Rainbow Press Of Fredonia, Inc.

RAINBOW PRESS OF FREDONIA 477 Rainbow Press of Fredonia, Inc. and Betty E. Reid Rainbow Press of Fredonia, Inc. and Rainbow Press, Inc., its alter ego and Erie Typographical Union No. 77. Cases 3-CA-13398 and 3-CA-13398-2 16 December 1987 DECISION AND ORDER BY CHAIRMAN DOTSON AND MEMBERS JOHANSEN AND BABSON On 2 September 1987 Administrative Law Judge Harold B. Lawrence issued the attached decision. The Respondents filed exceptions and a supporting brief, and the General Counsel filed an answering brief to the Respondents' exceptions. The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. The Board has considered the decision and the record in light of the exceptions and briefs and has decided to affirm the judge's rulings, findings,' and conclusions2 and to adopt the recommended remedy and Order3 as modified. AMENDED REMEDY The judge's remedy does not provide the usual remedy given by the Board in cases in which an employer refuses to bargain about the effects of a decision to close.4 We see no reason for deviating from our usual remedy here. Thus, in addition to the traditional remedies set forth in the remedy sec- tion of the judge's decision, to ensure meaningful bargaining and to effectuate the policies of the Act, we shall order the Respondents to bargain with the Union, on request, about the effects of its discon- tinuation of the operation of Rainbow Press of Fre- donia, Inc. and to pay its employees their wages at the rate in the collective-bargaining agreement when last in the Respondents' employ from 5 days after the date of this decision until the occurrence of the earliest of the following conditions: (1) the I The judge in his decision erred when he stated that the stock owner- ship of both Rainbow Press, Inc. and Rainbow Press of Fredonia, Inc is divided equally between Dennis Amato and Sandra Maffei. The stock ownership of Rainbow Press of Fredonia, Inc. is divided equally between Dennis Amato and Sandra Maffei , but the stock ownership of Rainbow Press, Inc. is divided equally between Dennis Amato and Carmen Maffei. This error is insufficient to affect the results of the decision. 2 Chairman Dotson notes that the Respondents excepted only to the judge's single-employer finding. Thus, the Chairman adopts, pro forma, in the absence of exceptions, the violations found by the judge. 9 The judge in his recommended Order granted a visitatorial clause au- thorizing the Board , for compliance purposes, to obtain discovery from the Respondents under the Federal Rules of Civil Procedure under the supervision of the United States court of appeals enforcing this Order. Under the circumstances of this case we find that such a clause is unwar- ranted. Thus, we shall delete this portion of the judge 's recommended Order. 4 Transmarme Navigation Corp., 170 NLRB 389, 390 (1968); W. R. Grace Co., 230 NLRB 617, 619 (1977) date the Respondents bargain to agreement with the Union on those subjects pertaining to the ef- fects of the discontinuation of the Rainbow Press of Fredonia, Inc. operation; (2) a bona fide impasse in bargaining; (3) the failure of the Union to re- quest bargaining within 5 days of this decision or to commence negotiations within 5 days of the Re- spondents' notice of their desire to bargain with the Union; or (4) the subsequent failure of the Union to bargain in good faith. In no event shall the sum paid to any of the employees exceed the amount each would have earned as wages from the time Respondent Rainbow Press of Fredonia, Inc. termi- nated its operations, to the time each secured equivalent employment elsewhere, or the date on which the Respondents shall have offered to bar- gain, whichever occurs first; provided, however, that in no event shall this sum be less than the amount these employees would have earned for a 2-week period at the rate provided in the collec- tive-bargaining agreement when last in the Re- spondents' employ. If circumstances warrant it, backpay will be computed in the manner required by F. W. Woolworth Co., 90 NLRB 289 (1950). Backpay resulting from the Respondents' failure to make contractual payments will be computed in the manner prescribed by Ogle Protection Service, 183 NLRB 682 (1970). Interest on all sums due under the Order shall be computed as provided in New Horizons for the Retarded.5 ORDER The National Labor Relations Board adopts the recommended Order of the administrative law judge as modified below and orders that the Re- spondents, Rainbow Press of Fredonia, Inc. and Rainbow Press, Inc., Fredonia, New York, their of- ficers, agents, successors, and assigns, shall take the action set forth in the Order as modified. 1. Insert the following as paragraph 2(a) and re- letter the subsequent paragraphs. "(a) On request, bargain collectively with Erie Typographical Union No. 77, with respect to the effects on unit employees of the decision to close the Fredonia plant." 2. Substitute the following for the judge's para- graph 2(b). "(b) Pay employees terminated on 13 May 1986 their wages at the rates provided for in the collec- 5 In accordance with our decision in New Horizons for the Retarded, 283 NLRB 1173 ( 1987), interest on and after 1 January 1987 shall be computed at the "short-term Federal rate" for the underpayment of taxes as set out in the 1986 amendment to 26 U.S.C. § 6621 Interest on amounts accrued prior to 1 January 1987 (the effective date of the 1986 amendment to 26 U S.C. § 6621) shall be computed in accordance with Florida Steel Corp., 231 NLRB 651 (1977). 287 NLRB No. 49 478 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD tive-bargaining agreement in the manner set forth in the remedy section of this decision." 3. Substitute the following for the judge's para- graph 2(f). "(f) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Respondents have taken to comply." 4. Substitute the attached notice for that of the administrative law judge. APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government WE WILL establish a preferential hiring list of all unit employees terminated on 13 May 1986 follow- ing the established seniority system and offer to such employees full reinstatement to their former jobs or, if the former jobs do not exist, to substan- tially equivalent jobs, if Rainbow Press , Inc. or Rainbow Press of Fredonia, Inc. resume operations in the Fredonia area. RAINBOW PRESS OF FREDONIA, INC. RAINBOW PRESS, INC. William B. Kenney, Esq., for the General Counsel. James Schwan and William E. Grande, Esqs. (Wysshng, Schwan and Montgomery), of Buffalo, New York, for the Employer. The National Labor Relations Board has found that we violated the National Labor Relations Act and has ordered us to post and abide by this notice. Section 7 of the Act gives employees these rights. To organize To form, join, or assist any union To bargain collectively through representa- tives of their own choice To act together for other mutual aid or pro- tection To choose not to engage in any of these protected concerted activities. WE WILL NOT refuse to bargain with Erie Typo- graphical Union No. 77 concerning the effects of closure on 13 May 1986 of our Fredonia, New York plant. WE WILL NOT in any like or related manner interfere with, restrain, or coerce you in the exer- cise of the rights guaranteed you by Section 7 of the Act. WE WILL, on request, bargain collectively with Erie Typographical Union No. 77 with respect to the effects on the unit employees of our decision to close the Fredonia plant and reduce to writing any agreement reached as a result of such bargaining. WE WILL pay to bargaining unit employees who were on our payroll during the period from 18 February through 13 May 1986 all sums owing to them by reason of differences between the wages we paid them and the rates of pay provided for in our collective-bargaining agreement with the Union, and all sums owing to employees for retro- active pay, contractual medical expenses, and ac- crued vacation, and for work performed on 11 and 12 May 1986. WE WILL pay to employees terminated on 13 May 1986 their normal wages at the rates provided for in the collective-bargaining agreement for the period required by this Decision and Order. DECISION STATEMENT OF THE CASE HAROLD B. LAWRENCE, Administrative Law Judge. These consolidated cases were heard by me at Buffalo, New York, on 2 June 1987. The consolidated amended complaint is based on charges filed by Betty E. Reid on 18 August 1986 and by Erie Typographical Union No. 77 (the Union) on 26 August 1986. The consolidated amended complaint alleges that Rainbow Press of Fredo- nia, Inc. (Fredonia) and Rainbow Press, Inc. (Rainbow), which I will sometimes refer to as the Respondent, col- lectively, "have been at all times material here alter egos and a single employer within the meaning of the Act." Respondent is alleged to have violated Section 8(a)(5) and (1) of the National Labor Relations Act (the Act) by reason of its refusal to pay contractual wage rates and accrued vacation pay and medical expenses, and by reason ' of its refusal to bargain with the Union regarding the effects of closure of its plant . Both companies ap- peared by the same attorneys and interposed a point answer, which denies the material allegations and denies any wrongdoing or statutory violation . It also alleges af- firmative defenses to the effect that the charges encom- pass actions occurring more than 6 months prior, to the filing and service of the charges on the Respondent, and are therefore barred by Section 10(b) of the Act, and that, since Respondent Fredonia filed backruptcy petition on 11 August 1986, these proceedings are automatically stayed. The parties were afforded full opportunity to be heard; to call, examine, and cross-examine witnesses; and to in- troduce relevant evidence. Posthearing briefs have been filed on behalf of the General Counsel and Respondent. On the entire record, including my observation of the' demeanor of the witness , and after consideration of the briefs filed, I make the following FINDINGS OF FACT 1. JURISDICTION In its answer, Respondent admitted, and I accordingly find, that at all times material here Respondent Fredonia RAINBOW PRESS OF FREDONIA ' 479 was an employer engaged in commerce within the mean- ing of Section 2(2), (6), and (7) of the Act, and the Union was and is a labor organization within the mean- ing of Section 2(5) of the Act. Fredonia was engaged in the manufacture, sale, and distribution of printed forms and related products in Fredonia , New York. Respondent denied that Rainbow was an employer en- gaged in commerce within the meaning of the Act. However, an important issue in this case is whether Rainbow was an alter ego of Fredonia or so integrated with Fredonia in its business operations that they are re- quired to be deemed a single employer or a :joint em- ployer for remedial purposes. After considering all the circumstances, and for the reasons stated, I find that Fre- donia and Rainbow constituted a single employer. Thus, Rainbow must be deemed a participant in the activities that confer jurisdiction over Fredonia . Accordingly, I find that Rainbow was an employer engaged in com- merce within the meaning of the Act, at all times materi- al, and subject to the jurisdiction of the Board. H. THE ALLEGED UNFAIR LABOR PRACTICES A. The Actions of Respondent' The complaint cites five instances of refusal on the part of Respondent to honor its obligation to bargain col- lectively with the Union : refusal to pay Fredonia em- ployees at the contractual rate from 18 February to 7 March 1986; refusal to pay for work performed on the last 2 days of Fredonia's operation, 12 and 13 May 1986; refusal, after 13 May 1986, to pay accrued vacation pay; refusal, from and after 18 February 1986, to pay medical expenses as provided in the collective-bargaining agree- ment; and refusal, from and after 16 May 1986, to bar- gain with the Union concerning the effects of the closure of the Fredonia plant on 13 May. These allegations were denied in the answer interposed on behalf of the two companies jointly, but evidence re- garding them was not rebutted at the hearing . The con- tractual medical expenses referred to consisted of pay- ments Fredonia was obligated to make under the collec- tive-bargaining agreement to meet expenses not covered by its medical insurance plan, up to 2 percent of the em- ployee's gross pay. Betty Reid , who had been a lead person in the bindery, testified that she put in such a claim, but that it was not paid , nor was she paid for the last 2 days she worked before the shutdown, for the ret- roactive pay owing to her or for her accrued vacation. Similar defaults existed regarding other employees. The closing had been abrupt, with no advance notice to the Union or to the employees . The announcement was made about 2 or 2:30 p .m. on the afternoon of 13 May and shutdown was immediate. On 16 May 1986, Larry S. Skowronski, the secretary- treasurer of the Union , sent a letter to Fredonia request- ing official notification as to the status of its operation I The matters narrated in this decision without evidentiary comment are those facts found by me on the basis of admissions in the answer, data contained in the exhibits, stipulations between or concessions by counsel, undisputed or uncontradicted testimony and, in instances where conflicts in the testimony did not warrant discussion , the testimony that I have credited and its intentions with respect to retroactive wages, earned vacations, and other benefits owed to employees under the collective-bargaining agreement. He received no response . On 28 May he wrote again, this time de- manding a meeting "for the purpose of collective bar- gaining over the effects of the closing of the Rainbow Press to employees represented by Erie Typographical Union No. 77." He also demanded arbitration of an unre- solved grievance that the chapel chairperson had filed concerning unpaid retroactive pay. This letter was not answered either. The failure of Fredonia' s management to comply with the union request for discussion of the effects of the clo- sure violated Section 8(a)(1) and (5) of the Act. First Na- tional Maintenance Corp. v. NLRB, 452 U.S. 666, 677-682 (1981); see Serrano v. Jones & Laughlin Steel Co., 790 F.2d 1279, 1287 (6th Cit. 1986); Summit Tooling Co., 195 NLRB 479 (1972); General Motors Corp., 191 NLRB 951, 952 (1971) (decision to sell business); Thompson Transport Co., 184 NLRB 38 (1970). Fredonia filed a petition in bankruptcy on 11 August 1986, focusing attention in this case 'on the question of whether responsibility attaches to Rainbow for the violation. B. The Relationship of the Two Companies 1. Their business history It is alleged that the Respondents were affiliated busi- ness enterprises with common management, agents, and supervision that engaged in the same type of business in the same labor market, shared common premises and fa- cilities, provided services and made sales to each other, interchanged personnel, materials, equipment, and sup- plies, and held themselves out to the public as a single integrated business enterprise . Common ownership is not alleged, but on the basis of the existing allegations it is asserted that the two corporations were "alter egos and a single employer within the meaning of the Act." Signifi- cant relationships were disclosed by the evidence. No documentation relating to incorporation of either Company is in evidence, but Elizabeth Yeremsky, who was a director and secretary-treasurer in each corpora- tion, testified that she believed Fredonia was incorporat- ed around May 1984 and that Rainbow had been incor- porated in Delaware in 1983 She maintained the corpo- rate books and records at her home in Pittston, Pennsyl- vania, near Scranton, where Dennis Amato, the president of both Companies, had another business. Pittston is identified as the situs of all directors ' meetings in the minutes of both corporations. The developments pertinent to this case can be traced by reference to the minutes of the directors' meetings of the two Companies as amplified by the testimony. There is no evidence to indicate whether these meetings phys- ically took place or whether minutes were simply writ- ten up and inserted in the records. Nevertheless , the min- utes reflect the problems and the corporate decision made during the pertinent times and shed light on the re- lationship of the persons involved to the corporations and of the two corporations to each other. 480 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD Rainbow minutes recite that on 3 January 1984 it was decided that Dennis Amato, Rainbow's president, and Yeremsky "will continue to pursue the objectives .. . set forth at the meeting held at . . . Wilkes-Barre, Pa between the officers, agents and Herb Douglas II in the summer of 1983." The objectives are not spelled out, but the significance of the entry lies in the fact that Herb Douglas I is the father of Paul Douglas, the first presi- dent of Fredonia. On 2 March 1984, purchase of equip- ment for a proposed printing plant was authorized and Paul Douglas was directed to seek a plant site and ar- range transfer of equipment to it. The testimony indicat- ed that the intention was to find a plant near the Wash- ington, D.C. area apparently in anticipation of Rainbow's doing government or government-connected printing. Fredonia was incorporated around May 1984 As early as 17 November 1983, Paul Douglas, as president of Fre- donia, had entered into an agreement on behalf of Fredo- nia, described as "a New York corporation to be formed," with The Westfield Republican, Inc., a corpo- ration that was described as being in chapter XI. The agreement was for the lease of Westfield's real property and equipment. Fredonia undertook to pay the chapter XI creditors and continue James W Mead (Westfield's former principal) as general manager. On 19 May 1984, either pursuant to this or some other arrangement, Fre- donia took over the operation of Westfield's printing business in Fredonia under the name "Rainbow Press." In addition to James Mead, retained as general manager, Richard Clawson, Westfield's production manager, and a number of other employees were also carried over. The minutes of a Fredonia directors' meeting dated 11 July 1984 recite that Fredonia was authorized to lease equip- ment from Rainbow and store it until it was put to use without payment of equipment rental. Things apparently did not go well, for on 17 September 1984, Amato and another person were authorized to go to Fredonia "to do whatever acts are necessary to determine and resolve the production and morale problems in Fredonia." The min- utes state that available work was not being produced and that the issue was whether to write it off as a loss. When it became apparent that a suitable plant site could not be found in the Washington, D.C. area, the equipment that had been purchased for that proposed op- eration was put to use in Fredonia. Directors' minutes for both corporations dated 9 July 1985 indicate that, pending finalization of plans for establishing a printing plant near the District of Columbia, the equipment would be leased to Fredonia to supplement the equip- ment it has leased from Westfield. A formal equipment lease, dated 1 July 1985, was entered into between the two corporations. Mead was discharged on 9 September 1985, apparently because of dissatisfaction with his management of the Fredonia operation Clawson acted as general manager on a temporary basis He was soon supplanted by Bruce Bowen, who, according to the Rainbow directors' min- utes of 7 October 1985, was authorized to purchase addi- tional equipment and work in Fredonia on a part-time basis until a manager could be found to run the plant. He started in November 1985 by spending weekends in Fre- donia. Beginning around the first of January 1986, he spent full time there. Fredonia directors' minutes of 9 December 1985 au- thorized the officers of the corporation to arrange addi- tional financing, with guarantees of the obligations by Carmen and/or Sandra Maffei (whom I will identify shortly) to be limited to $250,000. Bowen was to "con- tinue to be utilized by Rainbow Press of Fredonia, Inc. to assist and instruct Richard Clawson in the production area." On 13 May Yeremsky telephoned Clawson and told him to close down the plant He went out into the plant and announced the shutdown to the employees at 2 or 2:30 p.m. 2. Specific attributes of the relationship The lease and financial dealings between the corpora- tions and between them and the principles are significant enough to raise questions as to whether Rainbow is liable for Fredonia's violations of the Act on either an alter ego or single employer theory. A further detailed review of the circumstances establishes that the two corpora- tions constituted a single employer. a. Common ownership or financial control The stock ownership of Fredonia is divided equally between Dennis Amato and Sandra Maffei, the wife of Carmen Maffei. I will refer to Carmen Maffei simply as Maffei. The stock of Rainbow is equally divided between Dennis Amato and Sandra Maffei. Carmen and Sandra Maffei apparently guaranteed, or stood ready to guarantee, obligations of Fredonia, for on 9 December 1985 a directors' resolution was adopted limiting their liability to $250,000 on certain proposed additional financing. There was also testimony that Amato and Sandra Maffei each invested $250,000 in Fre- donia as an equity investment. On two important occasions, Amato and Maffei intro- duced themselves as owners of Fredonia. The first occa- sion was when they met Skowronski in August 1985 to complete negotiation of the collective-bargaining agree- ment They introduced themselves as the owners of "Rainbow," which under the circumstances can only be interpreted as a reference *to Fredonia. The second occa- sion was when they retained Clawson as production manager; they interviewed him after introducing them- selves as the new owners of Fredonia. Betty Yeremsky monitored the finances of the two companies. Fredonia had an account with Key Bank in Westfield, New York, but toward the end of its oper- ations the account was transferred to a Pittston bank. Eileen Bernor, a resident of Fredonia and a carryover from Westfield, worked for Fredonia and signed the pay- roll checks. She testified that the money for the payroll came from Rainbow, the practice being for Bernor to notify Yeremsky of the amount needed for payroll, whereupon Yeremsky would transfer the funds to Key Bank in Fredonia. Fredonia's petty cash needs were met by checks sent directly by Yeremsky to Bernor that Bernor cashed at Key Bank. RAINBOW PRESS OF FREDONIA 481 b. Common management The first president of Fredonia was Paul Douglas, whose father is mentioned in early minutes of a Rainbow directors' meeting as previously noted . Dennis Amato, president of Rainbow, later became president of Fredo- nia. Betty Yeremsky was secretary -treasurer of both cor- porations, maintained the records of each, and processed intercorporate exchanges of funds. When James Mead was terminated as general manager on 9 September 1985, he was succeeded briefly by Claw- son and then by Bruce Bowen. Bowen was a resident of Baltimore, and his family continued to reside there after he began working in Fredonia . He worked weekends at the Fredonia plant beginning in November 1985 and worked there full time after the beginning of January 1986. When he first came to Fredonia, he identified him- self to Clawson as a vice president of Fredonia and the new general manager, in place of Mead. At all times, however, he was exclusively on the payroll of Rainbow Press Carole Newton joined him as an assistant in Fredo- nia in March 1986, with instructions to "oversee the office, whip things in shape, check the accounts" (ac- cording to Eileen Bernor). She even did some of Ber- nor's work over again. However, she was on the Rain- bow, not the Fredonia, payroll. Actually, in one sense everybody was on the Rainbow payroll, for the pay of the former Westfield personnel- Mead, Clawson, and the other employees-was sent to Fredonia by Yeremsky. All of the minutes of the Fredonia directors ' meetings identify Amato and Yeremsky as the directors in attend- ance and note the presence of Maffei as counsel. All of the Rainbow directors' minutes identify Amato, Maffei, and Yeremsky as the directors present . The situs of all meetings is fixed as Pittston, Pennsylvania, where Yer- emsky resided. c. Interrelationship of operations In October 1985 Bowen purchased printing for Fredo- nia at a bankruptcy sale in Baltimore to supplement equipment already in use by Fredonia under the lease dated 1 July 1985. Bowen made the purchase as an agent of Rainbow. Rainbow, in making the equipment available to Fredonia, did not amend the lease or the schedule of equipment leased. It has been noted that originally Fredonia stored equipment for Rainbow. No charge was ever imposed for that service. Fredonia never made a single payment to Rainbow on account of equipment rental. Rainbow's intended operation depended on finding a suitable plant near Washington, D.C., which never hap- pened . Yeremsky testified that, because its operations never commenced , Rainbow was essentially an inactive corporation . But it was busy. It was engaged in minding the business of Fredonia. d. Centralized control of labor relations The Union's collective-bargaining agreement with Westfield expired in December 1984. Though Mead, as general manager, conducted negotiations on behalf of Fredonia for a new agreement , it is apparent that he did not have authority to conclude negotiations with the Union, even after six meetings. No contract was reached until Amato and Maffei personally joined in the discus- sion in late August 1985. Skowronski testified that in the two meetings he had with them at that time, Mead at- tended one meeting and Clawson the other, but Amato and Maffei did most of the talking. The new collective-bargaining agreement was effective for the period from 1 September 1985 to 31 August 1988. Respondent was supposed to prepare the agreement, but it procrastinated . The agreement was finally prepared and ready for signature during the period between Mead's departure and Bowen's arrival, when Richard Clawson was acting as temporary manager . On 14 No- vember 1985, the agreement was sent to Skowronski with the request that he execute it and forward it to Amato, at an address in Scranton set forth in the letter, for execution by Amato since Clawson was not author- ized to sign the agreement. A lengthy delay in Respondent's execution of the col- lective-bargaining agreement resulted in a written demand by Skowronski, on 14 January 1986, with a copy to Amato in Scranton, that the agreement be signed and agreed wage increases be implemented . He also filed an unfair labor practice charge. Bowen, who had just start- ed full time in Fredonia, met with Skowronski and told him that he had been sent to Fredonia to straighten mat- ters out. Thereafter, he dealt with the Union as general manager. He promised that the contract would be signed, asked for waiver of certain provisions of the con- tract, and in the months following participated in griev- ance procedures. In view of Bowen's statement to Skow- ronski and the fact that he was continued on the Rain- bow payroll, Bowen's status as the representative of Amato and Maffei is beyond dispute. When he was pressed by employees for payment of retroactive pay, he replied that he could not tell them what he was told. On one occasion, Amato and Maffei personally ap- peared at the plant for the purpose of trying to placate the employees. 3. The applicable law This is not an "alter ego" situation . The concept un- derlying alter ego is that of disguised conduct of an op- eration. There is usually, though not always, a continu- ation of a purportedly suspended operation by a new entity, with overtones of fraudulent concealment of true identity of the employer. There is frequently, though again not always, some element of deception or evasion of the employer's responsibilities under the Act. See Fugazy Continental Corp., 265 NLRB 1301, 1302 (1982), enfd. 725 F.2d 1416 (D.C. Cir. 1984); Continental Radia- tor Corp., 283 NLRB 234 (1987). In cases in which an alter ego relationship is found, there is often a resultant benefit to the old employer that is related to elimination of its labor obligations. See Alkire v. NLRB, 716 F.2d 1014 (4th Cir. 1983). In the instant case, both corporations were openly uti- lized by the principles to operate the business in Fredo- nia once it became apparent that the original objectives of Rainbow were unattainable . Instead of one corpora- 482 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD tion operating a business in lieu of another, both acted together as a unitary controlling employer. In Emsing's Supermarket, 284 NLRB 302 (1987), the Board stressed the factors I have just reviewed-factors "traditionally applied," such as common control of labor relations, common management , common ownership, and interrelationship of operation-and also noted that, Single-employer status ultimately depends on "all the circumstances of the case" and is characterized by the absence of the "arm's length relationship found among unintegrated companies." Stated oth- erwise, the fundamental inquiry is whether there exists overall control of critical matters at the policy level. The Board considered the following factors: common ownership; the fact that the owners made all manage- ment decisions of any significance for both entities, in- cluding labor relations policies; loans by the owners to both stores; coverage of employees under the same health insurance policy; and an advance by one to cover the other's final payroll, treated in the books as a loan transaction secured by merchandise and equipment. The Board held that functional integration was not a diaposi- tive factor, though it was a factor to be considered, and that transactions during the wind-up period of one of the corporations were as significant as those that occurred while both were fully operative and therefore had to be considered in determining whether the two businesses were functionally integrated. Reliance on corporate form was held not to be a shield, since form does not prevail over substance. The Board determined that intercorporate transactions had not been conducted at arms' length on the basis of the following factors: the financial and personal interest of the common owners in both businesses; the use of one as a "captive customer" to purchase leftover inventory of the other and to lend value to otherwise worthless equipment or defeat its possible seizure by creditors; transfers to validate bookkeeping entries relating to inter- corporate fund transfers; achievement of overall savings in insurance premiums by covering both stores under one policy; actual transfers of property and funds to meet payroll. The evidence disclosed financial interdepen- dency and "a propensity . . . to operate the two stores in such a manner that the exigencies of one would be met by the other." The parallels with the instant case are obvious. Here, one corporation owned a business; two corporations were operating it. They both served the interests of the same principals. The single-employer concept is relevant. See Blumenfeld Theatres Circuit, 240 NLRB 206, 215 (1979). There are present in this case all the requisites for a finding of single-employer status, as elucidated in Radio Union Local 1264 v Broadcast Service, 380 U.S. 255, 256 (1965). C. The Affirmative Defense The first affirmative defense alleges untimeliness within the proscription of Section 10(b) of the Act. The charges in the original complaint, brought solely against Fredonia, were filed 18 August 1986. The earliest date from which Respondent is claimed to be in violation of the Act is 18 February 1986, and all of the violations al- leged are of a continuing nature. The charges against Fredonia, therefore, are not barred by Section 10(b) of the Act. Inasmuch as 1 have found that Fredonia and Rainbow had such an identity of interest and operation as to con- stitute a single employer, Rainbow necessarily must be deemed to have been served with the charge at the same time Fredonia was charged and served. The service thereafter, on 26 August 1986, of a charge explicitly naming Rainbow accomplished nothing new juridically, but simply clarified the record and permitted insurance of a complaint that named both corporations and eluci- dated the reasons. See BMD Sportswear Corp., 283 NLRB 142 fn. 1 (1987) (holding that the interests of alter egos are identical and service on one was held sufficient to initiate proceedings against the other within the limita- tions of Section 10(b), a rationale that has equal force in the present case). The second affirmative defense asserts that these pro- ceedings are automatically stayed by reason of Fredo- nia's having filed a petition in bankruptcy. However, the proceedings are exempt from any automatic stay under the Bankruptcy Act. 11 U.S.C. § 362(b)(4); Goldstein Co., 274 NLRB 682 (1985); Phoenix Co., 274 NLRB 995 (1985). In any event, only Fredonia has filed a bankrupt- cy petition. Rainbow continues to be a viable entity. D. Conclusion The evidence demonstrates that Fredonia and Rain- bow constituted a single employer in the operations car- ried on under the name of "Rainbow Press" in Fredonia, New York. Therefore, Rainbow is subject to the jurisdic- tion of the Board in this case and is responsible, along with Fredonia, for the violations of the Act found. CONCLUSIONS OF LAW 1. Respondent Rainbow Press of Fredonia and Re- spondent Rainbow Press constitute a single employer en- gaged in commerce within the meaning of Section 2(6) and (7) of the Act. (They will be referred to as the Re- spondent, collectively.) 2. The Union is a labor organization within the mean- ing of Section 2(5) of the Act. 3. At all times material, the Union was the exclusive collective-bargaining representative, for purposes of col- lective bargaining within the meaning of the Act, pursu- ant to a collective-bargaining agreement between Re- spondent Rainbow Press of Fredonia and the Union, of the employees identified as all full-time and regular part-time employees, in- cluding on-call employees, in the following depart- ments: composing, pre-press, press, proofreading, bindery-collating, and warehouse-shipping; exclud- ing, office clerical employees, professional employ- ees, seasonal employees, guards and supervisors as defined in the Act, and all other employees. RAINBOW PRESS OF FREDONIA 4. Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(1) and (5) of the Act. (a) By refusing to pay the contractual pay rate to em- ployees from 18 February to 7 March 1986. (b) By refusing to pay unit employees for work per- formed on 12 and 13 May 1986. (c) By refusing to pay employees accrued vacation pay on and after 13 May 1986. (d) By refusing to pay contractual medical expenses on claims submitted by employees. (e) By failing to furnish notice to the Union of its in- tention to close the plant and by refusing, since 16 May 1986, to bargain with the Union concerning the effects of the plant closure on 13 May 1986. 5. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Sec- tion 2(6) and (7) of the Act. THE 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 necessary to effectuate the policies of the Act. Fredonia is in bankruptcy and Rainbow is apparently not operat- ing any business. However, the purpose of making a de- termination of single employer status is to permit formu- lation of effective remedies. There may be rights that may be pursued on behalf of the employees and either or both of the corporations involved may at some future time resume business operations . An appropriate order must place the Respondent in a posture of cooperating as fully as possible in salvaging employees' benefits and pay from whatever assets remain . I shall therefore direct that notification to the employees be given, so that they may be advised of these requirements, by mailing copies of the notice provided for in the Order to all employees who were on the payroll of Fredonia during the period from 18 February to 13 May 1986. In order to make the employees whole for the losses that they have sustained and to restore the bargaining ca- pability of the Union, I shall direct that contract sums owing to the employees be paid and that Respondent be directed to bargain with the Union concerning the ef- fects of the discontinuance of the business . Backpay will be ordered paid until such bargaining commences or other related conditions obtain, so as to mitigate the ef- fects of the dispersion of the bargaining unit. If circum- stances warrant it, backpay will be computed in the manner required by F. W. Woolworth Co., 90 NLRB 289 (1950). Interest on all sums due under the order shall be computed as provided in New Horizons for the Retarded, 283 NLRB 1173 (1987). See Isis Plumbing Co., 138 NLRB 716 (1962). Rainbow Press appears still to be viable a corporation, and Rainbow Press of Fredonia may once again become viable. It is even conceivable that the machinery in- volved, some or all of which was repossessed by the bank holding the security interest in it, may ultimately be made available again for a new venture by these Compa- nies. Accordingly, I shall incorporate a provision in the Order for recall of the employees terminated on 13 May 483 1986 in the event a new operation is started up in the Fredonia area by these Respondents. The General Counsel requests a visitatorial clause au- thorizing discovery from the Respondents under the Federal Rules of Civil Procedure for compliance pur- poses. Conflict with bankruptcy court supervision would not appear to be a problem inasmuch as such discovery will be subject to the supervision of the United States court of appeals enforcing the Order. As this appears to be an appropriate case for such relief, the General Coun- sel's application is hereby granted. On these findings of fact and conclusions of law and on the entire record, I issue the following recommend- ed2 ORDER Respondents Rainbow Press of Fredonia, Inc. and Rainbow Press, Inc., Fredonia, New York, their officers, agents, successors, and assigns, shall jointly and severally 1. Cease and desist from (a) Unilaterally withholding from bargaining unit em- ployees of Rainbow Press of Fredonia any sums owing to them by reason of failure to honor pay rates provided for in the collective-bargaining agreement between Rain- bow Press of Fredonia and Erie Typographical Union No. 77 (the Union), or owing to them by reason of medi- cal expenses, accrued vacation pay, or any other terms and conditions of employment thereunder or otherwise established. (b) Refusing to bargain with the Union concerning the effects of closure on 13 May 1986 of the Fredonia, New York plant. (c) 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) Pay to bargaining unit employees who were on the payroll during the period from 18 February through 13 May 1986 all sums owing to them by reason of differ- ences between wages paid to them and the contract rates of pay provided for in the collective-bargaining agree- ment with the Union, and all sums owing to employees for retroactive pay, contract medical expenses , and ac- crued vacation. (b) Pay to employees terminated on 13 May 1986 their wages at the rates provided for in the collective -bargain- ing agreement from the fifth day after the adoption of this Order by the Board until the occurrence of the earli- est of the following conditions: (1) failure of the Union to request bargaining concerning the effects of closure of the Fredonia plant within 5 days after adoption of the Board's Order herein by the Board; 2 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. 484 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD (2) the date Rainbow Press, Inc., commences bar- gaining with the Union pursuant to such request by the Union. (c) Establish a preferential hiring list of all unit em- ployees terminated on 13 May 1986 following the estab- lished seniority system and offer to such employees full reinstatement to their former jobs or, if the former jobs do not exist, to substantially equivalent jobs, if Rainbow Press or Rainbow Press of Fredonia resumes operations in the Fredonia area. (d) Preserve and, on request , make available to the Board or its agents for examination and copying , all pay- roll records, social security payment records, timecards, personnel records and reports, and all other records nec- essary to analyze the amount of backpay due under the terms of this Order. (e) Mail to the Union and to all persons who, during periods of time mentioned here, were carried on the pay- roll of Rainbow Press of Fredonia at their addresses stated in Respondent's records , copies of the annexed notice marked "Appendix."g Copies of the notice, on forms provided by the Regional Director for Region 3, after being signed by Respondent's authorized represent- ative, shall be mailed immediately on receipt as directed. (f) Notify the Regional Director in writing within 20 days from the date of this Order what steps the Re- spondent has taken to comply. For the purpose of deter- mining or securing compliance with this Order, the Board, or any of its authorized representatives, may obtain discovery from the Respondent, its officers, agents, successors, or assigns, or any other person having knowledge concerning any compliance matter, in the manner provided by the Federal Rules of Civil Proce- dure. Such discovery shall be conducted under the su- pervision of the United States Court of Appeals enforc- ing this Order and may be had on any matter reasonably related to compliance with this Order , as enforced by the court. 0 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 "