P & M Cedar Products, Inc.

652 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD P & M Cedar Products, Inc. and International Woodworkers of America, Local 3-433, AFL- CIO. Case 20-CA-20132 30 June 1987 DECISION AND ORDER BY MEMBERS JOHANSEN, BABSON, AND STEPHENS On 11 September 1986 Administrative Law Judge James M. Kennedy issued the attached deci- sion. The Respondent filed exceptions and a sup- porting brief, the General Counsel filed limited cross-exceptions, and the General Counsel and the Charging Party filed answering briefs to the Re- spondent's exceptions. 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 1 and has decided to affirm the judge's rulings, findings,2 and conclusions3 and to adopt the recommended Order. In adopting the judge's conclusion that the Re- spondent violated Section 8(a)(5) and (1) of the Act, we fmd it unnecessary to rely on the judge's finding that "the objective facts show that Re- spondent purchased [the Anderson] plant with the specific purpose, inter alia, of producing pencil stock to be sold to the same pencil slat plant that it had always serviced." In so doing, we find it un- necessary to decide what the Respondent's precise plans for the plant were at the time of its purchase. In this regard, in agreement with the judge, we are satisfied that the Respondent is a successor employ- er because there is a substantial continuity of the employing enterprise. See Eastone of Ohio, 277 1 The General Counsel has submitted a motion to correct the tran- script in various respects. Since no party opposes that request, we grant the General Counsel's motion. 2 Based on certain remarks the judge made at the hearmg, the Re- spondent contends that the judge was biased in that he prejudged the issues before him We have carefully reviewed the entire record and the judge's decision in light of the Respondent's contentions, and conclude that they are without merit. Additionally, the judge stated in his decision that the Respondent pur- chased a new debarker machine before commencing operations at the Anderson, California sawmill involved in this dispute. Contrary to the judge, the evidence regarding the debarker discloses that the Respondent only changed a part of the operation involving this machine when it up- graded the Anderson sawmill. This error is insufficient to affect our result in this case 3 We note that the judge properly found that the Respondent has ad- mitted in its answer that the Anderson sawmill meets the Board's discre- tionary standard for the assertion of junschction on a projected basis Based on the evidence that the Respondent conducts other lumber oper- ations, the judge also stated that "[n]o doubt it would have met the non- retail standard without the projection" The judge further stated that the Anderson sawmill operates "like other sawmills" We find that the judge's latter two statements lack evidentiary support in the record, and we place no reliance on these statements. NLRB 1652 (1986). Furthermore, in light of the other factors indicative of substantial continuity here, the 6-month hiatus between the former em- ployer's shutdown and the Respondent's com- mencement of operations is not determinative. See Fall River Dyeing Corp. v. NLRB, 107 S.Ct. 2225 (1987). We also note that, because during at least 3 months of the hiatus the Respondent was engaged in remodeling the sawmill for operation, the hiatus, viewed from the employees' perspective, may have been less than 6 months. We, however, place no re- liance on the judge's speculative finding that if the Respondent had permanently closed the Anderson sawmill, "it would have meant that [the Respond- ent's] other plants would have had to cease pro- ducing the products which they were then making and reducing its claim in those markets." ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, P & M Cedar Products, Inc., Anderson, California, its offi- cers, agents, successors, and assigns, shall take the action set forth in the Order. John M. Kelly, for the General Counsel. Morton H. Orenstein and Richard J. Curiale (with Edward L. Kaufman on brief) (Schachter, Kristoff Ross, Sprague & Curiale), of San Francisco, California, for the Re- spondent. Lynn-Marie Crider, of Gladstone, Oregon, for the Charg- ing Party. DECISION JAMES M. KENNEDY, Administrative Law Judge. This case was tried before me in Redding, California, on May 7, 8, 28, and 29, 1986, pursuant to a complaint issued by the Regional Director for Region 20 of the National Labor Relations Board on March 5, 1986. The complaint is based on a charge filed by International Woodworkers of America, Local 3-433, AFL-CIO (the Union) on Jan- uary 29, 1986. The complaint alleges that P & M Cedar Products, Inc. (Respondent) has engaged in certain viola- tions of Section 8(a)(5) and (1) of the National Labor Re- lations Act (the Act). Issue The sole issue is whether Respondent is a successor under the Act to the Hudson Lumber Company, Elkins Sawmill Division, having the obligation under the Act to recognize and bargain with the Union that had been the collective-bargaining representative of the Hudson em- ployees. Based on the entire record of the case, as well as my observation of the witnesses and their demeanor, I make the following 284 NLRB No. 76 CEDAR PRODUCTS 653 FINDINGS OF FACT I. RESPONDENT'S BUSINESS The complaint, utilizing a commerce projection formu- la, alleges that Respondent meets the nonretail standard for the assertion of jurisdiction by the Board. Specifical- ly, it alleges that since January 6, 1986, when Respond- ent began operating the Hudson facility in question, it will annually ship and sell from that facility products, goods, and materials valued in excess of $50,000 directly to enterprises which meet the Board's standards for the assertion of jurisdiction on a direct basis. Respondent admits the allegation and the admission is sufficient to warrant the assertion of jurisdiction here. As will be seen, however, Respondent is not a newcomer to the timber products field. Indeed, it operates sawmills in at least two States as well as mills that convert the raw lumber produced at the sawmills into other products. No doubt it would have met the nonretail standard without the projection. I find, therefore, that Respondent is an employer engaged in commerce and in an industry af- fecting commerce, within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED The General Counsel has alleged that the Union is a labor organization within the meaning of Section 2(5) of the Act. In its answer Respondent denies the allegation for lack of sufficient information. The evidence, howev- er, shows that International Woodworkers of America, Local 3-433, AFL-CIO is a local labor union in Ander- son, California, which has represented employees at the sawmill in question since it was certified by the Board in 1962. 1 The evidence further shows that the Union has bargained collectively with whoever was owner of that facility. The ownership changed in 1963 when Hudson purchased the mill from Elkins Sawmill, Inc. Since 1963 the Union has negotiated a series of collective-bargaining agreements with Hudson. I conclude, therefore, that the Union is a labor organization within the meaning of Sec- tion 2(5) of the Act. III. THE ALLEGED UNFAIR LABOR PRACTICES A. Background As noted above, Hudson Lumber Company had oper- ated the Elkins Sawmill in Anderson, California, since 1963.2 Hudson in turn became a subsidiary of the Berol Corporation. Berol, through its divisions, is a manufac- turer of writing instruments, including lead pencils. The first stage of the manufacture of lead pencils is the reduc- tion of raw cedar logs to 3-by-3 inch lumber in lengths that are multiples of 16 feet. This product is known as "pencil stock," and Hudson's Elkins Sawmill has always mannfactured it. Its pencil stock was thereafter kiln-dried and then shipped to a Hudson sister plant in San Lean- dro, California, where the pencil stock was further re- duced to another product known as "pencil slats." The Elkins Sawmill, 20-RC-4785 (1962) 2 The sawmill in question is referred to interchangeably as either Elkins or Anderson. log-to-slat process, as administered by Hudson, was an internal straightline operation. Because the diameter of raw logs varies as does the quality of the wood found within a given log, the Ander- son mill, like other sawmills, also produced, and still pro- duces, other products. These include bark, known as "hog fuel," chips (sold to a paper manufacturer), and other grades and shapes of lumber. The lumber that was not pencil stock was either commercial or industrial lumber that Hudson usually sold to other firms for re- manufacture into whatever product that company chose to make. The Elkins Sawmill is located on property consisting of approximately 30 acres, 5 of which are occupied by a power plant. In 1982, Hudson, desiring to become a more efficient operation, built a large dry kiln to dry not only the products it manufactured, but to dry the wood products of other sawmills. The new kilns are heated by spent steam from the electrical steam plant. The steam plant, built simultaneously with the new kilns, is also used to generate electricity both for the plant and for the sale of surplus electricity to the local electric utility, Pa- cific Gas & Electric Co. The "cogeneration plant," as it is called, is powered with the hog fuel produced at the sawmill This fuel is burned at the cogeneration plant to produce steam to run the turbines. When the cogeneration and dry kiln operations com- menced operating, Hudson recognized the Union as the representative of both the cogeneration plant and the new dry kiln employees. 3 Wage rates were agreed on for the cogeneration plant employees, as well as for the dry kiln employees. The most recent collective-bargaining contract between Hudson and the Union was in effect frorn July 8, 1983, with a scheduled expiration date of May 31, 1986. It covered all the production and mainte- nance employees at the sawmill, the dry kilns, and the cogeneration plant. Sometime in 1985, Berol Corporation decided to aban- don the pencil manufacturing business. In separate trans- actions it put up several of its west coast holdings for sale. It sold the Hudson San Leandro pencil slat plant to a newly formed company known as Hudson ICS and, in June 1985, sold the Elkins sawmill and dry kilns to Re- spondent. The cogeneration plant was eventually sold to a third firm, Catalyst Energy Development Corporation, in December 1985. Respondent P & M Cedar Products is headquartered in Stockton, California. From its headquarters it directs operations at its sawmills located in Mt. Shasta, Pioneer, Westwood, and McCloud, California, as well as in Med- ford and Roseburg, Oregon. These mills generally manu- facture commercial lumber of varying types but the Mt. Shasta mill has also produced pencil stock. There are only two customers for pencil stock in the United States, one being the Hudson plant in San Leandro and the other being a company known as California Cedar Prod- ucts. 3 The record does not show whether there was any other type of kiln on the premises prior to the construction of the new kilns. 654 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD On Friday, May 31, 1985, Hudson discontinued its sawmill operation at Anderson and advised its employees that it was selling the mill and the dry kilns to Respond- ent. On that date there were approximately 56 employees working at the three divisions. Ten of those were as- signed to the cogeneration plant. All the other bargain- ing unit employees were notified of their layoff at that time, although supervisory personnel and a few mainte- nance employees remained at the plant until Friday, June 21, in order to facilitate the shutdown and storage of equipment. On that date, the sale to Respondent was completed. B. The Nature of the Transaction Hudson had insisted that any purchaser of the Elkins Sawmill also purchase its Worden, Oregon mill. Accord- ing to Respondent's general manager and executive vice president, Larry Hood, P & M had no present intention of operating either the Worden or Anderson sawmills.4 He said that it was P & M's principal (crux) intention to obtain the pencil stock sales contract with the newly formed Hudson ICS and to run the dry kilns. Under the purchase agreement, Respondent purchased the sawmill, the dry kilns, the equipment, the logging inventory, the log supply contracts, the lumber inventory, and certain lumber sales agreements. In addition, before it actually closed the sale, Respondent did enter into the sought-for agreement with Hudson ICS, the San Leandro slat facto- ry, to supply that factory with its pencil stock require- ments. It also arranged a hog-fuel sale and steam pur- chase agreement with Hudson with respect to the symbi- otic cogeneration plant that Hudson continued to oper- ate. C. P & M Takes Over the Sawmill and the Dry Kilns On Monday, June 24, Respondent had hired most of Hudson's management officials and installed them in similar capacities. Hudson's plant manager David Waters was made P & M's plant manager; Hudson's sawmill su- pervisor John Lipsey was given the same position, as were Hudson's dry kiln supervisor Fred Statton and Hadsons sales manager Leo Jordan. Furthermore, Waters retained Richard Schneider as a handyman and to oper- ate the log loader and other yard equipment. The sawmill remained closed until January 6, 1986. However, beginning in October 1985, Respondent took steps to modernize and upgrade the mill. The steps it took will be described in more detail below. From June 24 on, the dry kilns continued to operate as before. On hand at the time the sale was completed, were approximately 5 million board feet of pencil stock. This represented several months' production and, togeth- er with inventory already on hand at the San Leandro slat factory, was enough to keep the slat factory going for 4 or 5 months. To the extent that additional pencil stock was needed, the Mt. Shasta mill later provided it. In addition, the dry kilns continued to dry green lumber in a manner identical to that under Hudson. Much of the pencil stock had come from the Elkins mill, 4 According to Hood the Worden mill is now being dismantled. or from Worden, but some came from Mt. Shasta for drying. In addition, various grades of commercial lumber produced either by P & M or by other firms continued to be dried. Indeed, Hudson had previously served as a commercial dryer for several other lumber companies. Between May 30 and the June 21 takeover, Hudson continued to accept the delivery of logs at the Elkins mill. After the takeover by P & M, logs continued to arrive under the log supply contracts Respondent had acquired from Hudson. It was Schnieder's job to receive them, sort them, and stack them in the yard. In the meantime, Sawmill Superintendent Lipsey drove a fork- lift in order to stay occupied. Principally, he moved green and dry lumber in and around the dry kilns.5 D. The Mill Modification In October, Respondent commenced a major modifica- tion of the sawmill. To assist in this remodel, it hired nine former Hudson employees. 6 Lipsey told them that if he had any say about it they could expect to be retained to work in the mill when it resumed operation. In No- vember, nine additional employees were hired, four of whom were former Hudson employees. Three of the four new employees were only hired on a temporary basis. In December, three more employees were hired. One had worked for Hudson at the time of the shut- down, one was a Hudson retiree, and the third was new. The retiree, Willard Miller, was hired as a temporary employee; the other two were hired as permanent em- ployees. Respondent's purpose in modifying the mill principally was to create a mill that had the capacity to produce a larger dimension commercial lumber when necessary. It also was attempting to make the mill more efficient by reducing the number of times a log needed to be turned to be cut. Furthermore, it wished to be able to handle larger logs in order to increase its production of com- mercial lumber. In fact, it may fairly be said that Hudson had simply been in the pencil stock business, whereas P & M wanted the same plant to produce both pencil stock and commercial lumber as major products. To this end, Respondent invested over $800,000 to make capital im- provements. First, it revamped the log inload system. Previously logs had been transported to the log deck by floating them to a conveyor rising from the mill pond. It substi- tuted instead a dry deck log storage system. This re- quired a change in the approach to the debarker, a new debarker, and required new and different conveyor sys- tems. Second, it replaced the edger saw, substituting a saw that can accommodate an 8-inch log as opposed to the 5-inch edger that Hudson had used. The new edger enables Respondent to cut 2-by-6 and 2-by-8 lumber, products that Hudson had not been able to produce. Third, Respondent changed the resaw from vertical to 5 There are eight dry kilns Each is 120 feet long and accommodates several railway cars that slowly traverse the length of the kiln. It takes approximately 2 weeks for a load of lumber to go through the drying process. Loads are then delivered to the cooling shed before being stored or shipped. 6 Three of the nine October recalls were initially assigned to the kilns. CEDAR PRODUCTS 655 horizontal. The head rig, the saw that makes the first cut, remained the same. At Hudson, however, the log had to be run at least three times through the head rig before it could be sent to the resaw. Under the new system the head rig need make only one cut before send- ing it to the resaw. Some of this machinery was quite big and in order to revamp the conveyor systems and install and/or reorient equipment it was necessary to remove portions of the building's roof. Fourth, Respondent added a new chipper. Respondent also purchased a larger log loader than the one it had acquired from Hudson. Hudson's loader remained on site, however. The new loader was more efficient in that it could unload an entire truckload of logs in one pass. The small- er loader had been unable to be as efficient. Finally, it added a trailer loader, allowing truckers to self-load their empty trailers onto the back of their tractors. Hudson had used the log loader to accomplish that task. E. Production Resumes On January 6, 1986, Respondent resumed sawmill pro- duction. Unlike Hudson, which had operated two shifts, Respondent began production with only one shift. On that date, it put 28 employees to work in production. Of those 28, 25 were employees who had performed similar work for Hudson at the time of the shutdown in June. Without attempting to detail each job, suffice it to say that most of the Hudson employees ended up with jobs identical or nearly identical to those jobs that they had performed previously for Hudson. Certain jobs, of course, had been eliminated, i.e., the pond man. Others remained nearly the same even if the job title changed. For example, what Hudson used to call lumber pilers were called green chain pullers under Respondent. Simi- larly, a loader operator became a log stacker and the edging picker became a strip catcher. The strip catcher also had to learn to operate the new chipper by himself. Previously it had been a two-man job. Similarly, the edger saw operator had to learn some new cuts, the resaw operator had to learn to run that new saw's com- puter control and to adjust to the new merry-go-round conveyor. Previously, Hudson had required the front- end loader operator to do some scaling, i.e., measuring and grading the logs to determine the amount and nature of the lumber that could be extracted. P & M now scales the logs via an independent contractor. In January, as the mill became operational, it produced principally pencil stock, approximately 85 percent, and only 15-percent commercial lumber for remanufacture. In March and April the figures became 70 percent and 30 percent, respectively. All the Anderson pencil stock produced in 1986 up to the time of the hearing has been shipped to the San Leandro slat factory. The commercial lumber has all been absorbed within the P & M system and sent to other plants for remanufacture. Adjusting to market factors and utilizing the new flexi- bility that the mill had acquired, there were times, begin- ning in April, when the mill produced only commercial lumber. There is no evidence that Hudson had ever uti- lized the mill in that fashion. F. The Union's Demand for Recognition Although the Union early on learned about the sale and even negotiated a severance package for the employ- ees with Hudson, it also attempted to obtain an agree- ment from Respondent that it would be recognized as the Anderson employees' collective-bargaining represent- ative when production resumed. There were several tele- phone conversations between the Union's regional coun- cil president, Vernon Red Russell, and Respondent's labor attorney, Richard J. Curiale. There is some dispute about what occurred during these conversations, but whatever may be made of the different versions of the telephone calls, it is clear that Respondent informed the Union that it would not be operating the mill immediate- ly, at the very least. At one point, in November or De- cember, Curiale told Russell that Respondent would not recognize it absent a Board election. On January 10, 1986, 4 days after Respondent resumed operation, staffed with approximately 90 percent Hudson employees, Local 3-433's business agent, Glenn Blaylock, hand-delivered to Plant Manager Waters a letter demanding that Respond- ent recognize the Union in an "all employee unit," i.e., a production and maintenance unit. Waters replied by letter dated January 13, refusing recognition. Based on Respondent's refusal to recognize it, the Union filed the instant unfair labor practice charge. IV. ANALYSIS AND CONCLUSIONS The Supreme Court has held that a lawfully recog- nized union does not lose its 9(a) status by a mere change of ownership in the employing industry. NLRB v. Burns Security Services, 406 U.S. 272 (1972). Generally speak- ing, in order to determine whether an employer is a suc- cessor within the meaning of the Act, the Board looks to whether there has been a substantial continuity in the employing industry. That question is complex, but there is general agreement that resolution may be had by ana- lyzing approximately seven factors, none of which are controlling. These are: (1) has there been a substantial continuity of the same business; (2) does the new em- ployer use the same plant; (3) is the same or substantially the same work force employed; (4) do the same jobs exist under the same working conditions; (5) are the same supervisors employed; (6) are the same machinery, equipment, and methods of production used; and/or (7) are the same products manufactured or the same services offered?7 Another factor is whether, as a result of these changes, the employees' desires concerning continued union representation is likely to have changed. Ranch- Way, Inc., 183 NLRB 1168 (1970). The parties have carefully directed their briefs to an- swering these questions. In addition, Respondent argues that another factor to be considered is whether the em- ployees in question had a reasonable expectancy of rehire at the time the predecessor left the business. Whether that is characterized as a separate factor or simply part of the "economic continuity" issue is of little practical difference. 7 Jejfries Lithograph Co., 265 NLRB 1499, 1503 (1982), citing George- town Stainless Mfg. Corp., 198 NLRB 234 (1972) 656 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD The parties are certainly in agreement that some of the factors listed above have been met. For example, there is really no doubt that substantially the same work force is employed. It is true that Hudson had a larger total com- plement, utilizing a two-shift system. Yet, Respondent hired approximately 90 percent of the Hudson employ- ees. It is also true that Respondent eliminated only four job classifications involving approximately eight employ- ees, four pond employees, the head scaler, the saw fitter, and the assistant kiln operators. Yet most of the jobs remain. There continues to be the standard jobs normally seen in sawmills, including sawyers, edger operators, resaw operators, debarker operators, green chain pullers, loader operators, strip catchers, forklift drivers, the standard maintenance employees, millwrights, electri- cians, oilers, and a saw filer. The presence or absence of a few jobs, a reduction in force, or a slight redefinition of duties does not change the essential fact that Respond- ent hired over 90 percent of its employees from its pred- ecessor's work force. Nor does it change the fact that the jobs performed by the successor's employees are es- sentially the same jobs performed by the predecessor's employees. Moreover, the same management continued to operate this plant. Waters, Lipsey, and Statton per- formed approximately the same duties as they had for Hudson. It is true that Waters' duties were changed slightly because he no longer had to concern himself with log supply, that being handled by Respondent's Stockton headquarters; and Lipsey was able to delegate his quality control duties to someone else. It is also clear that the new employer uses the same plant. To be sure, some of the machinery has been up- graded and modernized but it is the same sort of equip- ment and is used for the same purpose. The fact that the new equipment involved a large amount of money in capital investment does not alter the fact that it is essen- tially the same plant using the same type of equipment. Finally, essentially the same products are being manu- factured at this plant. Under the Hudson operation, the plant produced pencil stock and commercial lumber. Likewise, Respondent's operation produces pencil stock and commercial lumber. To be sure, the commercial lumber that Respondent can produce, because of the modernization of the equipment, is of a somewhat wider range, reducing waste and simultaneously expanding its marketability. And, Respondent on occasion now pro- duces commercial lumber as its sole product at this plant. Hudson never did that; commercial lumber for that com- pany was principally a by product of the pencil stock op- eration. Nonetheless, the change in emphasis, or perhaps more accurately the enhanced flexibility of this re- vamped mill, does not change the ultimate fact that the mill produces essentially the same sort of product—cedar lumber—for even the pencil stock may be so character- ized. In fact, at least one type of commercial lumber is virtually identical to pencil stock, 3-by-3 inch in dimen- sion. Depending on market conditions, it might be la- beled pencil stock. Moreover, virtually all the cedar lumber product produced at this plant is produced in the first instance to be remanufactured into other products. The pencil stock invariably went to a remanufacturer, the slat plant, and the commercial lumber invariably went to a manufacturing plant where it was further re- duced into other products. Thus, although Respondent vigorously argues that the enhanced capability of this plant to produce a wider va- riety of commercial lumber has significantly modified the nature of the product manufactured, I disagree. It seems to me that there is no question that the products manu- factured by P & M at the Elkins mill are substantially the same as the products manufactured by Hudson at the Elkins mill. Finally, there is the question of whether there has been substantial continuity of this same business operation. I reach the conclusion that there is substantial continuity. Although it has been said before, it bears repeating here. Hudson principally manufactured pencil stock and shipped it to its San Leandro plant. Respondent, when it purchased the mill, had as its principal purpose, the take- over of the pencil stock business. Even before the sale closed, Respondent sought and obtained a contract obli- gating it to supply the San Leandro pencil slat factory, now owned by Hudson ICS, with all its pencil stock re- quirements. It is certainly true that other plants in the P & M system were capable of producting the pencil stock and may well have been able to supply Hudson ICS with its needs. Had they done so, it would have meant that P & M's other plants would have had to cease producing the products that they were then making and reducing its claim in those markets. Thus, it seems likely that Re- spondent at all times intended to utilize the Elkins mill to manufacture pencil stock for San Leandro. It is clear to me, therefore, that there has been a substantial continuity of the same business operation insofar as the sale of pencil stock is concerned. Moreover, the commercial lumber operation continued to produce the same sorts of molding that Hudson had produced, although it is now able to produce an even greater variety of products. In my view, this demonstrates, rather than disproves, the al- legation that there has been a substantial continuity of that side of the business. Respondent also points to the 6-month shutdown as evidence that the business was not continuous. Actually, however, that is only partially true_ It may be that the kilns were only the tail on the dog of this business, but they continued to operate as usual during the 6 months in question. Previously they had been used to dry Elkins- produced lumber and lumber from other mills on a com- mercial basis. That practice continued throughout the 6 months that the mill was shut down. Furthermore, Re- spondent kept its supervisory staff in place, knowing that the pencil stock inventory would soon be exhausted. That in itself suggests that the shutdown was only tem- porary and Respondent knew it. Certainly a temporary shutdown while a business is upgraded is not the kind of hiatus that the Board and the courts have looked to in fmding a break in continuity. Usually that sort of hiatus is a time during which a company is dormant. No dor- mancy can be found here. Indeed, in Fall River Dyeing Corp., 272 NLRB 839, 840 (1984), enfd. 775 F.2d 425 (5th Cir. 1985), a 7-month hiatus did not defeat succes- sorship. Even an 8-month hiatus has been held not to be controlling. Daneker Clock Co., 211 NLRB 719 (1974). CEDAR PRODUCTS 657 The hiatus, of course, can also be seen as a fact affect- ing the employees' expectancy of recall. Any expectancy an employee may have in this regard is undoubtedly di- minished by the passage of time. Yet, one employee, Schneider, continued to be employee throughout this period and nine others (three of whom initially did bar- gaining unit work) were hired in October to begin refur- bishing the plant. Nine more were hired for the same purpose in November. At that point the expectancy of recall was clear. Not only were the employees told that they would be rehired when production resumed, but also they could see that the mill was reftirbishing in order to resume production. Indeed, Plant Manager Waters and Superintendent Lipsey are in agreement that the Hudson staff was a good staff and was the natural place for P & M to seek good quality employees. They had every intention of hiring as many former Hudson employes as they needed. They mailed letters to them before hiring any outsiders. To the extent that this 6- month hiatus had any impact at all on the employees' ex- pectancy of recall, I conclude that it only minimally di- minished them. Equally unpersuasive with respect to their diminished expectancy is Respondent's observation that the Hudson employees had received, through union negotiations, a severance pay package. Hudson, of course, was obligated to collectively bargain about the effects of its closure on the employees. The fact that it did so and that the Union obtained certain benefits from that negotiation does not in any way change the employees' perception of whether they were to be hired by the purchaser of the plant. Ironically, that factor tends to show that the employee complement had no reason to abandon their desire for continued representation by the Union. It had done a good job to the very end. Employees would be aware of that and would likely want it to continue. Ranch-Way, supra. Although the parties have focused on the expectancy of rehire as an issue of concern in measuring successor- ship status, I find that factor, although favoring the em- ployees, to be relatively minor in the overview. More significant is the economic continuity that resulted here. Despite Hood's testimony to the contrary, the objec- tive facts show that Respondent purchased this plant with the specific purpose, inter alia, of producing pencil stock to be sold to the same pencil slat plant that it had always serviced. It is also no doubt true that Respondent hoped to be able to utilize the Elkins mill's production facilities for products other than pencil stock but that does not change the economic continuum. Respondent's somewhat brittle argument that the continuum was broken because the San Leandro plant was no longer the same "customer" (being owned by a new company) falls short of establishing that there was no economic continu- ity here. Clearly, the process of manufacturing pencils began at the Elkins sawmill and proceeded to the next stage at the San Leandro plant. The fact that Hudson sold both of those mills to others does not change the economic continuum at all. In any event, it appears to me that the most important factor in the laundry list of significant features discussed above is the question of whether substantially the same work force was maintained and whether the same sorts of tasks were performed by that work force. These fac- tors are present and virtually control here, favoring a finding of successorship. Respondent makes one other argument that deserves mention. It asserts that there is no continuity because of the fact that it did not purchase Hudson's cogeneration plant. I disagree. The Union had negotiated with Hudson from 1963 until 1982 in a bargaining unit that did not in- clude the cogeneration plant employees, because that fa- cility had not yet been built. In 1982, after its construc- tion the Union was voluntarily recognized as the repre- sentative in that bargaining unit bargaining unit and they were included in the subsequent contract. Clearly, both units were appropriate for collective bargaining. Now that the cogeneration unit is no longer a part of the oper- ation, the bargaining unit merely reverts to what it was before. In any event, the presence or absence of the co- generation plant is not significant enough to change the substantial continuity of the underlying enterprise. Accordingly, I conclude that Respondent as of Janu- ary 6, 1986, was a successor to Hudson's Elkings Saw- mill Division in Anderson, California. As such it was ob- ligated to recognize and bargain with the Union, which was, and remained, the 9(a) bargaining representative of the production and maintenance employees at the Elkins sawmill. THE REMEDY Having found that Respondent has engaged in certain violation of Section 8(a)(5) and (1) of the Act, I shall recommend that it be ordered to cease and desist there- from and to take certain affirmative action designed to effectuate the policies of the Act. In this regard Re- spondent shall be ordered immediately to recognize and bargain with the Union in the unit found to be appropri- ate, and thereafter reduce to writing and sign any agree- ment which may be reached. CONCLUSIONS OF LAW 1.The Respondent, P & M Cedar Products, Inc., is an employer engaged in commerce and in a business affect- ing commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. The Union is a labor organization within the mean- ing of Section 2(5) of the Act. 3. Respondent is a successor to Hudson Lumber Com- pany, Elkins Sawmill Division, and was obligated to rec- ognize and bargain with the Union as of January 10, 1986. 4. By failing and refusing to recognize and bargain with the Union on or after January 10, 1986, the date of the Union's demand for recognition, Respondent violated Section 8(a)(5) and (1) of the Act. 5. The following is an appropriate unit for collective bargaining: All production and maintenance employees em- ployed by P & M Cedar Products, Inc. at its saw- mill and dry kiln operation located near Anderson, 658 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD California, excluding office clerical employees, guards and supervisors as defined in the Act. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed8 ORDER The Respondent, P & M Cedar Products, Inc., Ander- son, California, its officers, agents, successors, and as- signs, shall 1. Cease and desist from (a) Failing and refusing to recognize International Woodworkers of America, Local 3433, AFL-CIO as the collective-bargaining representative of its employees in the collective-bargaining unit described above. (b) In any like or related manner interfering with, re- straining, or coercing employees in the exercise of the rights guaranteed them by Section 7 of the Act. 2. Take the following affirmative action necessary to effectuate the policies of the Act. (a) Immediately recognize and bargain with Interna- tional Woodworkers of America, Local 3-433, AFL-CIO in the bargaining unit found appropriate herein and embody in writing and sign and agreement or under- standing may be reached. (b) Post at its Anderson, California facility copies of the attached notice marked "Appendix." Copies of the notice, on forms provided by the Regional Director for Region 20, after being signed by the Respondent's au- thorized representative, shall be posted by the Respond- ent immediately upon receipt and maintained for 60 con- secutive days in conspicuous places including all places where notices to employees are customarily posted. Rea- sonable steps shall be taken by the Respondent to ensure that the notices are not altered, defaced, or covered by any other material. 8 If no exceptions are filed as provided by Sec. 102.46 of the Board's Rules and Regulations, the findings, conclusions, and recommended Order shall, as provided in Sec. 102.48 of the Rules, be adopted by the Board and all objections to them shall be deemed waived for all pur- poses. 9 If this Order is enforced by a judgment of a United States court of appeals, the words m the notice reading "Posted by Order of the Nation- al Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board." (c) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representatives of their own choice To act together for other mutual aid or protec- tion To choose not to engage in any of these protect- ed concerted activities. WE WILL NOT refuse to recognize and bargain collec- tively with International Woodworkers of America, Local 3-433, AFL-CIO as the collective-bargaining rep- resentative in the following appropriate collective-bar- gaining unit: All our production and maintenance employees em- ployed at our sawmill and dry kiln operation locat- ed near Anderson, California, excluding office cleri- cal employees, guards and supervisors as defined in the Act. WE WILL NOT in any like or related manner interfere with any of the rights set forth above that are guaran- teed by the National Labor Relations Act. WE WILL, on request, bargain collectively with the above-named labor organization as the collective-bar- gaining representative of the employees in the unit de- scribed above, with respect to rates of pay, wages, hours of employment, and other terms and conditions of em- ployment, and, if an understanding is reached, embody such understanding in a signed agreement. P & M CEDAR PRODUCTS, INC.