Usg Acoustical Products Co.

USG ACOUSTICAL PRODUCTS 1 USG Acoustical Products Company and United Pa- perworkers International Union., AFL-CIO, CLC and Local No. 158. Case 18-CA-9465 30 September 1987 DECISION AND ORDER BY MEMBERS BABSON, STEPHENS, AND CRACRAFT On 30 October 1986 Administrative Law Judge Marion C. Ladwig issued the attached decision. The General Counsel filed exceptions and a sup- porting brief; the Respondent filed exceptions, a supporting brief, and an answering brief, and the Charging Parties filed a brief in support of the judge's decision. 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 conclusions and to adopt the recommended Order. ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge and orders that the Respondent, USG Acoustical Products Company, Cloquet, Minneso- ta, its officers, agents, successors, and assigns, shall take the action set forth in the Order. ' 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) To the extent the Respondent has excepted to some of the judge 's credi- bility findings, we have carefully examined the record and find no basis for reversing the findings. We find it unnecessary to rely on the judge's statement that some of the Respondent's changes in its manner of business operation , discussed in sec. II,B,3 of his decision, have "little bearing" on the successorship issue, because we conclude that the evidence as set forth by the judge supports a finding that the Respondent is a successor employer Fall River Dyeing Corp. v. NLRB, 482 U.S. 27 (1987) The General Counsel excepts to the judge's failure to provide a visits- tonal clause in the remedy. We find a visitatorial clause is not warranted in this case Everett Rotenbeny, Esq., for the General Counsel. Michael R. Flaherty and Paul K Whitsett, Esgx (Keck, Mahin & Cate), of Chicago, Illinois, for the Respond- ent. Melinda J. Branscomb, Esq., of Nashville, Tennessee, for the Charging Parties. DECISION STATEMENT OF THE CASE MARION C. LADWIG, Administrative Law Judge. This case was tried at Duluth, Minnesota, on 19-23 May 1986. The charge was filed' 21 November 19852 (amended 2 December) and the complaint was issued 2 April 1986. USG Acoustical Products Company (USG or the Company), a wholly owned division of USG Corpora- tion (formerly U.S. Gypsum Company), operated seven manufacturing plants, all nonunion . On 9 August the Company purchased its fourth ceiling tile plant, a union plant in Cloquet, Minnesota, from Conwed Corporation. During the next 4 weeks it restaffed the facility, employ- ing its plant supervision entirely from former Conwed personnel, but its plant employees "from the communi- ty." About 5 or 6 September it resumed the production of acoustical ceiling tile at the plant. On later learning that between 60 and 70 percent of the production and maintenance employees were former Conwed employees represented by the Union, USG's attorney declined either to grant or deny the Union's repeated requests for recognition and bargaining. The primary issues are whether the Company, the Re- spondent, (a) took frivolous positions to overcome the Union's majority status and (b) as a successor to Conwed, violated its obligation to recognize and bargain with the Union, violating Section 8(a)(5) and (1) of the National Labor Relations Act and necessitating a bar- gaining order. On the entire record, including my observation of the demeanor of the witnesses, and after considering the briefs filed by the General Counsel, the Company, and the Union, I make the following FINDINGS OF FACT 1. JURISDICTION The Company, a Minnesota corporation, manufactures acoustical tile at its facility in Cloquet, Minnesota, where it annually ships goods valued over $50,000 directly out- side the State. The Company admits and I find that it is an employer engaged in commerce within the meaning of Section 2(2), (6), and (7) of the Act and that the Inter- national and Local (the Union) are labor organizations within the meaning of Section 2(5) of the Act. II. ALLEGED UNFAIR LABOR PRACTICES A. Refusal to Recognize the Union 1. Termination of plant employees Effective 9 August USG purchased Conwed Corpora- tion's Cloquet ceiling tile facility, where the plant em- ployees had been represented by the Union since 1937 (C.P. Exh. 3). Although USG retained most of the plant and office supervision and other salaried personnel, it disowned any obligation under Conwed's collective-bar- gaining agreement and refused the Union's repeated re- quests that it retain the current work force (Tr. 125, 148, 165-166; R. Exhs. 6 and 7). In a telephone conversation, about 8 August, USG Attorney John McDonald in- formed International Vice President Edward Windorf ' The charging parties are shown as amended at the trial. 2 All dates are in 1985 unless otherwise indicated. 286 NLRB No. 2 S-222702 0001(00)(31-OCT-89-05:04:03) F0610 04/26/87 2 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD that USG intended to "hire from the community" (Tr. 166). Meanwhile on 2 August Conwed notified its bargain- ing unit employees by letter (G.C. Exh . 7, C.P. Exh. 4) that it would cease operation on the 9 August closing date for the purchase and that their employment would be terminated on their "last scheduled day worked, which will be no later than" that date. USG had purchased the entire "acoustical tile manu- facturing plant." The purchase included the land and building and all the ceiling tile machines , equipment, and tools. It included Conwed's trademarked ceiling tile brand names and patents, licenses, and production proc- esses. The purchase also included Conwed's lists of em- ployees and ceiling tile customers, its accounts receiva- ble, contracts, and inventory, and its unfilled ceiling tile orders . It did not include equipment for the manufacture of blanket products ("cellulose fibers, bonded fibers, and fabrics"), which provided work for about 140 of the 547 bargaining unit employees (R. Exh. 31). (Conwed re- tained and shipped this blanket products equipment to its other plants.) It did, however, include "certain other equipment for use in the manufacture of acoustical prod- ucts" from Conwed's plant in Ladysmith, Wisconsin, in- volving the work of about 12 employees. (R. Exhs. 1, 31, and 40; C .P. Exh. 5; Tr. 32-37, 117, 588.) (USG also pur- chased Conwed's Red Wing, Minnesota mineral fiber plant, which is not involved in this proceeding.) 2. The Union's majority status For the next 3 weeks, beginning 12 August, USG con- tinued a part of the Conwed business by using a skeleton crew of former Conwed salaried employees to do former bargaining unit work of loading and shipping ceiling tile from the plant's inventory purchased from Conwed (Tr. 466, 588). It resumed the production of ceiling tile about 5 or 6 September (Tr. 31, 124) with a new staff of em- ployees. By 3 September USG had hired a total of 222 employ- ees (excluding Eugene Polla, a new employee who quit that same day, and Ralph Anderson, who the Company contends was hired as an hourly supervisor). USG's records (R. Exh. 16) show that 155 of the 222 employees (69.8 percent) were former Conwed bargaining unit em- ployees. (Three of them were quality testers , who had been included in the Conwed bargaining unit, but who USG contends should be excluded. The Company has in- cluded them in the calculations in its brief (at 60-63), the parties having stipulated at the trial that their status "is not determinative of the outcome of this case " (Tr. 792).) USG continued to hire many of the former Conwed employees until 18 September, when 172 of the 246 newly hired employees (69.9 percent) were former bar- gaining unit employees . Between then and 26 September, however, USG hired only 2 former Conwed employees while hiring 25 outside employees. Yet on 26 September, 63.6 percent of the plant employees (173 of 272 on the payroll) were former bargaining unit employees. On 9 October , when USG received the Union's third bargaining request and when USG admits that the plant was fully staffed, 181 of the 292 employees (61.98 per- cent of them) were former bargaining unit employees. 3. The first bargaining requests The Union made an oral request to bargain about 8 August, when Vice President Windorf requested in the telephone conversation with USG Attorney McDonald that the Company employ the Conwed work force and bargain with the Union (Tr. 165). On 17 August the Union made the request in writing. Union Attorney Melinda Branscomb wrote the company president and McDonald, formally requesting that USG hire the current work force and recognize the Union, and offering to bargain . (R. Exh. 6.) McDonald respond- ed by letter dated 30 August , the Friday before the Labor Day holiday-making Tuesday, 3 September, the first likely date for the Union to receive the letter. By 3 September, as the company records show, the Company had hired 222 employees , 76 percent of the full comple- ment of 292 employees. Yet Attorney McDonald claimed in the letter (R. Exh. 7) that "As of this date, only 25% of the projected total work force has been employed. Accordingly . . . your request appears to be premature." He failed to mention that the Company was resuming production that week . He also failed to give any later re- sponse to the bargaining request. 4. Company attorney's discovery of union majority Sometime in September (he estimated about 3 or 4 weeks later) Attorney McDonald telephoned USG Vice President William McManus "to inquire how the man- ning was going at Cloquet" (Tr. 173 ). He learned that a majority of the newly hired employees were former bar- gaining unit employees. The evidence does not reveal whether this telephone call occurred before or after 18 September, when the Company had hired 69.9 percent of its production and maintenance workers from the former bargaining unit. As found , between that date and 26 Sep- tember USG hired only 2 former Conwed employees while hiring 25 outside employees , reducing the percent- age to 63.6 percent. By the time the full complement of 292 employees was hired, the percentage was reduced further to 61.98 percent . McDonald testified (Tr. 225) that yes, "somebody was keeping a tally of numbers," but he did not reveal whether the person began doing so before or after McDonald discovered the Union's majori- ty status. Attorney McDonald claimed (Tr. 175) that when he asked McManus about "how many of these people in your new work force came from the prior work force," McManus answered that "out of the 280 to 300, we've got about 160 that came in one way or another from the Conwed group." These figures are obviously inexact. The Company had already hired 168 former Conwed employees on 16 September , 2 days before it stopped hiring a majority of the employees from the former bar- gaining unit. But there were then nowhere near 280 em- ployees on the payroll . On 16 September there were only 242 employees working in the plant , and the 280- 300 range was not reached until 30 September, when the Company hired 18 employees (10 outsiders and 8 former Conwed employees). After McDonald gave these inexact figures , the com- pany counsel asked, "Did this occur over one telephone USG ACOUSTICAL PRODUCTS 3 conversation?" McDonald answered, "I think it may have been more than one." (Tr. 175.) He later revealed that he and McManus endeavored to figure out some way of overcoming the Union's clear majority. After re- calling (Tr. 175) that he asked McManus "to go back to get more specific numbers," McDonald testified on cross-examination (Tr. 225, 229-231): Q. When did [McManus] give you the numbers for the first time? A. It seems to me that he and I went through this exercise of the numbers at the end of September. A. And it was my idea to look at 1 hese three dif- ferent assumptions, yes. A. The first assumption is that . . . the 140 people who actually worked in the blanket depart- ment jobs for Conwed . . . are not part of this tally . . . . because [that] operation didn't get sold to USG Acoustical, but instead got transferred [and was] still with Conwed . .. . A. The second assumption was that had Conwed gone through . . . a bumping arrangement at the time it eliminated the blanket operation, then . . . a number of [the 140] would have bumped into other jobs because there were a lot of senior people. So that if the plant were still owned by Conwed, and the bumping had occurred, then the 1140 least senior people on the Conwed payroll would have been eliminated with no chance of re-employment. So as- sumption 2 was that you look at those 140 people having no opportunity to continue. A. . . . Assumption number 3 was [to] act as though USG Acoustical had bought the whole thing, and the whole work force of Conwed should be counted . . . to get 50 percent or not 50 percent. Q. . . . On the second assumption . . . if Conwed had gone through the bumping procedures, then the senior people would have rights to bump into other jobs. A. Right. Q. And that of those 140 who got hired, those in- dividuals should not be counted towards majority. A. There were about 40 of those people who got hired, and since they were people who had no ex- pectation under the successorship approach, no ex- pectation of continuing, then we had concern that they should not be counted as part of the mathemat- ics to determine the 50 percent. Q. And that would be if Conwed had gone through the bumping procedure. A. Right. Q. Conwed did not in fact go through the bump- ing procedure, did they? A. I believe they didn't I don't know . . . I don't know. [Emphasis added.] It is obvious that there was no bumping. Conwed termi- nated all the bargaining unit employees during the week of 5 August; the contractual layoff and recall provisions did not apply to bumping if the plant ceased operating (G.C. Exh. 3 pp. 21-22; Tr. 512); and there were obvi- ously no remaining Conwed jobs at the plant for the senior blanket employees to bump into. It is one thing for the attorney to suggest such a bizarre legal theory, but quite another thing for him to feign ignorance of the obvious. (He did not appear, on the stand, to be entirely candid.) The Company's trial counsel (McDonald's law partner) later admitted at the trial (Tr. 299) that the low- seniority employees were not bumped. I discredit Attor- ney McDonald's repeated claims that he did not know that "Conwed did not in fact go through the bumping procedure." I also discredit his claim (Tr. 236) that he did not know whether any of the company plants have union contracts. 5. Bargaining requests after full complement hired On 9 October, when the Company admittedly had hired a full complement of employees at the Cloquet plant, its attorney, McDonald, received the Union's 7 October bargaining request. In the letter (R. Exh. 9) Union Attorney Branscomb stated "that the Union repre- sents a majority of your employees in an appropriate unit," requested a bargaining meeting, and stated, "The Union is prepared to demonstrate our majority status." As found, Attorney McDonald was fully aware of the Union's majority status. (The full complement of 292 em- ployees consisted of 111 outside employees and 181 former Conwed bargaining unit employees-a 61.98 per- cent majority.) Yet, instead of recognizing and beginning to bargain with the Union, McDonald, on 18 October, wrote Attorney Branscomb a reply letter (R. Exh. 10), stating that "As previously indicated to you in my letter of August 30, 1985, we had no independent knowledge of the Union's claim of majority status . . . and this is still the case now that we are fully manned . . . . Please advise me specifically as to the basis for your [claim]." He concealed his personal knowledge of the Union's ma- jority. Attorney Branscomb renewed the bargaining request in her 24 October reply to McDonald (R. Exh. 11). She explained that the Union was basing its claim of majority status on the fact that "USG is a successor employer that has substantially continued" the Conwed business enter- prise and that a majority of the USG employees are "holdover employees" from the Conwed work force "that are members of, and represented by, the Union." She concluded: The Union is prepared to verify our majority status if you are unable for some reason to confirm that over half of your employees came from the prior bargaining unit. If this is the case, please con- tact United Paperworkers International Representa- tive Marvin Finendale if you feel it necessary to have the Union's majority status verified by a review of the appropriate information. Attorney McDonald responded by offering to meet with Representative Finendale. But he had no reason for meeting to calculate the Union's majority status. He ex- 4 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD plained when testifying as a company witness at the trial (Tr. 247), "I had the list from Mr. McManus and we had the list from Conwed. I had no reason to believe that my list" was different from the Union's list of former Conwed employees hired by USG. He clearly had a dif- ferent purpose for offering to meet. McDonald testified (Tr. 179) that in a discussion of Branscomb's 24 October letter, Vice President McManus "told me a number of things . .. I should be aware of about what was happening in Cloquet." McDonald claimed (Tr. 181, 799-800) that this information caused him to have certain "concerns" about union representa- tion at the plant and that he wanted a "preliminary meet- ing" with Finendale to discuss his "concerns" so that "we could make our decision about whether we would indeed recognize the Union or not." Without indicating this purpose in the letter, McDonald wrote Finendale on 30 October (R. Exh. 12) that Attorney Branscomb "has recently suggested that I write you about the Union's claim of majority status . . . . Please contact me as to the basis of your claim. The Company will fulfill its legal obligations in this matter, but will insist on its full legal rights." 6. Frivolous "concerns" Concern 1. Attorney McDonald testified (Tr. 179) that in his discussion with Vice President McManus about the Union's 24 October bargaining request, McManus "said that he had newspaper articles in which union represent- atives were being quoted as saying that they did not rep- resent a majority of people at the Cloquet plant." One of the clippings that McManus sent McDonald (R. Exh. 14) was a newspaper article dated 2 October, with the heading "Cloquet plant at full production for USG." It stated in part: None of the nine USG Acoustical Products plants is unionized, but the president of the union that represented workers under Conwed has said it will try to organize USG employees Another clipping (R. Exh. 15) was an article dated 15 October entitled "To Cloquet, workers seemed the only losers in Conwed deal." It stated in part: [Local President] Pelletier said none of the nine union officers at the plant was rehired, and of the 200 rehired workers, nearly 100 are salaried, non- union workers. Since fewer than 50 percent of the plant's workers are not [sic] former union workers, federal labor law allows USG not to recognize the IPU as the workers' bargaining agent. ... Pelletier said the IPU is trying to reorganize the plant. The Company had hired a full complement of 292 em- ployees, of whom 181 were former Conwed bargaining unit employees represented by the Union. McDonald ob- viously knew that the purported union figures quoted in the second article were inaccurate and that the Union did in fact represent a clear majority. McDonald admit- ted on the stand (Tr. 211) that he would not think the newspaper articles would be a sufficient basis for refus- ing recognition. I find that Attorney McDonald, being aware of the Union's majority status, had no actual concern that the Union might be a minority union. I find that he fabricat- ed this frivolous "concern" as a pretext for not recogniz- ing the Union. Concern 2. Attorney McDonald also testified (Tr. 179) that McManus "told me that it had been reported to him by local management that the union was engaging in some kind of organizing campaign. Employees were coming and reporting to their supervisors that they were being approached to sign cards." This information obviously provided no reason for McDonald to be concerned about recognizing a minority union. He knew that the Union already represented a majority of the bargaining unit employees at the plant. Whether the Union was seeking to increase its actual ma- jority could have no bearing on the Company's decision to grant the Union recognition. Concern 3. McDonald further testified (Tr. 179) that McManus did not "have any numbers of how many," but "A number of employees had indicated to their su- pervisors that they did not want to sign cards." He later admitted (Tr. 201) that "we're talking about a small group of employees." As an experienced labor lawyer, McDonald undoubt- edly was aware that the opposition of a few employees could not affect the employees' collective-bargaining rights. In fact, he admitted at the trial (Tr. 191) that he had not come to the conclusion that the Company had a good-faith doubt that the Union represented a majority at the plant. He also admitted (Tr. 190) never expressing such a doubt to the Union. I find that this purported "concern" is also frivolous. Concern 4. This is Attorney McDonald's bizarre theory, referred to at the trial (Tr. 632) as the "construc- tive bumpee" issue. The theory is that Conwed had transferred the blanket products operation, eliminating about 140 jobs from the plant; that employees performing the 140 jobs had se- niority in the bargaining unit; that if there had been no sale of the plant, the senior blanket products employees would have exercised their seniority and bumped less senior employees from the remaining ceiling tile oper- ation; that the 140 low-seniority employees (in both the ceiling tile and blanket products operations) would have no "reasonable likelihood" (Tr. 635) of being reemployed by Conwed at the plant; and that those who were hired by USG should be considered new employees and not former employees in the successorship calculations. Of course, all the 547 ceiling tile and blanket products em- ployees, being terminated during the week of 5 August because of the 9 August sale, had their Conwed jobs eliminated. None of them had any expectation of con- tinuing to work in the plant for Conwed, or being reem- ployed by Conwed to work there. Many of the low-se- niority employees, as well as senior employees, did have an expectation of being hired by USG, which hired 44 of them (R. Exh. 44). USG ACOUSTICAL PRODUCTS 5 Attorney McDonald's alternative theory for reducing or eliminating the Union's majority representation at the restaffed plant is asserted in the Company's brief (at 55) as follows: The former Conwed employees hired by USG who had worked in the blanket products depart- ment had no reasonable expectations of reemploy- ment at the Cloquet plant; indeed, their jobs had been permanently eliminated when the blanket prod- ucts operations were transferred to other Conwed facilities. The former blanket products employees, therefore, cannot be included in any calculation of the Union's majority status. But like the ceiling tile employees, these 140 blanket products employees were in the bargaining unit repre- sented by the Union before Conwed sold the plant, elimi- nating all the Conwed bargaining unit jobs; some of them had frequently worked in the ceiling tile departments, ex- ercising their seniority in slack periods (Tr. 429-431); and many of them did have expectations of being reem- ployed at the Cloquet plant by USG, which hired 37 of them (R. Exh. 16). I find that this purported "concern," based on either of Attorney McDonald's theories, is likewise frivolous. 7. No company position on union recognition When Attorney McDonald and Representative Finen- dale conferred over the telephone the second week in November about a meeting to discuss union recognition, McDonald made it clear that he was seeking only a "preliminary" meeting to discuss his "concerns." As McDonald recalls, "I told him that there were a number of questions that the company felt needed to be an- swered before we could make a decision about whether we were obligated to recognize the union or not in Clo- quet" (Tr. 180). On 14 November Attorney Branscomb telephoned McDonald and inquired about the purpose of McDon- ald's upcoming meeting with Finendale. As she credibly testified (Tr. 799), McDonald "responded that the pur- pose of the meeting was not to seek to verify whether the Union had majority status as I had suggested was the purpose, but rather he wanted to meet with Mr. Finen- dale because he had several concerns about union repre- sentation at the plant." McDonald admits (Tr. 182, 241) that Branscomb "said that she had no objection to my meeting with Mr. Finendale to make a head count," but it was not appropriate for McDonald to set up a meeting with Finendale to discuss the legal subjects McDonald was mentioning. (The meeting was canceled.) Later in this telephone conversation Branscomb told McDonald that she had not heard anything in the conversation with him that would be grounds for the Company to deny the Union recognition (Tr. 240). She offered to meet and show McDonald the seniority lists to prove that a major- ity of the new employees were from the old work force, but he responded that if they were just doing a head count, "I can do it in my office just as well as you could do it" (Tr. 224). Attorney McDonald recalls (Tr. 183) that at one point in the conversation Attorney Branscomb "asked me, well, are you refusing to bargain? Are you saying that there is a good faith doubt here, and I said, I'm not saying there is a good faith doubt, and I'm not saying there isn't. I'm saying we're not at that point yet. I want to get these preliminary things settled so I can tell you whether we will recognize the union or not " He later testified (Tr. 248): Q. When did you come to a conclusion about whether USG is obligated to bargain with the union or not? A. I never did Branscomb credibly testified (Tr. 807) that after McDon- ald stated he "really would like to get these concerns worked out first" before he could determine whether the Company would recognize the Union, I said, "Well, Mr. McDonald, it is now November. We . . . first demanded recognition in August. [Four] months is long enough for this uncertainty to take place. I really don't see any point in delaying any longer." And he said, "Well, we just really are con- cerned." I said, "Well, Mr. McDonald, you are giving me no other choice. If you can't have any more specific response than that, I am going to be forced to file charges with the Labor Board." And he said, "Well, do whatever you need to do to represent your client. Do whatever you have to do, but that is the best I can do at this time." McDonald also recalls (Tr. 240) that Branscomb threat- ened to go to the Labor Board to get this matter re- solved because "I wasn't willing at that point to commit to recognition." A week later the charge was filed. 8. The parties' contentions The General Counsel contends in her brief (at 16) that the Company's failure to respond to the Union's demand for recognition constituted a rejection of the demand and that the Company refused to bargain with the Union. The Union's brief asserts (at 25) that the Company's "constructive bumpee" argument, "pretending" that the 44 bumpees should not be counted as former Conwed employees to defeat the union majority, is "specious." It also argues that the newspaper articles, the Union's pass- ing out cards, and the opposition of a few employees (Attorney McDonald's other purported "concerns") did not justify the Company's refusal to bargain, and that "USG had a legal obligation long before" McDonald's and Branscomb's 14 November telephone conversation "to recognize and bargain with the Union." The Company contends in its brief (at 37) that it has never refused to bargain with the Union. It argues (at 38) that Union Attorney Branscomb advised Attorney McDonald that he could contact Representative Finen- dale "for information clarifying the Union's majority status," but "reneged on this agreement to meet and dis- 6 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD cuss the issues bearing on the Union's majority status." To the contrary I find that Branscomb authorized McDonald to meet with Finendale if "necessary to have the Union's majority status verified by a review of the appropriate information"-not to discuss McDonald's frivolous "concerns". The Company also argues in its brief (at 39-40) that "although the Company declined to take a definitive po- sition concerning union recognition until after it had re- solved the majority status issues [referring to Attorney McDonald's frivolous "concerns"], it has made every effort to meet with the Union to resolve this issue." It adds (at 40-42): The Company was fully justified in requesting a resolution of the majority status issue before bar- gaining with the Union. The unresolved unit deter- mination issues, the elimination of 140 jobs in the blanket products operation [found to be a frivolous "concern"], the Union's abortive attempt to orga- nize the USG work force [another of McDonald's frivolous "concerns," fabricated over 3 weeks after the Union's 7 October bargaining request, when the plant was "fully manned"], the conduct of union representatives which was inconsistent with its claim of majority status [referring to McDonald's frivolous "concern" about the statements in newspa- per articles], and the opposition of [a small group of] USG employees to union representation [also a frivolous "concern"] cast a cloud over the Union's claim of majority status. The Company has made every reasonable effort to meet and confer with the Union concerning its majority status, but the Union has refused to coop- erate. It would be contrary to the purpose of the Act, under these circumstances, to hold that the Company has refused to bargain, where the Union, not the Company, broke off discussion between the parties. 9. Concluding findings on refusal to bargain As found, Company Attorney McDonald discovered some time in September that USG's local management at the Cloquet ceiling tile plant had restaffed the plant with a substantial majority of production and maintenance em- ployees from the terminated Conwed bargaining unit em- ployees represented by the Union. In an "exercise in the numbers" with USG Vice President McManus, he and McManus endeavored to figure out some way to over- come the Union's majority status. McDonald suggested the bizarre "constructive bumpee" and an alternative theory as a plausible pretext to exclude some of the former Conwed employees from the calculation of ma- jority status. Later, after receiving two additional union requests for recognition and bargaining, McDonald fabri- cated three other frivolous "concerns" about recognizing the Union. Knowing that the Union represented a clear majority of the bargaining unit employees, he refused to go to a "head count" with the Union to calculate the percentage of Conwed "holdovers" employed at the plant. He insisted on getting "these preliminary things [his frivolous "concerns"] settled" before he would de- termine whether the Company would grant or reject the Union's requests for recognition and bargaining. He con- tended that he never reached a conclusion whether USG was obligated to bargain with the Union. I find that Attorney McDonald was using his purport- ed "concerns" in a bad-faith effort to delay and avoid recognition of the Union. I agree with the General Counsel that the Company's failure to respond to the Union's demands for recognition constituted a rejection, and I find that the Company refused to bargain with the Union. B. Successorship 1. Belated defense Throughout the 3-1/2 months that the Union was seeking recognition before filing the charge, Company Attorney McDonald expressed no doubt that USG's pur- chase and operation of the Cloquet ceiling tile plant was a continuation of the employing enterprise. About 8 August he told International Vice President Windorf that USG intended to "hire from the community"-not that USG intended to change the nature and character of the plant. On 30 August, when McDonald responded to Union Attorney Branscomb's written request for recog- nition, he stated that her "request appears to be prema- ture"-nothing about a new and different enterprise. On 18 October (about 2 weeks after USG was operating the plant with a full complement of employees), McDonald answered Branscomb's second written bargaining request without mentioning any change in the nature or charac- ter of the enterprise. He instead asserted the lack of any independent knowledge of the Union's claim of majority status and invited her to please advise him specifically of the basis of her claim. In reply to McDonald's 18 October letter, Attorney Branscomb specifically referred to successorship by ex- plaining that the Union was basing its claim of majority status on the fact that "USG is a successor employer that has substantially continued" the Conwed business enter- prise with a majority of its employees being holdovers from the Conwed work force. McDonald still confined his response to the union majority issue. In his 30 Octo- ber letter to Representative Finendale he stated that Branscomb "has recently suggested that I write you about the Union's claim of majority status . . . . Please contact me as to the basis of your claim." Finally, in Attorney McDonald's telephone conversa- tions with Finendale and Branscomb before the union charge was filed, he expressed frivolous "concerns" about the majority issue, but still nothing about a change in the essential nature of the employing enterprise. He never denied that USG is a legal successor to Conwed at the plant (McDonald is an experienced labor counsel. When called by his law partner (Tr. 223) as a company witness he testified (Tr. 163), "I'm . . . the senior labor law partner in the firm.") He took the position on the stand (Tr. 193) that he never reached a conclusion whether USG is a successor. USG ACOUSTICAL PRODUCTS 7 Now in the Company's brief (signed by the trial coun- sel member of McDonald's law firm) the Company not only disputes the Union's majority status, but it also con- tends that USG implemented changes in the organization and operation of the plant that substantially changed the nature and character of the employing enterprise. It con- tends in the brief (at 44) that "the record compels a con- clusion that the Cloquet plant did not have a 'substantial continuity of the business enterprise' when it resumed operations under USG." 2. Successorship criteria As recently held in NLRB v. Fall River Dyeing Corp., 775 F.2d 425, 429 (1st Cir. 1985) (fns . omitted), cert. granted 106 S.Ct. 2243 (1986), on irrelevant factual, "substantial and representative complement ," and "con- tinuing demand" issues 50 U.S.L.W. 3524 (1986), enfg. 272 NLRB 839 (1984): In determining whether an employer must recog- nize and bargain with a union that has represented the employees of the former employer, "the Board looks to the totality of the circumstances to deter- mine whether there has been a substantial and mate- rial alteration in the employing enterprise." In making this determination, the Board considers vari- ous factors, among them [a] the percentage of em- ployees who were employed by the previous em- ployer, [b] the extent to which their former supervi- sors have been retained, [c] the identity of skills used and functions performed by the employees, [d] the continuation of the business in the same physical facility with the same or similar equipment, [e] the continuity of products sold or services rendered, and [f] the identity of the customers. Significant changes in the scope of the new employer's business are to be considered, but alone they do not negate the possible successorship status of the new busi- ness. The critical inquiry is whether any changes in op- eration have significantly altered the employees' work- ing conditions, the employment relationship, and corre- spondingly, the employees' expectations and needs with regard to representation. [Emphasis added.] Similarly, in NLRB v. Jeffry Lithograph Co., 752 F.2d 459, 466 (9th Cir. 1985), enfg. 265 NLRB 1499 (1982), the court held that "the law focuses on whether business operations, 'as they impinge on union membership [empha- sis added], remain essentially the same after the transfer of ownership' [citing NLRB v. Hudson River Aggregates, 639 F.2d 865, 869 (2d Cir. 1981) and Electrical Workers IUE v. NLRB, 604 F.2d 689, 694 (D.C. Cir. 1979)]. Standing alone, the magnitude of change is irrelevant. Unless the changes affect employees' attitudes toward representation, they do not undermine the presumption that the old union should bargain with the new employ- er." The court also cited Ranch-Way, Inc., 183 NLRB 1168, 1169 (1970), in which the Board held: "The key test in determining whether a change in the employing industry has occurred is whether it may reasonably be assumed that, as a result of transitional changes, the em- ployees' desires concerning unionization has likely changed." (Emphasis added.) In the often-cited Zim 's IGA Foodliner v. NLRB, 495 F.2d 1131, 1140-1141 (7th Cir. 1974), cert. denied 419 U.S. 816 (1974), enfg. 201 NLRB 905 (1973), the court held, citing NLRB v. Armato, 199 F.2d 800, 803 (7th Cir. 1952): "Substantial changes in the employing industry may be expected to alter employee expectations and needs, thereby changing employee sentiment with respect to repre- sentation." (Emphasis added.) The court agreed, howev- er, that the changes accompanying the business transfer (from national grocery chain to individual supermarket) were unlikely "to significantly affect employee attitudes." In C. G. Conn, Ltd., 197 NLRB 442, 447 (1972), enfd. mem. 474 F.2d 1344 (5th Cir. 1973), the purchaser hired fewer than a majority of the predecessor's employees, but a majority of those hired had been in the bargaining unit. It was held that "The fact that they found them- selves fewer in number than before warrants no implica- tion that they no longer desired the union to represent them [emphasis added]," following the language of the court in NLRB v. Armato, above at 803. "Moreover, here the former . . . employees were undoubtedly looking to the Union to protect, or reclaim, their jobs in the plant." (Emphasis added.) 3. Preliminary finding The Company's brief ignores the "critical inquiry" of whether changes in operation, which alter working con- ditions and the employment relationship, significantly alter "the employees' expectations and needs with regard to representation." It cites evidence of various changes in the organization and operation of the plant that, even if they altered bargaining unit employees' working condi- tions or the employment relationship, apparently would have minimal if any effect on the employee attitudes toward representation. At USG all department superintendents answer direct- ly to the plant manager, whereas at Conwed several de- partments answered directly to the St. Paul headquarters. These were the personnel, accounting, and customer service departments, none of which employed any bar- gaining unit personnel. (Tr. 142-143, 319, 323, 427.) I note, however, that the Conwed personnel department manager had a "dotted line relationship" to the plant manager (Tr. 29, 294). The Conwed transportation department (employing no bargaining unit employees) is replaced by USG's central corporate transportation department in Chicago. Now at the Cloquet plant only one person coordinates outbound traffic and an office clerk checks incoming traffic. Nei- ther of them is a bargaining unit employee. USG contin- ues to use contract haulers, using so-called vendor truck- ers exclusively. (Tr. 63, 323-324, 393; R. Exh. 17.) The entire purchasing function has been eliminated at the plant level. Conwed had a purchasing department employing about four or five employees (none in the bar- gaining unit). Now the purchasing is done at the Chicago headquarters, with only a few people in Cloquet releas- ing purchase orders. (Tr. 320, 324; R. Exh. 31.) 8 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD At Conwed the production control manager worked in St. Paul, handling "order correspondence and passing on information for scheduling" (Tr. 325-326). At USG the production control department (with no bargaining unit employees) works under the plant manager (G.C. Exh. 5). The Company contends in its brief (at 44) that these organizational changes "significantly affect the work force," but it does not suggest how they might affect the bargaining unit employees' attitudes toward, or their ex- pectations and need of, representation. The Company's brief contends (at 45, see also 17-20, 22, 32) that the "elimination of the blanket products de- partment, which employed 140 employees," had "a sig- nificant impact on the work force." It also contends (at 29, 44, 46) that contracting out three shipping depart- ment jobs (covering loads with plastic and canvas) and another shipping job (driving a spotting tractor, retriev- ing the empty trailer from the yard, and removing the loaded trailer to the yard for Conwed's "contract hauler" to come and pick up) "also has a direct impact on the Cloquet work force" (Tr. 61-63, 95-97, 393). Again, it offers no suggestion how these changes might affect employee attitudes about representation. Clearly, the "mere diminution in the employee complement of the bargaining unit does not relieve the successor of his duty to bargain." Zim's IGA Foodliner v. NLRB, 495 F.2d at 1141. The brief also fails to suggest how changes planned to be implemented a few weeks or a year or more later would have a substantial effect on the bargaining unit employees' expectations and need of representation. The Company admits in its brief (at 33) that "USG had hired a full complement of employees" when Company Attor- ney McDonald received (on 9 October) the Union's 7 October bargaining request. Yet it cites the following subsequent changes. In late October or in November the Company added 12 jobs when the work on fabric-covered wall and ceil- ing panels was brought from the Ladysmith plant (Tr. 33, 49-53, 118, 344, 355-361, 368, 418). In March 1986, about 5 months after the full employee complement was reached, the plant received heavy steel "fissure" rolls for a pattern change. The purpose was to enable USG to service its ceiling tile customers nationwide with the same products from either the Cloquet or its Greenville, Mississippi plant (Tr. 113, 118, 138-139, 368-369, 424). The Company installed new "man lifts" in the mainte- nance department (one in November and two in late De- cember or early January 1986, with possibly a fourth purchased) at a total cost of "probably around $100,000," for more efficiency and safety (Tr. 370-371). About a year after the full employee complement was hired, probably sometime in late 1986, the Company planned to add a third perlite expander (without increasing the pro- duction work force) at a cost of about $1 million, to in- crease the perlite content of the ceiling tile (Tr. 120-121, 144, 151-152, 372-378, 381-382). After about 2 years, sometime in the summer or fall of 1987, the Company planned to convert the second and third dryers entirely to gas at a cost of about half a million dollars and then to replace the large steam boiler with a smaller package boiler (Tr. 121-122, 144-145, 152, 378-383, 424-425). Regarding these subsequent changes at the plant, the Company argues in its brief (at 43) that the Board "does not confine itself to viewing the facts solely as they exist- ed at the time of the transfer." It cites Galis Equipment Co., 194 NLRB 799 (1972) (purchaser's employee com- plement on beginning operations "only a temporary ex- pedient" to finish the predecessor's work in progress). The brief later cites Georgetown Stainless Mfg. Corp., 198 NLRB 234, 237 (1972) (the purchaser "engaged in a dis- tinctly different operation" and its "initial continuation" in the predecessor's general type of manufacturing "merely a temporary expedient"). Both cases are clearly distinguishable. Although I have taken all this evidence into consider- ation, I find that it has little bearing on the issue of successorship at the ceiling tile plant. 4. Application of successorship criteria a. Percentage employees employed by previous employer On 9 October, when the Company received the Union's 7 October renewed bargaining request, it admit- tedly employed a full complement of employees in an ap- propriate unit: All hourly paid nonsupervisory production and maintenance employees of USG Acoustical Prod- ucts Company at its Cloquet, Minnesota facility; ex- cluding employees in the following job classifica- tions: General, Engineering and Mill Offices; Sample Department; Quality Control Department; Development Department, except in pilot plants; Guard and Security Forces; and Contract Service, such as General Office Janitorial. On this date, as found, a clear majority of nearly 62 percent (181 of the 292 employees in the unit) were former Conwed bargaining unit employees. (The parties stipulated (Tr. 608-609) that the seven working foremen were then nonsupervisory bargaining unit employees.) The Company contends in its brief (at 54, 57, 63) that either 35 of these former Conwed bargaining unit em- ployees (those who worked in the blanket products oper- ation) or 41 of them (those with the least seniority under the "constructive bumpee" theory) should be regarded as new, not former, employees. Their exclusion from the number of 181 former employees would reduce the number to 146 (50 percent of the 292 unit employees on 9 October or 140 (47.9 percent). In making this conten- tion the Company disregards whether these former em- ployees had an expectation, desire, or need of representa- tion and whether they, like the employees in C. G. Conn, Ltd., 197 NLRB at 447, "were undoubtedly look- ing to the Union to protect, or reclaim, their jobs in the plant." Having found both theories for excluding them to be frivolous, I reject the contention. The Company also makes a contention-never ad- vanced by Attorney McDonald (Tr. 220, 222)-that two other former employees should not be counted because S-222702 0008(00)(31-OCT-89-05:04:15) F0610 04/26/87 USG ACOUSTICAL PRODUCTS they retired (during the week of 5 August when all the bargaining unit employees were terminal ed). The em- ployees, John Corrigan and Chester Haataja, retired 6 and 8 August to take advantage of the 20-year-service early retirement under the Conwed retirement plan, enti- tling them to prorata vacation pay and health and life in- surance policies (Tr. 291, 531, 851-856; R. Exh. 16). A somewhat similar contention was made in NLRB v. Band-Age, Inc., 534 F.2d 1, 5 (1st Cir. 1976), cert. denied 429 U.S. 921 (1976), enfg. 217 NLRB 449 (1975), in which the former employer had discharged the employ- ees and given them severance pay. Their new employer contended that their prior union representation "is no in- dication that they, after discharge! (with severance pay) necessarily maintained union ties or continued union membership." The court rejected the contention, holding that although "discharge and severance pay obviously signal the end of employment, they may have little bear- ing on continued reliance on a union for representation." (Emphasis added.) Here the Company was aware that the two former employees, after their early retirement, had sought reemployment at the plant, the same as other unit employees. Their USG employment applications stated (Tr. 288) "plant shutdown" and "sale of Conwed" as their reasons for leaving Conwed. As former bargain- ing unit employees who were terminated with the other Conwed employees, they presumably would have the same interest as the other former employees in union rep- resentation . I reject the Company"s contention that Cor- rigan and Haataja should be excluded as new employees and find that they should be treated the same as other former Conwed employees and included in the count. The Union contends (1) that its August requests to bargain were continuing requests, (2) that a representative complement of employees was working when USG hired its principal work force full-scale startup operations on 3 September, (3) that the successorship criteria should be measured at the latest on 18 September after over 2 weeks of full resumption of operation, and (4) that on 3 and 18 September it represented a majority even if the "constructive bumpees" were excluded from the count of former employees. (On 3 September, when 222 employ- ees constituted 76 percent of what became a full comple- ment of 292 employees, there were 155 former employ- ees (69.8 percent of the 222), and 123 (55 percent) if the 32 low-seniority employees were excluded, or 125 (56.3 percent) if the 30 former blanket products employees were excluded (see R. brief at (50). On 18 September when 246 employees constituted 84 percent of a full com- plement, there were 172 former employees (69.9 percent of the 246), and 134 (54.5 percent) if the 38 low-seniority employees were excluded or 136 (55.3 percent) if the 36 former blanket products employees were excluded (see R. Br. at 61).) I find it unnecessary, however, to rule on these contentions because the Union clearly represented a majority of the USG bargaining unit employees on 9 October, the date the Company received the Union's re- newed bargaining request after a full complement of em- ployees had been hired 9 b. Extent to which employees' former supervisors were retained All 34 of the superintendents and supervisors over the 4 departments in which the 292 bargaining unit employ- ees worked on 9 October were former Conwed person- nel (G.C. Exhs. 5 and 6, R. Exh. 17). These included a superintendent in each of the 4 departments and 15 su- pervisors (foremen and other supervisors) in the board finishing department, 9 supervisors in the board mill, 4 supervisors in the engineering (maintenance and power plant) department, and 2 supervisors in the warehouse (assuming that Ralph Anderson was supervisory as the Company contends). All of them were former members of Conwed's supervisory staff except eight of the shift foremen and Anderson, who had been nonsupervisory Conwed bargaining unit employees. In the remaining 5 departments, in which none of the bargaining unit employees are employed, 14 of the 18 su- perintendents and supervisors were former members of Conwed's supervisory staff: 1 of 3 in personnel, 2 of 4 in the office, 4 of 4 in production control, 4 of 4 in product development, and 3 of 3 in quality control. Only the plant manager and a department superintendent and su- pervisor in personnel and in the office were not hold- overs from Conwed. Thus, all the supervision over the bargaining unit em- ployees and 90 percent of the total management and su- pervision (48 of the 53) were holdovers from Conwed. c. Skills used and functions performed by employees The production employees resumed producing the same ceiling tiles, using the same skills as the Conwed ceiling tile employees had used (Tr. 41-49, 54, 57-59, 94- 95, 424). The maintenance employees continued to per- form the same electrical, filing, instrument, machinist, millwright, pipefitting, tinsmith, and welding work as previously done by Conwed craftsmen, although they are all considered mechanics who can be assigned to more than one skill, if qualified (Tr. 123-124, 385-390, 396-413). There is no evidence that any of them received any special training, apart from these assignments, to per- form multiple crafts. "There are a few designations over and above a me- chanic," such as an electrician and machinist (Tr. 385). The mechanic-electricians (R. Exh. 41) are regularly as- signed to the electric shop as before, but they are now permitted to do mechanical, welding, and tinsmith work. "They don't necessarily normally do that because we have enough electrical work for them." (Tr. 386, 405- 407, 435-436.) The machinists work in the same machine shop as before, doing precision machine work, building and repairing shafts, and building equipment that is spe- cially designed by the engineers. They "are capable of being used as millwrights if they didn't have anything to do," but they are "very busy." (Tr. 389.) I note that a greater flexibility in the assignment of craft employees had begun a year earlier in 1984 when Conwed began permitting millwrights, tinsmiths, and pipefitters to do welding, using an oxyacetylene torch as a tool of trade, heating, cutting, and burning metal (Tr. 428-429, 434). 10 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD The production employees are permitted to do mainte- nance work much more than they were permitted before (Tr. 328-329, 390-391, 420-421), and their cross-training is different. At Conwed employees are bumped into dif- ferent jobs and departments and received training ac- cording to their seniority, but USG gives employees more cross-training, without regard to seniority (Tr. 383- 385). Thus, when the Company resumed production in early September, both the production and maintenance em- ployees continued to use the same skills and performed the same functions as before, although job overlapping occurred. d. Continuation of business in same physical facility with same or similar equipment The Company purchased the entire ceiling tile plant at Cloquet and all the ceiling tile equipment, which is listed in a 141 -page computer printout in exhibit B of the Asset Purchase Agreement (R. Exh. 1). In early September it resumed production of the ceiling tile in the same plant with the same equipment. e. Continuity of products sold or services rendered After resuming 25 production, the Company continued to manufacture the same ceiling tile as before . In March 1986, after about 6 months, it received equipment to enable it to change patterns to match those produced in its Greenville plant. f. Identity of customers The Company took over the Conwed ceiling tile oper- ation as a going business . It acquired Conwed's customer list and unfilled ceiling tile orders (Tr. 568, 588) and pur- chased all Conwed's accounts receivable (R. Exh. 1, Exh. F) and Conwed's salesmen cars in 21 States, from Massachusetts to California (R. Exh. 1, Exh. B). Between 9 August and early September when it resumed produc- tion, it shipped about 400,000 ceiling tiles from the plant inventory that it had purchased from Conwed (Tr. 588). For former Conwed customers who had not established USG credit, it continued to make direct shipments to them on the payment of cash (Tr. 580, 589). The Company, however, changed its marketing strate- gy from selling directly to small as well as large contrac- tors and distributors, to selling more through major dis- tributors and to larger accounts to avoid credit problems. Although it supplied most contractors through the dis- tributors, the Company continued to make shipments di- rectly to a total of 290 former Conwed customers who obtained approved USG credit . (Tr. 126, 128-132, 146, 153-154, 157-158, 568-575, 584-586, 589-590, 596; R. Exhs. 2, 3, and 40.) The Company continued to sell to the same customer market across the nation , but it con- centrated its sales by selling mostly to larger contractors and through distributors. Thus all six of these factors for determining successor- ship indicate that there was a "substantial continuity of the business enterprise," as that requirement is stated by the Board in Spencer Foods, 268 NLRB 1483, 1484-1485 (1984), discussed below . Now, looking to the totality of the circumstances, I consider other changes in the oper- ation to determine whether the employees ' working con- ditions have been so significantly altered that the em- ployees' expectations, desires, or need of representation has likely changed. g. Other evidence The Company paid lower wages (not mentioned in its brief), had fewer job classifications, eliminated seniority, and had compulsory overtime (instead of assigning over- time by seniority) (Tr. 394-395, 624-625; G.C. Exh. 3 pp. 46-51; R. Exhs. 41 and 42). The day workers had an unpaid instead of a paid 30-minute lunch period (Tr. 67). Two maintenance supervisors were moved from the en- gineering department, one to the board finishings depart- ment and the other to the board mill (G.C. Exh. 5, R. Exh. 17), and some of the maintenance employees were assigned to those departments, "decentralizing " the main- tenance to that extent (Tr. 122, 327-328, 416-417). The Company assigned three shift foremen under each gener- al foreman in the board finishing department and board mill. Conwed had assigned one shift supervisor and two working leaders under each general supervisor in board finishing and four shift supervisors as well as leaders under the general supervisor in the board mill. (G.C. Exhs. 3, p. 47, and 5 ; R. Exh. 17; Tr. 326, 414-416, 433- 434.) At Conwed one personnel employee handled the scheduling of all employees, and seniority was followed when layoffs were necessary . At USG the shift supervi- sors schedule the employees and because of more flexible assignments (and presumably more business) no full-time employees have been laid off. (Tr. 391-393, 432.) USG contracts out more work in the absence of any contrac- tual restrictions that Conwed had in its agreement with the Union (Tr. 323-324, 394, 432-433). Such changes as these would affect the employees' working conditions. I find, however, that they did not significantly alter the former employees' expectations, desires, or need of representation . In fact, several of the changes would appear to enhance their interest in retain- ing union representation-particularly the lower wages, the elimination of seniority, the compulsory overtime, the loss of a paid lunch period, and the contracting out of work, as well as the loss of other contractual items such as the grievance-arbitration procedure (G.C. Exh. 3, R. Exh. 42). 5. Contentions and concluding findings The General Counsel contends that the Company "has continued the employing industry substantially as Conwed had operated it"; that it "has been successor to Conwed from the time it employed a representative com- plement of employees . . . in late September"; and that, as a successor, it "inherited Conwed's obligation to bar- gain with the Union as the representative of its produc- tion and maintenance unit." The Union contends that, based on the successorship criteria, USG is clearly a suc- cessor employer. It further argues that although a finding of bad faith is not necessary for finding an unlawful re- fusal to bargain , the Company's farfetched defenses USG ACOUSTICAL PRODUCTS 11 "clearly evidence a blatant lack of good faith for USG's one-year-old refusal to bargain" with the Union. The Company contends that there is no substantial continuity of the employing enterprise . It relies primarily on the Board's decisions in Georgetown Stainless Mfg. Corp., 198 NLRB 234 (1972) (found above to be clearly distinguishable); Cagle's Inc., 218 NLRB 603 (1975) (in- volving a bankruptcy); and Spencer Foods, 268 NLRB 1483, 1485 (1984), revd in relevant part 768 F.2d 1463, 1474 (D .C. Cir. 1985) (the court finding the operational changes instituted after the hiatus not to be "so substan- tial as to affect employee attitudes toward representa- tion"). I find that, like the Board's decisions in George- town Stainless and Cagle 's, its decision in Spencer Foods (involving a hiatus in operations lasting almost a year and a half) is clearly distinguishable. As found, the Company continued to operate the ceil- ing tile plant with (a) a clear majority of former Conwed bargaining unit employees , who (b) worked under the same or promoted supervisors, (c) using the same skills and performing the same functions, (d) in the same plant with the same equipment, (e) producing the same ceiling tiles, which (f) continued to be sold to the same custom- er market, and (g) the changes in working conditions did not significantly alter the former employees' expecta- tions, desires, or need of representation. I conclude, after applying the Board's traditional criteria and considering the totality of the circumstances, that there has been a substantial continuity in the employing enterprise and that the Company is a successor to Conwed at the Clo- quet ceiling tile plant. The Company admits that on 9 October, when it received the Union's 7 October re- newed bargaining request, it employed a full complement of employees . As found, the Union represented a clear majority of the bargaining unit employees on that date, and the Company refused to bargain although it admit- tedly did not then have a good-faith doubt of the Union's majority status. I therfore find that on and since 9 October 1985 the Company has unlawfully refused to recognize and bar- gain with the Union, thus violating Section 8(a)(5) and (1) of the Act. C. Bargaining Order Appropriate On 21 and 22 November (6 weeks after USG unlaw- fully withheld recognition from the Union on 9 October) the Company held employee communication meetings with the bargaining unit employees . At the end of each of the meetings the plant manager announced an employ- ee survey and left the room . Then Personnel Superin- tendent Jerry Ray explained to the employees that the Company was giving them a chance to evaluate USG as a place to work and to indicate how they felt the oper- ation was going. Ray and a personnel employee passed out questionnaires to be answered, without signatures, and left in an open box at the front of the room, while Ray and the assistant remained in the room (Tr. 755-757, 772, 784). Based on this employee survey, the Company now makes the following contentions in its brief (at 2, 58-59): Even if USG were a successor employer, a bar- gaining order would be wholly inappropriate here in the face of an overwhelming employee opposition to the Union . In response to one of the questions in a survey administered by the Company to Cloquet employees in November 1985, over 79 % of the em- ployees stated that they did not need a union at the plant. . . . An overwhelming majority of the employ- ees, in response to the Company 's attitude survey stated that they did not need a union to represent them . Such overwhelming opposition to the Union casts serious doubt on the Union 's majority status, particularly where that status is based exclusively on a claim of successorship. ... To impose a union on the employees on the basis of a union's claim of majority status, in the face of such overwhelming evidence that the employees do not want union representation, would be contrary to the purpose of the Act. .. . In any event, a bargaining order would be inap- propriate here, where an overwhelming majority of the employees have expressed opposition to the Union. [Emphasis added.] Evidence of this so-called overwhelming employee op- position to the Union consists solely of employee an- swers to the second of the following two questions on the questionnaire (R. Exh. 45): 7. Do you feel free to tell your supervisor about any problems or complaints that you may have re- garding your job? 8. Do you feel you need a union to express your views to the Company? There were no questions directly asking if they favored or opposed the Union , if they wanted or needed a union to represent them in collective bargaining, or if they wanted to work under a union agreement (as a majority of them had worked before). There was no announce- ment of such a purpose. Question 8 was obviously ambiguous. After asking each employee in question 7 if "you feel free to tell your supervisor about any [job] problems or complaints," the Company asked in question 8 whether "you feel you need a union to express your views to the Company." The Company did not specify whether it referred to a need for a union to express "your [individual] views" on any job problems or complaints, as in the preceding question, or to a need for a union to express "your views [as employees]" on working conditions generally. Given only a yes or no choice, many employees may have an- swered no to question 8, but still wanted union represen- tation for collective action , arbitration, job protection, or the negotiatifbn of a collective -bargaining agreement in the hope of regaining higher wages , lost benefits, etc. As held in Premium Foods v. NLRB, 709 F.2d 623, 630-631 (9th Cir. 1983) (fns. omitted), enfg. 260 NLRB 708 (1982): 12 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD A successor employer may rebut the presumption [of continued majority status] and refuse to bargain with the previously recognized union only if he can show that the Union in fact no longer represents a majority of the members of the bargaining unit, or that he has a reasonable good faith doubt of majori- ty support. . . . A good faith doubt must be reasonable and sup- ported by objective considerations. . . . Evidence which raises only an ambiguous inference of loss of majority support is not sufficient. . . . The fact that four [of eight] employees asked for withdrawal cards is, at best, equivocal. . . . Even if a request for withdrawal indicated that the employ- ee no longer wished to be a member of the Union, it does not necessarily indicate that he no longer wished to be represented by it. [Emphasis added.] Similarly here, contrary to the Company's contentions, the fact that 79.5 percent of the employees checked the "No" answer to the equivocal question 8 did not neces- sarily indicate that a majority of them did not want a union in the plant or that "an overwhelming majority of the employees have expressed opposition to the Union." Moreover, a bargaining order is appropriate even as- suming (1) that the employee survey was conducted in a noncoercive manner (despite the limited secrecy safe- guards and the presence of the personnel superintendent and his assistant in the room), (2) that in answering ques- tion 8 the employees were aware they were voting for or against union representation at the plant, and (3) that on 21 and 22 November an overwhelming majority of the former and new employees were opposed to union repre- sentation (which I consider unlikely). The Company's "duty to bargain as a successor employer arose at a time [9 October] when [the Company] had no objective basis to support its [belated] claim" that it doubted the Union's majority status. First Food Ventures, 229 NLRB 1228, 1230 (1977). As held in NLRB v. Fall River Dyeing Corp., 775 F.2d at 433, "once it has been determined that an employer has unlawfully withheld recognition of an em- ployees' bargaining representative, the employer cannot defend against a remedial bargaining by pointing to an intervening loss of employee support for the union when such loss of support is foreseeable consequence of the employer's unfair labor practice [citing Franks Bros. Co. v. NLRB, 321 U.S. 702, 702-705 (1944)]." I find that any loss of the Union's majority support was a foreseeable consequence of the Company' s refusal since 9 October to recognize and bargain with the Union. Accordingly, I find that a bargaining order is appro- priate. CONCLUSIONS OF LAW By refusing on and since 9 October to & cognize and bargain with the Union, the Company engaged in unfair labor practices affecting commerce within the meaning of Section 8(a)(5) and (1) and Section 2(6) and (7) of the Act. REMEDY Having found that the Respondent has engaged in cer- tain unfair labor practices, I find it necessary to order it to cease and desist and to take certain affirmative action designed to effectuate the policies of the Act. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed3 ORDER The Respondent, USG Acoustical Products Company, Cloquet, Minnesota, its officers, agents, successors, and assigns, shall 1. Cease and desist from (a) Refusing to bargain with United Paperworkers International Union, AFL-CIO, CLC and Local No. 158 as the exclusive representative of the employees in the bargaining unit. (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) On request, bargain with the Union as the exclusive representative of the employees in the following appro- priate unit concerning terms and conditions of employ- ment and, if an understanding is reached, embody the un- derstanding in a signed agreement: All hourly paid nonsupervisory production and maintenance employees of USG Acoustical Prod- ucts Company at its Cloquet, Minnesota facility; ex- cluding employees in the following job classifica- tions: General, Engineering and Mill Offices; Sample Department; Quality Control Department; Development Department, except in pilot plants; Guard and Security Forces ; and Contract Service, such as General Office Janitorial. (b) Post at its facility in Cloquet, Minnesota, copies of the attached notice marked "Appendix."4 Copies of the notice, on forms provided by the Regional Director for Region 18, 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. 3 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- 4 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 the United States Court of Appeals Enforcing an Order of the National Labor Relations Board " USG ACOUSTICAL PRODUCTS (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 The National Labor Relations Board has found that we violated the National Labor Relations Act and has or- dered us to post and abide by this notice. WE WILL NOT refuse to bargain with United Paper- workers International Union, AFL-CIO, CLC and Local No. 158 as the exclusive representative of the employees in the bargaining unit. 13 WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exercise of the rights guaranteed you by Section 7 of the Act. WE WILL, on request, bargain with the Union and put in writing and sign any agreement reached on terms and conditions of employment for our employees in the bar- gaining unit: All hourly paid nonsupervisory production and maintenance employees of USG Acoustical Prod- ucts Company at its Cloquet, Minnesota facility; ex- cluding employees in the following job classifica- tions: General, Engineering and Mill Offices; Sample Department; Quality Control Department; Development Department , except in pilot plants; Guard and Security Forces; and Contract Service, such as General Office Janitorial. USG ACOUSTICAL PRODUCTS COMPANY