Sol-Jack Co.

SOL-JACK CO. Sol-Jack Company and United Steelworkers of America, Upholstery Diviision, Local Union 404-U, Petitioner. Case 4-RC-16278 27 November 1987 DECISION AND CERTIFICATION OF RESULTS OF ELECTION BY CHAIRMAN DOTSON AND MEMBERS STEPHENS AND CRACRAFT The National Labor Relations Board, by a three- member panel, has considered a determinative chal- lenge to an election held 12 August 1986 and the attached hearing officer's report recommending disposition of it. The election was conducted pur- suant to a Stipulated Election Agreement. The tally of ballots shows one for and one against the Petitioner, with one challenged ballot, a sufficient number to affect the results. The Board has reviewed the record in light of the Respondent's exceptions and brief and reverses the hearing officer's finding that Rodney Sewell had a reasonable expectation of being recalled on the date of the election and was therefore eligible to vote. Accordingly, we sustain the challenge to Sewell's ballot. The Employer excepted to the hearing officer's finding that Sewell has a reasonable expectation of future employment. The Employer contended that Sewell was dismissed owing to lack of work and declining sales that resulted in decreased income which showed no indication of increasing in the near future. The relevant facts are, briefly, as follows. The Employer is engaged in the manufacture of bed- ding, over 90 percent of which is used by Reliance Corp., a sister corporation located 50 feet from Sol-Jack. In 1983 the Employer earned a net profit of $2000 on sales of $203,203. In the following 2 years sales fell to $104,611 resulting in a net loss of $6000. At the time of Sewell's discharge in July 1986, sales for 1986 were projected to be approxi- mately equal to those of 1985. Part of this decline in sales can be attributed to the fact that Sol-Jack had lost five of its six outside customers. Rodney Sewell was hired in May 1984 as a helper. His tasks included loading and unloading trucks, delivering quilted panels to Reliance Bed- ding, assisting fellow employee Shirley Calvin in the operation of her quilting machine, stocking ma- terial, keeping the work area clean, and learning how to cut and measure mattress panels and to op- erate the quilting machines.' i The Employer contends many of these duties were of an intermittent nature and of relatively short duration. 1173 On 18 July 1986 Sewell was informed by Super- visor Jerry Dorfman that he was laid off because of the Company's lack of business and poor finan- cial condition. Sewell then sought out Jack Dorf- man, the supervisor's father and part-owner, to confirm his layoff. According to the testimony of Dorfman, Sewell was told that his layoff was the result of a lack of work and that there were no plans to recall him. However, Sewell contends that Dorfman stated that he might be back to work in 1 or 2 weeks and asserts that this is conclusive evi- dence of a probability of recall notwithstanding that he was informed on 12 August, the day of the election, that his layoff was permanent. The test for establishing the eligibility of a laid- off employee to vote in a representation election was set forth in Higgins, Inc., 111 NLRB 797 (1955). This test looks to all the facts and circum- stances in the record to determine whether there is a reasonable expectancy, on the date of the elec- tion, that an individual will return to work in the near future. The "objective factors" the Board em- ploys to decide whether an employee possesses such an expectancy include "the Employer's past experience, the Employer's future plans, and the circumstances of the layoff, including what the em- ployes were told as to the likelihood of recall." Atlas Metal Spinning Co., 266 NLRB 180 (1983), Accord: D. H. Farms Co., 206 NLRB 111, 113 (1973). Applying that test to this case, the hearing offi- cer credited Sewell's version of the facts surround- ing his layoff in July and relied on the statement by Jack Dorfman that Sewell might return to work in 1 or 2 weeks to find that Sewell had a reasonable expectation of recall. In making this finding, the hearing officer dis- missed the Employer's financial argument, dis- counting it as inconclusive and unpersuasive and rejecting the Employer's contention that the de- creasing sales and net income necessitated the layoff of Sewell. The hearing officer further ques- tioned the timing of the discharge, 3 months after Sol-Jack's accountant specifically recommended Sewell's layoff, and immediately following a 2- week plant shutdown. We disagree with these findings.2 When the ob- jective factors involved indicate a laid-off employ- 2 The Employer has excepted to some of the hearing officer's credibil- ity findings The Board's established policy is not to overrule a hearing officer's credibility determinations unless the clear preponderance of all the relevant evidence convinces us that they are incorrect. Connor Trad- ing Co, 188 NLRB 263, 264 fn 4 (1971), Coca-Cola Bottling Co, 132 NLRB 481 , 485 (1961) We find no basis for reversing the credibility findings in this case 286 NLRB No. 113 1174 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD ee had no reasonable expectancy of recall, vague statements by the employer about the chance or possibility of the employee being hired will not overcome the totality of the evidence to the con- trary. E.g., S & G Concrete Co., 274 NLRB 895, 897 (1985); Foam Fabricators, 273 NLRB 511, 512 (1984); Tomadur, Inc., 196 NLRB 706, 707 (1972). This is particularly so when any possible sugges- tion of intent to recall is firmly disavowed by the date of the election and there is no claim that the employer was converting an intended temporary layoff to a permanent one for unlawful reasons.3 In this case, the record indicates that Sewell's discharge was due to the deteriorating financial condition of the Company and the lack of work available for Sewell.4 Declining sales and rising labor costs left the Employer little choice but to lay off Sewell. There was little need for a third employee with Sol-Jack's shrinking product market. This is clearly illustrated by the lack of overtime worked by the remaining employees after Sewell's layoff and Sewell's own testimony that he made sure he had enough work by taking his time and not rushing.5 The remaining objective factors also provide little basis to support the hearing officer's conclu- sion. There has been no history of seasonal and cy- clical layoffs in the Employer's past record, nor any policy or practice of recalling laid-off employ- ees. Thus it would be difficult to determine the Employer's future plans. An equivocal statement of the kind Dorfman made here-which is inconsistent with the clear statement on the day of the election and which, at s No one asserts that the General Counsel issued an unfair labor prac- tice complaint with respect to Sewell's layoff. 4 We find the hearing officer erred in not thoroughly considering the financial information introduced by the Employer. Although this infor- mation was not introduced in documentary form, it was uncontroverted and should have been fully considered 5 The hearing officer found the lack of overtime inconclusive , relying in part on the testimony of Reliance employee Johnson, who stated that he and two other employees did work at Sol-Jack formerly performed by Sewell. We find Johnson's testimony not dispositive of the issue present- ed, i e , whether Sewell had a reasonable expectancy of employment That other employees performed some of the work that Sewell had per- formed does not necessarily mandate a conclusion that Sewell had a rea- sonable expectancy of employment . It does not follow that simply be- cause some of the duties formerly carried out by a laid-off employee are assumed by those remaining, that the laid-off employee's future services are required When, as here, no new employees are hired and the remain- mg ones are able to perform their own and additional work without needing to work overtime, an inference may properly be drawn that the laid-off employee will not be recalled In any event, the accuracy of Johnson's claim that without working overtime, he worked 4-5 hours per day doing Sol-Jack work, in addition to his regular work at Reliance, is subject to serious question. Either Johnson worked less than half of an 8- hour day at Reliance or he was mistaken about the amount of daily working hours he spent at Sol-Jack . In this regard, we note the testimony of Shirley Calvin that Johnson spends an average of 4-5 hours a week at Sol-Jack Thus, although we do not disturb the hearing officer 's apparent credibility finding, in favor of Johnson, we find Johnson's testimony has little or no bearing on the issue before us best, expresses a possibility more likely expressed to lend hope to the laid-off employee than to give a realistic assessment of his being recalled to work-does not, without more, provide an ade- quate basis for concluding that an employee had a reasonable expectancy of recall. In this case, the other objective factors, such as the Employer's fi- nancial condition, the absence of any prior history of layoffs, and the indeterminate nature of the Em- ployer's future plans together outweigh Jack Dorf- man's statement to Sewell that he might be back to work in I or 2 weeks. CERTIFICATION OF RESULTS OF ELECTION IT IS CERTIFIED that a majority of the valid bal- lots have not been cast for United Steelworkers of America, Upholstery Division, Local Union 404-U and that it is not the exclusive representative of these bargaining unit employees. APPENDIX Hearing Officer's Report on Challenged Ballot FINDINGS OF FACT The Employer challenged the ballot of Rodney Sewell on the ground that he was permanently laid off on July 18, 1986, with no reasonable expectation of recall. The Petitioner contends that Sewell was a regular employee who was temporarily laid off. The Employer, Sol-Jack Company (herein Sol-Jack) a partnership owned jointly by Sol Sauls and Isadore "Jack" Dorfman, is a wholesale service company en- gaged in the quilting business at its facility located at 2018 East Willard Street, Philadelphia, Pennsylvania. Re- liance Bedding Corp. (herein Reliance) is a Pennsylvania corporation engaged in the manufacture of bedding at its facility at 3263 Emerald Street, Philadelphia, Pennsylva- nia. The sole stockholders of Reliance are Sauls and Dorfman. Sometime in 1979, Sol-Jack was formed by Sauls and Dorfman to provide quilting for Reliance and other companies. Sol-Jack is located in a building about 50 feet away from Reliance's facility. More than ninety percent of the quilting manufactured by Sol-Jack is used by Reliance. Rodney Sewell was employed by Sol-Jack in May 1984, as a helper. Sewell was also hired to learn to oper- ate the quilting machines. From the time Sewell was hired till the time of his layoff on July 18, 1986, Sewell's duties basically remained the same. His duties included loading and unloading trucks, delivering quilted panels to the Sewing Room at Reliance, putting material on Cal- vin's3 machine, helping Calvin run the machine, stocking materials, sweeping the work area, bagging and loading trash and learning how to cut and measure mattress panels and operate the quilting machines. 3 Shirley Calvin is a quilting machine operator employed by Sol-Jack. SOL-JACK CO. 1175 Sewell was laid off on Friday , July 18, 1986. Accord- ing to Sewell, Jerry Dorfman, current supervisor for Sol- Jack and Reliance and the son of Jack Dorfman, told Sewell he was laid off for lack of work . Sewell then went to see Jack Dorfman to ask why he was laid off. Jack Dorfman told Sewell it was for lack of work and that Sewell might be back to work in one or two weeks. Sewell claims that it wasn 't until he came to vote on August 12, 1986, that he was told that he was perma- nently laid off. The Employer asserts that Jerry Dorfman told Sewell he was laid off due to the Company 's finan- cial condition and lack of business. Sewell then asked Jerry Dorfman how long the layoff would be and Jerry Dorfman responded that the Company had no plans of calling Sewell back . Sewell then went to Jack Dorfman, reporting that Jerry Dorfman had just laid him off. Jack Dorfman told Sewell that he was laid off and that Sol- Jack didn't have a need for three people. I credit Sewell's version of the facts surrounding his layoff and find the Employer's contention that Sewell was permanently laid off on July 18 , 1986 unpersuasive. I found Sewell's testimony straightforward and to the point while Jack Dorfman 's testimony appeared less than forthright. Jerry Dorfman appeared nervous and hesi- tant, especially when asked to recount his July 18, 1986 conversation with Sewell . Thus, I find that on July 18, 1986, Sewell was told by Jerry Dorfman that he was laid off for lack of work and when Sewell questioned Jack Dorfman about his layoff Sewell was told that he might be recalled in one or two weeks . I discredit Jerry Dorf- man's testimony that he told Sewell the Company had no plans to call Sewell back from his layoff . The following facts support this finding. The Company claims that the decision to permanently lay off Sewell was based on several factors . One such factor was Sol-Jack's financial situation. Jack Dorfman testified that during the month of April 1986 , the Com- pany's account reviewed Sol-Jack's 1985 financial state- ment, pointing out that payroll had been steadily increas- ing, stating that this was not a good trend and suggesting a cut in labor as Sol-Jack's only alternative. Jack Dorf- man also testified that Sol-Jack's, total sales for 1983, 1984, and 1985 were $203,203, $ 126,863, and $104,611, respectively . Net income for Sol-Jack was approximately $2,000 in both 1983 and 1984 with a net loss of $6,000 in 1985. The financial statements from which the above fig- ures were gleaned were not placed in evidence. The Company attempts to paint a bleak picture of Sol- Jack's financial condition. However, I question why Sol- Jack, a company in such dire financial straits , would wait approximately three months, after specifically being told by its accountant to `cut labor,' to terminate the employ- ment of Rodney Sewell. Sol-Jack offers that June is tra- ditionally its busy season and that is why it waited until July 18, 1986, to permanently lay off Sewell . That does not explain why the Company waited until after a two week vacation4 to lay off Sewell. I find it unlikely, given 4 Sol-Jack had its customary plant shutdown dung the first two weeks m July 1986 Sol-Jack's financial condition as presented on the record coupled with the recommendation made by its account- ant in April 1986, that Sol-Jack would not have acted in a more expedient manner to cut costs by quickly sever- ing its employment relationship with Sewell. I also find it noteworthy that the Employer did not present any fi- nancial information for 1986, the time period most rele- vant to Sewell's lay off. The Employer attempts to equate a decrease in gross sales with a decrease in the volume of business but failed to support this with any evidence . It does not automati- cally follow that a decrease in gross sales means a de- crease in the volume of business, i.e., lower cost or a de- crease in the price of the produce could lead to a lower gross sales without necessarily affecting the volume of business. In fact, the uncontradicted testimony of the Employer's prior supervisor Charles Harrington is that Jack Dorfman and he discussed the possibility of starting a night shift at Sol-Jack in 1985-at a time when gross sales were decreasing. Nevertheless, the trend in decreas- ing total sales and net income began in 1983 and 1984, long before Sewell's layoff occurred. Furthermore, gross sales decreased dramatically from 1983 to 1984 , the year in which Jack Dorfman hired Rodney Sewell. Another factor which the Employer maintains led to Sewell's permanent layoff was a lack of work. Jerry Dorfman, the son of Jack Dorfman, became supervisor of Sol-Jack and Reliance in late May 1986. Both Jack and Jerry Dorfman testified that after two or three days on the job , Jerry recommended to Jack that there was no need for a third person at Sol-Jack. Jerry Dorfman, by his own admission, claimed to have spent about an hour or so a day (Tr. 33, 34) at Sol-Jack during his first few weeks as supervisor and less time after that. Jack Dorfman claims that he had long questioned the need for a third employee at Sol-Jack and states on pages 50 and 51 of the transcript that the normal complement of em- ployees at Sol-Jack was two. However , the record does not support this assertion. In 1979, Sol-Jack employed only one employee, a quilting machine operator. A second quilting machine operator was hired in 1981 . There are two quilting ma- chines at Sol-Jack. A third employee who, according to Jack Dorfman was hired in 1982 or 1983 , was caught sleeping upstairs and was terminated prior to the arrival of Harrington. Harrington was hired in January 1983, to supervise employees at both Sol-Jack and Reliance. Shortly after being employed, Harrington saw a need for a third employee at Sol-Jack and spoke of this to Jack Dorfman. Dorfman agreed with Harnngton's assessment and gave his approval for the hiring of a third employee. Shirley Calvin was hired by Sol-Jack in late 1983 or early 1984 as a helper. Calvin was also trained in the op- eration of the quilting machines. In May 1984, Sewell was hired by Dorfman to replace Calvin who had been promoted to a vacant machine operator position . Sewell like Calvin, was hired as a helper and to learn how to operate the quilting machines . So, while Jack Dorfman states that Sol-Jack's normal complement of employees was two, Sol-Jack has employed a third employee on an almost continuous basis since about 1982 or 1983. Thus, 1176 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD the normal work complement at Sol-Jack for the past several years appears to be three employees rather than two. The Company offers a summation of overtime hours worked by Sol-Jack employees from July thru Septem- ber for the years 1985 and 1986 as evidence that a third person was not required at Sol -Jack. Employer's Exhibit 1 shows that there are less regular hours as well as over- time hours being worked at Sol-Jack since Sewell was laid off. However, it logically follows that total hours as well as overtime hours would be reduced following the reduction of one-third of the workforce. I find these fig- ures inconclusive and meaningless for another reason as well. The job duties previously performed by Sewell are not being performed by Calvin as well as by Reliance employees. Accordingly, Willie Johnson, a current Reli- ance employee, testified that he, and two other Reliance employees, Juan Vasquez, and Rob , are performing the duties at Sol-Jack which were performed by Sewell. Johnson testified that he began doing work at Sol-Jack only after Sewell was laid off. I am favorably impressed with the testimony of Willie Johnson since he, as a current Reliance employee, has little to gain from his involvement in these proceedings and I credit his tes- timony. For all of the reasons stated above, I find the Employer's contention that Sewell was laid off for lack of work unsupported by the facts. Jack Dorfman alluded to the fact that the Company's disillusionment with Harrington led Dorfman to question whether there really was enough work for Sewell. Har- rington, who has recommended Sewell for the helper po- sition vacated by Calvin, was fired from Sol-Jack and Reliance in May 1986, for dishonesty.5 However, it was Dorfman who hired Sewell and, as was pointed out above, a third employee has been employed by Sol-Jack since about 1982, before Harrington was employed by Sol-Jack and Reliance. Again, if Dorfman questioned the need for Sewell at the time of Harrington's discharge in May 1986, 1 find it unreasonable that he would have waited almost two months to permanently lay off Sewell. I believe the Employer's suggestion that Sewell was laid off on July 18, 1986 because of his association with Har- rington to be a smokescreen. There is no prior history of layoffs at Sol-Jack. How- ever, there have been layoffs at Reliance. Harrington tes- tified that Keith Barrett was temporarily laid off from Reliance for lack of work. Barrett was recalled, after a "short period" (Tr. 258).6 Jerry Dorfman testified that Pearl Grimes was laid off from Reliance in September 1986. Jerry Dorfman told Grimes that she was laid off for lack of work and that the layoff was permanent be- cause her job was not needed . Grimes was a sewing op- erator. Jack Dorfman testified that Grimes was laid off for lack of work and a personality conflict. The entitlement of a laif-off employee to vote in a rep- resentation election depends on whether the employee had a reasonable expectancy of recall in the near future. Higgins, Inc., 111 NLRB 797. In analyzing this issue, the Board examines such factors as the past experiences of the Employer, the Employer's future plans, and the cir- cumstances of the layoff, including what employees were told as to the likelihood of recall. Atlas Metal Spinning Co., 266 NLRB 180; High Energy Corporation, 259 NLRB 761. Applying this analysis to the matter at hand, I fmd that Rodney Sewell, on the date of the election could reasonably have expected to be recalled by the Employer in the near future. I find that at the time of his layoff on July 18, 1986, Sewell was told he might be back to work in one or two weeks. As detailed above, the duties previously performed by Sewell are currently performed by Calvin and various Reliance employees and the Employer's assertion that its poor financial con- dition is the reason for Sewell 's permanent layoff is highly suspect. Furthermore, the record is void of any history of permanent layoffs solely for lack of work, either at Sol-Jack or at Reliance. As the election at Sol- Jack occurred less than four weeks after Sewell was laid off, I find that Sewell had a reasonable expectancy of recall and is eligible to vote. Acme Industrial Company, 227 NLRB 249; D. H. Farms Co., 206 NLRB 111, 113. Having found that Rodney Sewell was temporarily laid off and had a reasonable expectation of recall on the date of the election, I recommend that the challenge to his ballot be overruled. Recommendation Based on the foregoing, I recommend that the chal- lenge to the ballot of Rodney Sewell be overruled and that this ballot be opened and counted and that the ap- propriate certification issue. 5 The Employer asserts that Harrington was fired for dishonesty. I am a Harnngton's testimony was not contradicted and I, therefore, credit not making any finding on this issue. it