter dated September - 18, 1984,- the Em- ployer's attorney wrote me, in salient part, that the -Em- ployer "suggest[s] that the hearing .. , .. be ,reopened"-- to receive evidence ' of collective-bargaining negotiations during and since the hearing before -me, evidence-of the post-hearing use and operation of the facility from which bargaining unit work was allegedly unlawfully removed (GHR), and the facility to .which the work was -.trans- ferred (Newnam), and evidence regarding disposition of a' different unfair labor -practice charge,. Case 9-CA- 20393-1, I viewed the letter- from, the Employer 's attorney as a motion , to reopen, the, record: Thus, I ordered all -parties to, show cause , ; in -writing,. why '-or , why, not,- I, should reopen ,the record., The General Counsel and, the Em- ployer filed timely responses, due October 42,.,1984., The General Counsel opposed the motion, while the Employ- er supported'it.3 "I have considered - all the positions, -arguments, and contentions contained' in the parties' documents, _in the light of the Board's directive in its remand -order; and the record, earlier developed . Based thereon I conclude - the record, in its present state , contains all evidence germane to the issues of the - complaint to enable -I me. to :.fully i Since my decision issued; the name of. Dayton -Malleable," Inc - was changed to Amcast Industrial Corporation , , - ;",A, f, 2 Indeed, former Membei• .Zimmerman dissented , from the remand order because "there is no claim that tie`record is deficient or that the parties' positions are unknown:" (See remand 'order, August •30,` 1984,,un- published in Board volumes ) '.i' . " The above-described documents are received iri,evidence as ALJ ex- hibits, as follows ALJ Exh I The Board's remand ordei, August 30, 1984 ALJ Exh 2 The Employer's motion to reopen record, September 18, 1984 ALJ Exh 3 The Show cause order, September 25, 1984 - ALJ Exh 4 The,Employer's show cause response , October ,10, 1984 ALJ Eali 5 The -General Counsel's show cause response, October' 10, 1984 ' - I ' • . . - comply with the remand order Accordingly _the motion to reopen the record, is denied On the entire record , considered in the light of Mil- waukee II and Otis III I find as follows - 1. JURISDICTION - The Employer and Union are subject to the Act's ju- risdiction, as more explicitly appears in my original deci- sion. - II. THE FACTS I reaffirm and adopt all the factual findings and-con- clusions which appear in sections II-A and B in my original decision Those sections are incorporated herein by reference, as if fully reported in this supplemental de- cision. - III. THE ALLEGED VIOLATIONS , The Employer is alleged to have violated the Act by (1) unilaterally effecting a midterm modification of its collective-bargaining agreement with the Union by de- ciding to relocate bargaining unit work from- GHR to Newnam and causing attendant layoffs of unit employees without first affording the Union an opportunity to bar- gain.over that decision, in violation of Section 8(a)(5), (3), and (1) and independently,- in violation of Section .8(d) of the-Act; and (2) failing and refusing to bargain collectively with the Union over. the effects of the Janu- ary 21, 1983 shutdown at GHR, in violation of Section 8(a)(5)-and-(1) of the Act.4 • A Decision to Relocate In my original decision, I found: - (1) That the Employer's decision to shut down and re- locate GHR operations was motivated by a desire to ex- tricate itself from the economic terms of its current col- lective-bargaining agreement.5 • - 4 (2) That 'the Employer and the Union had engaged in extensive bargaining over the decision to shut down and relocate the work. ' • (3) • That the Employer nonetheless violated . Section 8(a)(1), (3), and (5) and Section 8(d) under the Los Ange- les Marine principles. - ' `4 The complaint was, predicated largely on the legal theories enunci- ated by the Board: in Los Angeles Marine Hardware Co, 235 NLRB 720 (1978), enfd 602 F 2d 1302 (9th Cir 1979), and Milwaukee Spring I, 265 NLRB 206 (1982) The analysis in my original decision-was based on those cases as seminal 'authority - However' in Milwaukee II, the Board overruled the principles con- tained in Milwaukee J,) concluded that the Board's Los Angeles Marine de- cision misapplied then . current Board law; and overruled that portion of Los Angeles Marine that held respondent's transfer of work from one lo- cation to another violated Secs 8(a)(5) and 8 (d) • - • • Otis=l7 likewise overruled the principle in Otis 1, 255 NLRB235, (1981), which held a iespondeiit-violated Secs 8(a)(5) and 8(d) of the Act by discontinuing part of its operations at one facility and consolidating them with work at a different facility 'The impact of Milwaukee II and Otis II will be considered, infra, in my analysis section • ' 5 In sec II,CI in'iny original decision , I enumerated the various fac- tors which led to this conclusion DAYTON MALLEABLE, INC - - • 709 B. Independent Violation of Section 8(d) In my original decision, I' found that the "facts bf• this' particular case 'support the proposition that the reloca- tion decision was not amenable to effective collective- bargaining because it represented a significant change in the Employer's operations and lies at `the very core of entrepreneurial control."' Therefore, I found no merit to the claim that the Employer violated Section 8(d).6 C. Effects Bargaining In my original decision , I found that the Employer failed to bargain with the Union over the effects of the decision to relocate, in violation of Section 8(a)(5) and (1)oftheAct - - I reaffirm, adopt, and incorporate herein, all my dis- cussion, findings, and conclusions contained in section II,C,2 of my original decision , only to the extent they are consistent with, explanatory , and supportive of my addi- tional analysis of this same issue , infra, in this supplemen- tal decision. - •IV. ANALYSIS A. The Decision to Relocate - - Factually, the instant case resembles Milwaukee 'II. In Milwaukee 'II, the parties stipulated the relocation deci- sion was economically motivated. Herein, I concluded the overwhelming evidence shows that the Employer's decision was motivated by identical economic consider- ations, and I have so found. Also, in Milwaukee II, the parties stipulated the Employer had satisfied its obliga- tion to bargain over the -relocation decision. I have found, herein, that the Union had not-requested such de- cision bargaining and, in any, event, the length, scope, and contents of the "concession" bargaining in which the parties herein engaged -effectively satisfied the Employ- er's duty to bargain over the decision (see original deci- sion). This factual posture triggers the Board's interpretation of Section 8(d),7 as explicated in. Milwaukee II. There, the Board provided a more limited meaning to Section 8(d) than had been applied in Milwaukee I, in terms of employer constraints upon changes in employment con- ditions, during the life of 'a collective-bargaining agree- ment. • Thus, under Milwaukee II, in situations where the col- lective-bargaining agreement contains no express prohibi- tion against an employer's contemplated changes in em- ployment conditions, "the employer's obligation remains 6 I now disavow the basis of my earlier findings, as it is inconsistent with the findings, that the decision to relocate was substantially based on, and motivated by, a desire to reduce labor costs Thus, it is my intention .to revoke the entirety of sec II-C (3) of my original decision and, to substitute, the discussion and analysis regarding Sec 8(d) contained, infra, in this supplemental decision - ? Sec 8(d) of the Act provides, in pertinent part, that .."to,bargain • col- lectively is the performance of the mutual obligation of the employer and the representative of the employees to meet at reasonable times, and confer in good faith with respect to wages, hours, and other terms-and conditions of employment Provided, That where there is in effect a collective-bargaining contract covering employees in an industry affect- ing commerce, the, duty to bargain, collectively shall also - mean that, no party to such contract shall terminate or modify such contract " . the general one of bargaining in good faith-to impasse over the subject before instituting -the proposed change. Milwaukee II, 268 NLRB at 602. Clearly, if an, employer satisfies that obligation, it is free, to implement its deci- i-sion unrestrained'by Section 8(d). -In Milwaukee II, the Board found it unnecessary to ad- dress the question of whether the work relocation com- prised ' a, mandatory bargaining subject, because, inter alia, of the parties' stipulation that the respondent had satisfied its obligation to bargain over the decision. Based alone on my findings that the instant Employer satisfied its bargaining -obligations, Milwaukee II dictates that the` Employer did not refuse to bargain in violation of Section 8(a)(5) and (1) and, Section 8(d) of the Act. Assuming, -arguendo, the aforementioned finding ulti- mately is not, sustained, other principles. derived from Milwaukee II and Otis II also militate against. a finding of violation. The Board's Milwaukee II discussion of the application of Section • 8(d) makes its clear' that if there is no contractual provision' identified which requires bar- gaining unit'work to remain'at a particular. location, then the Union's consent,^ normally 'required by Section 8(d) to a midterm modification, is not a prerequisite to exon- eration of an employer that effectuates changes in em- ployment conditions See Milwaukee' II, fn 16, 268 NLRB at' 605. The 'parties' relevant 'collective-bargaining agreement is'in evidence. (G.C.' Exh. 3)._ I have'searched, but in vain, for a provision' requiring bargaining-unit work to remain 'at GHR: None of the'parties has cited or referred me to • such' a prrovision. - Although the instant agreement does include recognition;` and specific wage 'and benefits provisions, I find -- their ' contents - virtually identical to similar clauses which the- Board;.in Milwaukee II, con- cluded do "not state that the functions that the unit per- forms must remain" at GHR. There;'-the Board expressly declined to' imply the -existence of a' work-preservation clause (Milwaukee •II,• 268 NLRB at 602). A fortiori, the Board' treated the' decision` as a Inonmandatory subject beyond the reach' of-Section 8(d).. .'Viewed in this light; I conclude that the Employer did not modify the GHR-Union collective-bargaining agree- ment and consequently -did not violate 'Section -8(d) of the Act when it-decided to relocate the work in question to'Newnam '. . . - - • Otis-II bears on my conclusion that the Employer sat- isfied- his bargaining, obligation regarding the relocation decision because, -in Otis 'II, the 'respondent conceded it did not bargain to a good-faith 'impasse over its reloca- tion -decision.:The Board, in Otis ,II directly treated the subject of whether economically motivated decisions to relocate -'(and' other' types''of management decisions) 'con- stitute; mandatory- bargaining; subjects.' The Board noted the-Supreme Court's decision in First. National Mainte- nance. Corp. 'V.' -NLRB, 452"U.S"666=(1981),-had -excluded management decisions such as plant relocations from, its ruling (see fn;"22, First . National) „ In Otis II, the Board declared that management deci- sions "which affect the scope, direction, or nature of the business"' are excluded from Section 8(d)-see Otis : .11, 269 NLRB at 893. `The Board then specifically enumerr 710 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ated types of decisions encompassed within the quoted phrase-see Otis II, footnote 5. Included are-decisions "to restructure or consolidate operations ... and -all other decisions akin to the foregoing." " - Herein, I conclude the facts reasonably support the conclusion, which I make, that the Employer's decision to relocate constituted a restructuring of its operations or, at least, a decision "akin" to such an activity: This conclusion is based on the following factors. First, the acquisition of Newnam cost the Employer approximately $4.2 million. Clearly, this purchase price required the Employer's investment of a significant and sizeable amount of capital (see Member Dennis' concurring opin- ion, Otis II, 269 NLRB at 895). Next, in my original-de- cision, I noted that Brunskill's November 29 letter to the Union advised that the Employer would redistribute tooling and ' equipment to other of its facilities, and would also involve realignment-of its operations. I con- cede there 'is no evidence to show the precise extent of such redistribution of work or realignment. However, it is equally clear that the record contains no challenge to the accuracy of Brunskill's statement. In this posture; I accept that statement as some evidence that the Employ- er's decision to relocate also involved more extensive re= structuring of operations than the mere transfer of work to Newnam. _ Inasmuch as the totality of the record shows the es- sence of the instant Employer's relocation decision falls within the purview of decisions which Otis II excludes from the reach of Section 8(d), the shutdown and reloca--- tion of work herein are not violative of Section 8(a)(5) and (1) of the Act.8 On all the foregoing,-I find that the Employei_,did•not refuse to bargain, in violation of Section 8(a)(5) and (1) and 8(d) of the Act, over its decision to relocate -work to Newnam. B. The Shutdown and Layoffs In 'my original decision; - I found that the January 21, 1983 shutdown and layoff of employees comprised a vio- lation of the Act. Milwaukee I and Los Angeles Marine were the bases of this finding. As noted in footnote 4, supra, both of these cases have been overruled in materi- al respects by Milwaukee IL. . - My. review of the two cases on which I previously relied shows that the rationale for the 8(a)(3) violations which resulted from the treatment accorded the unit em- ployees affected by therelocation decisionsfwas predicat- ed on a conclusion, expressed or implied , that the unlaw- ful conduct was "inherently destructive" of employees' statutory rights. However, in Milwaukee II, involving a situation which I have found parallels the instant case, the Board explic- itly concluded that "there is no factual or legal basis for finding that the consequent layoff of employees violated Section 8(a)(3)" once it has been decided that no 8(a)(5) 8 I recognize my Otis II analysis ostensibly contradicts my findings that the Employer satisfied its bargaining obligations , and that the reloca- tion decision was motivated by a desire to reduce labor costs. Thus, I emphasize that my Otis II analysis is set forth only as an alternative anal- ysis,•in the event those two conclusions are, for some reason; not ulti- mately sustained violation resulted from the employer's actions regarding the relocation decision-see Milwaukee, II, 268 NLRB, at 604. Applying that reasoning to the case at bar, I reverse my previous finding that the employee layoff herein was in violation of Section 8(a)(3) and (1) of the Act.9 C. Effects Bargaining In section III-C, supra. I reaffirmed and incorporated the contents of my original decision regarding the Gen- eral Counsel's contention that the Employer unlawfully failed to bargain over the effects of the January 21, 1983 shutdown. Some-additional discussion is necessary. In Milwaukee II, the parties stipulated that the employ- er was willing to engage in effects bargaining -with the union. The Board was not faced-with an effects bargain- ing issue. In Otis II, the complaint expressly alleged that the respondent failed and refused to bargain over the ef- fects of the decision to consolidate operations. The Board, in Otis I, found merit to these "effects" allega- tions, relying on its Otis I findings that the respondent had refused to bargain over the consolidation decision. In view of its reversal of violation findings, over'the deci- sion to consolidate, in Otis II, the Board remanded the issue of effects bargaining to its administrative law judge for further consideration. - ' Cases decided by the Board after Otis II clearly, reflect that decision has not altered an employer's obligation to bargain over the effects of its decisions to relocate or consolidate operations. In Columbia City Freight Lines, 271 NLRB 12 (1984), the Board affirmed its administra- tive law, jjudge's. finding -that, though no refusal-to-bar- gain violation occurred when the respondent decided to consolidate operations, it nonetheless was obligated 'to bargain over the effects of that decision. In Fraser Ship- yards, 272 NLRB 496 (1984), the Board affirmed its 'ad- ministrative law judge's dismissal of both the allegation that it unlawfully decided to close its machine shop and also failed to bargain over the decision's effects. In af- firming the dismissal, of these allegations, the Board rec- ognized the existence of a duty to engage-in effects bar- gaining, but-explicitly found that the respondent offered the union an opportunity to pursue effects bargaining. In my original decision herein, I found that the Union, on October 25 and again on December 16, 1982, request- ed the Employer to engage in bargaining over the effects of its decision to relocate work to Newnam. I also found that the Employer failed to comply. No party :has come forward with an assertion that anything occurred after the hearing closed which bears on this-particular issue.1° s In so holding, I have also considered that it was neither alleged, nor proved, that (1) the Employer engaged in any , conduct independently violative of Section 8(a)(1),-and (2) the record contains no other evidence of employer hostility to the Union - - . 10 In making this observation , I am mindful of the Employer's asser- tion contained in its show cause response (ALJ Exh 4) that "subsequent conduct of the Charging Party proves that effects bargaining was not sought until at the instance of your Honor was such a demand made, and that in fact the parties negotiated for a new collective -bargaining agree- ment covering all proposals made by both sides to the negotiations which efforts resulted in an impasse " First, however the Union's request for effects bargaining was designed does not, in my view, alter the evidence which shows the Employer did Continued DAYTON MALLEABLE, INC. 711 Accordingly, based on the reaffirmation of my original findings and conclusions, I again find that the Employ- er's failure to afford the,Union an opportunity to bargain over the effects of its relocation decision constitutes a re- fusal to bargain, in violation of Section 8(a)(5) and (1) of the Act. - ;REVISED AND AMENDED CONCLUSIONS OF LAWi' 1: GHR Foundry` Division of Dayton Malleable, Inc. is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. '2: United Electrical, Radio &,Machine Workers of America, Local'Union No. 765, UE is a labor-organiza- tion-within the meaning of Section 2(5) of the Act. . 3. All production and maintenance employees, includ- ing maintenance stockroom • and shop clerical employees at GHR's facility located at 400 Detrick St., Dayton, Ohio; but excluding all office clerical employees, co-op students, student engineers, technical ^ employees, profes- sional employees, guards and supervisors as defined in the Act constitute a unit appropriate for collective bar- gaining within the meaning of Section 9(b) of.the Act. 4. The Employer has not violated Section 8(a)(5) and (1) or Section 8(d) of the Act by failing and refusing to bargain with the Union over,its decision-to relocate bar- gaining unit work to Newnam. not comply with such requests before the hearing closed Second, wheth- er or not effects bargaining was pursued in connection with efforts to ne- gotiate a new collective-bargaining agreement is a matter for the compli- ance stage of these proceedings under the framework of my Order, infra, patterned after' the Board's order in Columbia City Freight Lines, supra- Neither of these arguments affects either • my denial of the motion to reopen the record or my findings regarding effects bargaining i i These Conclusions of Law are, intended to supplant those which aie contained in my ongmal ' decision - -' - 5. The Employer has not violated the Act in violation of Section 8(a)(1) and (3) by laying-off its GHR employ- ees on and after January 21, 1983. - 6. The Employer has violated Section 8(a)(5) and (1) of the Act by failing and refusing to bargain with the Union over the effects of its-decision to relocate its work to Newnam. 7. The above unfair labor practice affects commerce within the meaning of the Act. THE REMEDY Having found that the Employer engaged in a certain unfair labor practice, I find it necessary to order it to cease and desist and to take certain affirmative action de- signed to effectuate the policies of the Act. - More specifically, the Employer's failure to engage in effects bargaining shall be remedied by an order identical to that provided by the Board to remedy the same viola- tion in Columbia City Freight Lines, supra, 271 NLRB at 13. Also, the Employer shall be ordered to disseminate the results of this litigation to all affected employees by mailing copies of. a - "Notice to Employees" to them. Maxwell's Plum,,256 NLRB 211 (1981); Whitehall Pack- ing Co., 257 NLRB 193 (1981). I, find no probative evidence that the Employer's con- duct was egregious or that the Employer has a proclivity to violate the Act. Accordingly; I conclude a broad pro- scriptive order is unnecessary (Hickmott Foods), 242 NLRB 1357'(1979). Thus, the Employer shall be ordered to cease and desist from, in any like or related manner, interfering with, restraining, or coercing employees in the exercise of their Section 7 rights. [Recommended Order omitted-from:publication.]-