American Press, Inc.

AMERICAN PRESS American Press, Inc. and Calvin L. Casteel, and De- troit Toledo Local No. 289 , Graphic Communi- cations International Union . Cases 7-CA-23186 and 7-CA-23201 24 June 1986 DECISION AND ORDER BY MEMBERS DENNIS, JOHANSEN, AND BABSON On 18 April 1985 Administrative Law Judge Walter J. Alprin issued the attached decision. The Respondent filed exceptions, a supporting brief, and an answering brief. The General Counsel and Charging Party Local 289 filed answering briefs, and Local 289 joined in the General Counsel's cross-exceptions and supporting brief. The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. 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 only to the extent consistent with this Decision and Order. 1. We agree with the judge's conclusion that the Respondent, American Press, Inc. (American Press), is a successor employer to Rite-Way Press, Inc. (Rite-Way). The judge found, with record sup- port, that the Respondent is substantially in the i 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 In the section of his decision entitled "Acquisition of Rite-Way by Stu- dios," par 5 , the judge states that the 12 August 1983 "Asset Purchase Agreement" between Rite -Way, as seller, and American , as purchaser, in- cluded "all leases, purchase orders, customer orders, sales and other con- tracts, all trademarks, trade names, etc, and all customer lists and other data relating to 'the purchased assets, business and operations of the Seller Although the body of the Asset Purchase Agreement provides that the transaction include such items, we note that these items are spe- cifically excluded by the Agreement's exhibits The conversation between Denaro and Casteel referred to in the judge's decision in par . 2 of sec . II,C,2,c, entitled "Not Hired by Amen- can Press," occurred on 24 October, not 13 October, 1983. The last sen- tence of par 7 of sec III,B of the judge's decision , entitled "Successor- ship," should be corrected to read "and under the circumstances Young acted reasonably in believing that Reich's thoughts accurately reflected those of American " In sec l1,D of his decision , entitled "Bargaining Demands on Ameri- can Press," the judge incorrectly stated that the production work of American is performed by 10 employees , including an employee named Nashotka The Respondent has never employed an employee named Na- shotka The Respondent's initial production work force complement con- sisted of eight employees, including two former Rite-Way employees and union members, Rye and Drury, and employee Hamilton, who was a union member hired from the outside 2 The Respondent has requested oral argument This request is denied as the record , exceptions, and briefs adequately present the issues and the positions of the parties 937 same printing business as was Rite-Way; that the Respondent services a substantial number of Rite- Way's former customers;3 that with the exception of some cosmetic changes and small additions of equipment, the Respondent uses the same plant, the same machinery, the same equipment, and the same methods of production as was used by Rite-Way; that the same printing services are offered and the same printing product is manufactured by the Re- spondent as was offered and manufactured by Rite- Way; and that, within the bargaining unit, the same jobs exist under the same working conditions at American Press as they existed at Rite-Way. In concluding that the Respondent is a successor employer to Rite-Way, the judge specifically found, and we agree, that but for unlawful consid- erations, the continuity of the predecessor's em- ployee complement would have been maintained. The Respondent's initial production work force complement consisted of eight employees, two of whom were former Rite-Way employees and union members, Ed Rye and Ray Drury. As discussed infra, the Respondent discriminatorily refused to hire seven former Rite-Way employees in violation of Section 8(a)(3) and (1) of the Act. Thus, we find that but for the Respondent's unlawful conduct, the majority of the work force would have been com- posed of employees of the predecessor employer. It is well established that where the other requisite elements for finding successorship are present, a new owner's failure to hire its predecessor's em- ployees will not defeat a claim of successorship if such failure is shown to have been motivated by the former employees' union affiliation.4 Accord- 2 In sec II,E of his decision, entitled "Business Operations of Amen- can Press After Agreement With Rite-Way," the judge misstated that the sales revenues attributable to former Rite-Way customers during the Re- spondent's first year of operation represented $1,521,800 This figure rep- resents the overall total sales by the Respondent in its first year of oper- ation, October 1983 through September 1984, not the amount of sales made to former Rite-Way customers during that same period. In its brief the Respondent concedes that during the first year of operation, 63 per- cent of its billings came from its corporate parent, American Center Stu- dios, Inc, and 37 percent of its billings came from sales to former Rite- Way customers and new customers The Respondent contends that during its first year of operation, its total billings to former Rite-Way cus- tomers totaled less than $568,900 and that it was able to secure only ap- proximately 65 percent of Rite-Way's billing level to its former custom- ers The Respondent also has excepted to the judge's "number of ac- counts billed" analysis, where the judge concluded that during its first year of operation American Press billed an average of 25.6 customers per month, of which an average 20 7, or 81 percent, were former Rite-Way accounts The Respondent contends this analysis is misleading because many of its customers are billed through American Center Studios Whether the customer continuity issue is viewed in connection with the Respondent's arguments or the judge's findings, it is clear there is a sub- stantial continuity of customers, which we note is only one factor in eval- uating successorship See Mondovi Foods Corp, 235 NLRB 1080 (1978) 4 CJB Industries, 250 NLRB 1433 (1980), Love's Barbeque Restaurant No 62, 245 NLRB 78 (1979), enfd in relevant part 640 F 2d 1094 (9th Cir 1981) 280 NLRB No. 109 938 DECISIONS OF NATIONAL LABOR RELATIONS BOARD ingly, we adopt the judge's conclusion that the Re- spondent, as a successor employer, violated Section 8(a)(5) and (1) of the Act by refusing to bargain with Local 289. 2. The General Counsel has excepted to the judge's failure to find that the Respondent also vio- lated Section 8(a)(5) and (1) of the Act by unilater- ally establishing terms and conditions of employ- ment which differed from those to which Rite-Way was contractually bound. We find merit to the General Counsel's exception. We recognize that under NLRB v. Burns Security Services, 406 U.S. 272 (1972), a successor employer is ordinarily free to set initial hiring terms without preliminary bargaining with the incumbent union. Where, however, "it is perfectly clear that the new employer plans to retain all of the employees in the unit," the successor must consult the union before altering the terms and conditions of employment.5 Here, any uncertainty about what the Respondent would have done absent its unlawful purpose must be resolved against the Respondent, because it cannot be permitted to benefit from its unlawful conduct. When a successor employer has discrimi- nated in hiring, it can be inferred that substantially all the former employees would have been retained absent the unlawful discrimination.6 We find, infra, that the Respondent unlawfully discriminated against the predecessor's former employees by re- fusing to hire them because of their union affili- ation. Accordingly, we find that absent its unlawful purpose, the Respondent would have retained sub- stantially all these employees and therefore the Re- spondent was not entitled to set initial terms of em- ployment without first consulting the Union. The record indicates that the Respondent paid employees Rye and Drury different wages from those they received from Rite-Way. Moreover, American Press has not made payments into the Union's fringe benefit funds. Accordingly, we con- clude that the Respondent unilaterally changed terms and conditions of employment in violation of Section 8(a)(5) and (1) of the Act. 3. We also agree with the judge's finding that the Respondent violated Section 8(a)(3) and (1) of the Act by its discriminatory refusal to hire employees Calvin Casteel, Charlotte Casteel, Stella Roulette, Robert Bolda, John Mohan, Gale Willard, and Norman Wilson. We disagree, however, for the reasons discussed below, with the judge's conclu- sion that the Respondent violated Section 8(a)(3) with respect to employee Roger Young. The judge's finding that the Respondent discri- minatorily refused to hire former Rite-Way em- Burns, supra at 294-295 Love's Barbeque, supra at 82 ployees was based on credited statements by the Respondent's representatives as well as the Re- spondent's methods and pattern of hiring. The judge credited former Rite-Way President and Business Manager Harrison Parker's testimony that during a meeting of Rite-Way and American Center Studios representatives to discuss the possi- ble purchase of Rite-Way, American Center Stu- dios Representatives Hunter and Decker said, in re sponse to Rite-Way Co-Owner Denaro's inquiry wheather the fate of Rite-Way employees, that they did not want the Union involved and did not want to be a union company. Further discussions were held with Hunter, Decker, and Rite-Way rep- resentatives culminating in an arrangement where- by Rite-Way was sold to Hunter and Decker, who formed a new corporation, the Respondent, Ameri- can Press, Inc., with former Rite-Way owners Denaro and Augustyn each purchasing 9-1/2 per- cent of the outstanding stock of the corporation. American Press agreed to lease Rite-Way's build- ing owned by a co-partnership of Rouls, Bek, Denaro, and Augustyn, the original four Rite-Way owners. Prior to the execution of the purchase docu- ments, American Press placed two "blind" classi- fied ads beginning 30 July 1983,7 one for a press- man, the other for a camera and stripping person. Identical ads were placed in another newspaper for 3 days appearing 5, 6, and 7 August. Although the parties had reached tentative agreement in July, and American Press had begun efforts to hire employees, neither Rite-Way nor American Center Studios communicated any notice of the purchase to the Union or the employees at this time. During the period from January to August, Denaro had been meeting with the Union to nego- tiate a new collective-bargaining agreement. On 5 August, Union Representative and Vice President Gerry Deneau received an anonymous phone call from a woman who said that Rite-Way was going to be taken over by American Press, closed down for a few weeks, and reopened to get rid of em- ployees and the union contract. In a 12 August col- lective-bargaining meeting in response to Deneau's inquiry about whether the substance of the anony- mous phone call was true, Denaro assured Deneau that it was not true and that he had turned down two purchase offers because such offers did not in- clude the Rite-Way employees. Denaro admitted in his testimony that he denied the existence of a transaction in progress with American Press even though he had accepted the American Press offer v All dates are to 1983 unless otherwise indicated AMERICAN PRESS at this time. The Asset Purchase Agreement be- tween Rite-Way and American Press and Denaro's and Augustyn's employment contracts with Ameri- can Press were executed on 12 August. On 30 August Rite-Way's attorney told the Union that Rite-Way was closing its operation. The Union, Denaro, and Rite-Way's attorneys met on 2 September to discuss the closing. The judge found that at the meeting Rite-Way Attorney Boyer told Deneau and Union Steward Wilson that the plant was closing and would not operate anymore. The judge further found that Boyer told the union rep- resentative that Rite-Way was trying to sell its equipment, but the only piece on which it had a deal was the Heidelberg Press . Deneau told Denaro that he heard that the plant was going to be reopened and that Denaro had a job with the new owners . Denaro told Deneau this was not true. At this meeting Deneau asked Boyer for in- formation and copies of the purchase agreements relating to the sale of machinery ; however, Deneau did not receive the Asset Purchase Agreement until January 1984. The judge credited Denaro's testimony that Deneau was told at the 2 September meeting that the purchaser of the Heidelberg Press was "American Press, Inc." or "American Center Studios" and that Hunter was the individual to contact. The record demonstrates that notice by Rite- Way and hirings by American Press differed sig- nificantly for nonbargaining unit office and sales personnel and bargaining unit production employ- ees. Secretary and bookkeeper Belinda Young- Werner and estimator Sherwood Kogelshatz, the only two Rite-Way office employees, were inter- viewed and offered employment by American Press prior to Rite-Way's closing . Kogelshatz filled out his application on the day he began working at American Press. Young-Werner was not asked to fill out an employment application until after she had started to work for American Press. All Rite-Way sales personnel were contacted by American Press in late August to discuss employ- ment opportunities. Such contacts occurred before the Union had been notified of Rite-Way's closing or the transaction with American Press. Although American Press was interviewing and offering em- ployment to all nonunit employees , unit employees were not similarly apprised of American Press' ex- istence as a purchaser of Rite-Way or the opportu- nity for employment. All sales personnel associated as employees or brokers with Rite-Way were hired by American Press , including Pat Byrne and Chuck Reich. Both Byrne and Reich submitted their employment applications on the day they were hired. Thus, all nonunit employees were con- 939 tacted by American Press and received job offers before Rite-Way closed. Denaro formally notified unit employees that Rite-Way was closing about 1 week before the 12 September closing . When questions were asked about whether the Company had been sold, Denaro responded, "I have no further comments that I can give you or information about this than we are closing the business." Employee Willard asked Denaro what Denaro and Augustyn were going to do. Denaro responded that he and Augus- tyn did not know what they were going to do, that they did not have jobs, and that they were going to take care of the closing first. Ed Rye and Ray Drury, highly skilled pressmen who worked as a team operating the Heidelberg Press, were the only unit employees hired by the Respondent. Denaro approached Rye and Drury about employment before Rite-Way closed. The judge found, and we agree, that their hiring was prompted by their particular skill and expertise on the most important and valuable piece of equip- ment at the printing shop. In early October, Roger Young, a layout stripper at Rite-Way, was contacted by fellow former em- ployee Reich, who was then employed as a sales- man by American Press. Reich told Young that Denaro and Johnson, the Respondent's general manager, could not call him directly, but wanted Young to phone about a job. Young, who had ob- tained employment elsewhere, asked Reich why they did not call fellow former employee John Mohan, who was then unemployed . The judge credited Young's testimony that Reich told Young that he did not think Denaro and Johnson would hire Mohan or former employee Bolda "because they were too pro-union." Young did telephone Johnson and was asked to come for an interview. When Young responded he could not come be- cause he was working, Johnson said that he al- ready knew of Young's qualifications and offered him a job at a specified salary. Young rejected the offer. Contrary to the judge, we do not find that the Respondent discriminatorily refused to hire Young. Young was offered a job by the Respondent at a higher salary rate than his previous Rite-Way salary. The record indicates that Young rejected the Respondent's offer because his current place of employment was closer to his home and did not re- quire payment of city income tax as would be re- quired in employment with the Respondent. Under these circumstances, we conclude that the evidence does not support a finding that the Respondent dis- criminated against Young. Accordingly, we reverse the judge's finding in this regard. 940 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Seven other Rite-Way bargaining unit members were not hired by American Press. Calvin Casteel, his wife, Charlotte, and his mother, Stella Rou- lette,8 constituted the Rite-Way bookbindery de- partment. Denaro testified that prior to 12 August he told Calvin and Charlotte Casteel about the pos- sibility of a buyer of Rite-Way. Denaro further tes- tified that when Charlotte Casteel asked if there was a possibility of a job with the new company, he responded, "I'm sure they would be looking for a [sic] bindery personnel, yes." Calvin Casteel testified, as credited by the judge, that on 6 September, Denaro again spoke privately to the Casteels, telling them that the shop would close in a week, but that Casteel would be better off after it was all over and should not look for a new job. Several days before Rite-Way closed, Calvin Casteel again spoke privately with Denaro, at which time Denaro affirmed that the shop would reopen under the name American Press and that the three Rite-Way owners hoped each to have a 15-percent interest in the new company. On 15 September, his last day of employment, Casteel asked Denaro on behalf of himself and his family, "[W]hat are we going to do?" According to Cas- teel's credited testimony, Denaro told Calvin that it was not necessary to look for a job, that they should take a vacation and call him when they re- turned, and that things would be better after every- thing was straightened out. Casteel telephoned Denaro as instructed by Denaro when he, his wife, and mother returned from vacation. Denaro told Casteel that Johnson was taking care of everything and that he should call him. Casteel called Johnson and asked if he needed bindery help, and Johnson responded that he had to "use his own people." He suggested that Casteel fill out an application, but then reconsidered and said that he knew Casteel's qualifications and that if something came up he would "get in touch." Casteel accepted employment as a binder at an- other print shop. On 24 October, Denaro picked up work that had been subcontracted to Casteel's new employer and, in a conversation with Casteel, said that he could not understand why Johnson had not contacted Casteel. The judge credited Casteel's tes- timony that Denaro told him, "I keep mentioning your name; [t]he only thing I could figure is that he figures you and Charlotte might want the union back." On 25 October, Johnson came to Casteel's new employer. Casteel asked Johnson again about how he was set for help. According to Casteel's 8 The Respondent excepted to the inclusion of Roulette as an alleged named discnminatee because she is not a member of the Union We find no merit to this exception The Respondent does not contend nor does the evidence establish that Roulette was not a bargaining unit member. credited testimony, Johnson replied that they did not currently need help and added, "I don't want any problems with the union; I have had enough of Local 289 to last me the rest of my life." Pressman Bob Bolda, like the Casteels, was given assurances about a job by Denaro prior to the Rite- Way closing. According to Bolda' s unrefuted testi- mony, approximately 1 week prior to the 12 Sep- tember plant closing announcement, Denaro told Bolda that Rite-Way was having problems, but "if anything happens, you won't have to worry about working, you'll always have a job." In early December 1983 Bolda talked to former coemployee Ed Rye, who was working at Ameri- can Press. Rye told Bolda that if he was interested in employment, he should call Belinda Young- Werner to make sure Johnson would be there so he could get an application from Johnson. Bolda called Young-Werner asking if American Press was hiring. Young-Werner replied yes and said that he should come down to get an application. The next day Bolda stopped at American Press and asked for an employment application. Johnson told Bolda that he would have to make an appointment to get an application. When Bolda asked if Johnson would give him an application while he was there, Johnson told Bolda that he was too busy and did not have time for it right then. Johnson testified on cross-examination that he was interested in hiring Bolda for the night shift in December, that he knew that Bolda was qualified to do the job, and that he needed no further information to evaluate him as an employee. Johnson did not assist Bolda in obtaining an application or offer him a job when Bolda was at the plant, but rather asked Bolda to make an appointment and come back at another time to fill out an application.9 Employee John Mohan testified he first heard of the shop closing when Denaro informed him and Willard approximately 1 week before the closing. Mohan testified that Willard asked Denaro whether or not they had sold the Company to someone else and Denaro responded, "I have no further com- ments that I can give you or information about this, other than we are closing the business." On 14 9 Johnson testified he required applications from all the people who came to be interviewed, however, the record indicates that production employee Young did not fill out an application prior to the Respondent's job offer Nonunit employees Young-Werner, Kogelshatz, Denaro, Rouls, and Augustyn did not fill out job applications until they began working or had already signed employment contracts Moreover, the incomplete- ness or absence of applications in American Press' personnel files suggests that the Respondent's alleged practice of requiring an application was merely a formality Several weeks after Bolda went to American Press, Johnson authorized Denaro to contact Bolda about his interest in seeking employment with the Respondent Denaro spoke with Bolda 's wife Bolda did not follow up on Denaro's telephone calls because he was employed at the time AMERICAN PRESS September, Mohan returned to Rite-Way to pick up his last paycheck. In response to Denaro's in- quiry as to whether he had found another job, Mohan said he had not found another job, although he had had an unpromising interview. According to Mohan's unrefuted testimony, Denaro told Mohan that if he heard of any employment oppor- tunities for Mohan he would let him know. In his job search Mohan checked the want ads and sent a copy of his resume to the box number of a blind ad inserted by American Press in mid-Sep- tember 1983. During a conversation with Rye, one of the two former Rite-Way employees hired by American Press, Mohan asked whether he and em- ployee Bolda should seek employment at American Press. The record contains uncontroverted testimo- ny by Mohan that Rye told Mohan that Rye had specifically asked Denaro whether Mohan or Bolda would be considered for jobs and Denaro said, "[T]hey did not want [to] hire too many people from the old plant because it [sic] did not want to have trouble with the Union." Mohan testified he did not contact the Respondent about employment based on his conversation with Rye and his discov- ery through Rye that the blind ad which he had answered was the Respondent's ad. Mohan further testified that he decided not to contact the Re- spondent concerning employment because Denaro had not contacted him despite the fact that Denaro knew Mohan was unemployed, was aware that Mohan was capable of doing the job for which they were soliciting help, and had assured Mohan that he would notify him of any positions that he knew that were open. Employee Gale Willard was employed by Rite- Way as a cameraman and platemaker. One and a half months after the Respondent opened, Denaro called Willard and asked him to show another em- ployee how to operate the Roll-fed Chemco camera that Willard had operated as a Rite-Way employee. Willard spent 3-1/2 hours instructing the cameraman and was paid $50 by Johnson. The judge credited Willard's testimony that he was never advised to fill out an employment application with the Respondent. At the time Rite-Way closed Willard had 7 months until he would be eligible, under the Union's pension plan, to retire at age 60. Willard told Denaro that if the shop were sold, he would wait the 7 months and then retire. Accord- ing to Willard's uncontroverted testimony, Denaro told him occasionally over a 2-year period, and most recently about 2 months before Rite-Way was sold, that he would get Willard a job if the Compa- ny were sold. Willard further testified that when Denaro informed him of the closing, Denaro as- sured Willard that he would take care of Willard. 941 Although the judge did not specifically discuss employee Norman Wilson, we agree with his con- clusion that the Respondent discriminatorily re- fused to hire Wilson. Wilson was present in his ca- pacity as union steward at the 2 September meeting between union and Rite-Way representatives, at which Rite-Way's closing was discussed. The judge found the Union was informed at that meeting that "American Center Studios" or "American Press, Inc." was a prospective purchaser of the Heidel- berg Press. Implicit in the judge's finding is the conclusion that the Union was not made aware the purchase involved substantially all of Rite-Way's assets. The judge specifically found that Denaro denied that there were "new owners" and that the plant would be reopened. Based on the judge's findings concerning notice to the Union, and con- trary to Respondent's assertions, Wilson's role as union steward did not provide him with all the per- tinent information necessary to contact the Re- spondent about potential employment. In fact, it appears that Wilson was privy to less information concerning the purchase transaction and subse- quent employment opportunities than some of his coworkers. The Respondent also contends that Wilson contemplated retirement upon Rite-Way's closing and communicated this to Denaro, who, in turn, relayed this information to Hunter. Denaro, however, testified that Wilson had never given him formal notice that he was retiring. In concluding that the Respondent unlawfully discriminated against Rite-Way's former employ- ees, the judge relied primarily on Hunter's state- ment to Parker and Denaro and on Johnson's state- ment to employee Casteel as evidence that Ameri- can Press intended to operate as a nonunion shop despite the previous union representation of Rite- Way employees. The judge also relied in part on Denaro's statement to Casteel that the reason why Casteel and his family were not hired by American Press was their union affiliation. We agree that these statements establish unlawful motivation for the Respondent's refusal to hire Rite-Way employ- ees.' 0 10 The judge also relied on Reich's statement to Young that he did not think Mohan or Bolda would be hired because they were too prounion The Respondent argues, inter alai, that neither Reich's statement to Young or Denaro's statement to Casteel can be attributed to American Press since neither Reich nor Denaro were agents of American Press In light of the other evidence supporting a finding of unlawful motivation, we find it unnecessary to pass on the judge 's discussion with respect to Reich's statement to Young In agreement with the judge and contrary to the Respondent, we find that Denaro's statement to Casteel was property attributable to American Press. The judge correctly found Denaro to be the Respondent's agent by virtue of his ownership interest and the Re- spondent's use of him in connection with hiring The record indicates the Respondent used Denaro to relay information about hiring to Rite-Way employees According to Hunter, he asked Denaro on at least two occa- Continued 942 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Other record evidence concerning the methods and pattern of the Respondent's hiring further sup- ports a finding of unlawful motivation. Credited employee testimony establishes that pertinent infor- mation concerning the purchase of Rite-Way and employment opportunities with American Press was concealed from the unit employees. American Press placed blind ads in July and August 1983 at a time when Rite-Way was engaged in contract ne- gotiations with the Union and when Rite-Way em- ployees had no idea they would be in need of em- ployment. The interviews were conducted away from the Rite-Way shop. This hiring procedure, coupled with the above statements by Hunter, Johnson, and Denaro demonstrating union animus, warrants the inference that the hiring procedure was designed to conceal from Rite-Way employees that American Press was hiring.I I The different treatment the Respondent accorded Rite-Way unit and nonunit employees is further evidence of a discriminatory motive. As discussed above, American Press contacted and made job offers to all nonunit employees before Rite-Way closed. The Respondent's assertion that former Rite- Way employees were not hired because they did not seek employment is false and unpersuasive. Casteel asked about employment on behalf of him- self and his family. Mohan responded to one of American Press' blind ads, and Bolda attempted to apply in person. The Board has held that, where an employer has attempted to conceal from employees the fact it is accepting applications, failure to apply is not a defense to an 8(a)(3) finding; moreover, those who discover the employer is hiring would be justified in assuming the futility of applying.12 Accordingly, for the reasons stated above, we find that the Respondent violated section 8(a)(3) and (1) of the Act by discriminatorily refusing to hire employees Calvin Casteel, Charlotte Casteel, Stella Roulette, Robert Bolda, John Mohan, Gale Willard, and Norman Wilson. sions to talk to Rite-Way employees to tell them to turn in applications When Johnson needed a Rite-Way employee to show an American Press employee how to run a camera, Johnson authorized Denaro to contact the employee and make the necessary arrangements Johnson authorized Denaro to contact Bolda about employment American Press asked for and received evaluations of Rite-Way employees from Denaro and fol- lowed his recommendations in the case of employees Rye and Drury. 11 See Love's Barbeque Restaurant No 62, 245 NLRB 78 (1979), enfd in relevant part 640 F 2d 1094 (9th Cir 1981). '$ Love's Barbeque, supra at 81 fn. 10. Employee Willard's testimony reveals such a perception of futility. According to Willard 's unrefuted testimony, when Denaro informed him of Rite-Way's closing, Denaro as- sured Willard that Denaro would take care of Willard On cross-examina- tion, when Willard was asked if he had contacted Denaro to come through on his alleged promise to take care of him in terms of a job, Wil- lard replied, "When I was there [American Press] for three and a half hours, I knew him so well , I figured he would give me a job But he didn't say nothing about it, so " 4. The General Counsel has excepted to the judge's failure to find that the Respondent violated Section 8(a)(1) by Denaro's statement to Casteel on 24 October that Denaro did not understand why Johnson had not contacted Casteel "except that he figures you and Charlotte might want the union back." The General Counsel further has excepted to the judge's failure to find the Respondent violat- ed Section 8(a)(1) of the Act when, following Cas- teel's inquiry about employment, Johnson told Cas- teel on 25 October that Johnson did not want any problems with the Union because he had had enough of Local 289 to last the rest of his life. We find merit to the General Counsel's exceptions and find that Denaro's and Johnson's statements to Cas- teel violated Section 8(a)(1) of the Act. The John- son-Casteel conversation ratified and repeated the substance of the message that Casteel received from Denaro the previous day, namely, that the new employer would not hire Casteel and his family because of their union affiliation. We agree with the judge's findings that Denaro and John- son 13 are agents of the Respondent and, as such, that their statements may be imputed to the em- ployer. Accordingly, by engaging in this conduct, the Respondent violated Section 8(a)(1) of the Act. AMENDED REMEDY Having found that the Respondent has engaged in unfair labor practices in violation of Section 8(a)(1), (3), and (5) of the Act, we shall order that the Respondent cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. The Respondent shall be re- quired to offer employees Calvin Casteel, Charlotte Casteel, Stella Roulette, Robert Bolda, John Mohan, Gale Willard, and Norman Wilson employ- ment in their former jobs or, if those jobs no longer exist, to substantially equivalent positions, without prejudice to their seniority or other rights and privileges previously enjoyed, discharging, if neces- sary, employees hired from sources other than the Rite-Way Press, Inc., Detroit, Michigan printing plant to make room for them, and make them whole for any loss of earnings that they may have suffered due to the discrimination against them from 10 October 1983 until proper offer of rein- statement, less net interim earnings, as prescribed in F. W. Woolworth Co., 90 NLRB 289 (1950), with interest thereon to be computed in the manner pre- scribed in Florida Steel Corp., 231 NLRB 651 (1977). is The Respondent does not except to the judge 's finding that Johnson is an agent of the Respondent AMERICAN PRESS Further, we shall order that the Respondent be required to recognize and bargain with Detroit- Toledo Local No. 289, Graphic Communications International Union in the appropriate collective- bargaining unit and, if agreement is reached, to reduce the agreement to a written contract. In ad- dition, we shall order the Respondent to cancel, on request by the Union, changes in rates of pay and benefits unilaterally effectuated and to make the employees whole by remitting all wages and bene- fits 14 that would have been paid absent such changes from 10 October 1983 until the Respond- ent negotiates in good faith with the Union to agreement or to impasse.15 The Order contains a broad cease-and-desist provision as we find that the Respondent's conduct demonstrates a general disre- gard for the employees' fundamental statutory rights. 16 AMENDED CONCLUSIONS OF LAW 1. Respondent is an employer engaged in com- merce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Union is a labor organization within the meaning of Section 2(5) of the Act. 3. All employees employed at American Press, Inc., as successor to Rite-Way Press, Inc., engaged in performing work, processes, or operations asso- ciated with lithography, wet or dry offset printing, photo engraving, intaglio, gravure, or any techno- logical or other change, evolution of, or substitu- tion for any of the above-named work, processes, or operations, bindery employees, shipping and maintenance employees, cold-type employees (in- cluding proofreaders, keyliners, keyboard opera- tors, and photon employees), excluding all sales employees, professional employees, office clerical employees, superintendents, guards, and supervisors as defined by the Act constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. At all times material herein the Union has been the exclusive representative of all the employ- ees in the above unit for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 5. Respondent American Press, Inc. is a succes- sor employer to Rite-Way Press, Inc., and by dis- avowing its bargaining obligation to the Union and departing from preexisting rates of pay and benefits 14 See Kraft Plumbing, 252 NLRB 891 (1980), Merryweather Optical Co, 240 NLRB 1213, 1216 fn 7 (1979) is The remittance of wages and benefits is to be made consistent with the make-whole remedy set forth above with respect to the discrimma- tees save that, when appropriate, the amount due shall be paid as pre- scribed in Ogle Protection Service, 183 NLRB 682 (1970) 16 Hickmott Foods, 242 NLRB 1357 (1979) 943 without prior notification to and bargaining with the Union, the Respondent violated Section 8(a)(5) and (1) of the Act. 6. By telling employees that they would not be hired because of their union affiliation, the Re- spondent has violated Section 8(a)(1) of the Act. 7. By failing to hire the employees named in paragraph 2(a) of the Order because of their union affiliation, the Respondent in each instance engaged in unfair labor practices in violation of Section 8(a)(3) and (1) of the Act by interfering with the exercise of their rights guaranteed in Section 7 of the Act and by discriminating in regard to their hire or tenure of employment, thereby discourag- ing membership in a labor organization. 8. These unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the Act. ORDER The National Labor Relations Board orders that the Respondent, American Press, Inc., Detroit, Michigan, its officers, agents, successors, and as- signs, shall 1. Cease and desist from (a) Refusing to recognize and bargain collective- ly with Detroit-Toledo Local No. 289, Graphic Communications International Union as the exclu- sive collective-bargaining representative of its em- ployees in the following appropriate unit: All employees engaged in performing work, processes, or operations associated with lithog- raphy, wet or dry offset printing, photo en- graving, intaglio, gravure, or any technologi- cal or other change, evolution of, or substitu- tion for any of the above-named work, proc- esses, or operations, bindery employees, ship- ping and maintenance employees, cold-type employees (including proofreaders, keyliners, keyboard operators, and photon employees) employed by American Press, Inc. as succes- sor to Rite-Way Press, Inc., but excluding all sales employees, professional employees, office clerical employees, superintendents, guards, and supervisors as defined by the Act. (b) Making changes unilaterally in the rates of pay and benefits of the employees in the above unit without notice to and bargaining with the above Union. (c) Telling applicants that they will not be hired because of their union affiliation. (d) Refusing to hire or otherwise discriminating against employees in their hire or tenure of em- ployment because they are members of, or gave support to, Detroit-Toledo Local No. 289, Graphic 944 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Communications International Union or any other labor organization. (e) In any other 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 neces- sary to effectuate the policies of the Act. (a) Offer immediate and full employment to Calvin Casteel, Charlotte Casteel, Stella Roulette, Robert Bolda, John Mohan, Gale Willard, and Norman Wilson, without prejudice to their seniori- ty or any other rights or privileges previously en- joyed, discharging if necessary employees hired from sources other than the Rite-Way Press, Inc., Detroit, Michigan printing plant to make room for them. (b) Make whole Calvin Casteel, Charlotte Cas- teel, Stella Roulette, Robert Bolda, John Mohan, Gale Willard, and Norman Wilson for any loss of pay they may have suffered as a result of the dis- crimination against them in the manner described in the section of this decision entitled "The Amended Remedy." (c) Recognize and, on request, bargain collec- tively with Detroit-Toledo Local No. 289, Graphic Communications International Union as the exclu- sive collective-bargaining representative of the em- ployees described in paragraph 1(a) above, and, if an agreement is reached, embody that agreement in an executed written contract. (d) On request of the above union, restore the status quo ante which existed prior to the imple- mentation of the unilateral changes made by the Respondent with regard to the rates of pay, wages, and other terms and conditions of employment in the unit described above, and make the employees whole by remitting all wages and benefits that would have been paid absent such changes, plus in- terest, from 10 October 1983 until it negotiates in good faith with the Union to agreement or to im- passe, in the manner set forth in the section of this decision entitled "The Amended Remedy." (e) Preserve and, on request, make available to the Board or its agents for examination and copy- ing, all payroll records, social security payment records, timecards, personnel records and reports, and all other records necessary to analyze the amount of backpay due under the terms of this Order. (f) Post at its office and place of business in De- troit, Michigan, copies of the attached notice marked "Appendix." 17 Copies of the notice, on 17 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 Nation- al Labor Relations Board" shall read "Posted Pursuant to a Judgment of forms provided by the Regional Director for Region 7, after being signed by the Respondent's authorized representative, shall be posted by the Respondent immediately upon receipt and main- tained for 60 consecutive days in conspicuous places including all places where notices to em- ployees 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. (g) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondent has taken to comply. the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. 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. WE WILL NOT refuse to recognize Detroit- Toledo Local No. 289, Graphic Communications International Union as the exclusive collective-bar- gaining representative of our employees in the fol- lowing appropriate unit: All employees engaged in performing work, processes, or operations associated with lithog- raphy, wet or dry offset printing, photo en- graving, intaglio, gravure, or any technologi- cal or other change, evolution of, or substitu- tion for any of the above-named work, proc- esses, or operations, bindery employees, ship- ping and maintenance employees, cold-type employees (including proofreaders, keyliners, keyboard operators, and photon employees), but excluding all sales employees, professional employees, office clerical employees, superin- AMERICAN PRESS tendents, guards, and supervisors as defined by the Act. WE WILL NOT make unilateral changes in the rates of pay and benefits of the employees in the above unit without notice to and bargaining with the above Union. WE WILL NOT tell applicants that they will not be hired because of their union affiliation. WE WILL NOT refuse to hire or otherwise dis- criminate against employees to avoid bargaining with a union. WE WILL NOT in any other manner interfere with, restrain, or coerce you in the exercise of the rights guaranteed you by Section 7 of the Act. WE WILL offer immediate and full employment to Calvin Casteel, Charlotte Casteel, Stella Rou- lette, Robert Bolda, John Mohan, Gale Willard, and Norman Wilson, without prejudice to their se- niority or any other rights or privileges previously enjoyed, discharging if necessary employees hired from sources other than the Rite-Way Press, Inc., Detroit, Michigan printing plant to make room for them, and WE WILL make them whole for any loss of earnings they may have suffered by reason of our unlawful failure to hire them, with interest. WE WILL, on request, bargain with the above Union as the exclusive representative of all the em- ployees in the above unit concerning their terms and conditions of employment, and, if an under- standing is reached, embody it in a signed contract if asked to do so. WE WILL, on request of the above Union, cancel any changes from the rates of pay and benefits that existed immediately before our takeover of the Rite-Way, Press, Inc., Detroit, Michigan printing plant and make the employees in the above unit whole by remitting all wages and benefits that would have been paid absent such changes, plus in- terest, from 10 October 1983 until we negotiate in good faith with the Union to agreement or to im- passe. AMERICAN PRESS, INC. Amy Bachelder, Esq., for the General Counsel. John P. Caponigro, Esq. and Michael Mills, Esq. (Frasco, Hackett and Durisin), of Bloomfield Hills, Michigan, for Respondent. Roger J. McClow, Esq. (Klimist, McNight & Sale), of Southfield, Michigan, for Charging Party Union. DECISION STATEMENT OF THE CASE WALTER J. ALPRIN, Administrative Law Judge. The issues in this case are whether the Respondent, as a suc- cessor employer, engaged in the unfair labor practices of 945 discriminatorily refusing to hire former employees of the succeeded employer, and refusing to bargain collectively with the Union Charging Party, in violation of Section 8(a)(1), (3), and (5) of the National Labor Relations Act. The charges herein were filed 5 and 8 March 1984, complaint issued 30 April 1984 and was amended and consolidated on 15 June 1984, and the hearing was held before me at Detroit, Michigan, on various days between 4 September and 25 October 1985. On consideration of the entire record, including the briefs filed on behalf of Respondent, Charging Party Union, and the General Counsel, and having observed the demeanor of the witnesses, I make the following FINDINGS OF FACT I. BACKGROUND AND JURISDICTION In 1975, American Motors Corporation (AMC), not a party to this proceeding, caused the formation of Ameri- can Center Studios, Inc. (Studios), not a party to this proceeding, as a wholly owned subsidiary performing graphic arts services, including typesetting, layout, design, and photography for AMC and for other custom- ers. AMC also maintained another wholly owned subsid- iary, Graphic Center, Inc. (Graphic), not a party to this proceeding, which functioned as the printing arm of Stu- dios in providing a total and unified service under common management and control. In 1982, AMC decid- ed to divest itself of various nonautomotive facilities, in- cluding Studios. In December of that year, Robert Hunter and Donald Decker, an officer and sales manager of Studios respectively, purchased Studios from AMC. Although Hunter and Decker attempted to pursuade AMC to sell them Graphic as well, AMC would not do so. Studios continued its operations, servicing new and existing customers, except for AMC, and having a major- ity of its printing work performed by Graphics even though the two companies no longer shared common ownership, management, and control. Rite-Way Press, Inc. (Rite-Way), not a party herein, was a commercial printer in Detroit, Michigan, which had been in existence since 1964 but which was experi- encing severe financial difficulties. Rite-way was owned in equal shares by Bill Denaro, Norbert Augustyn, and Fred Rouls. Rite-way's production employees had been represented by Detroit Toledo Local No. 289, Graphic Communications International Union (the Union) and its predecessor since some time in the 1970s. Rite-way and the Union had been parties to successive collective bar- gaining agreements, the most recent of which ran from 1 June 1980 to 1 May 1983.1 In March or April, Studios considered establishing its own printing capabilities. After a series of actions herein- after discussed, it acquired Rite-Way, or its assets, on 15 September and, on 10 October there was formed a new corporate entity, American Press, Inc. (American), the Respondent herein. Studios owns 81 percent of Ameri- can, and the balance is owned equally by Denaro and I All dates will be in 1983 unless otherwise noted 946 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Augustyn, each of whom hold employment contracts from American as later discussed. American admits to gross annual revenue in excess of $250,000 and to providing directly to customers located outside the State of Michigan services valued in excess of $50,000. It is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act. The Union is a labor organization within the mean- ing of Section 2(5) of the Act, and represented all Rite- Way's production employees.2 II. ACTIONS OF THE PARTIES A. Acquisition of Rite- Way by Studios During the summer and fall of 1982, before AMC sold Studios to Hunter and Decker, there were several con- tacts between Hunter and Decker, on the one hand, and, on the other, Denaro and Harrison Parker, then Rite- Way's business manager . On one occasion Hunter and Decker toured the Rite-Way plant and then had lunch with Denaro and Parker and, on another occasion, Denaro and Parker toured Studios' facilities after which the four had dinner. Rite-Way was already involved in economic difficulties and, in addition to the possible con- sideration of finding new sources of business for their print shop were interested, in Parker's words, in "look- ing for some financial relief and the fact that perhaps we could get somebody to either get involved in the compa- ny or perhaps to buy it." Parker testified that during dinner the four discussed, among other things, a possible purchase of Rite-Way "or some ramification of financial changing our operation around." Denaro asked what would happen to the Rite-Way employees in such event, and Decker, and possibly Hunter, responded in substance that they did not want to get involved with a union. Rite-Way had no similar mutual tours, and had no dis- cussion regarding sale to any other entity until March, 1983. Hunter denied Parker's testimony, stating that the in- tercompany contacts were strictly attempts by Rite-Way to add a new printing customer. Together with Denaro, Hunter denied any statement that Studios was interested in a print shop but did not want to get involved with a union. Denaro testified that in March 1983 he contacted Hunter to ask if he was interested in buying "the print shop" because "word was around town" that Studios was "looking to buy a shop." About 3 weeks later Hunter called back to arrange a meeting to inspect Rite- Way's equipment about a month thereafter. At the meet- ing were Hunter, Decker, Denaro, and Rouls. At the next contact, in May or June, Studios presented a hand- written proposal, which Denaro later discussed with 2 I e , all employees engaged in performing work , processes or oper- ations associated with lithography , wet or dry offset printing, photo en- graving, itagho, gravure or any technological or other change, evolution of or substitution of the above-named work , processes, or operations, bindery employees, shipping and maintenance employees, cold type em- ployees (including proofreaders, keyliners, keyboard operators, and photon employees) employed by Rite-Way Press, Inc, but excluding all sales employees, professional employees, office clerical employees, super- intendants, guards and supervisors as defined by the Act Rouls and Augustyn. This handwritten proposal was not available and is not part of the record, but it was gener- ally an offer to take the physical assets of Rite-Way in return for $25,000 plus assumption of Rite-Way's out- standing debt balance of $138,000 on its purchase 2 years before of a Heidelberg press for $188,000. About 2 weeks later this offer was typed and given to Denaro to show Rite-Way's accountant. This document also was unavail- able and not in the record. A "purchase agreement" was then prepared and signed, and on September 15 a "clos- ing" was held. The purchase agreement between Rite-Way, as seller, and American, as purchaser, dated 12 August, was enti- tled Asset Purchase Agreement, provided that on a future closing date Rite-Way "will sell to Purchaser and Purchaser will purchase from seller, all of the business and assets (excluding the assets in Exhibit A . . . ) of Seller . . . . The purchased assets shall consist of all assets (other than the Excluded Assets), properties, rights, purchases, claims and licenses owned by seller and used in its business." The physical assets specifically excluded consisted of three cabinets, a saw, a Model 8 Linotype with 7500 pounds of lead, a hand feed, a Kluge 12 by 18, and a check protector. The assets specifically included consisted of all other assets on Rite-Way's May 31 balance sheet plus any ordi- narily kept or acquired in the course of business; all leases, purchase orders, customer orders, sales, and other contracts; all trademarks, trade names, etc; and all cus- tomer lists and other data relating to "the purchased assets, business and operations of the Seller." The 45 specified physical assets to be purchased included the Heidelberg press, which was the major item of machin- ery, and other printer's machinery such as presses, cut- ters, stitchers, folders, feeders, gluers, binders, etc., plus office equpment such as cabinets, desks chairs, tables, safe, typewriters, etc. As an exhibit, Rite-Way provided the names and annual compensation "of salaried employ- ees," the same information "of union employees," and lists of "The Customers, Distributors and Dealers of Sell- ers. II Contemporaneously with the closing an employment agreement was entered into between American, Denaro, and Augustyn. Denaro and Augustyn were hired for a 36-month period, each to serve full time "as salesman and bindery/press operator" for American. Compensa- tion to the employees was to be twofold: first, a direct salary of "not less than" $600 per week, and second, for a period of 4 years, i.e., extending 12 months after the term of employment, a commission of 3 percent of sales to previous Rite-Way customers, up to but not less than a total commission of $75,000. Denaro and Augustyn, in turn, agreed not to compete during the term of employ- ment, and to jointly purchase 19 percent of American's stock for $12,500. Also contemporaneously, by a "consultant agreement" dated 15 September in consideration of their entering into the above-employment agreement, Denaro and Au- gustyn agreed to equally divide the commissions re- ceived under the employment agreement with Frederick B. Rouls, who had been, with them, an equal owner of AMERICAN PRESS Rite-Way. Rouls was to "consult with and assist" Denaro and Augustyn in producing the sales on which the commissions were to be paid. American was not a party to this agreement. An additional agreement prior to the execution of doc- uments and closing related to the lease of the premises at which Rite-Way was conducting its business. The build- ing was owned by "BARD," a co-partnership consisting of Denaro, Augustyn, Rouls, and one Bek, who had been one of the original coowners of Rite-Way but had previ- ously been bought out by the remaining three. Rite-Way had no written lease, and was paying a monthly rental of $1250. American left all assets in place, though it did do some alterations and, also with no written lease, is paying a monthly rental of $1325 to BARD. B. Rite-Ways Notice to the Union The current bargaining agreement between Rite-Way and the Union was to expire 31 May 1983, and Denaro began negotiating with union representatives in January. There were seven or eight negotiating sessions between then and 12 August. Gerald Deneau, vice president of the Local Union was at that meeting, as he had been at the earlier meetings, and particularly wanted to speak with Denaro having received an anonymous phone call on 5 August from a woman who stated that Rite-Way was going to be taken over by American, closed for sev- eral weeks, and then reopened to get rid of the Union and the bargaining agreement. Denaro, however, denied the "rumor" and stated that in fact Right Way had re- jected two offers because the prospective purchaser "wouldn't take the employees or the Union contract." On 30 August, Rite-Way's counsel, Boyer, phoned Deneau and told him Rite-Way was closing and that Boyer wished to meet with the Union regarding vacation pay due, and to make arrangements for an orderly termi- nation. Deneau asked Boyer to bring to that meeting, to be held 2 September, information on sale of any equip- ment and accounts receivable. At the meeting Boyer told Deneau that the plant was closing and would not there- after operate and that the owners of the building were looking for another tenant. When Deneau told Denaro he had heard that there were "new owners" of Rite-Way and that Denaro had already been employed by them for when they reopened the plant, Danero denied all and claimed to be looking for a job elsewhere. Deneau de- manded information and copies of agreements regarding the claimed sale of machinery, to which he felt entitled in conformance with the bargaining agreement and court decisions involving ERISA pension accounts, but did not receive the Asset Purchase Agreement until January 1984. Deneau was told at that meeting however, that the purchaser of the Heidelberg press was "American Press, Inc.," or "American Center Studios," and that Hunter was the individual he could contact. In mid-September, after Rite-Way had closed, one of their former employ- ees phoned Deneau to ask whether he, like Denaro, could go to work for the "new employer." C. Rite- Way's Notice to Employees and Hirings by American Press 947 1. Nonbargaining unit employees Belinda Young-Werner was Rite-Way's bookkeeper and secretary. About August she became aware of nego- tiations with Hunter and approached Denaro, expressing concern about having to look for another job. Denaro told her not to worry, and he spoke with Hunter recom- mending her. Shortly thereafter, when Denaro told other employees that Rite-Way would be closing, he told Young-Werner that if she was interested in employment at the new company, she should make an appointment with Hunter and Decker. She did so and arranged an interview on 2 September. At the interview she was of- fered a job, substantially similar to that which she held for Rite-Way, commencing immediately upon Rite-Way's closing. She began work for American Press on 19 Sep- tember, but was not required to fill out an employment application until after having started to work. Sherwood Kogelshatz was Rite-Way's estimator, and Denaro also spoke to Hunter on his behalf. Kogelschatz was interviewed by Hunter, Decker, and Bernie Johnson, general manager of American, about the same time as Young-Werner, and which was 2 September, and a few days later was offerred a job with American after Rite- Way closed. Kogelschatz' application for employment is dated 14 September. During the last 2 weeks of August, and early Septem- ber, Hunter or Decker, or both, interviewed and hired salespeople who had been associated, as employees or brokers, with Rite-Way, including Pat Byrne, employed 26 September, and Chuck Reich, employed 12 Septem- ber. Both Byrne and Reich submitted their applications for employment on the same day they were hired. 2. Bargaining unit employees a. General About March, when Parker was leaving the employ- ment of Rite-Way, there was a disucssion in which an unnamed employee reported having heard that there was an attempt to sell Rite-Way as a business. Danero's re- sponse was that they had held a meeting with Aronson Printing but decided not to sell because the proposed purchaser "had not offered positions for any of the em- ployees. They only wanted the accounts receivable." About September 5, 1 week in advance, Denaro orally notified Rite-Way's employees of the imminent plant closing. When asked whether Rite-way had been sold, Danero only stated, "I have no further comments that I can give you or information about this other than we are closing the business." When asked whether he and Au- gustyn were going to retire, Denaro responded, "We don't know at this point. We don't have jobs ourselves. We're just going to take care of the closing of the plant right now." b. Hired by American Press Ed Rye and Ray Drury worked for Rite-Way as a team operating the Heidelberg press, Rite-Way's most 948 DECISIONS OF NATIONAL LABOR RELATIONS BOARD important piece of physical equipment. After Denaro had announced that Rite-Way was going to close, he told Rye that-other shops-Dearborn Litho and Aronson- were looking for pressmen to hire, and he also told Rye that American would probably be looking for a pressman and helper. After several requests, after Rite-Way had closed, Denaro gave Rye Johnson's number, and also told Rye to call his work-partner, Drury. Rye phoned Johnson and arranged an interview at Studios, about September 20 or 22. Rye filled out an application for em- ployment and was interviewed and hired. Denaro had also spoken directly with Drury, suggesting he phone Johnson because the new people would need press oper- ators. Johnson told him to come in on 21 September, fill out an employment application, and be interviewed, all which he did, and he was then hired. Roger Young was a layout stripper at Rite-Way, and after it closed obtained employment elsewhere, starting 12 September. In early October he was phoned by fellow former employee Reich, who was then a salesman for American Press and who told him that Denaro and Johnson could not call him directly, but wanted Young to phone about a job. Young asked why they did not call another fellow former employee, John Mohan, who was then unemployed, and Reich told him that he did not think Denaro and Johnson would hire Mohan, or Bolda, "because they were too pro-union." Young did phone Johnson, who asked him to come for an interview. When Young responded that he could not because he was working, Johnson said that he already knew of Young's qualifications and offered him a job at a stated salary. Because the salary was not sufficient for him, even though more than he had received from Rite-Way, Young rejected the job offer. c. Not hired by American Press Seven of the bargaining unit members were not hired by American Press. The following concerns the notice to them and other matters affecting their employment. Calvin and Charlotte Casteel and Stella Roulette Casteel, his wife, Charlotte, and his mother, Stella Roulette, were all bookbinders employed by Rite-Way. Casteel testified as follows: On 6 September, Denaro spoke privately to him and his wife , telling them that the shop would close in a week but that Casteel should not look for a new job because he would be better off after- wards. Several days before Rite-Way closed, Casteel again spoke privately with Denaro, at which time Denaro affirmed that the shop would reopen under the name American Press, and that the three Rite-Way owners hoped each to have a 15-percent interest in the new entity. On his last day of work, 15 September, Cas- teel asked Denaro what he should do and was told to take a vacation and phone when he got back. This Cas- teel did, phoning Denaro on 29 September. Denaro then told him to phone Johnson, whom Casteel had known previously. Johnson told him that because he had been required to "use his own people" there were presently no openings, but to "make an appointment, come by, fill out an application." Johnson then amended this, saying that he knew Casteel's qualifications and that if some- thing came up he would "get in touch." Casteel gained employment shortly thereafter at another print shop, again as a binder. On 13 October Denaro delivered a job to Casteel's new employer and, in conversation with Casteel, said he did not understand why Johnson had not contacted him, "except that he figures you and Charlotte might want the union back." On 25 October Johnson came to Casteel's new employer to pick up a job, and when asked by Casteel about employment replied that they did not currently need help, and further said: I don't want any problems with the union. I have had enough of Local 289 to last me the rest of my life. Denaro denied the conversations ascribed to him. Johnson also denied the comment regarding not wanting "problems with the union," alleging specifically that he did not know or refer to the Union as "Local 289," but rather as the "L.P.I.U.," which was the union of the li- thographers and photoengravers at the shop where he worked until 1977, and that, though he was in Detroit for several years prior to the events herein, kept himself informed about the printing business, and taught at the union-sponsored trade school, he was unaware of the merger in 1973 of that union into the Graphic Arts Inter- national Union, of which Local 289 is a part. Robert Bolda Bolda was a pressman employed by Rite-Way. He heard Denaro's general statement about the plant closing 12 September. Several weeks prior to that announce- ment, Denaro had told Bolda that there were no prob- lems and that Bolda would "always have a job." After the shop closed, Bolda was told by his former coem- ployee, Ed Rye, that if he wanted to work at American, he would have to phone first, see that Johnson would be there, , and get an employment application from him. Bolda started a temporary job at another shop, but on his next-to-last day there phoned American. He did not make an appointment or go there that day, but did go at the end of his work the next day, shortly after 4'p.m. He saw and spoke to Denaro, who said he was not in charge and that Bolda would have to see Johnson. Johnson was there, but when Bolda asked about a job he told him he would first have to get an application and submit it, and that Johnson was busy and did not have time for it right then. John Mohan Mohan was employed by Rite-Way as a foreman in the preparations department. He also first heard of the shop closing about a week in advance. On 14 September, when picking up his last check, Mohan was told by Denaro that he, Denaro, and Augustyn, did not have jobs. Mohan did not find employment until 13 October. Among other efforts, Mohan checked the want ads in the Detroit News and sent a resume to a box number of a blind ad inserted by American, which will be later dis- cussed. Mohan eventually discovered that American AMERICAN PRESS' Press was operating at the former Rite-Way location and that he would have to submit an application to be con- sidered for employment, but because he also discovered that the, blind advertisement which he had answered was that of American, he did not bother to do so. Gale Willard Willard was employed by Rite-Way as a cameraman and platemaker. One and a half months- after American opened, Denaro called Willard and asked him to show another employee how to work an old camera. Willard did so, and Johnson paid him $50 for his time. He was never advised about filing an application for employ- ment. At the time Rite-Way was closing, Willard had 7 months before he could, at age 60, retire under the union pension plan. Willard told Denaro that if the shop were sold he would just wait the 7 months and then retire. Several months prior to closing, Denaro had sent Wil- lard to Studios to use their camera while Rite-Way's was broken, and at that time mentioned it as the entity which was going to purchase the Rite-Way business.3 Denaro denies making this statement. d. Solicitation of non-Rite- Way personnel During late July and early August , and on 18 Septem- ber, in contemplation of some contract with Rite-Way, American placed blind help-wanted ads in the Detroit News and in the Detroit Free Press , seeking applicants for a second-shift operation. It was American's custom to make these advertisements "blind" to screen out unquali- fied applicants. Johnson and Hunter testified that these ads were placed to compile a listing of qualified possible employees, as opposed to advertisements placed in De- cember, giving Johnson's telephone number , which were placed to fill immediate openings. As Hunter testified, "[G]ood help is hard to find . This is a tough town and most good quality press men and binders and what have you are already employed." D. Bargaining Demands on American Press The Union was engaged in collective bargaining with Denaro during the entire period that Rite-Way and American were negotiating their agreement, that Denaro and Augustyn were negotiating their employment with and investment in American, that Denaro, Augustyn, and Rouls were arranging division of future commissions from American and, presumably, American was negotiat- ing with Denaro, Augustyne, Rouls, and Bek as owners of the premises. After Denaro advised of the "sale" of the assets the Union continued its negotiations, now on the issues of closing the operation. The Union sought in- formation about assets, including a copy of the alleged sales agreement which was refused until finally provided on 4 January 1984, in settlement of the Union's charge to the Board on that point. By telegram of 23 February 1984, the Union requested American to engage in negoti- ations on reinstatement of terminated Rite-Way employ- 3 This sentence refers to testimony by Willard, not part of his direct examination, and was given only after he had reviewed his affidavit to a Board representation. 949 ees and resolving other differences. A response from Hunter was received on 9 March 1983, taking the posi- tion that there was no bargaining obligation-because the Union did not represent a majority of employees. Ameri- can has always held the position that it is, a mere pur- chaser of some of the assets of, and is not a successor employer of Rite-Way. The production work^of Ameri- can is performed by 10 employees, 2 of whom are former Rite-Way employees and union members, and '2 other employees, Nashotka and Hamilton, also are union members. Of the other four employees, one transferred from Studios, and three were new hirees from nonunion shops. Rite-Way maintains its corporate viability, though it engages in no business operations.' E. Business Operations of American Press After Agreement With Rite- Way As a print shop, American's business comes from two sources from its corporate parent, Studios, and from former customers of Rite-Way. For its first year of oper- ation, October 1983 through September 1984, 63' percent of the billings came from Studios, and 37 percent from former Rite-Way customers. That 37 percent represents $1,521,800 in sales to former Rite-Way customers, while an additional $300,000 in prior Rite-Way billings was lost. In other words, approximately 83 percent of Rite- Way's business was continued by American and 17 per- cent lost. In terms of the number, of accounts billed; for the same first year American billed an average of 25.6 customers per month, of which an average 20.7, or 81 percent, were former Rite-Way accounts. American made physical improvements in 'operations. The premises were painted, carpeted, provided with an entrance hallway, a conference room, interior and exteri- or security, and a darkroom. The phone system was changed, furniture and operating equipment added, work flow improved, and certain business procedures changed. American uses the same suppliers previously used by Rite-Way, those suppliers being generally "generic" to the local printing trade. Ill. DISCUSSION A. Credibility Issues 1. Regarding Denaro The initial issue posed by the testimony is whether, de- spite denials, Denaro made certain statements to Rite- Way employees-to Costeel that after closing the Rite- Way plant would reopen as American and,that he fig- ured American did not employ Casteel and his wife be- cause they would want the Union back; to Willard that American was purchasing the Rite-Way business; and to Willard, Bolda, Mohan and Casteel, his failure to advise that if they wanted to be considered by American for employment when the shop reopened they should obtain and submit an application. There is no doubt that Denaro lied to these and other employees on several occasions, regarding associated topics-that Rite-Way was closing and the shop would 950 DECISIONS OF NATIONAL LABOR RELATIONS BOARD not reopen, and that he and Augustyn would have no jobs or employment after the closing . Though it may be that Denaro took action both before and after his initial contacts with American to protect Rite-Way's employ- ees, there is no question but that his testimony and be- havior was evasive and explicitly showed prior false statements . I can but find that his denials at the hearing must be discredited, and that Denaro did in fact know before the closing and indicate to some employees that American was going to purchase Rite-Way and operate it as a nonunion shop, while at the same time not advis- ing them that they should file an application seeking re- employment. 2. Regarding Johnson The credibility issue here is whether Johnson made a statement to Casteel fraught with union animus, to wit, that he wanted no problems with the Union , having had enough of such problems to last him the rest of his life. To buttress his bare denial , Johnson incorporates an ar- gument which I find specious. Given his close associa- tion with the industry involved , I cannot accept his testi- mony that he was unaware the union he had known as the L.P.I.U. had merged in 1973, 10 years prior to the statement, with the Graphic Arts International Union of which Local 289 was the Toledo and Detroit representa- tive. I credit Casteel's testimony and find that Johnson did in fact make the comment in question, and that American intended to operate its business as a nonunion shop. 3. Regarding Hunter It is alleged that at dinner after meetings with Denaro and Rite-Way's then general manager, Parker , Hunter, and/or Decker stated in regard to rehiring Rite-Way em- ployees that they did not want to get involved with a union. Hunter denied that such statement had been made. The allegation was made by Parker , who is no longer as- sociated with any party to this proceeding and to whom no specific bias can be shown. Though cross-examination did reveal that Parker was uncertain regarding details of this dinner conversation held over 2 years prior to the hearing, he remained firm in his recollection of the state- ment regarding the Union. Though Denaro was recalled as a witness he did not dispute that such a statement was made. Decker, the only other person present at the dinner, was not recalled to rebut the testimony. I find that credence must be given to the testimony of Parker, the only unbiased witness, and that the representatives of American expressed an intention to operate their print shop after the purchase from Rite-Way as a nonunion shop. B. Successorship The central issue in this proceeding of course is whether American is a successor employer to Rite-Way. The Board has succinctly stated the ramifications of successorship as follows:' • Mondavi Foods Corp, 235 NLRB 1080, 1082 (1978) When all or part of a business is sold, certain legal obligations of the seller devolve on the pur- chaser. When there is substantial continuity in the identity of the employing enterprise , one such obli- gation will be that of the employer to recognize and bargain with a union which represents the former owner's employees. However, if in the course of the transfer there have been substantial and material changes in the employing enterprise , the new em- ployer will not be found to have succeeded to the bargaining obligation of the former employer. In cases involving the successorship issue, the Board's key consideration is "whether it may be reasonably assumed that, as a result of transitional changes, the employees' desire concerning unioniza- tion [have] likely changed." The Board considers a variety of factors in determining whether the new employer has succeeded to the former employer's bargaining obligation. Certainly a prime factor is whether the purchaser has hired a sufficient number of former employees of the seller to constitute a ma- jority of the employee complement of the appropri- ate unit. Before getting to that "prime factor" of employment of a sufficient number of former empoyees, however, let us enumerate and consider that other "variety of factors." Although not all the circumstances need be present to show successorship,5 the Board has enumerated them as: [W]hether (1) there has been a substantial continuity of the same business operations; (2) the new em- ployer uses the same plant; (3) the same or substan- tially the same work force is employed; (4) the same jobs exist under the same working conditions; (5) the same supervisors are employed; (6) the same machinery, equipment, and methods of production are used; and (7) the same product is manufactured or the same services offered.6 In the case at hand there can be no question but that American, as Studios' printer and as printer of over 80 percent of Rite-Way's volume on former customers, is substantially in the same printing business as Rite-Way was; that with the exception of some cosmetic changes and small additions of equipment, American uses the same plant, the same machinery, the same equipment, and the same methods of production as Rite-Way previ- ously used; that the same printing services are offered and the same printing product is manufactured by Amer- ican as was offerred and manufactured by Rite-Way; and that, within the bargaining unit, the same jobs exist under the same working conditions at American as existed at Rite-Way. The only substantive difference between the operations of American and of Rite-Way is in the identity of the su- pervisors employed . It is clear that Johnson is the sole supervisor for American , while Denaro and/or Augustyn was supervisory personnel at Rite-Way. 6 Georgetown Stainless Mfg Corp, 198 NLRB 234 (1972). 6 Border Steel Rolling Mills, 204 NLRB 814, 815 (1973). AMERICAN PRESS Finally, and most important, we must confront what has been referred to as the "threshhold" criterion of con- tinuity of work force. "Notwithstanding its continued re- ferance to a `totality of circumstances' in determining successorship, it has been apparent, at least since Burns (NLRB v. Burns Security Services, 406 U.S. 272 (1972)) that the threshhold criterion in determining successorship is the continuity of the work force; in no Board decision since Burns has a successorship been found absent a find- ing of majority." (Citations omitted.)? Until the actual time that the new employee complement contains a ma- jority of the predecessor's employees, the new employer is not, as a successor, bound to bargain with the Union.8 Until such time, so long as he does not discriminate on grounds of union membership, it is equally clear that the new employer is free to offer employment to whomever and on whatever terms he choses. NLRB v. Burns Securi- ty Services, supra; Howard Johnson Co. v. Detroit Joint Board, Hotel & Restaurant Employees, 417 U.S. 249 (1974). In exercising this freedom of selection the employer may not engage in the discriminatory exclusion of hold- over employees based on a desire to avoid having to rec- ognize a union or because of the union membership or activities of individuals.9 Where the Union would have held majority status were it not for the discriminatory re- fusal to hire, the successor is generally subject to a bar- gaining order.' ° It is obvious from the statements of Hunter to Parker and Denaro, and of Johnson to Casteel, that American Press intended to commence its operations, and to con- tinue them, as a nonunion shop despite the previous union representation of employees in the print shop it was succeeding. This, together with the other affirmative criteria of successorship, would be sufficient to declare American as a successor employer. There are, however, additional factors. Denaro stated that he thought the reason why Casteel and the members of his family were not hired by Ameri- can Press was their union affiliation, and Reich stated to Young that he did not think Mohan or Bolda would be hired because they were too prounion. Respondent argues that neither statement can be attributed to Ameri- can because both were mere matters of opinion only, ut- tered by persons beyond the scope of their employment ° Morns (Section of Labor and Employment Law, American Bar As- sociation), The Developing Labor Law, (The Bureau of National Affairs, Inc, Washington, D C ), vol I, p 726 8 An exception, when the new employer planned to retain all holdover employees, is not applicable here 8 Howard Johnson Co v Detroit Joint Board, supra at 262, NLRB v Burns Security Services, supra at 280 fn 9, NLRB v Kimbell Foods, 496 F2d 117 (1974), enfg 201 NLRB 933 (1973), Sousa & Sons, 210 NLRB 982 (1974), Hudson River Aggregates, 246 NLRB 192 (1979), Love's Barbe- que Restaurant No 62, 245 NLRB 78 (1979), Houston Distribution Serv- ices, 227 NLRB 960 (1977), enfd 573 F 2d 260 (1978), cert denied 439 U S. 1047 (1978), Potter's Drug Enterprises, 233 NLRB 15 (1977), enfd mein 584 F 2d 980 (9th Cir 1978), Mason City Dressed Beef 231 NLRB 735 (1977), enfd in part sub nom Packing House & Industrial Services v NLRB, 590 F 2d 688 (8th Cir 1978), Crawford Containers, 234 NLRB 851 (1978), Nevis Industries, 246 NLRB 1053 (1979) 10 Hudson River Aggregates, supra, Love's Barbeque, supra, Houston Dis- tribution Services, supra; Kimbell Foods, 201 NLRB 933 (1973), enfd 496 F 2d 117 (5th Cir 1974), Potter's Drug Enterprises, supra, Greengate Mall, 209 NLRB 37 (1974) 951 and authority by American and hence beyond the bind- ing effect of the law of agency or respondent superior. The Board, however, holds that strict rules of respondent superior are not applicable to determine whether an em- ployer can be charged with the actions of an agent, and it need not be shown that the actions were authorized or ratified. Pepsi-Cola Bottling Co., 242 NLRB 265, 269 (1979). The test rather is whether, under all the circum- stances, employees could reasonably believe the person whose status is at issue reflects company policy and is speaking and acting on behalf of management. Aircraft Plating Co., 213 NLRB 664 (1974); Montgomery Ward & Co., 228 NLRB 750 (1977). A former owner, particular- ly, has been found to be an agent of the new owner when he served in some official capacity for the new owner. Joe & Dodie's Tavern, 254 NLRB 401, 411 (1981); Garrett Flexible Products, 270 NLRB 1147 (1984). Denaro was a former owner and present part-owner, and was re- quested by American Press to contact former Rite-Way employees, and it was quite natural for a former employ- ee to accept him as an agent of American Press. Even Reich, though he was not a former or present owner, identified himself as having been asked by Johnson to call regarding employment and, under the circumstances Casteel acted reasonably in believing that Reich's thoughts accurately reflected those of American. See Quality Drywall Co., 254 NLRB 617, 620 (1981); Ameri- can Lumber Sales, 229 NLRB 414, 420 (1977). Thus, American has met virtually all the criteria of a successor employer: it has, or but for its antiunion policy would have, employed a majority of Rite-Way's union workers; it uses substantially the same plant, equipment, and procedures, from the same sources, to produce the same goods or services, for consumption by a substantial number of Rite-Way's former customers. In the totality of the circumstances, I find that American is a successor employer to Rite-Way. C. Discrimination in Failing to Employ This topic has been sufficiently covered above. It has been proven that American negotiated for the purchase of Rite-Way with the intention of operating as a non- union shop, contrary to the desires of a majority of unit workers then employed; that it made known its policy to the seller, Rite-Way, and, after the sale, to the former employees. While rehiring all of the nonunionized em- ployees, American hired only those two production em- ployees whom it could not otherwise replace and hired other employees without permitting Rite-Way former employees a reasonable opportunity to be considered. D. Failure to Bargain As discussed, supra, American is a successor employer, and is thereby bound to bargain with the Union. CONCLUSIONS OF LAW 1. Respondent is an employer engaged in commerce within the meaning of Sections 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. 952 DECISIONS OF NATIONAL LABOR RELATIONS BOARD 3. Respondent has engaged in unfair labor practices in violation of Section 8(a)(1), (3), and (5) and Section 8(d) of the Act, by interfering with the exercise of rights guaranteed in Section 7 of the Act, by discriminating in regard to the hiring and conditions of employment, thereby discouraging membership in a labor organization, and by refusing to bargain collectively with the repre- sentative of its employees. 4. These unfair labor practices affect commerce within the meaning of Section 2(6) and (7) of the act. THE REMEDY Having found that Respondent has engaged in unfair labor practices in violation of Section 8(a)(1), (3), and (5) and Section 8(d) of the Act, I recommend that Respond- ent cease and desist therefrom, and take certain affirma- tive action designed to effectuate the policies of the Act. Respondent will be required to recognize and bargain with Detroit-Toledo Local No. 289, Graphic Communi- cations International Union in its appropriate collective- bargaining unit and, if agreement is reached, to reduce the agreement to a written contract. Respondent will be required to reinstate employees Calvin Casteel, Charlotte Casteel, S. Roulette, R. Bolda, J. Mohan, G. Willard, N. Wilson, and R. Young, and make them whole for any losses they may have suffered as a result of the discrimi- nation against them from October 10, 1982 to date, less net interim earnings during that period. Backpay shall be computed in accordance with F W. Woolworth Co., 90 NLRB 289 (1950), with interest as proscribed in Florida Steel Corp., 231 NLRB 651 (1977). [Recommended Order omitted from publication.]